Loyalty Programs in Australia – It’s Time to Improve

By ADAM POSNER, CEO OF DIRECTIVITY

Loyalty Programs paper_28May13

Just because you have a loyalty program doesn’t mean it’s working. According to the recent Australian research report – For Love or Money? 2013 Consumer Study into Australian Loyalty Programs, only 41% of consumers feel that loyalty programs have improved in recent years and offer good benefits to members.

With 88% of consumers over the age of 16 being members of a loyalty program, the research finds loyalty marketers are yet to tap into all the opportunities the data age provides to produce actionable insights and make their loyalty programs better.

Where can loyalty programs improve?

Not surprisingly, immediate discounts were highly rated by consumers – 80% think they are very important. Closely following the financial benefits were points-based programs that allow members to redeem ‘points’ for vouchers, products or other rewards  – 77% rated these as very important.

Surprise, surprise!

What was surprising and a little unexpected was that 67% of consumers feel that surprise gifts or rewards are very important in a loyalty program. This is the opportunity to get closer to members and besides the financial benefits offered, it’s time to lift the emphasis on the softer more unexpected rewards that have the element of surprise, inspiring a consumer reaction such as “….the gift cards are automatically sent out, you don’t have to log on and ‘redeem’ anything so it’s a nice surprise to open the letterbox and have a gift card waiting…”

Ultimately financial rewards are the ‘ticket to play’ for consumers and are the main motivation for joining loyalty programs. But a winning program, one that has longevity and greater emotional connection to their members, is one that also has multiple softer and unexpected benefits creating an element of ‘surprise and delight’.

Who loves loyalty programs?

While men are members of fewer programs than women (on average three compared to five), they’re more active with their memberships, with 49 % of men presenting their card upon purchase compared to 41 % of women.  The research report uncovers more insights on different age groups and their likes / dislikes of the varied benefits of loyalty programs and some interesting findings on which communication channels they prefer.

Personalised email, for example, is favoured far more by consumers aged 45+ as compared to younger consumers, who surprisingly think personalised letters are very appealing (consumers under 25). Text message or SMS is considered to be a good option by under 35s. Twenty eight per cent of 25 to 34-year-olds agree.

Similarly, Facebook alerts and updates are far more appealing to younger consumers (16% of consumers under 24) as they are more open to engaging in a variety of platforms, whereas consumers over 45 years have a distinct preference for email.

Adam Posner is CEO of Directivity, a strategic marketing company, who together with digital agency Citrus, commissioned Australia’s first rsearch study into what consumers really think about the loyalty programs they belong to.

 

The research report ‘For love or money: 2013 Consumer Study into Australian Loyalty Programs’ is available at http://www.theloyaltypoint.com.au or at ADMA Knowledge Lab website:

Read the report_3

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s