Thursday, August 27, 2026

BAN PALM OIL

Indonesia’s forest-zone oil palm dilemma needs more than stricter laws, Hasanuddin study finds

Analysis shows that effective restoration must balance forest protection with smallholder livelihoods, land rights, and economic interests

Hasanuddin University

Indonesia’s Forests Face an Oil Palm Governance Dilemma — image:
A policy analysis by researchers from Hasanuddin University along with other institutes in Indonesia finds that neither gradual rehabilitation nor stricter state enforcement fully addresses the challenges created by oil palm cultivation in forest zones, underscoring the need for more integrated forest governance.
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Credit: "Palm oil plantations" by europeanspaceagency via Flickr Image source link: https://openverse.org/image/09da85bc-774d-4d7e-a764-bc20dd0ecaa9

A policy analysis by Hasanuddin University finds that Indonesia's shift from gradual rehabilitation to stricter enforcement has not fully addressed the underlying drivers of oil palm expansion in state forest zones and has created new uncertainties for smallholder farmers. The study argues how sustainable forest restoration can only be achieved when environmental protection is pursued alongside social equity, secure livelihoods, and effective governance. These findings were made available online on June 13, 2026, and was published in Volume 189 of the journal Forest Policy and Economics on August 1, 2026.

To put these findings into context, Indonesia is the world’s largest palm oil producer, with an estimated 3.4 million hectares of oil palm cultivated within state forest zones. As international pressure for sustainable palm oil sourcing increased, the Indonesian government has introduced policies to address oil palm cultivation in these areas.

One such approach was Strategi Jangka Benah (SJB) or “Rehabilitation Period Strategy,” introduced in 2020–2021. Rather than immediately removing oil palm plantations, SJB allowed existing cultivation to continue for a transitional period while farmers gradually transformed monoculture plantations into mixed agroforestry systems. In early 2025, the government shifted toward stricter enforcement with Presidential Regulation No. 5/2025 (Perpres 5/2025), which introduced administrative penalties, potential criminal enforcement against violations, and state reclamation of forest land.

Shining light on these approaches, the research team led by Professor Muhammad Alif K. Sahide at the Forest and Society Research Group (FSRG) of Faculty of Forestry Hasanuddin University, Indonesia, examined how both approaches have struggled to reconcile forest restoration with the economic realities of smallholder farmers. They find that SJB faced implementation challenges because oil palm was deeply embedded in smallholder livelihoods, while the newer enforcement-oriented approach could create further uncertainty over land and livelihoods.

By engaging with stakeholders in Central Kalimantan and West Sulawesi, two regions where SJB was implemented, the researchers found a fundamental disconnect between the policy’s ecological objectives and the economic realities facing smallholders. SJB promoted a gradual shift from monoculture oil palm to agroforestry but offered few economic incentives for farmers to make the transition. With palm oil remaining profitable and alternative livelihoods being limited, replacing productive plantations with slower-growing timber or food crops was economically difficult.

Similarly, Perpres 5/2025 frames forest reclamation primarily through law enforcement and territorial control, while leaving the implications for smallholder livelihoods uncertain. The researchers warn that reclaimed land could potentially become concentrated among state-owned companies or other actors with greater political, bureaucratic, or financial influence, potentially marginalizing smallholders further.

The researchers argue that SJB and Perpres 5/2025 reflect a fragmented approach to forest governance. SJB prioritized gradual rehabilitation and social inclusion, while Perpres 5/2025 places greater emphasis on law enforcement and state control. Neither policy, however, addresses the underlying drivers of forest conversion.

To break this cycle, the researchers call for a more integrated approach that protects forests while also addressing farmer’s livelihoods, land rights, and economic needs. This would include clarifying who has legal rights to the land before imposing penalties, using social forestry programs to give smallholder farmers more secure land rights, involving local communities in forest restoration planning, and ensuring that they share in the benefits of restored land. The researchers also call for better coordination between the agriculture, forestry, and energy ministries so that policies on farming, palm oil, biodiesel, and forest protection work toward the same goals.

