Loyalty and CRM

Why loyalty leaders should care about microservices architectures

Why loyalty leaders should care about microservices architectures

While technology professionals are well aware of the advantages microservices architectures deliver, why should business leaders in loyalty actually care? Why not just let the IT team worry about such complicated technical topics? In short, because it has a direct impact on your loyalty business.

Successful loyalty programs add value to their members, which translates into revenues for the program provider. Creating an engaging loyalty program involves facilitating everyday earn and burn opportunities for members so they can extract full benefit from the scheme. And that involves launching new offers, targeting new segments, and integrating new partners, for example. Yet loyalty veterans know the process behind launching new ideas is only as agile and viable as the underlying technology´s ability to adapt and support innovation.

So what are microservices architectures, and what are their advantages? 

In simple terms, microservices architectures are a combination of multiple smaller services units that work independently to contribute to a bigger cause. Yes, they are the small units that generate the output, which, when orchestrated, can solve an enterprise-level problem. Breaking down the constituents of a system into microservices offers several advantages over traditional monolithic architectures.

Speed to market 

Microservices are modular and can plug and play easily with new or updated code. This reduces the performance risk of incremental updates and provides more flexibility as development requires much less code than a monolithic application. As a result, teams work with greater agility, building higher-quality systems with less complex code that reduces testing requirements. This increases the stability and the speed at which new applications can be developed to launch new loyalty program designs and campaigns to market.

If a bug occurs, the specific microservice can be isolated and a specific task shut down instead of having to take the entire system offline and disrupting daily operations. As a result, regular product upgrades can be performed while building and integrating new modules can be accomplished without affecting core systems, speeding go-to-market timelines and flexibility for new loyalty initiatives.

Ease of maintenance and damage limitation

In large-scale software environments, maintaining monolithic architectures can prove challenging. Tightly coupled architectures have a domino effect that can induce additional knock-on complexities. With microservices, ongoing maintenance and troubleshooting are easier, as individual output from modules can be analyzed to isolate the source of problems and provide the right fix.

Microservices offer superior fault tolerance – the property that enables a system to continue operating properly in the event of the failure of some of its components. If any single microservice for a given task fails, others automatically kick in to pick up the slack. While several microservices can be assigned to a particular task, each unit is specifically designed to perform that task and is configured to do it best. Each microservice can be deployed redundantly, in parallel, hence making single points of failure outdated. This provides loyalty leaders with greater systems stability to ensure uninterrupted program delivery.

System scalability to business needs

Business processes in monolithic architectures are often handled as single and complex iteration. With this design, applications have a tough time handling traffic and processing transactions beyond a specific threshold without undergoing significant changes. In addition to struggling with peaks in demand, this approach is also more vulnerable to errors, increasing development and testing timelines.

With microservices architectures, the same business processes are broken down into many independent, moving parts. This translates into individual tasks running across multiple available computing units with much higher overall throughputs. Each microservice´s scalability is directly tied to this capability. As the workload grows, additional microservices can be deployed in parallel to spread the load across additional computing nodes. Moreover, the cost of scaling is significantly lower compared to monolithic systems since each microservice can quickly scale up or down based on demand. For loyalty leaders, this means that high volume traffic and transactions from the launch of new campaigns won´t negatively affect your members´ user experience.

Real-time data processing for personalized experiences 

With the increased adoption of digital technology, data volumes continue to grow at an unprecedented scale. Businesses must increase real-time data processing performance to stay ahead of the curve and make informed decisions. The ability of microservices to scale can help achieve that competitive edge by offering efficient and instant data processing capabilities.

Personalizing loyalty offers relies on processing data in line with its real-time input rate while ensuring reliable operations. Microservices architectures enable the parallelism and redundancy to maintain the processing loads and provide a reliable data stream to visualization tools. The modularized approach, along with scalability, enables the microservices architecture to generate the right output in less time and enrich the business with better data-based decision-making. For loyalty leaders, this means more personalization capabilities for each segment of the program´s members

More freedom to innovate

The architectural foundations upon which new technologies are developed have made great strides since the first loyalty systems came to market. Technology should support evolving business needs, not limit loyalty leaders´ ability to innovate, experiment, and grow. Costly, resource-intensive, and drawn-out customizations to legacy systems that often don´t satisfy business expectations no longer need to hamper loyalty success.

A loyalty platform designed on an open microservices architecture provides more flexibility to integrate new partners into the ecosystem, accelerates the time to market of new ideas, and scales to demand. They also process data from different business areas more efficiently, in real-time, enabling loyalty leaders to make more informed business decisions and deliver personalized experiences to their program members.


Author Info 

Mithun has extensive experience in designing and implementing loyalty and CRM solutions for several leading airline and non-airline businesses around the world. He is responsible for product management, domain consulting, and business analysis for iLoyal, IBS Software´s industry-leading loyalty platform.

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