Warc Blog

Mixed picture for loyalty programmes

8 July 2013
CINCINNATI: Loyalty programme membership is rising in the US but declining in Canada, according to research from industry specialist Colloquy.

The Colloquy 2013 Loyalty Census noted that 90% of Canada's population was now enrolled in at least one loyalty scheme, but this figure was down from 94% in 2010. In terms of total numbers, there was a 1% dip to 119.97m members.

While the overall penetration of loyalty programmes was lower in the US, at 74% in 2012, membership was growing fast, up 26.7% since 2010.

The average number of programmes per household in Canada fell from 8.9 in 2010 to 8.2 in 2012. These totals indicated, said Colloquy, that consumers were consolidating memberships and tiring of schemes that failed to deliver on their promises.

It also pointed to the "deafening noise level" from social media, mobile communications and traditional advertising, all of which were competing for the same "limited consumer bandwidth".

Other possible factors included a growth in population levels driven by immigration, which has led to more local retailers serving particular demographics.

"Because such retailers tend to have well-established cultural and service relationships, they don't rely on loyalty programs to engage customers," the report observed.

The retail and financial categories had the largest participation rates in Canada, accounting for 46% and 27% of programme memberships respectively. The coalition programmes Air Miles and Aeroplan took a further 8% and 4% respectively, with the "other" classification making up the remaining 15%.

Digging further into the data reveals that the retail category had declined by 3.5% to 55.3m members overall, while financial services had expanded by 2.8% to 31.9m. Coalition memberships had also risen by 6% to 14.8m.

The "other" sector, which includes travel, gaming, dining and entertainment, slipped by 2.1% to 17.9m, despite the entertainment segment having recorded growth.

Colloquy suggested that Canada presented an opportunity for loyalty programmes worldwide to learn how best to address a mature marketplace and to lead in developing innovations and engagement.

Data sourced from Colloquy; additional content by Warc staff

 
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