Brand loyalty continues to change as consumers say they want to personalize every element of their experience, from earning to redeeming rewards, even select their benefits and personalize how they earn points based on past purchases.
Merkle surveyed more than 1,500 consumers in 2019 to show how mindsets are shifting. The findings in the 2020 Loyalty Barometer Reportanalyzeswhat consumers expect from loyalty programs, how they prefer to earn points, and what drives emotions.
The responses came from U.S. residents, ages 18 to 65, allowing agency to segment the data into baby boomers, Gen X, Millennials, and Gen Y. None of those participating in the survey participate in programs managed for Merkle’s clients.
Interestingly, 85% would like to select the benefits and rewards they receive by personalizing their loyalty program based on their specific purchases and individual preferences, but the amount of personalization remains up for debate. Consumers are not comfortable with brands collecting excessive data about them. They prefer brands use the information specifically provided.
Consumers expects brands to recognize their loyalty and history to improve on their rewards experience, yet some are reluctant to share information.
Consumers are wary of allowing brands to use their location data, but 59% said they are comfortable allowing brands to use their purchase history. Some 53% accept brands using gender, while 42% cited self-selected profile preferences, 30% cited browsing history on a brand’s site, 29% cited current location, 25% cited address, and 21% cited income.
The one major dissatisfaction with loyalty programs cited by consumers is the time it takes to earn a reward. Many participate in rewards programs for the discounts and free stuff, but these days they believe it’s too difficult or takes too long to reap the rewards. A program like this can actually damage the consumer-brand relationship, according to the data.
In fact 45% said it takes too long to earn rewards, 34% said it’s too difficult to earn a reward, while 24% cite rewards as not valuable, and 23% said there are too many communications.
About 38% of the consumers participating in Merkle’s survey cite discounts as the main reason to participate in loyalty or rewards programs, followed by free stuff at 30%, members-only benefits at 11%, access to exclusive rewards at 7%, enhanced experiences at 5%, and stay connected at 4%.
Consumer will engage with a brand beyond the purchase if they can earn points faster. The top six include participating in surveys at 71%, answering polls and questions at 65%, online reviews at 43%, downloading an app at 42%, and viewing brand content like videos and articles at 37%.
Some 59% of consumers said the most important way a brand can interact with them by surprising and thanking them for being loyal customers. Customers want to be acknowledged and feel appreciated for their loyalty. Brand need to show consumers they appreciate them.
About 41% of consumers indicated that this is one of the most important ways a brand can interact with them, and this is has increased since last year. Welcoming consumers when they visit the brand’s website also works.