OCBC Bank and StarHub are jointly developing Singapore’s first loyalty alliance so Singaporean consumers will be able to exchange, consolidate and redeem loyalty rewards – such as rewards points and air miles – earned from market-leading partners across industries.
Set to launch later this year as the next step of the ‘We Economy’ initiative that the two companies have jointly announced, the Coalition Loyalty Programme aims to bring on board key players from ten industries – financial services, telecommunications, travel, insurance, retail, hospitality, food and beverage, grocery, petrol and transport. Consumers will be able to utilise this first-of-its kind cross-industry loyalty platform to accumulate, convert and utilise their rewards points and air miles across the different partners and merchants with ease and speed, via an online tracking dashboard.
There are 400 loyalty programmes in Singapore with approximately 70% of consumers participating in one or more programmes. However, the average redemption rate of a typical standalone loyalty programme is 50-70% based on OCBC Bank’s estimates. This relatively low usage rate may be a result of consumers not having sufficient points to make a meaningful redemption, not being aware of the points expiry date or having forgotten to redeem the points.
With the Coalition Loyalty Programme, OCBC Bank and StarHub expect redemption rates to increase significantly as the consolidation of points will make it easier for consumers to redeem their desired rewards. Suppose a customer makes purchases from 10 different merchants across industries, in each instance earning him the right to a $2 redemption from a standalone loyalty programme. Instead of the $2 redemptions possibly going unused due to the small amount, he could combine them all in order to make a more significant redemption worth $20. If one million consumers were to each make a $20 redemption, this would enable $20 million worth of rewards to be exchanged that would otherwise be left unutilised in standalone loyalty programmes.
Therefore, for the first time, OCBC Bank and StarHub are highlighting this rewards wastage and are coming together to substantially reduce the wastage to benefit consumers. With the creation of an online tracking dashboard, consumers will also be able to monitor the expiry dates of the loyalty points and be aware of the available points any time and the rewards to redeem. Details of the dashboard will be released soon.
Multi-industry Memorandum of Understanding Established
The Coalition Loyalty Programme currently boasts a total of seven partners across seven industries. Joining OCBC Bank and StarHub are AirAsia BIG Loyalty, Frasers Property Singapore, Great Eastern, Millennium Hotels and Resorts, and Robinsons Group. Company representatives from the seven organisations have signed a Memorandum of Understanding on the Coalition Loyalty Programme. With this, customers can look forward to exchanging points and miles to redeem a whole host of compelling dining, travel, entertainment and lifestyle options. As for coalition partners, they can look forward to reaching a much wider base of customers, building strong brand associations and harnessing data analytics to drive deeper customer engagement.
OCBC Bank and StarHub are in talks with other market leaders and will bring them into the programme progressively. Rewards providers and merchants who would like to explore collaborative opportunities can contact OCBC Bank or StarHub.
OCBC Bank and StarHub customers can already start enjoying the benefits of exchanging their existing loyalty rewards through the respective websites. OCBC Bank customers can choose to convert their OCBC$ and Voyage Miles into StarHub Rewards Points, and vice versa, to maximise use of their loyalty rewards. As an example, StarHub customers can log in to www.starhub.com/rewards to convert 100 StarHub Rewards Points into 350 OCBC$. Correspondingly, OCBC Voyage credit card holders can get 160 StarHub Rewards Points by converting 100 Voyage Miles.
Mr Desmond Tan, Head, Group Lifestyle Financing, OCBC Bank, said: “There will be no more wastage. Consumers will now be able to get the maximum value out of each reward point. We are only able to do this because of the strong partnership between OCBC, StarHub and all partners. We have had many years of experience running loyalty rewards programme and we know what consumers want. One of the key driving forces behind the creation of our ‘We Economy’ is to go beyond banking and leverage the strengths of partners across various industries. This Coalition Loyalty Programme is exactly that. We want to proactively create a community of engaged members, rather a run-of-the-mill loyalty programme.”
Mr Howie Lau, Chief Marketing Officer, StarHub, said: “In our increasingly collaborative world, we saw an opportunity to innovate in the loyalty and rewards space to serve our customers better. By deepening our strategic partnership with OCBC Bank and further breaking down the walls between industries, customers will be able to enjoy unparalleled flexibility in how they amass and utilise their points and miles, across programmes, partners and merchants. In all that we do, we want to deliver to our customers more rewarding experiences, enhance customer satisfaction and remain their trusted brand of choice.”
Such a coalition is made possible with the establishment of the ‘We Economy’ framework, enabling organisations to collaborate and capitalise on each other’s strengths and resources to shape better business outcomes and customer experiences. Apart from OCBC Bank and StarHub, the five other partners will be integrated into the loyalty platform later this year.
Re-disseminated by The Asian Banker