Table of Contents
Executive Summary
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- Overview
- The market
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- Figure 1: Actions taken to earn loyalty rewards, May 2014
- Key players
- The consumer
- Loyalty programs key factor in determining where consumers shop
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- Figure 2: Factors influencing where consumers shop, May 2014
- Action taken correlates to household size
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- Figure 3: Action taken to earn loyalty rewards - any, by household size, May 2014
- More than four in 10 report frustration with loyalty programs
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- Figure 4: Frustrations with loyalty programs, May 2014
- What we think
Issues and Insights
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- Does loyalty program participation translate to customer loyalty?
- The issues
- The implications
- Central frustrations with loyalty programs
- The issues
- The implications
- Should retailers emphasize personalization or privacy?
- The issues
- The implications
Trend Applications
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- Trend: Many Mes
- Trend: Return to the Experts
- Trend: Why Buy
Market Drivers
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- Key points
- Consumer spending trending upward since the recession
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- Figure 5: Consumer confidence and unemployment, 2000-14
- Online shopping forecast to grow
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- Figure 6: US total online shopping sales, at current prices, 2009-19
- Mobile apps improve the convenience of loyalty programs
- Credit cards provide universal rewards to consumers
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- Figure 7: Rewards/affiliations with respondents' credit cards, by age, November 2012-December 2013
Leading Companies
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- Key points
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- Figure 8: Number of mentions of leading retailers May 2014
- CVS
- Walgreens
- Kroger
- Target
- Amazon
- Best Buy
- Starbucks
- Kohl’s
- Walmart
- Safeway
Innovations and Innovators
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- The North Face offers experiential awards
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- Figure 9: The North Face’s VIPeak rewards catalog, April 2014
- Delicious Karma translates loyalty into charitable donations
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- Figure 10: Delicious Karma’s “Karma Challenge” page, April 2014
- Birdback
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- Figure 11: Birdback homepage, April 2014
- American Express lets loyalty members use points for Uber rides
Marketing Strategies
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- Loyalty programs that emphasize cost savings
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- Figure 12: Pier 1 Imports, fresh finds for your spring table, April 2014
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- Figure 13: Pier 1 Imports, make it an early spring with our candles, lanterns, and fragrances, February 2014
- Figure 14: The Children’s place, loyalty member email campaign, April 2014
- Loyalty programs that emphasize exclusivity
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- Figure 15: Banana Republic, cardmembers: add some color with exclusive savings!, January 2014
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- Figure 16: Sephora, VIB 15% off: early access event, April 2014
- Loyalty programs with experiential rewards
Social Media
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- Key points
- Market overview
- Key social media metrics
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- Figure 17: Key performance indicators, selected retailer loyalty programs, June 16, 2013-June 15, 2014
- Brand usage and awareness
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- Figure 18: Brand usage and awareness of retailer loyalty programs, May 2014
- Interaction with brands
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- Figure 19: Interaction with retailer loyalty programs, May 2014
- Leading online campaigns
- Rewarding healthy, active lifestyles
- Exclusive partnerships for limited-edition offers
- Loyalty programs that give to charity
- Social media promotion rewarded with extra perks
- What we think
- Online conversations
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- Figure 20: Selected Starbucks’ My Starbucks Rewards Twitter mentions, November 2013
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- Figure 21: Online mentions, selected retailer loyalty programs, June 16, 2013-June 15, 2014
- Where are people talking about retailer loyalty programs?
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- Figure 22: Selected Walgreens Balance Rewards Twitter mentions, June 2014
- Figure 23: Mentions by page type, selected retailer loyalty programs, June 16, 2013-June 15, 2014
- What are people talking about online?
