Saturday, April 13, 2024

Loyalty program use on the rise

Almost all surveyed Australians (95%) are members of one or more loyalty programs, according to new research by Pureprofile and The Retail Doctor Group.

83% of respondents said they are loyal to their preferred retailers, with 18% reporting increased loyalty program usage over the past year.

Close to half of those surveyed (45%) said that a loyalty program would make them visit a retailer more often, and 27% said a program would encourage them to spend more at said retailer.

“Australia currently finds itself in a unique economic situation and it’s interesting to see how consumers are responding,” says The Retail Doctor Group COO Anastasia Lloyd-Wallis.

“The research has uncovered that loyalty programs weigh heavily when it comes to purchasing behaviour but that consumers have demands when it comes to these programs. They want personalisation, systems have to be easy to use, and they want to see their loyalty rewarded quicker – in fact, access to special discounts was the most important consumer consideration with these programs.

“It’s also important that loyalty programs are not a one-size-fits-all solution to consumer behaviour. The effect of programs decreases with age, with 70% of gen Z and millennials reporting being influenced, but only 35% of those aged 65-plus reporting the same.”

Reasons for loyalty and disloyalty

The top reason for loyalty across the fashion (77%), homewares (63%), and takeaway food (41%) categories was because consumers liked the look and feel of a brand or a retailer.

However, with the grocery category, which was the category that reported the highest levels of loyalty, 60% stayed loyal purely because they were a member of a loyalty program.

Conversely, the top reason for disloyalty across the fashion (51%) and homewares (54%) categories was because consumers followed a sale.

With takeaway food, 51% of consumers were keen to try something new, while 63% sought the cheapest option for groceries.

Favourites

The research revealed that Australia’s favourite loyalty programs are Everyday Rewards, Flybuys, McDonald’s MyMacca’s Rewards, Dan Murphys and Qantas Frequent Flyer.

“The list of Australia’s most popular loyalty programs lends real insight into the country’s priorities. Groceries are a clear and consistent focus, followed by affordable treats such as drive-through meals and larger ticket items such as travel,” says Pureprofile CEO Martin Filz.

“While loyalty programs are a key influencer when it comes to purchasing behaviour, consumers report that connection to a brand is the most important driver of loyalty, even more so than price. So, retailers need to think holistically about the customer experience from fantastic in-store experiences to personable staff interactions and frictionless online journeys. Every touch point is an opportunity to win or keep loyalty which is of paramount importance in the current environment.”

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