CommBank has radically re-thought the way that its Yello loyalty program works, offering a new, Australia-first, whole-of-bank offering and a series of deeper integrations with a range of major partners.
The changes sound simple but are tantalising in their potential. Rather than just being rewarded for their credit card spending, eligible customers will be rewarded for all of the banking they do with CommBank.
Customers will be able to earn points across their home loans, savings, credit cards and insurance. And they will be able to track and redeem them within the CommBank app and NetBank.
These points can then be renewed across Woolworths Everyday Rewards, Origin Energy, Myer, Velocity Frequent Flyer, Doordash, bp and Qatar Airways — in the case of retail partners, the points can literally be renewed at checkout. The changes take effect on 1 October.
A few thousand points can get $10 off groceries at Woolies, 20,000 points will get $100 off at Myer and 100,000 points can get return flights from Sydney to Bali via CommBank’s online travel booking service, for example.
As CommBank CMO Jo Boundy told B&T at an exclusive media event yesterday afternoon, it’s a change that puts “value back in customers’ hands”.
“The program first launched in November 2023 and that was about cashback, discounts, offers, event perks and tickets — $243 million has been given to customers since launch,” the four-time B&T CMO Power List inductee said.
“We’ve been playing close attention to what customers need and want and we’re really excited about this opportunity to evolve and expand it to find more ways for customers to earn.”
The change comes as Australians — already among the world’s most prolific loyalty program users — are seeking more ways to extract value from the relationships they have with brands. Perhaps unsurprisingly, much of this comes off the back of cost of living pressures.
In research presented yesterday afternoon, CommBank said that 78 per cent of Australians saw rewards help them manage rising living costs and more than half of Aussies say that rewards programs are more important to them now than 12 months ago.
This desire for rewards extends beyond the occasional $10 off at Coles or Woolies. For instance, some 21 per cent say that they would like to redeem rewards for money off energy bills (though only 7 per cent currently do). The research also found that 85 per cent of Aussies are frustrated with current loyalty programs with the most common gripes are that rewards take too long to earn, aren’t valuable enough or offer too few options.
Pertinently, half of Australians have switched brands, providers or services because of a loyalty program.
“It’s clearly very beneficial for retention, but absolutely for acquisition,” Boundy said of the new Yello program.
“When it launches, you’ll see that signing up for new products will be one of the ways you can earn points. At the heart of the program, though, it’s all about being recognised for the more that you do. The more things you do with CommBank, the more whole-of-bank relationship you have, the more ways that you can earn CommBank Yello points and the more that you’ve got built up to use with partners.
“We have so many customers and the rewards that one customer wants versus another are different. What we’ve been able to provide is something that’s hyper-bespoke… It’s also a banking first. Nobody else is doing this. A lot of the banks are coming out with changes to their credit card program. We’ve listened to what our customers really want and reimagined the whole thing to put value back in the hands of customers.”
The launch partners include some of the country’s largest brands but partnerships are not category exclusive. For instance, Qatar Airways and Velocity Frequent Flyer are both part of the program — though Virgin Australia and Qatar have a joint venture. When asked, Boundy said that Myer and David Jones could both be Yello partners — hypothetically speaking, at least.
Importantly, Yello and Connect, CommBank’s commerce media network, are treated separately Boundy said.
“But certainly many of our partners also have advertising in CommBank Connect, as well,” she explained.
“They are separate parts of the business but wherever we can provide value to our partners in either side of the CBA ecosystem, we’re absolutely looking to do that.”
For the partners involved in Yello, there are potential benefits in terms of customer acquisition and retention, too. While Hannah Ross, MD of Woolworths Everyday Rewards, said that “many” of its 11 million users will also be CommBank customers, for Myer’s chief customer officer Amanda McVay, there’s the potential to find new audiences.
“For us at Myer One with 5.3 million users, we see this as a significant increase in a record year for us with a 600,000 net increase year-on-year,” she said during a short panel discussion during the media event.
CommBank also announced that it is exploring the launch of a new charge card option, distinct from its Smart and Ultimate cards, which will give cardholders access to a higher points-earning reward card with exclusive benefits such as concierge support, airline lounge access, no international transaction fees and so on.
