UK shoppers ditch traditional loyalty cards for phones, new CloudZync study reveals

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Following the surge in smartphone usage across the country, consumers now have access to more loyalty schemes on mobile devices than they do in their physical wallets, reveals a study by CloudZync.

The research, which polled 2000 consumers, highlights that while our wallets are still bulging with an average of four traditional loyalty cards, people now have access to six loyalty schemes on their phones.

Tech-savvy electrical retailers are leading the mobile revolution as almost two thirds (62%) of consumers say they access at least one loyalty scheme for electrical stores over their phones, followed by hairdressers (43%) and clothes stores (38%).

When looking at traditional loyalty card usage, it is no surprise supermarkets lead the way, as 92% of people claim they regularly use at least one loyalty card for a grocery store, followed by coffee shops (51%) and pharmacies (51%) [See Fig. 1]. However, these leaders in traditional loyalty schemes are lagging behind when it comes to mobile, as just a third (36%) of people access supermarket schemes through the device in their pocket, dropping to 33% for coffee shops and 27% for pharmacies.

The study was commissioned by CloudZync, creator of smart mobile wallet Zwallet, to provide retailers with insight into consumer attitudes towards loyalty schemes. The research also found loyalty card users have on average £83 worth of redeemable points across their loyalty cards at any point in time, and UK shoppers cashed in on over £4bn worth of loyalty card points over the past year. But despite this, £150m points remained unclaimed as consumers simply didn’t know how to redeem them. The main reasons why shoppers aren’t claiming freebies or discounts is because they feel it takes too long to start earning benefits from loyalty schemes (27%), followed by forgetting to add on points because they don’t carry their cards in their wallets (18%), and 14% of shoppers say that they don’t remember to add on their points even when paying in-store.

The main issue stopping people from signing up to loyalty schemes seems to be their already bulging wallets, with a third (33%) of consumers saying that the main reason why they don’t register is because they already have too many cards in their wallets, and 14% don’t like having to send off paperwork to join the loyalty scheme.

Andrew Smith, co-founder and CTO of CloudZync, said: “We are a nation of bargain hunters, and the research shows that Brits are cashing in on loyalty schemes across the board. But whereas we have previously been limited by the number of cards we can fit into our wallets, the boom in mobile devices means that we can now access even more loyalty programmes via our phones. While it’s clear that traditional cards are still doing well in many sectors, retailers that don’t embrace smartphones and tablets as part of their loyalty schemes risk being left behind by those businesses that see the opportunity these devices offer to engage consumers in new ways. Mobile gives retailers a platform through which they can build more personal relationships with customers while providing them with access to offers and promotions in a more convenient way, so they never miss out.”

Fig. 1 – Consumers that regularly use one or more physical loyalty cards or access loyalty schemes via a mobile device, by retail sector (Source: OnePoll research commissioned by CloudZync)

Loyalty cards (1 or more)

Rank

Mobile schemes (1 or more)

Retail sector

%

Retail sector

%

Supermarkets

92%

1

Electrical stores

62%

Coffee shops

51%

2

Hairdressers

43%

Pharmacies

51%

3

Clothes shops

38%

Cafes & restaurants

24%

4

Cafes & restaurants

37%

DIY & homeware stores

23%

5

Supermarkets

36%

Clothes shops

23%

6

Coffee shops

33%

Hairdressers

16%

7

DIY & homeware stores

32%

Electrical stores

12%

8

Pharmacies

27%

The research follows the launch of CloudZync’s mobile wallet, Zwallet, which allows people to integrate all of their existing loyalty cards straight into one app, redeem points, gain exclusive cashback offers, and pay for items straight from their phones.  CloudZync’s Zwallet launched in Greater London in July 2013 and already has 280 merchants on board. Consumers can download the app for free from theApple App Store and Windows Phone Store, and merchants can download the Zwallet Terminal app to start using the service from the Apple App Store and Windows Phone Store.