DO: What are the main features of the basmaRewards loyalty program that you believe will enable it to succeed?

“basma” is Oman’s First Multi-Partner Smart Card Enabled rewards programme that has been launched by BankMuscat, Oman Oil Marketing Company, Oman Mobile and Lulu Hypermarkets. Positioned as a product that helps shoppers ‘save as they spend ’, the basmaRewards programme, will help shoppers ‘add more smiles to their day’, with a world of benefits and privileges coming their way from the four partner organizations.

The programme offers customers instant rewards with the accumulation and redemption of basmaPoints at any of the basmaPartners’ Point of Sale (POS) terminals. The basmaCard gives the customer tremendous convenience and value in terms of savings across various product and service categories that many consider essential for our day-to-day subsistence today: fuel, groceries and mobile usage. As we speak, Capital Stores has signed up for this programme. Going forward we are confident of additional partners and merchants representing car sales and service companies, jewellery stores, fashion outlets, electronic showrooms, restaurants, travel agents and hotels would join the programme.

The advanced chip technology that the basmaCard employs - links the Point of Sale terminals to the basmaRewards System, thereby providing participating merchant outlets with the flexibility to tailor and create their own promotions around the card.

To benefit as a basmaCard holder, one has to just make it a habit of shopping at the basmaPartner outlets to accumulate basmaPoints. The basmaPoints are like currency with 1 basmaPoint being the equivalent of one baiza. BasmaPoints are easily redeemable against products and services of the customer’s choice at the basmaPartner outlets.

The basmaCard also offers maximum security, as it is a 2K MP-COS EMV 3DES_16 GEMPLUS card. It also comes with a Personal Identification Number (PIN), which the customer can choose at the time of first use. The customer has to enter in this 4 digit PIN to redeem the points in the card thus making the card virtually safe against any kind of fraud.

DO: To what extent and how rapidly do you expect the card to promote behavioral change among customers and how will this become evident?

By tying up with the major brands in Oman the basmaRewards programme has made it easier for customers to participate and take benefit of the same. These brands have good distribution networks and provide a wide choice at reasonable prices to customers. Over time, it will help customers consolidate their monthly shopping across these merchants and at the same time help them save a little money in the bargain.

Changes will become evident by the increasing sales volume at the basmaPartner outlets and the increasing acceptance of basma among merchants and customers.

DO: How will BankMuscat determine the return on investment of its basmaRewards programme?

BankMuscat is looking at the basmaRewards programme as an investment in promoting customer satisfaction. It is a way of thanking valued customers. The customers will earn additional 5 points for every Rial spent using the BankMuscat credit card. Over time, the bank expects customers to gradually change their mode of payment from cash to credit card. Also the bank foresees an increase in its merchant acquiring business, as more and more merchants are likely to be interested in joining the basmaRewards programme. This increase in card usage and merchant acquiring will help determine the return on investment

DO: To what extent do you expect the basmaRewards programme to aid BankMuscat’s growth?

BankMuscat sees the basmaRewards programme as a major initiative aimed at attracting, rewarding and retaining customers in its credit cards business, as this will help differentiate its credit card product from the competition. Though the bank already occupies a leadership position in the cards business in the Sultanate, it believes that it is important to keep providing reasons to enhance customer satisfaction. The basmaRewards programme will go a long way in doing this and changing the very way people shop in Oman.

DO: In your opinion, what will be the most challenging aspects of running the basmaRewards programme?

As with any new programme, the biggest challenge before the basmaRewards programme lies in ensuring that the new concept is widely disseminated and accepted by the target audience. This includes both the intermediary or prospective merchant outlet and the discerning customer. The other big challenge lies in managing the overall customer experience and meeting his or her expectations across all basmaPartner outlets. Continuous efforts will also have to be made to strengthen the programme by adding more and more partner outlets, which will accept the basmaCard and provide accumulation and redemption opportunities to cardholders.

DO: How will BankMuscat determine whether shoppers are ‘loyal’ to BankMuscat or primarily to the rewards offered by the basmaReward card?

basma is a rewards programme for the customers and BankMuscat will be giving them points for their usage on its credit cards. Increase in the usage of the credit cards will give us a good indication of the acceptance and success of the concept by the customers.

Besides, the basmaProgramme is a product that belongs to four partner organizations and not BankMuscat alone. Therefore, the objective will be achieved if the programme is able to generate behavioural change in the purchasing habits of the customers to all the partners of the programme

DO: Are we getting to the point where there is customer fatigue with loyalty marketing programmes?

It is observed globally that loyalty programmes act as a major tool for rewarding and retention of customers. What determines the success or failure of the programme include:

Ease of understanding

Benefits offered

Ease of accumulation and redemption of points.

In Oman, customers have largely been exposed to only a few outlet specific rewards programmes. In addition to lucky draws, most of the programmes on offer work primarily on the exchange of vouchers/coupons that reflect the amount spent. Customers redeem these coupons against a future purchase for the value of the coupon. However, this can often prove to be a cumbersome process. Coupons also have a limited validity period, after which they lapse.

With basma, customers don’t have to collect any coupons or take additional efforts to keep track of the cards. All accumulated points are loaded and stored on the smart chip on the card and every time the customer carries out a transaction with the basmaCard s/he gets a printed statement from the POS machine which clearly indicates the points accumulated for that transaction and the total points accumulated till date. There is no minimum threshold number of points required for redemption and the programme provides the customer the flexibility to redeem basmaPoints at any of the participating basmaPartner outlets, irrespective of where they have been collected.

We strongly believe that the customer will appreciate and benefit from this new concept of rewards in time.

DO: What is the benchmark for capturing card information to have a good loyalty-marketing programme?

As with any customer relationship-marketing (CRM) programme it is critical to capture the right customer data for deriving maximum benefit from the programme. Analysis of the spend patterns of customers transacting across the various basmaPartner outlets (using different mode of payments) will help track the efficiency of the programme and will also provide inputs to all the basmaPartners to tailor offers and promotions to customers. As the entire programme is chip based, the smart technology will facilitate the tracking of customer spends across basmaPartner outlets.

DO: One of the selling points for loyalty programs has been that you can get rid of a lot of your mass marketing, such as newspaper ads and television advertising. Was this part of your marketing thinking? Don't you still have to invest in mass marketing or risk losing customers to your competitors?

In an era of increasing competition one has to be in constant touch with one’s customer base either through mass media or through personalized one-to-one communication. For any new concept to be understood and accepted by target customers it is necessary for a certain amount of customer education and visibility. However, the primary reason behind this programme was to build stronger ties with our customer and enhance customer satisfaction. If this results in savings in marketing expenditure, it would be welcome!