Overall, the study suggests that forest restoration cannot be separated from the livelihoods and land rights of the communities that depend on these landscapes. Without addressing land rights and economic needs, new regulations could create uncertainty without resolving the underlying challenges.

As Professor Alif puts it, “The challenge, then, is not merely to design better policies, but to build governance architectures that can navigate the inherent trade-offs between economic, social, and ecological goals in a transparent, accountable, and equitable manner.”

Reference
Title of original paper: Policy forum: Between incorporation and reappropriation – The unresolved dilemma of oil palm in Indonesia's forest zones
Journal: Forest Policy and Economics
DOI: https://doi.org/10.1016/j.forpol.2026.103835

About Hasanuddin University, Indonesia
Hasanuddin University (Universitas Hasanuddin or Unhas) is one of Indonesia’s largest autonomous universities, located in Makassar. Established on September 10, 1956, and named after Sultan Hasanuddin of the Gowa Kingdom, the university has grown into a major center for higher education with 18 faculties, including medicine, engineering, law, agriculture, and natural sciences. Its origins date back to 1947 with an economics faculty linked to the University of Indonesia. Today, Unhas focuses on advancing science, technology, arts, and culture, with a strong emphasis on the Indonesian Maritime Continent, aiming to develop innovative and globally competitive graduates.
Learn more, here: https://www.unhas.ac.id/about/

About Professor Muhammad Alif K. Sahide from Hasanuddin University, Indonesia
Muhammad Alif K. Sahide is a Full Professor at the Faculty of Forestry, Universitas Hasanuddin, and leads the Forest and Society Research Group. His research focuses on forest and land-use governance, community forestry, institutions, international environmental regimes, and bureaucratic politics in Indonesia. He actively contributes to forest policy and education across Southeast Asia through the ASEAN Social Forestry Network and national policy committees. Prof. Alif is also a founding and chief editor of Forest and Society and regularly supports research and writing capacity-building initiatives for young researchers and local organizations across Southeast Asia.

Funding information
Hasanuddin University

Journal

Forest Policy and Economics

DOI

10.1016/j.forpol.2026.103835

Method of Research

Commentary/editorial

Subject of Research

Not applicable

Article Title

Policy forum: Between incorporation and reappropriation – The unresolved dilemma of oil palm in Indonesia's forest zones

Article Publication Date

21-Aug-2026

Former Taliban commander admits destroying Bamiyan Buddhas

Image of one of the statues from around 1940. / Annemarie Schwarzenbach - PD - WikiFacebook

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By Mark Buckton in New Taipei August 27, 2026

A former Taliban commander and provincial governor has admitted taking a direct part in the destruction of the Bamiyan Buddha statues, telling the BBC he has no regrets, the broadcaster reports.

Abdullah Sarhadi, who commanded Taliban forces in Bamiyan during the movement's first period in power, said he blew up the two colossal statues with his own hands during the demolition ordered by the Taliban leadership in March 2001. The admission is a rare first-hand account of one of the most notorious acts of cultural destruction of the past century, and it comes from a man the Taliban has since promoted to senior posts under its restored government.

After initially declining to answer questions about the demolition, Sarhadi told the BBC: "I destroyed them with my own hands."

He defended the act, saying the Taliban had acted in line with Islamic law and the orders of the movement. "We are idol breakers, not idol sellers," he said, adding that he had no reason for regret because he regarded the destruction as "a divine command."

The two statues, carved into sandstone cliffs in the central Bamiyan Valley in the 6th century, had stood for close to 1,500 years before being brought down with explosives. Their destruction drew condemnation from UNESCO, foreign governments and cultural bodies, which called it an irreversible assault on shared human heritage.

The Bamiyan Valley is a UNESCO World Heritage Site and remains among the most important archaeological and cultural sites in Central Asia, a record of centuries of Buddhist civilisation along the ancient Silk Road.

According to the documentary, Sarhadi served as a military commander during the Taliban's rule in the 1990s and surrendered to the US-led coalition after the movement collapsed in late 2001. He was held at Guantanamo Bay before his release.

After the Taliban returned to power in August 2021, Sarhadi was made governor of Bamiyan and later of Jawzjan province.

