Loyalty schemes lack relevance and fail to keep up with generation Y, finds Grass Roots research

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A survey of over 2,700 UK consumers has revealed over half (56%) claim they are regularly offered irrelevant rewards or discounts. These findings come despite 50% of the respondents citing loyalty programmes as a factor when choosing who to buy from. The research, carried out by Grass Roots Group, customer engagement division, also revealed this disconnect between consumers and brands, resulted in over a quarter (27%) of people leaving a loyalty programme as a result.

With brands continuously looking to attract long-term, loyal customers, it is vital that they engage with consumers as individuals in the most specific and relevant ways. With nearly half of all 18-24 year olds surveyed (49%) citing offers and rewards as most important to them when buying from a brand and the over 65s valuing low prices over offers (86 per cent), it is clear that if brands are to appeal to a wide audience, they have to tailor the way they engage with them.

Understanding how consumers want to interact with a brand is also a key consideration. Nearly half (47%) of consumers questioned, admitted to occasionally failing to make best use of loyalty programmes because they forget to use their card/details.

Adam Goran, divisional director of customer engagement at Grass Roots Group, said: “To achieve the consumer Holy Grail – loyal advocates who like to shout about how good you are – brands must understand that their consumers are individuals, and they must be treated as such. With 41% of 18-24 year olds preferring to interact with loyalty programmes via their smartphones, compared to just 25% of the over 65s, demographic differences can have a huge impact upon a successful engagement strategy.

“With loyalty schemes proving to play a big part in the consumer decision making progress, it is imperative that brands make any loyalty schemes relevant and consumer friendly. If this is not done, or done incorrectly, consumers could switch allegiance to a competitor.”

The research was carried out by Grass Roots Group in September 2014 and surveyed 2,741 UK consumers about their views towards and experience of customer loyalty schemes.