DSF is a world-renowned retail event that lures shoppers from across the country, the Middle East, and beyond. As such, many UAE retailers offer loyalty programmes to residents and non-residents alike due to repeat visits by many non-residents. A survey conducted by UK market research company YouGov found that retail, travel and hospitality spending during DSF 2011 contributed Dh15.1 billion to Dubai’s economy, a figure that includes Dhs5.9 billion spent by regional and international visitors, and Dhs6.6 billion spent by residents of other emirates.
Recent stats also suggest that visitors from Saudi Arabia and the UK are now the top foreign spenders at DSF. In 2015, tourists from these countries contributed US$35.18 million and US$29.98 million, respectively.
Stand out from the crowd (and reap the benefits)
There’s a gap in the market that needs to be filled. In 2013, 70% of retailers had no loyalty programme to speak of, while only 34% were planning on running one. Furthermore, ICLP surveys have found that 58% of KSA and 60% of UAE consumers agree that a loyalty programme influences their purchases, while 60% of KSA and 55% of UAE consumers buy more from brands whose loyalty programme they join. There’s never been a better time to for retailers to set themselves apart from the competition during peak shopping periods.
- Use loyalty programmes to maximise sales during peak shopping periods – retail sales in Dubai exceeded US$41.5 billion in 2014, with a massive 30% of annual sales occurring during DSF.
- Keep in mind that 92% of consumers belong to at least one retail programme, while 84% are more likely to visit a retailer that offers a loyalty programme.
- Entice consumers away from their current shopping habits of brand switching by offering rewards. Up to 91% of shoppers would drop a brand in favour of one offering a promotion or rewards programme.
- During DSF 2015, malls recorded an 18% increase in footfall. Take advantage of this increase by targeting programme members with exclusive offers and experience enhancements. Rewards can be sweetened to further entice loyal shoppers – in 2013, the ‘Shop & Win’ promotion during DSF accumulated sales of over US$108 million in just two weeks.
Drive customer acquisition and motivate engagement
Acquire new programme members and, ultimately, new loyal customers during peak shopping periods. Implement a programme that rewards customers for purchases, and boost customer acquisition by up to 10% and market share up to 20%.
- Remember: loyalty programmes are in place to reward customers who generate a sale or register an account. Giving ‘bonus points’ will encourage registrations and won’t reduce revenues in the way discounts do.
- Shoppers are well informed – half will use their mobile devices to research before purchasing in-store, while six out of 10 shoppers do some show-rooming. So, where prices are similar, the added value of a reward programme could be the deciding factor in capturing a sale.
Get to know your customer!
Use peak shopping periods to boost customer data and use a customer’s brand journey to build their story. Data is insight and is essential in identifying behaviours that inspire engagement and loyalty.
- Use loyalty programmes to better understand customers. Consumers will share personal information in exchange for tangible rewards – i.e. loyalty points or exclusive member discounts.
- Build comprehensive customer profiles using an interactive data-capture strategy. Customers should be able to sign up by disclosing an email address, online or at point of sale. If customers can redeem points immediately they’ll be further incentivised to complete a full profile.
- Look beyond the top 20% of customer segment – the behaviours and personality of the other 80% can give vast amounts of attitudinal data and behavioural analytics. Stats should be used to define strategies that maximise engagement and sales across all segments
- In today’s connected world, savvy shoppers are accustomed to high levels of personalisation. A loyalty programme can increase sales by serving the right incentives, rewards and content at the right time in the right place to the right shopper.
Timing is everything!
Influence customer behaviour by engaging with them before the peak shopping period. Monitor engagement and purchase behaviour through programme membership to attain additional insight on how to maintain relationships beyond the DSF.
- Leverage the build-up period to motivate shopper behaviour, ideally using points to create that ‘habit’ or learned behaviour of incentivisation and gaining points ahead of time.
- DSF revenues may have grown by 650% since 1996, but the festival is not the sole revenue driver for the retail sector. Capitalise on the feeling of optimism around the UAE economy. Consumer confidence is high and this, coupled with the announcement of Dubai hosting Expo 2020, has led to an increase in shopping centre expansion and consumer spend. There are countless opportunities for retailers to harness this and drive sales throughout the rest of the year.
- Eid 2015 saw a migration of shoppers from the Middle East into the UK. These shoppers spent treble the amount in the UK than what they would normally spend in the UAE (in the region of GBP1,432 per transaction). Re-capture these sales using rewards, which are cited as the main loyalty driver for UAE consumers. A well-timed loyalty programme could persuade shoppers to stay in the region and ensure retailers aren’t missing out.
Beyond DSF…
Ramping up activity to make the most of DSF is important, but retailers shouldn’t spend all their energy planning just for the festival – they should drive initiatives forward into Q2, and beyond, by building strong customer relationships and an ongoing brand dialogue.
- Ensuring programmes and loyalty initiatives are successful during the festival can be challenging, but retailers who do so effectively will reap the benefits during other peak shopping periods, such as Ramadan and Eid. During Ramadan, 57% of fasting and non-fasting MENA residents save money to spend during Eid, while, overall, 60% of people spend more during Ramadan and Eid combined than over the rest of the year.
- Encourage continuous customer activity by supplementing customer rewards and membership points collected through DSF with additional offers, which have a limited redemption date, encouraging activity during slower periods. Alternatively, members should be encouraged to purchase overstock with points, allowing retailers to clear items after the peak shopping periods.
- Use customer data beyond DSF, ensuring communications are targeted and personalised, with content relevant to customer demographic and purchase behaviour.
- Encourage members to redeem as early as possible in the membership accelerates further engagement and earning activity. Redemption behaviour often results in additional spending beyond the points that are available to redeem
- Maintain customer relationships post purchase (in-store or online), regardless of whether it’s a busy shopping period or not. A continual engagement programme will ensure a brand remains top of mind, as well as keeping the dialogue going.
Key takeaways
- Plan and prepare well ahead of peak season to get the foundations in place.
- Leverage the footfall for key sales periods.
- Engage customers before, during and after Dubai Shopping Festival.
- Establish iterative data capture techniques – start simple and build your knowledge and customer profile.
- Continue to engage the customer across their end-to-end journey with your brand.