Nepal floods leave over 150 dead, hundreds more missing

/ Dr. PM Dhakate Govt of Uttarakhand - XFacebook

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By IntelliNews - Kolkata Bureau August 26, 2026

At least 150 people have been killed and hundreds of tourists are missing after a massive flash flood and mudslide struck the Nepal-Tibet border on August 26.

The area stricken area is known to be popular with pilgrims and trekkers. Nepal’s tourist board said more than 500 tourists were currently missing in the country, including more than 100 from India, 54 from the US, 33 from the UK and more than 100 from Nepal itself, the BBC reports.

In Tibet, Chinese government media, however, reported three deaths and 265 people missing with CCTV footage showing a wall of water and mud hitting buildings at the Gyirong border crossing.

Dozens of Nepalese police and army personnel are also reported missing, along with power workers. The scale of the disaster is expected to become clearer as rescue teams reach affected areas in the days ahead.

The flooding caused widespread damage to homes, roads and other infrastructure. Video footage shows thick brown water surging through the landscape and destroying bridges. At the border crossing, people were seen fleeing before floodwater hit the building.

Authorities initially believed an earthquake may have preceded the flooding although reports say the US Geological Survey now says the seismic energy was generated by a landslide, rather than an earthquake triggering the disaster.

Nepal’s Prime Minister Balendra Shah said the country has been shocked and deeply distressed by the disaster.

One woman told the BBC that her family had been swept away in front of her. She and her son survived by climbing onto a rooftop.

The Australian government said a number of Australians had been in the flood area but had not confirmed how many were among those reported missing.

Meanwhile, a trekking company operating tours across the Nepal-Tibet border has also been trying to establish the whereabouts of missing customers. The manager told the Press Association that around a dozen Britons from one excursion were missing and that the company had received thousands of calls from their families. Four Nepalese guides working for the company were also missing.

International governments have offered support. India’s Prime Minister Narendra Modi said the country was prepared to provide humanitarian assistance to Nepal. The US State Department said it was in contact with the Nepalese government and ready to assist.

European Commission President Ursula von der Leyen has also said the EU was ready to mobilise further assistance. UK Foreign Secretary Ed Miliband too said Britain’s consular team was working with local authorities on the emergency response and supporting those affected.

Around 1,300 people missing in Nepal and Tibet after catastrophic floods caused by a glacial collapse

Rescuers use earthmovers to reach submerged houses after flash flooding along the Trishuli River in Nepal's Nuwakot district, Wednesday, Aug. 26, 2026. (AP Photo/Niranjan Shre AP Photo

By Jerry Fisayo-Bambi
Published on 27/08/2026 -
EURONEWS

Officials in Nepal earlier said 826 people, including some 341 foreigners, are missing after the Bhotekoshi-Trishuli floods.

At least 162 were killed in Nepal and three others in Tibet after massive flash floods in a border area of Nepal and China swept through communities on Wednesday, China’s state media reported, saying more than 1300 people remain missing from the disaster.
Mudslides in Tibet left three people dead and 558 missing; some 260 of the 558 missing people in Tibet were foreigners, both China's state news agency Xinhua and broadcaster CCTV reported Thursday morning.
On Thursday morning, officials in Nepal said around 826 people, including some 341 foreigners, are missing after the Bhotekoshi-Trishuli floods.
Drone footage in Nepal showed roads destroyed and buildings buried by thundering water the colour of wet cement.
“When I reached Dhunge bazaar, in half an hour, the flood came and damaged all the market. People were preparing to go to the office then,” a resident, Shoyam Rajbhandari, said. “How many people are missing or dead, we don’t know.”

