MELBOURNE: Members of loyalty programs are likely to shop more often and spend more if they are able to share the rewards with friends and family, a new report has found.
Share the Love: 2014 consumer study into Australian loyalty programs, from strategic marketing company Directivity and digital agency Citrus, used a national online panel of more than 1,000 consumers aged over 16 who were members of at least one loyalty program, to explore their relationships with such programs.
Two thirds (65%) indicated they would like to be able to share the benefits they earned with family, friends or a charity.
And if they could share, fully 70% said they would shop more often and almost half (45%) said they would spend more.
Adam Posner, CEO of Directivity, said there was a strong opportunity for loyalty marketers to differentiate their programs, given not many programs offered this feature.
The report also revealed a significant proportion of respondents (26%) had left a loyalty program in recent years, citing the speed of earning and redeeming points and unappealing offers as the key reasons for quitting.
Peter Noble, CEO of Cirtus noted that a loyalty program was a key touchpoint for a brand and was blunt about the impact of people leaving on this scale: "Make no mistake – if members have defected from a program they've defected from the brand," he declared.
Most respondents (57%) preferred using a traditional card to an app, partly for status reasons according to Noble. "Pulling out a card especially if it's a status based program like a Black Amex or Myer Gold card is not the same as using an app," he said. But given that almost a third of those surveyed wanted both options, Noble recommended that marketers let members choose their program interaction.
The issue of privacy provoked a mixed reaction, with 73% happy to have their buying behaviour monitored in return for personalised offers. But more than half (52%) were reluctant to have their personal details shared with other organisations.
A final aspect of sharing considered by the study was what happened to accumulated points in the event of death. Some 65% of respondents wanted to leave their rewards or points to someone else when they died.
When US loyalty marketing specialist Colloquy looked at this area last year, it concluded that offering free points transfers was the sort of gesture that demonstrated empathy and could promote long-term retention and engagement with the beneficiaries.
Data sourced from Directivity, Citrus; additional content by Warc staff