Table of Contents
Executive Summary
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- The issues
- Average number of loyalty accounts tops 10 memberships per consumer
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- Figure 1: Loyalty program participation (mean), by age, March 2016
- Loyalty programs still offering irrelevant rewards
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- Figure 2: Loyalty program frustrations, March 2016
- The relationship between the loyalty program and the brand
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- Figure 3: Attitudes toward retailer loyalty programs, by age, March 2016
- The opportunities
- Leverage the connection between loyalty program and brand
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- Figure 4: Attitudes toward retailer loyalty programs, March 2016
- Personalization in high demand
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- Figure 5: Top five desired loyalty program features, March 2016
- Increase the sophistication of targeted offers
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- Figure 6: Desired loyalty program features, by type of living area, March 2016
- What it means
The Market – What you need to know
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- Mobile payment will drive branded apps
- Average number of children in family households declining
Market Factors
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- Mobile payment will help to drive seamless loyalty interactions
- Fewer multi-child households could dampen loyalty revenue
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- Figure 7: Number of children per family household (mean), 2000-15
Key Players – What You Need to Know
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- Analytics increasingly drive loyalty
- Retailers redesigning for Plenti
- Opportunity to engage Baby Boomers in loyalty programs
- Loyalty programs shift to become digital services
What’s Working?
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- Brands integrate analytics into workplace culture
- Plenti drives value for consumers, retailers
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- Figure 8: Wellness+ with Plenti loyalty email marketing example, June 2016
What’s Struggling?
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- Baby Boomers: Underserved in loyalty marketing
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- Figure 9: Retail loyalty programs' impact, by generation, March 2016
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- Figure 10: Sears loyalty direct mail marketing example, May 2016
- Figure 11: GNC Loyalty direct mail marketing example, April 2016
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- Figure 12: Words Baby boomers associate with product quality, February 2016
- Lack of brand integration causes sales to falter
What’s Next?
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- The line between loyalty program and digital services continues to blur
- Greater focus on analytics to lead to more sophisticated personalization
- Synchrony Financial boosts user control and experience for loyalty interactions
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- Figure 13: How the next best offer app enables data-driven promotions, July 2016
The Consumer – What You Need to Know
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- Consumers hold more than 10 loyalty memberships
- Loyalty programs continue to impact shopping
- Loyalty programs are tied to brands
- Loyalty still challenged by irrelevant rewards
Retailer Loyalty Program Participation
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- Consumers now participate in more than 10 loyalty programs on average
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- Figure 14: Loyalty program participation (mean), March 2016
- Differentiation a greater challenge in targeting younger consumers
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- Figure 15: Loyalty program participation (mean), by age, March 2016
- Demographics with lower overall loyalty participation present opportunities for individual sectors
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- Figure 16: Loyalty program participation (mean), by age and household income, March 2016
- Consumers discuss how they use loyalty programs
Loyalty Programs’ Impact on Shopping Behavior
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- How loyalty programs influence shopping behavior
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- Figure 17: Retail loyalty programs’ impact (summary), March 2016
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- Figure 18: Retail loyalty programs’ impact on shopping, March 2016
- Loyalty fatigue increasing among 25-34s
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- Figure 19: Consumers’ desire for loyalty account management, April 2015-March 2016
- Heightened engagement among multi-child households
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- Figure 20: Loyalty programs’ impact on shopping, March 2016
- Brand loyalty impacts engagement among Blacks
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- Figure 21: Loyalty programs’ impact, by race, March 2016
Relationship Between Loyalty Programs and Retail Brands
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- Consumers expect loyalty programs from retailers
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- Figure 22: Attitudes toward retailer loyalty programs, March 2016
- Majority of young consumers relate loyalty program quality to retailers
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- Figure 23: Attitudes toward retailer loyalty programs, by age, March 2016
- Moms and dads more likely to connect loyalty program and brand
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- Figure 24: Attitudes toward retailer loyalty programs, parental status and gender, March 2016
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- Figure 25: Wells Fargo Loyalty direct mail marketing example
- Product-specific promotions resonate with Asians and Hispanics
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- Figure 26: Attitudes toward retailer loyalty programs, by race and Hispanic origin, March 2016
Attitudes toward Loyalty Programs
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- Irrelevant rewards remain a top consumer frustration
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- Figure 27: Loyalty program frustrations, March 2016
- Older consumers underserved by loyalty programs
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- Figure 28: Loyalty program frustrations, by age, March 2016
- Asian consumers feel it takes too long to earn rewards
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- Figure 29: Loyalty program frustrations, by race, March 2016
Participation in Select Retail Loyalty Programs
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- More than 40% of loyalty program participants engaged with Amazon Prime
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- Figure 30: Participation in specific loyalty programs, March 2016
- Lack of familiarity presents the biggest barrier for participation
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- Figure 31: Participation in specific loyalty programs, March 2016
- Plenti: Strong traction among women 35-54
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- Figure 32: Participation in specific loyalty programs, by gender and age, March 2016
Features that would Encourage Loyalty Program Participation
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- Personalization: The leading driver of loyalty program engagement
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- Figure 33: Top five desired loyalty program features, March 2016
- Social good and social media top of mind for urban loyalty consumers
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- Figure 34: Desired loyalty program features, by type of living area, March 2016
- Younger consumers opt for mobile interaction
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- Figure 35: Desired loyalty program features, by age, March 2016
- Consumers talk about their ideal loyalty programs
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Consumer survey data
- Consumer qualitative research
- Direct marketing creative
- Abbreviations and terms
- Abbreviations
Appendix – Market
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- Figure 36: Number of children per family household (mean), by family type, 2000-15
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