Loyalty Management Global Market Opportunities and Strategies to 2033

This report describes and explains the loyalty management market and covers 2018-2023, termed the historic period, and 2023-2028, 2033F termed the forecast period. The report evaluates the market across each region and for the major economies within each region.

The global loyalty management market reached a value of nearly $9.55 billion in 2023, having grown at a compound annual growth rate (CAGR) of 15.5% since 2018. The market is expected to grow from $9.55 billion in 2023 to $20.25 billion in 2028 at a rate of 16.2%. The market is then expected to grow at a CAGR of 18.2% from 2028 and reach $46.73 billion in 2033.

Growth in the historic period resulted from the rise in the number of cardholders and the use of reward points, increased demand for improved customer satisfaction and the rise in internet penetration. Factors that negatively affected growth in the historic period were stringent government regulations.

Going forward, the growing importance of customer experience, rising digital transformation and increasing government support for customer engagement and personalized experiences will drive the market. Factors that could hinder the growth of the loyalty management market in the future include a lack of skilled professionals.

The loyalty management market is segmented by component into software and services. The software market was the largest segment of the loyalty management market segmented by component, accounting for 59.6% or $5.69 billion of the total in 2023. Going forward, the services segment is expected to be the fastest growing segment in the loyalty management market segmented by component, at a CAGR of 16.7% during 2023-2028.

The loyalty management market is segmented by deployment into cloud and on-premises. The cloud market was the largest segment of the loyalty management market segmented by deployment, accounting for 65.7% or $6.27 billion of the total in 2023. Going forward, the cloud segment is expected to be the fastest growing segment in the loyalty management market segmented by deployment, at a CAGR of 16.9% during 2023-2028.

The loyalty management market is segmented by organization type into small and medium enterprise and large enterprise. The large enterprise market was the largest segment of the loyalty management market segmented by organization type, accounting for 62.8% or $5.99 billion of the total in 2023. Going forward, the small and medium enterprise segment is expected to be the fastest growing segment in the loyalty management market segmented by organization type, at a CAGR of 17.6% during 2023-2028.

The loyalty management market is segmented by end use into BFSI, IT and telecommunications, transportation, retail, hospitality, media and entertainment and other end-users. The retail market was the largest segment of the loyalty management market segmented by end use, accounting for 25.8% or $2.46 billion of the total in 2023. Going forward, the BFSI segment is expected to be the fastest growing segment in the loyalty management market segmented by end use, at a CAGR of 18.5% during 2023-2028.

North America was the largest region in the loyalty management market, accounting for 33.6% or $3.2 billion of the total in 2023. It was followed by Asia Pacific, Western Europe and then the other regions. Going forward, the fastest-growing regions in the loyalty management market will be South America and Asia-Pacific, where growth will be at CAGRs of 18.9% and 18.7% respectively. These will be followed by the Middle East and Africa, where the markets are expected to grow at CAGRs of 17.7% and 16.9% respectively.

The global loyalty management market is fairly fragmented, with a large number of small players operating in the market. The top ten competitors in the market made up 18.80% of the total market in 2022. The market concentration can be attributed to the presence of a large number of players in different geographies. Maritz Motivation Inc was the largest competitor with a 3.62% share of the market, followed by Salesforce, Inc with 3.27%, Oracle Corporation with 2.63%, Epsilon Data Management LLC with 2.18%, Dentsu Inc with 2.16%, SAP SE with 1.99%, Kobie Marketing Inc. with 1.39%, Comarch SA with 0.62%, Bond Brand Loyalty Inc with 0.52% and Kognitiv Corporation with 0.41%.

The top opportunities in the loyalty management market segmented by component will arise in the software segment, which will gain $6.22 billion of global annual sales by 2028. The top opportunities in the loyalty management market segmented by deployment will arise in the cloud segment, which will gain $7.41 billion of global annual sales by 2028. The top opportunities in the loyalty management market segmented by organization type will arise in the large enterprises segment, which will gain $6.25 billion of global annual sales by 2028. The top opportunities in the loyalty management market segmented by end use will arise in the retail segment, which will gain $2.93 billion of global annual sales by 2028. The loyalty management market size will gain the most in the USA at $2.54 billion.

Market-trend-based strategies for the loyalty management market include focus on product innovation to enhance customer engagement features, launch of new rewards loyalty programs, investing in analytics and business intelligence tools, development of webpages for loyalty and marketing solutions and strategic partnerships and collaborations among market players.

Player-adopted strategies in the loyalty management market include focus on enhancing business operations through strategic collaborations and partnerships and strengthening operational capabilities through business expansions.

To take advantage of the opportunities, the analyst recommends the loyalty management market companies to focus on innovations in loyalty programs, focus on targeted rewards programs, focus on enhanced analytics for targeted loyalty, focus on cloud-based solutions for unprecedented growth, expand in emerging markets, focus on strategic collaborations for market expansion, focus on strategic distribution expansion, provide competitively priced offerings, focus on strategic pricing, participate in trade shows and events, continue to use B2B promotions, focus on targeted digital campaigns, focus on exponential growth in BFSI loyalty programs and focus on niche persona-centric approaches.