Klarna’s new rewards programme worth watching – article by Gabi Kool, Chief Commercial Officer at Loylogic
It’s an exciting period for those of us working in the loyalty industry, as increasing numbers of brands recognise the power of rewards to boost engagement and loyalty – and partner with companies creating innovative rewards technologies. And Klarna is fast becoming an exciting player to watch in this space.
And it makes sense. After all, we all have to make payments, so why not make the process a rewarding one? Imagine shopping online and finding the perfect outfit, and by paying for it you’ll be able to get rewards and exclusive deals?
The fintech and ecommerce brand, which is well known for its bold campaigns and innovative approach to retail and payments, recently announced a revamp and expansion of its global rewards programme. As part of this, the company unveiled new loyalty concepts using emerging loyalty technology and strategies to better engage and retain customers – and boost their spending power.
Here we’ll take a look at some of the most exciting features in Klarna’s rewards programme, and how these fit into wider trends we’re seeing in the world of rewards, engagement and loyalty.
The perks of “little and often” rewards
As part of its new-look rewards programme, Klarna has taken a leaf out of the gamification playbook by creating “Missions”, which give customers the chance to win points and unlock new app features in real time by completing small tasks.
This method of providing “little and often” rewards – whether for points, or for quick win prizes – is something we’re set to see more of. Not only is this a sure-fire way of driving engagement with consumers – especially if it’s done in a fun way – it can also be a low investment solution that produces impressive results, so is particularly useful for achieving customer loyalty on a budget.
The key here is that it’s not just about building up to big rewards – sometimes it can be more impactful to give smaller rewards earlier on and consistently. This type of rewards model really stands out from others for its ability to inject excitement into the consumer journey from day one.
Using “Pay Now” to reward positive financial behaviour
A rewards-based checkout option is an easy way to drive repeated custom and in Klarna’s case, it’s designed to encourage good money management too. Stepping away from the “Buy Now, Pay Later” focus it’s known for – and sometimes criticised for – Klarna is now incentivising customers to “Pay Now” or settle payments early.
With this, Klarna gains a competitive edge by rewarding good behaviour and money management, which in turn helps their customers and boosts their own reputation. And this is an opportunity that many other financial organisations should consider in order to future proof their customers, and their own business – while positioning them in a favourable way. After all, wouldn’t you rather bank with the company that’s looking after you and rewarding you for your good choices? This is something traditional banks in particular should latch on to as they look to keep up with disruptors.
Bringing rewards and retailers together
It’s important not to overlook that where Klarna has really gone above and beyond in customer engagement and loyalty is by bringing together its 100 million plus users and 250,000 merchants on its platform – which is of course where its rewards programme is focussed. In fact, Klarna has established its app as a shopping destination in its own right – where consumers can find new brands, and retailers can boost exposure and sales – designing an offer that appeals to its community of customers, while creating a marketing opportunity for merchants.
What Klarna is doing is undeniably impressive, and very much In line with our own belief in the value creation of bringing new, engaged audiences to merchants through payments. At Loylogic we have developed our innovative “MarPay” technology platform called Pointspay to connect the world’s top online merchants with loyalty programme members looking to maximise their spending power at checkout. And we anticipate these types of partnerships in commerce, loyalty and payments to flourish in the coming years.
The value of rewards
Klarna is clearly on point with some of the emerging trends in the rewards and loyalty space, and its investment in new loyalty concepts and technology demonstrates how innovative this space is. Between the consistent and smaller rewards via “Missions”, incentivising “Pay Now” payments to promote financial wellness, and using its platform to build and strengthen the relationships between retailers and consumers, they’re definitely ones to watch.
It’s an exciting time for those of us in the loyalty industry, and we expect to see even more companies follow suit and wake up to the value of loyalty and rewards.