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- Figure 24: Mentions by topic of conversation, selected retailer loyalty programs, June 16, 2013-June 15, 2014
Retailer Loyalty Program Participation
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- Key points
- Loyalty program participation is on the rise
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- Figure 25: Participation in retailer loyalty programs, June 2013 - May 2014
- Young men and women participate in the largest number of programs
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- Figure 26: Participation in retailer loyalty programs (mean), by gender and age, May 2014
- Parents more likely to participate in loyalty programs than those without children
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- Figure 27: Participation in retailer loyalty programs (mean), by gender and parents with children in household, May 2014
- Participation across retail sectors trends upward with household income
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- Figure 28: Participation in retail loyalty programs, by household income, May 2014
Shopping Motivations: Where Loyalty Programs Fit
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- Key points
- Top motivations for engaging with a business
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- Figure 29: Respondent opinions about shopping, by age, November 2012-December 2013
- Nearly four in 10 consumers prefer stores with loyalty programs
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- Figure 30: Factors that influence where consumers shop, by gender and age, May 2014
The Impact of Loyalty Programs on Shopping Behavior
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- Key points
- More than half of respondents took action to earn loyalty rewards
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- Figure 31: Impact of loyalty programs on shopping behavior, by demographics
- Young men and women more likely to spend more to earn rewards
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- Figure 32: Impact of loyalty programs on shopping behavior, by gender and age, May 2014
- Moms and dads show higher engagement with loyalty programs than nonparents
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- Figure 33: Impact of loyalty programs on shopping behavior, by gender and parents with children in household, May 2014
- Engagement with loyalty programs trends upward with household size
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- Figure 34: Impact of loyalty programs on shopping behavior, by household size, May 2014
- More than four in 10 consumers from lower-income households alter shopping behavior to earn rewards
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- Figure 35: Impact of loyalty programs on shopping behavior, by household income, May 2014
Perceptions Regarding Customer Loyalty Programs and Sources of Frustration
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- Key points
- Most common loyalty frustrations
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- Figure 36: Preferences and frustrations regarding loyalty programs, May 2014
- Types of loyalty programs consumers prefer
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- Figure 37: Preferences and frustrations regarding loyalty programs, by gender and age, May 2014
- Dads express frustration with redeeming rewards
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- Figure 38: Preferences and frustrations regarding loyalty programs, by gender and parents with children in household, May 2014
Loyalty Incentives: Importance of Reward Types
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- Key points
- Free products, storewide discounts, and store credit with purchases top loyalty program incentives
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- Figure 39: Importance of retailer loyalty program features, by gender and age, May 2014
- High-priority incentives for subscription-based programs
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- Figure 40: Importance of features for subscription-based loyalty programs, May 2014
- Younger consumers more receptive to subscription-based loyalty programs
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- Figure 41: Importance of incentives in subscription-based loyalty programs, by gender and age, May 2014
Consumers’ Preferred Mediums and Frequency of Promotional Communication
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- Key points
- How much do consumers want to interact with businesses?
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- Figure 42: Preferred frequency and medium of promotional communication, May 2014
- Young consumers open to frequent promotional communication
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- Figure 43: Preferences regarding promotional communication – any high frequency, by gender and age, May 2014
- More than one third of larger households are receptive to frequent promotions on social media
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- Figure 44: Preferences regarding promotional communication – any high frequency, by household size, May 2014
Race and Hispanic Origin
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- Key points
- Asians participate in the largest variety of loyalty programs
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- Figure 45: Participation in retailer loyalty programs, by race/Hispanic origin, May 2014
- Half of Asians ask others for advice before making a purchase
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- Figure 46: Respondent shopping behaviors, by race/Hispanic origin, November 2012-December 2013
- Hispanics and Asians are the most likely to prefer frequent communication
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- Figure 47: Preferences regarding promotional communication – any high frequency, by race/Hispanic origin, May 2014
- Blacks show receptiveness to advertising
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- Figure 48: Respondent general attitudes about the media, by race/Hispanic origin, November 2012-December 2013
Consumer Segmentation
