Fresh evidence has emerged on the parlous state of most loyalty schemes after a new survey revealed that the majority of customers believe they are regularly offered irrelevant rewards or discounts.
According to the research – carried out by Grass Roots Group, 56% of loyalty club members are not happy with the rewards they receive, despite the fact that half of them cite loyalty programmes as a factor when choosing who to buy from.
The findings chime with a recent study by GI Insight, which showed the vast majority of brands which run loyalty schemes are failing to use the insight gleaned from their data.
The Grass Roots Group report even goes as far to state that over a quarter (27%) of people leave a loyalty programme as a result.
With brands continuously looking to attract long-term, loyal customers, it is vital that they engage with consumers as individuals in the most specific and relevant ways, the study maintains.
With nearly half (49%) of all 18- to 24-year-olds surveyed citing offers and rewards as most important to them when buying from a brand and huge numbers (86%) of over 65s valuing low prices over offers, Grass Roots urges brands to tailor the way they engage with customers.
Understanding how consumers want to interact with a brand is also a key consideration. Nearly half (47%) of consumers questioned, admitted to occasionally failing to make best use of loyalty programmes because they forget to use their card/details.
Commentating on the research findings, Grass Roots Group divisional director of customer engagement Adam Goran said: “To achieve the consumer Holy Grail – loyal advocates who like to shout about how good you are – brands must understand that their consumers are individuals, and they must be treated as such.
“With 41% of 18- to 24-year-olds preferring to interact with loyalty programmes via their smartphones, compared to just 25% of the over 65s, demographic differences can have a huge impact upon a successful engagement strategy.
“Loyalty schemes are playing a big part in the consumer decision-making process, so it is imperative that brands make any loyalty schemes relevant and consumer friendly. If this is not done, or done incorrectly, consumers could switch allegiance to a competitor.”
The research was carried out by Grass Roots Group in September 2014 and surveyed 2,741 UK consumers about their views towards and experience of customer loyalty schemes.
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