The report - based on surveys of 4,750 respondents across ten markets in Asia Pacific (Australia, China, Hong Kong, India, Japan, Malaysia, Thailand, Singapore, South Korea and Vietnam) between 23-Jan-2023 and 8-Feb-2023 - shows that three-in-four (76%) consumers in Asia Pacific perceive the experiences that brands and companies provide to be as important as its products and/or services.
Consumer expectations are rapidly evolving
As consumers form the new "C-suite", their expectations are rapidly evolving, notes Collinson, and they want brands to provide hyper-personalised communication and offers, to anticipate their needs, and are eager to build emotional connections with the brands they buy from the most.
Against this "Customer Experience Era", travel-related rewards and benefits have emerged as a rising opportunity for financial services brands to drive better commercial returns, Collinson acknowledges. For example, its survey shows consumers in India have ranked access to airport transit hotels, airport lounges, and airport parking as the top three travel related rewards and benefits they value.
Asia Pacific consumers more likely to use payment cards for travel expenses if the cards offer travel-related rewards or benefits
According to the report, four in five consumers in Asia Pacific are more likely to use their payment cards for travel expenses if the cards offer travel-related rewards or benefits. This trend is especially apparent among consumers from Malaysia (84%), India (83%), Vietnam (82%), Thailand (81%), Mainland China and Hong Kong SAR (both 80%).
It is also reported that consumers from India (83%), Vietnam (82%), Hong Kong SAR (81%), Malaysia (81%) and China (79%) are more likely to use payment cards with travel rewards or benefits for daily expenses.
Interestingly, millennial consumers make up the largest group with this sentiment, while more than nine in 10 Gen Z consumers in Asia Pacific are likely to join a new customer engagement and loyalty programme if it offers these rewards.
Long-standing behaviours and consumer preferences have shifted in the wake of the pandemic
The survey highlights that customers now have higher expectations of enhanced, highly relevant experiences. At the same time, brands are under pressure to deliver measurable business impact through their customer engagement activities.
Customer experience remains the key to earning long-term, enduring loyalty. While most consumers (60% of surveyed respondents) cite rational rewards such as points or cashback as preferred ways to engage with them; emotional, 'experiential' benefits are becoming increasingly significant - especially for younger demographics like Gen Z, and travellers who take 10 or more trips per year.
Interestingly, this latter cohort are also members of twice as many customer engagement and loyalty programmes when compared to less frequent travellers.
Loyalty rewards most popular with consumers vary significantly
The survey highlights a range of non-financial, experiential-driven rewards that are most highly sought after by consumers in Asia Pacific. These include airport lounge access (41%); VIP privileges (39%); environmental sustainability rewards, such as carbon offsetting (26%); digital rewards in the form of NFTs (19%); access to digital experiences in the Metaverse and charitable donations (both 18%).
These types of benefits are most appealing to millennial and Gen Z respondents. Consumers in India too have shared that they prefer engaging with brands digitally - through mobile apps (66%), email (54%), website (51%), and social media (48%).
Financial services brands have 'advantage' to offer most popular experiences
Financial services brands "have an advantage" when it comes to providing the experiences consumers increasingly desire, connecting customer data across products to identify and predict major life events, says Collinson.
An increasing number of brands, particularly in the financial services sector, are in turn creating more contextual engagements by identifying and leveraging micro-moments in their customers' lives to add value - and in turn, generate a direct and measurable impact to their business.
Travel-related rewards and benefits still key in loyalty programmes
Linked to the rising popularity of experiential rewards, the report findings also highlight the popularity of customer engagement and loyalty programmes that come with the ability to redeem and use travel-related rewards and benefits. Nine out of 10 consumers are attracted to join such programmes, more so consumers from Vietnam (97%), Malaysia (94%), Thailand (94%), India (90%) and China (89%).
Lounge access has positive impact on emotional connection to brands
With travel firmly back on the agenda globally, the report also discovered that consumers in India rate airport lounge access as one of the most appealing travel-related reward - in turn having a positive effect on Indian travellers' emotional connection to the brand providing access - with respondents in India advising it makes them feel valued (59%) and rewarded (57%).