• by Jack Loechner , Staff Writer @mp_research, February 22, 2017

According to a new report, “Seeing Beyond the Loyalty Illusion,” from Accenture Strategy, by Jim Tierney, customer loyalty programs aren’t working like they used to, and marketers need to take a fresh look at their respective strategies to ensure success.

The report gauges the experiences and attitudes of 25,426 consumers around the world, including 2,532 U.S. consumers, finding that 54% of U.S. consumers have switched providers in the past year, and 18% confirm their expectations around brand loyalty have completely changed. The report also identified five new factors influencing loyalty today.

Robert Wollan, senior managing director, global lead of Advanced Customer Strategy at Accenture Strategy, says “… new ‘languages of loyalty’ have emerged, driven by brands experimenting with creative digital experiences, which have changed the dynamics of customer loyalty today… traditional ‘low price’ and ‘reliable service’ mechanics are no longer as effective at driving loyalty…”

With 66% of U.S. consumers spending more with the brands they love, organizations that stick to traditional approaches and don’t explore the new drivers influencing loyalty, risk draining profitability and pushing customers away, says the report.

According to the report, there are five languages of loyalty which are driving customer relationships in the digital age, particularly among U.S. millennials:

• Tokens of affection – 59% of U.S. consumers feel loyal to brands that present them with small tokens of affection, such as personalized discounts, gift cards and special offers to reward their loyalty.
• Get to know me – 41% of U.S. consumers are loyal to brands that offer them the opportunity to personalize products; 51% are loyal to brands that interact with them through their preferred channels of communication; 81% feel loyal to brands that are there when they need them, but otherwise, leave them alone; and, 85% are loyal to brands that safeguard and protect the privacy of their personal information
• Thrillseeker – 44% of U.S. consumers are loyal to brands that actively engage them to help design or co-create products or services; 41% are loyal to organizations that present them with new experiences, products or services; 33% are loyal to brands that engage them in ‘multi-sensory’ experiences, using new technologies
• If you like it, I like it – 23% of U.S. consumers are loyal to brands that partner with celebrities, and another 23% feel loyal to organizations that partner with social influencers; 42% are loyal to brands that their family and friends do business with; 37% show loyalty to brands that actively support shared causes
• Hook me up – 39% of U.S. consumers feel loyal to brands that connect them with other providers; 51% are loyal to brands that keep them on the cutting edge by consistently offering the latest products and services.

Evan Magliocca, brand marketing manager for Baesman Insights & Marketing, concludes that “… instead of clumsy, one-size-fits-all programs, members expect an agile, personalized program that worries more about the needs of the customer than it does the program’s liability rate…  Loyalty programs need to utilize a scalpel, not a sledgehammer, to nurture and build members…” 

For additional information from the report, please visit here.