Foreign nationals are among those missing

The international response began to trickle in Thursday after Australia, which reported some of its citizens missing, offered help, while South Korea said it sent a rapid response team to Nepal Thursday to support search and rescue efforts for nine of its nationals who remain unaccounted for.
At least 34 Australians on pilgrimages and hiking tours were missing, Australia’s Foreign Minister Penny Wong told reporters on Thursday.
“We understand these Australians were part of separate pilgrimage and tour groups,” Wong told reporters in Adelaide, Australia.
The Nepalese government had not yet requested help, but Australia was coordinating with Nepal, the United Nations, the Red Cross and other organisations on a humanitarian response, she said.
Malaysia also reported 55 of its citizens in Kathmandu are now unreachable, according to Malaysia's Foreign Ministry, which increased the number of missing on Thursday.
It stated that it is closely collaborating with authorities to determine the safety and locations of Malaysian casualties, but there is no formal confirmation of their presence.
The Bhotekoshi-Trishuli floods started on Wednesday after a sudden outburst in Nepal's Bhotekoshi River in Rasuwa district.
The US Geological Survey reported a magnitude 4.4 earthquake about 66 kilometres north of Kathmandu, near the border.
The USGS later updated its analysis to say the seismic event it measured was a magnitude 5.2 glacial collapse that sent debris flowing downstream with catastrophic impact on communities.
It said its determination was based on data from nearby seismic stations, long-period seismic waves and satellite imagery, and that no earthquake had occurred

Avalanche from glacier caused disaster, experts say

Climate experts at the Kathmandu-based International Centre for Integrated Mountain Development said an avalanche from a glacier likely caused Wednesday’s flash flood.
“Hydrological observations indicate the exceptional speed and magnitude of the flood wave,” they said in an emailed statement, noting that water levels at one point on the Trishuli river rose by as much as 9 metres over half an hour.
The Lhende Khola River, a tributary of the Bhotekoshi, had maximum flooding, they said.
Related
Hundreds missing as flash floods tear through Nepal
At least 160 dead and hundreds missing after floods strike Nepal-China border
While the scale of the disaster is huge, the catastrophe in Tibet and Nepal is not a one-off. Over the past year, the Lhende Khola river system has flooded twice, and in one of the most heavily inhabited areas of the globe, populations, infrastructure, and water supplies are at risk due to the increasingly unstable Himalayan glacier system.
“The Lhende Khola has flooded twice in 14 months, this time triggered by an ice rock avalanche from a glacier on the Nepal side that blocked the river and released a sudden surge downstream,” said Saswata Sanyal, a disaster risk reduction specialist at the climate research group.
The region saw similar flash floods in August last year, when a glacial lake in Tibet overflowed because of high temperatures.
Nine people were killed, and critical infrastructure, including a bridge connecting Nepal and China, was damaged at the time.

EU joins aid effort as more than 1,300

remain missing after Nepal floods

The EU has joined international efforts to send aid after catastrophic floods on the Nepal-Tibet border left at least 168 people dead and more than 1,300 missing.

Issued on: 27/08/2026 - RFI

Mud covered buildings following a flash flood at Trishuli in Nepal, 26 August 2026. © Navesh Chitraka/Reuters

A wall of mud and rock collapsed into a river near Gyirong on the Tibet-Nepal border on Wednesday, triggering a flash flood that swept through towns and villages and washed away houses, roads and power projects.

At least 165 people have been reported dead – 162 in Nepal and three in Tibet. Nepal's disaster agency said on Thursday that 826 people were unaccounted for, including at least 579 Nepali and foreign tourists.

Hikers and climbers from around the world travel to Nepal to climb some of the world's highest peaks, including Mount Everest. The French foreign ministry said 80 French nationals had registered their presence in Nepal and that other French people travelling through the country could also be in the affected areas.

Search for the missing

“The top priority is to mobilise all available resources to search for and rescue missing people, evacuate and relocate residents in danger, provide prompt medical treatment to the injured and minimise the number of casualties,” Chinese President Xi Jinping said, state media reported.

The Chinese president does not usually comment on disasters unless the death toll is significant.

Chinese authorities have mobilised more than 1,500 personnel.

The International Federation of Red Cross and Red Crescent Societies in Nepal said it had released just over €1 million in emergency funds to support rescue operations and provide drinking water and supplies including blankets, first-aid kits, stretchers and body bags.
International aid

The European Union has activated its Copernicus satellite system to support rescue efforts and said it was ready to provide further assistance.

