A new benchmarking survey by customer insight specialist GI Insight shows that, while 94% of consumers belong to at least one loyalty programme, just under half of scheme members on average are actually active users and just a quarter see companies effectively analysing their needs and sending them relevant offers.
Only 21% join catering schemes
The research, based on a survey of more than 1,000 UK consumers on their participation in loyalty programmes across various industry sectors, showed that supermarkets remain by far the most popular scheme providers with 79% of respondents saying they belong to at least one, whilst catering schemes lagged far behind with only 21% of consumers joining these.
While a better than average 48% of catering scheme members are active, a relatively poor 22% believe their data is used effectively and they are sent relevant offers.
Companies struggle to engage members
Andy Wood, GI Insights managing director, observes:” The results show that, while loyalty schemes have become pervasive marketing tools, too many companies operating them struggle to fully engage their members – and thus fully utilise the potential insight and gains to be made from better understanding customers.”
Loyalty Frequency: Who’s Tuning In?
The report, Loyalty Frequency: Who’s Tuning In? shows that many consumers belong to multiple programmes across different sectors. The findings on respondents belonging to at least one scheme reveal 47% actively participate on average, but providers are efficiently reading the needs and sending appropriate commercial messages to only 27% of members on average.
With active participation in loyalty schemes across sectors at roughly the 50% rate, the numbers were encouraging for programme operators in most sectors, as the majority now compete for use among consumers with multiple memberships. Multiple brand schemes run a very strong second to supermarkets, while petrol stations, chemist/ beauty/ health retailers, and banks all have well over 50% active members but still lag behind supermarkets by a considerable margin.
More women members
The research shows that women are more likely to be members of loyalty schemes than men (97% versus 93%), with programmes in the chemist/ beauty/ health, department store and fashion categories significantly more likely to attract female customers, while men gravitated to hotel and computer/ consumer electronics/ appliance schemes.
Age groups
The age group that leads scheme membership in the most sectors is the 25-34 demographic, but consumers aged 18-24 years lead the pack when it comes to membership in fun and trendy loyalty schemes – those centred on food, fashion and personal entertainment purchases. When it comes to active participation, on average 54% of the loyalty scheme members in the 25-44-year-old age range use them frequently – a greater proportion than all other demographics.
Use the data properly
Wood concludes: “These findings highlight how important it is to not just have a loyalty programme but to use the data properly to send appropriate offers and deals to customers. The sectors doing it best – supermarkets and multiple brand schemes – prove the effectiveness of these programmes, but others such as fashion and children’s and DIY/ home furnishings retailers are missing a trick.”
About GI Insight GI Insight specialises in database marketing and loyalty schemes, having created and managed more retail loyalty programmes than anyone else in the UK. The Leicester-based company offers a full range of database marketing services including consultancy, database design/build/host, data capture, analysis, segmentation, profiling, campaign execution and measurement, available as a whole or on a ‘pick and mix’ basis. The analysis and interpretation of your sales and customer data enables you to influence customer behaviour. This knowledge helps you to reliably increase profitability by:
- Getting more new customers (acquisition)
- Getting existing customers to:
- Spend more often
- Spend more per transaction
- Reducing Customer Attrition (retention)
- Move customer from low to high margin purchases
For more information click here
Wired Media are the technology partner of Hospitality & Catering News
Wired Media increase bookings, revenue and occupancy for hotels, luxury destinations and other hospitality clients – Find out more