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- Key points
- Consumer segmentation by promotional communication frequency
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- Figure 49: Loyalty program groups, by gender and age, May 2014
- Influence of communication preferences on loyalty participation
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- Figure 50: Impact of loyalty programs on shopping behavior, by loyalty programs groups, May 2014
- Consumers who prefer frequent brand communication show greater interest in diverse loyalty programs
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- Figure 51: Importance of loyalty rewards, by loyalty programs groups
- Consumers who prefer limited promotional communication are the most price sensitive
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- Figure 52: Factors that influence where consumers shop, by loyalty programs groups, May 2014
- Communication preferences and loyalty program frustrations
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- Figure 53: Preferences and frustrations regarding loyalty programs by loyalty programs groups, May 2014
Appendix – Loyalty Program Members
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- Overview
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- Figure 54: Total US loyalty program memberships and active memberships, 2006-12
Appendix – Other Useful Consumer Tables
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- Participation in retailer loyalty programs
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- Figure 55: Participation in retailer loyalty programs, by gender and age, May 2014
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- Figure 56: Participation in retailer loyalty programs, by gender and parents with children in household, May 2014
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- Figure 57: Participation in retailer loyalty programs, by loyalty programs groups, May 2014
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- Figure 58: Participation in retailer loyalty programs (mean), by household income, May 2014
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- Figure 59: Participation in retailer loyalty programs (mean), by household size, May 2014
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- Figure 60: Repertoire of participation in retailer loyalty programs, by gender and age, May 2014
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- Figure 61: Repertoire of participation in retailer loyalty programs, by gender and parents with children in household, May 2014
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- Figure 62: Participation in retailer loyalty programs (mean), by race/Hispanic origin, May 2014
- Importance of loyalty rewards by type
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- Figure 63: Importance of loyalty rewards, by race and Hispanic origin, May 2014
- Consumer shopping motivations and behaviors
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- Figure 64: Respondent opinions about shopping, by gender and age, November 2012-December 2013
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- Figure 65: Respondent opinions about shopping, by household income, November 2012-December 2013
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- Figure 66: Respondent shopping behaviors, by age, November 2012-December 2013
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- Figure 67: Factors that influence where consumers shop, by household income, May 2014
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- Figure 68: Factors that influence where consumers shop, by household size, May 2014
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- Figure 69: Factors that influence where consumers shop, by gender and parents with children in household, May 2014
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- Figure 70: Respondent opinions about shopping, by race/Hispanic origin, November 2012-December 2013
- Sources of product information
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- Figure 71: Sources of product information during shopping, by age, November 2012-December 2013
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- Figure 72: Sources of product information during shopping, by race/Hispanic origin, November 2012-December 2013
- Participation in credit/debit card rewards programs
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- Figure 73: Respondent credit card ownership, by age, November 2012-December 2013
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- Figure 74: Rewards/affiliations with respondents' credit cards, by household income, November 2012-December 2013
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- Figure 75: Perceptions regarding retail loyalty programs by actions taken to earn rewards
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- Figure 76: Rewards/affiliations with respondents' credit cards, by gender and age, November 2012-December 2013
- Preferences regarding promotional communication
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- Figure 77: Preferences regarding promotional communication – any high frequency, by gender and parents with children in household, May 2014
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- Figure 78: Preferences regarding promotional communication – any usage, by gender and age, May 2014
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- Figure 79: Preferences regarding promotional communication – any usage, by loyalty programs groups, May 2014
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- Figure 80: Loyalty program groups, by household income, May 2014
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- Figure 81: Loyalty program groups, by race/Hispanic origin, May 2014
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- Figure 82: Loyalty program groups, by household size, May 2014
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- Figure 83: Loyalty program groups, by gender and parents with children in household, May 2014
- Perceptions regarding advertising
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- Figure 84: general attitudes about the media, by gender and age, November 2012-December 2013