Neighbouring India will provide military helicopters to help search and rescue operations and has sent 10 tonnes of humanitarian aid, including blankets, solar lamps and medicines.

The flooding appears to be linked to a collapsing glacier.

Nepal's foreign minister initially said an earthquake may have triggered a landslide that blocked the Lhende Khola river and sent water downstream. The US Geological Survey later said the seismic activity was actually caused by a glacial collapse and debris flow.
Collapsed glacier

The flooding “was caused by an avalanche of ice that fell into the Lhende River, but its exact cause remains to be confirmed,” Qianggong Zhang, a scientist at the International Centre for Integrated Mountain Development in Kathmandu, told AFP.

Water levels in the Trishuli river, downstream from the blockage, reportedly rose by as much as nine metres in just 30 minutes.

The blockage is still there and could cause further flooding.

(with newswires)

Nepal secures World Bank pledge for flood recovery

/ Indian Air Force - XFacebook

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By IntelliNews - Chennai Bureau August 27, 2026

At least 150 people have been killed and hundreds of tourists are missing after a massive flash flood and mudslide struck the Nepal-Tibet border on August 26.

Nepal's Ministry of Finance said international partners have offered coordinated financial support for flood response and rebuilding efforts across affected regions, as the government moves to channel emergency aid following widespread damage.

According to a report by The Rising Nepal, World Bank Country Director David Sislen told Nepal's Finance Minister Swarnim Wagle that approximately NPR25bn ($163mn) could be made available as urgent emergency support, marking one of the largest pledges disclosed so far among the international assistance offers.

India's government reportedly requested an inventory of critical items needed for disaster victims and the Indian Airforce posted pictures and details on social media platform X of their C-130J aircraft being dispatched with 10 tonnes of relief supplies.

China's Ambassador to Nepal, Zhang Maoming, separately informed officials that Beijing intends to deliver prompt monetary assistance, asking Nepal's Ministry of Finance to begin transfer procedures for the funds.

Both India and China have a competing interest in providing humanitarian aid to Nepal as it reflects the reach of their soft power and geopolitical influence in the region.

Wagle acknowledged the international support offers and has initiated inter-agency consultations to establish distribution channels for the incoming resources, as the government works to coordinate the arrival and deployment of aid across multiple bilateral and multilateral sources.

Nepal's Cabinet formally declared affected municipalities within Rasuwa, Nuwakot and Dhading districts as disaster crisis zones, authorising deployment of both domestic and foreign relief assets to support recovery operations.

The designation is expected to expedite logistical coordination as international pledges convert into on-the-ground assistance, with authorities likely to face continued pressure to demonstrate transparent and efficient distribution of the incoming funds across the disaster-affected districts in the coming weeks.

Hundreds of tourists among victims in Nepal as Europe issues travel advice

By Simon Ormiston

Published on 27/08/2026 - EURONEWS

European governments have issued safety guidance and emergency contacts for travellers as flooding and landslides disrupt transport across parts of Nepal.

Hundreds of foreign tourists are reported missing after devastating flooding in Nepal struck an area popular with international travellers.

The Nepal Tourism Board said on Thursday that 644 tourists were out of contact, including 517 foreign nationals. They include visitors from 19 European countries as well as China, the United States and Australia.

Eight German nationals are among those reported missing, according to trekking agencies cited by Nepal Tourist Police chief Bishow Raj Adhikari, although Germany's Foreign Office said it had no confirmation that any German citizens were affected. Portugal's Foreign Ministry has confirmed that two Portuguese nationals, a man and a woman, have been reported missing following the disaster.

Nepali officials are urging travellers to inform the nearest police or security authority, local administration, travel agency, guide or tour operator of their location and in a statement said "please remain calm, stay informed and follow official safety instructions".

The disaster has particularly affected Rasuwa and neighbouring Nuwakot, north of Kathmandu and close to Nepal's border with Tibet.

Nepal has long been one of Asia's most popular destinations for backpackers, hikers and adventure travellers, attracted by its dramatic Himalayan landscape, relatively affordable travel and combination of mountain trekking, historic cities and Buddhist and Hindu culture.

