With 68% actively using between one and four loyalty cards, and 18% using between five and ten, a key consideration when developing a loyalty and retention scheme is ensuring that it not only offers relevant rewards and incentives to customers, but that it is also delivered in a way that cuts through the crowd.
Supermarket loyalty cards were revealed as the most widely used by respondents (71%), followed by hair and beauty (36%), coffee shop (28%), restaurant (19%), fashion (17%), entertainment (11%) and travel and leisure (10%).
With such high loyalty card usage levels, it’s clear these schemes offer brands the opportunity to really nurture the relationships they have with their customers, but are they missing the mark with the rewards they are providing in exchange for customer loyalty?
More than a quarter of consumers across all sectors (28%) said not feeling valued and a lack of or poor reward scheme was a key driver for switching brands or suppliers, suggesting that the rewards brands are currently offering are failing to encourage loyalty and need reinvigorating with desirable offers and experiences if they are to meet customer expectations.
With or without a loyalty card scheme in place, to have the desired effect of customer retention, it’s essential the rewards that brands provide are not only sought-after by their customer base, but are perceived to be valuable enough to justify keeping their business with you.
When we asked consumers how they would like to have their loyalty rewarded across all sectors, they identified vouchers from their preferred supermarket (53%) as the option they felt offered the best value for staying loyal, with restaurant discounts (24%) and cinema discounts or tickets (19%) identified as the next preferred options.
In a world where it costs on average five times as much to attract a new customer than it does to retain an existing one, offering rewards that add real and regular value to the lives of your customers is perhaps the most effective solution for ensuring sustained customer interaction and engagement with your brand.
A ‘one size fits all’ approach will however no longer suffice; consumers are increasingly demanding a one-to-one, personalised service that slots seamlessly into their varying daily lifestyles.
As such, if brands are to develop successful loyalty and rewards programmes, they should spend their budget wisely and invest in a strategy that allows them to gain a deep understanding of customer behaviour and engagement to inform and shape future offerings. Failing to do so will foster loyalty cards or schemes that don’t align with the rapidly evolving demands of customers, and ultimately impact the bottom line.
One factor frequently overlooked when developing loyalty and rewards strategies is understanding exactly what consumers want from them. The best way to achieve this is through utilising data capture technology to identify trends and habits of consumers, which allows the constant development and refinement of services to provide innovative, bespoke loyalty programmes that promote long-term value and increase retention.
This is why ELLO Media has an in-house team of business analysts using our proprietary technology and products to support clients in providing detailed insight into their customers, and their reward habits, to create the most effective and connected engagement experiences possible.
Are you interested in developing a loyalty scheme that is in line with the demands of your customers? Get in touch to discover how ELLO Media could help, or download our Understanding Customer Expectations of Brand Loyalty Programmes report to learn more.