The loyalty and rewards market in Latin America recorded important progress in the previous few years. In accordance with Analysis and Markets, the loyalty market within the area is predicted to develop by 13.6 % in 2023 totaling roughly US$8.7 Billion.
“There’s a enormous alternative to develop loyalty packages within the area,” says Latam Move Brasil Normal Director, Martin Holdschmidt (LATAM airways).
Brazil is, by far, the biggest marketplace for loyalty packages in Latin America, adopted by Mexico and Argentina.
Information reveals that 81 % of Brazilians are in some form of loyalty program though solely 10 % of those are airline packages.
“Extra spectacular than penetration of loyalty packages in Brazil is the variety of packages individuals are in. Roughly 80.9 % of Brazilians participate in at the very least one loyalty program,” says Holdschmidt.
In accordance with the manager there’s a diploma of maturity of loyalty packages within the Brazilian market, which is even better than these seen in Europe and the USA.
“In Brazil you might have very developed financial institution loyalty packages. Extra than simply working in a direct partnership, with a direct bank card with the airline, banks have developed their very own loyalty packages, and this creates a way more aggressive setting and brings way more innovation into the system as an entire,” says the Latam Move CEO.
International Flight’s managing director, Ravindra Bhagwanani, agrees.
“And it is not solely that everyone right here has a loyalty program however that they’re absolutely developed, they usually know the right way to work with them. Its already of their tradition,” famous Bhagwanani throughout International Flight’s 2023 Loyalty & Awards Convention, this 12 months held in Rio de Janeiro, Brazil.
Executives say the problem of loyalty packages in Brazil and different Latin American nations immediately is making an attempt to make this system extra informative and simpler to know.
“It is not at all times such a trivial factor for folks to know the way it works, the right way to accumulate factors, and so forth. We should make the packages simpler to know. I feel the large problem now could be how we train the inhabitants the right way to take part in these loyalty packages,” provides Holdschmidt.
They admit that some components, equivalent to gasoline prices and overseas trade charges, have a major impression on airline journey throughout South America.
“Points equivalent to unstable overseas trade charges restrict the expansion of journey,” says Holdschmidt.
However, though unstable foreign exchange charges have restricted using loyalty factors and progress of air journey, it has additionally created a dynamic setting for the event of recent merchandise.
“In Argentina, for instance, airline loyalty factors transcend simply touring, and are used nearly completely as financial savings account, conserving journey funds secure from the robust forex devaluation,” notes the Latam Move govt.
Mexico’s Viva Aerobus has mixed each subscription and non-subscription loyalty packages – with the bus firm having its personal points-revenue, non-subscription-based program whereas the airline has its co-brand and subscription loyalty program.
In accordance with Pablo Sordo, Chief Technique Officer of Viva Aerobus, prospects could make use of the advantages each of their air journey, in addition to land journey with these allied manufacturers.
“They’ll journey throughout the nation, combining each land and air transportation in a single journey, saving money and time,” says Sordo.
Regardless of the financial hurdles of Latin American nations, the evolution of loyalty packages within the area up to now few years is seen as spectacular.
Information from ABEMF (Brazilian Affiliation of Firms within the Loyalty Market) discovered a rise of 20.4 % within the gross income of its members in 2Q23, in relation to the identical interval in 2022, totaling R$4.9 billion in the course of the interval.
In accordance with ABEMF, factors/miles issued additionally grew, totaling 209.7 billion within the quarter, a rise of 25.9 % than that seen in 2Q22.
“The sector continues to evolve constantly, in double digits in virtually all of the market indicators we consider. Even after we measure Brazilians’ interplay with loyalty packages was 25.9 % increased than that recorded in 2Q22, reaching 11.7 million transactions within the interval”, says govt director at ABEMF, Paulo Curro.