The country is home to eight of the world's 10 highest mountains, including Mount Everest, and official figures show 1.16 million international tourists visited Nepal in 2025, including more than 165,000 who went trekking.

What should travellers in Nepal do?

European governments and other foreign embassies are advising travellers to follow instructions from Nepalese authorities and closely monitor local conditions.

The embassies of Finland, France and the UK, together with Australia, Norway and Switzerland and the EU Delegation in Nepal, issued a joint statement urging people in affected areas to "follow the guidance of local authorities and official safety advisories as the situation continues to evolve".

France warns that due to flooding and landslides telephone networks and internet connections can be cut for several days. Travellers are advised to check with local authorities before making journeys and to follow their instructions.

The Netherlands advises people caught in flooding to move to higher ground, avoid bridges and not attempt to walk or swim through floodwater. Travellers should be prepared to evacuate and keep passports, medication and other essential belongings together in a waterproof bag.

Foreign travellers should also:

Avoid flood and landslide-affected areas and do not travel simply to observe the damage.
Stay away from rivers, riverbanks, bridges, unstable slopes and damaged buildings.
Check local weather, flood warnings and road conditions before travelling.
Contact their tour operator, trekking company, guide or accommodation provider before attempting to change location.
Keep relatives or friends informed of their location and condition, preferably by text or online if telephone networks are congested.
Keep phones charged and passports, medication and essential documents readily accessible.
Contact their travel insurer as soon as possible if their journey has been disrupted or they require medical treatment, evacuation or repatriation.

Nepal's Department of Hydrology and Meteorology provides weather and flood information through the toll-free number 1155, with callers able to select weather forecasts or early flood warnings.

Nepal emergency numbers

Police: 100

Fire: 101

Ambulance: 102

Tourist Police: 1144

Flood and extreme weather information: 1155

The Tourist Police service is particularly useful for foreign visitors and has officers with English-language skills.

Help for EU nationals

EU citizens requiring consular help should first contact their own country's embassy, consulate or foreign ministry.

Not every EU country has an embassy in Nepal but under EU consular protection rules, an EU citizen whose own country is not represented can seek assistance from the embassy or consulate of another EU member state. Belgium's foreign ministry, for example, identifies Germany, Finland and France as EU countries with embassies in Kathmandu.

Some useful European emergency contacts include:

France: French nationals in Nepal can contact the French Embassy in Kathmandu on +977 980 101 7201. France is asking its citizens to follow local-authority instructions and, where possible, tell relatives that they are safe.

Italy: Italian nationals requiring emergency assistance can contact the Italian Foreign Ministry Crisis Unit on +39 06 36225, the Italian Consulate General in Kolkata on +91 9831212216, or the Honorary Consulate General in Kathmandu on +977 1 4538388 / +977 1 4529089. Italy is also asking nationals in the area to register through its Dove siamo nel mondo service or Viaggiare Sicuri app.

Spain: Spanish nationals requiring urgent consular assistance can call +91 98101 74160. Spain advises its citizens in Nepal to follow instructions from local authorities and monitor updates from its embassy.

Belgium: Belgians can contact the Honorary Consulate in Kathmandu on +977 985 10 32 785 for emergencies. The Belgian Embassy in New Delhi, which is responsible for Nepal, has an out-of-hours emergency number of +91 98101 17931.

Travellers from other EU countries should check their national foreign ministry's latest Nepal advice for the appropriate emergency consular number.

Wednesday, August 26, 2026

Do customer loyalty programs actually work? The benefits are in the eye of the cardholder

New research led by Edith Cowan University (ECU) has analysed survey data from more than 800 Australian supermarket retail customers to better understand what influences customer engagement with loyalty programs.

Edith Cowan University

Whether you love a loyalty discount at the supermarket or frequently forget your loyalty card, loyalty programs (LPs) can be an essential support to families and households amid growing cost-of-living pressures.

The number of LPs offered by retailers is increasing. Globally, the loyalty management market is projected to grow in value from $17.38 billion USD in 2026, to $51.65 billion USD by 2034. The market will continue to expand as cost-of-living pressures force households to seek discounts, coupons, gifts and vouchers to reduce their shopping expenditure.

