Study: Brand loyalty programs fastest route to a millennial’s heart

 

Loyalty programs are proving valuable with consumers and are paying off in more ways than one.

That’s the feedback from Bond Brand Loyalty and its sixth annual loyalty report. The report was conducted in collaboration with Visa and is the largest of its kind, according to a news release.

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The report obtained responses from roughly 12,000 U.S. and 7,000 Canadian consumers on 58 different loyalty program dimensions including actual behavior changes as the result of such programs.

Related News: How Millennials are reshaping the retail industry

Major findings reveal consumer satisfaction with such programs remains steady — at the same 32 percent rate as last year — despite significant innovations. The study also found that although such programs are challenging to pull off, those who do it well not only cut operational costs, but also have substantial positive effects on customer behavior.

Other key findings include:

 

Re: Loyalty impact

Consumers belong to an average of 11.3 loyalty programs, but are active in only 7.3 programs

An increasing number of consumers modify brands they patronize to maximize points

66 percent of members are more likely to recommend brands with good loyalty programs

63 percent of consumers modify brand spending to maximize points

 

Re: Program satisfaction, brand alignment and rewards redemption

Program satisfaction is steady from last year

23 percent said their program fits very well with their brand expectations

 

Re: Rewards and redemption

They are key to satisfaction, yet more than a quarter of members have never redeemed anything

Rewards are important to retention, with non-redeemers twice as likely to defect

Credit card loyalty programs can benefit from instant retail and online points redemption

 

Re: Demographic differences

Millennials are 1.5 times more willing than boomers to pay a premium if they also earn loyalty points

44 percent of millennials don’t mind product recommendations based on purchase history, while only 30 percent of boomers do

Substantially more millennials value programs with special services compared with boomers

Related News: New Study Shows Millennials Prefer Short Mobile Videos, While Older Crowds Like Long-form

Re: Mobile is a largely missed strategic advantage

44 percent want to engage via mobile device

More than half don’t know if a mobile app exists to complement their loyalty program

Consumers are most interested in mobile to check points balances, read emails, find a store and redeem rewards.

Source: Retail Customer Experience


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