Appendix – Social Media
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- Online conversations
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- Figure 85: Online mentions, selected retailer loyalty programs, June 16, 2013-June 15, 2014
- Brand analysis
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- Figure 86: Starbucks’ My Starbucks Rewards key social media indicators, June 2014
- Figure 87: Best Buy’s My Best Buy key social media indicators, June 2014
- Figure 88: CVS ExtraCare Rewards Program key social media indicators, June 2014
- Figure 89: Walgreens Balance Rewards key social media indicators, June 2014
- Figure 90: Kroger Rewards key social media indicators, June 2014
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- Figure 91: Safeway Rewards Points key social media indicators, June 2014
- Brand usage or awareness
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- Figure 92: Brand usage or awareness, May 2014
- Figure 93: Walgreens Balance Rewards usage or awareness, by demographics, May 2014
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- Figure 94: CVS ExtraCare Rewards Program usage or awareness, by demographics, May 2014
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- Figure 95: Kroger Rewards usage or awareness, by demographics, May 2014
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- Figure 96: Safeway Reward Points usage or awareness, by demographics, May 2014
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- Figure 97: Best Buy’s My Best Buy usage or awareness, by demographics, May 2014
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- Figure 98: Starbucks’ My Starbucks Rewards usage or awareness, by demographics, May 2014
- Activities done
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- Figure 99: Activities done, May 2014
- Figure 100: Walgreens Balance Rewards – activities done – I have looked up/talked about this brand online on social media, by demographics, May 2014
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- Figure 101: Walgreens Balance Rewards – activities done – I have contacted/interacted with the brand online on social media to, by demographics, May 2014
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- Figure 102: Walgreens Balance Rewards – activities done – I follow/like the brand on social media because, by demographics, May 2014
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- Figure 103: Walgreens Balance Rewards – activities done – I have researched the brand on social media to, by demographics, May 2014
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- Figure 104: CVS ExtraCare Rewards Program – activities done – I have looked up/talked about this brand online on social media, by demographics, May 2014
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- Figure 105: CVS ExtraCare Rewards Program – activities done – I have contacted/interacted with the brand online on social media to, by demographics, May 2014
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- Figure 106: CVS ExtraCare Rewards Program – activities done – I follow/like the brand on social media because, by demographics, May 2014
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- Figure 107: CVS ExtraCare Rewards Program – activities done – I have researched the brand on social media to, by demographics, May 2014
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- Figure 108: Kroger Rewards – activities done – I have looked up/talked about this brand online on social media, by demographics, May 2014
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- Figure 109: Kroger Rewards – activities done – I have contacted/interacted with the brand online on social media to, by demographics, May 2014
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- Figure 110: Kroger Rewards – activities done – I have researched the brand on social media to, by demographics, May 2014
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- Figure 111: Safeway Reward Points – activities done – I have looked up/talked about this brand online on social media, by demographics, May 2014
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- Figure 112: Safeway Reward Points – activities done – I have contacted/interacted with the brand online on social media to, by demographics, May 2014
- Figure 113: Safeway Reward Points – activities done – I have researched the brand on social media to, by demographics, May 2014
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- Figure 114: Best Buy’s My Best Buy – activities done – I have looked up/talked about this brand online on social media, by demographics, May 2014
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- Figure 115: Best Buy’s My Best Buy – activities done – I have contacted/interacted with the brand online on social media to, by demographics, May 2014
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- Figure 116: Best Buy’s My Best Buy – activities done – I follow/like the brand on social media because, by demographics, May 2014
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- Figure 117: Best Buy’s My Best Buy – activities done – I have researched the brand on social media to, by demographics, May 2014
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- Figure 118: Starbucks’ My Starbucks Rewards – activities done – I have looked up/talked about this brand online on social media, by demographics, May 2014
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- Figure 119: Starbucks’ My Starbucks Rewards – activities done – I have contacted/interacted with the brand online on social media to, by demographics, May 2014
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- Figure 120: Starbucks’ My Starbucks Rewards – activities done – I follow/like the brand on social media because, by demographics, May 2014
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- Figure 121: Starbucks’ My Starbucks Rewards – activities done – I have researched the brand on social media to, by demographics, May 2014
Appendix – Trade Associations
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