The findings will help retailers design LPs based on what is most important to customers.

ECU Professor of Marketing and Service Science, Sanjit Roy from the School of Business and Law, said research found that customer behaviour and retailer loyalty are driven by customers’ characteristics and capacity to engage with LPs.

“Many customers don’t have the time to do mental cost-benefit analysis. What am I getting and what am I giving up? Retailers know this, so they’ll prompt you at the till before you pay, either at self-serve checkout or by a customer serviceperson asking: do you want to scan your rewards card? Do you want to scan your Flybuys card? Retailers know how to reinforce our habit,” Professor Roy explained.

“But as customers we are losing more than we are gaining. If we earn one point for every dollar spent, and every 2,000 points we receive a $10 voucher – is it worth handing over our personal data when discounts and promotions aren’t being personalised or tailored to our buying habits as a reward for our loyalty? Therefore, is it worth signing up for the loyalty programs?”

The results show that LP engagement leads to retailer engagement and customer loyalty – both in attitude and behaviour toward a customer’s retailer of choice.

Dr Saalem Sadeque, Course Coordinator and Lecturer in Marketing at ECU, said a customer’s capability to wait and use LPs played a major part.

“If a customer predicts there will be a future discount on an item they frequently purchase, they may wait a week or two to buy it and buy more of the same product. But if they don’t have the capacity to wait – like a parent desperately needing nappies or with too tight a budget to buy in bulk – they will miss out on the discount despite their loyalty to the retailer,” Dr Sadeque said.

In the age of digital marketing algorithms and discount codes, engaging customers through LPs can create both challenges and opportunities for supermarket retailers.

Implications for retailers

Despite their existence and increased reliance on LPs from major supermarkets like Coles and Woolworths, customers often do not engage with them. The success or failure of LPs depends largely on a combination of customers’ trust in, commitment to and perceived benefits from these programs.

“Our research shows that engaging with loyalty programs from the customers perspective depends on several factors: trust in the retailers, commitment toward and from the retailers, perceived benefits, as well as the ability to wait for discounts (temporal price search strategy), and ability to look for deals across multiple retailers (spatial price search strategy). Our findings demonstrate that no one factor leads to engagement but rather a combination of all these factors,” Professor Roy said.

The absence of these conditions significantly hinders engagement with LPs and retailers.

“A lack of loyalty program engagement also creates uncertainty in cash flow projections which is an additional downside for retailers.”

In a recent report, the Australian Competition and Consumer Commission (ACCC) advised Australian supermarkets to be more transparent about their pricing.

Recipe for success

“Transparency is important to customers. Retailers should strive to be transparent about their prices and business practices, provide exceptional customer service, and send out consistent brand image messages. If you make a commitment to providing fresh fruit and vegetables – ensure you deliver on that promise,” Professor Roy said.

Professor Roy said Australian supermarkets should better use the data generated from individual customers to personalise the benefits offered and build connection.

“Customers know they’re just a datapoint. Supermarket retailers should focus on advancing their LP offering by establishing a personalised dialogue with customers and making their loyalty benefits more human-centric. Creating a personalised dialogue is a precursor to building trust.”

Given that LP engagement is crucial for fostering deeper customer engagement, retailers should design LPs that deliver clear, consistent value and build an emotional connection.

“A tailored, integrated strategy that aligns a loyalty program’s value with trust and relationship building is essential for sustaining customer loyalty and long-term retailer relationships,” Dr Sadeque said.

“Retailers can enhance customer commitment by conducting market research to ensure that their values align with their customers. In addition, retailers may cultivate customer commitment by creating personalised offerings to improve the perceived benefits, increasing the likelihood of customer engagement with LPs.”

The journal article Customers’ Disposition Towards Loyalty Program Engagement is published in the European Journal of Marketing.

- ends -   

Media contact:

Hayley Butler, (08) 6304 5575, h.butler@ecu.edu.au

or ECU Corporate Relations, (08) 6304 2222, pr@ecu.edu.au