• by Tanya Gazdik , February 14, 2011

While just about every company has a loyalty program, a few stand out in the crowd, according to Zócalo Group and M/A/R/C Research.

The rewards programs that received the highest Recommendation Index score, determined by the ratio of positive to negative comments, are Rite Aid, Borders and Chase.

Zócalo Group, a word-of-mouth and social media agency, looked at which stores, airlines, banks, restaurants and hotels stood out, including what factors trigger recommendation, purchase decision and loyalty.

The third installment of the Recommendation Index finds that consumers are most likely to recommend reward programs that offer everyday value. Although finance and travel programs have the highest membership of any reward programs, the most positively recommended programs by consumers are those in the retail space.

However, this does not discount the excitement that consumers generate around brands within the travel and finance sectors. Because programs in these areas offer larger, one-time, harder-to-achieve rewards, consumers simply recommend them on a less consistent basis.

Each year, billions of dollars are spent by marketers to establish and manage reward programs. While the average U.S. household has more than 14 reward or loyalty memberships, consumers tend to recommend reward programs based on their most recent experience earning or redeeming rewards.

"Marketers spend so much in this area that gaining insight into what really makes a program highly recommended can offer a huge advantage," says Paul M. Rand, president and CEO of Zócalo Group. "Consumers are very clear about what they value -- and recommend."

Words associated with the most favorable aspects of reward programs -- "actual rewards," "cash back," "free" and "discounts" -- led to positive recommendations. With retail often being attributed to "everyday" rewards, it makes sense that these words are used more often, Rand says.

"What this tells marketers of reward programs is that it becomes essential to find ways to actively build more everyday reward programs," Rand says.

Conversely, primary drivers of negative word of mouth and recommendation point to "problems with redemption," "lack of benefits" and "expiring points" -- all of which led to negative recommendations. These relate specifically back to the difficulty that consumers have in making use of the rewards they have spent time accruing.