Loyalty Program Membership Doesn’t Always Translate to Activity; Satisfaction Levels May Be to Blame

People continue to enroll in loyalty programs, but are active in fewer than half of them, according to a report [download page] by Bond Brand Loyalty. Among the 55,000 consumers surveyed, American respondents on average reported holding 14.8 memberships in loyalty programs, but were only active in 6.7 of them.

Part of the lackluster engagement with loyalty programs may be partially down to satisfaction. On average, just 44% of US consumers report being very satisfied with their program. This percentage is lower than last year’s figure of 47%. So what could reverse this?

The data in the report suggests that personalization could help, as only 2 in 10 (22%) loyalty scheme members claim they are very satisfied with the level of personalization seen from their programs. Bond Brand Loyalty’s report claims that when personalization is done well, there is a 6.4x lift in satisfaction levels. This shows that even with troves of customer data, loyalty schemes suffer from a similar conundrum faced by marketers more broadly – that personalization drives ROI, but few feel they are doing well enough.

Brands would do well also to target “resolute loyalists” – as these are consumers that tend to buy only from their favorite brands. As covered in earlier research, these resolute loyalists are also less price-driven, choosing to focus on quality of the products.

In terms of sectors, the area with the largest proportion of very satisfied members were movie loyalty schemes. At the bottom were hotel programs (37%), car rental (38%) and apparel (40%).

Other findings from the report include:

  • Only around one-third (32%) of members claim that their loyalty program makes their brand experience better.
  • 84% of members say they have made redemptions, with those that do so reporting higher satisfaction. Separate research has shown that cash back is the most rewarding way to claim redemptions.
  • More than half (53%) of loyalty members say they are interested in ‘game mechanics’ – that is, incentives to earn extra points or status levels.
  • Younger Millennials (those age 24-29) are slightly more likely to say they are very satisfied (44%) with loyalty programs than are Gen Z members (41%) age 18-23.

The full report can be downloaded here.

About the Data: Data is based on US respondents from a survey of more than 55,000 consumers across more than 20 marketers who rated 900 programs across 15+ industry sectors.

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