Immediate redemptions are most popular loyalty driver


Instant redemption opportunities, such as cash back at the checkout, are most likely to entice consumers to choose one loyalty programme over another.

That’s one of the findings of new research from Mintel in the US, which explores how shoppers choose loyalty programmes. It found almost half (47%) of consumers favoured immediate rewards.

Meanwhile, consumers are somewhat disenchanted with airline miles — only 7% of those surveyed say a programme that offers airline miles would be an effective incentive to choose one over another. These consumers tend to be in the higher income groups.

“In any sector that utilises loyalty marketing, loyalty programmes are fast becoming a very important part of the relationship with the customer,” said Susan Menke, VP, behavioral economist at Mintel Comperemedia. “It seems now is the time to focus on adding or improving loyalty programmes to help engage customers and maintain and even grow their relationship with the post-recession consumer.”

Once they have chosen a rewards programme, 61% of respondents say lower overall costs for merchandise they would have purchased anyway is an important attribute of a loyalty or rewards programme. Getting merchandise or taking trips they wouldn’t normally be able to take was deemed important by 25% of consumers.

“Loyalty programme members are quite often the most profitable customers for marketers, and those who use loyalty programmes tend to be more brand-loyal,” said Menke. “By personalising redemption opportunities and offering easy to redeem savings, companies can lure and retain more customers.”

Twenty four per cent of those surveyed say they actively examine credit card offers in order to compare rewards programmes, while 10% have switched to a different primary credit card in the past because of a better rewards programme.