The top barriers deterring consumers from joining loyalty programs are…
Deena M. Amato-McCoy
As consumers increasingly limit their loyalty program participation, retailers need to step up their game to attract and retain members.
Half of consumers are deterred from joining loyalty programs, according to “Loyalty in the Age of the Connected Consumer,” a study from Kobie Marketing.
According to data, consumers are most turned off by brands that ask for too much information or enrollment processes that take too long (26%). Almost one in four shoppers (22%) won't join if it takes too long to earn and redeem points.
Rather, 86% of consumers reported that they primarily join programs to collect and redeem points for rewards. Meanwhile, 36% said they join programs specifically to redeem points for discounts and prizes.
Format simplicity is the main factor that encourages consumers to join programs. Almost one in four (22%) said they would be most willing to join a loyalty swipe card program, 15% said they would most likely sign up for store credit cards, and 11% said they would most want to join a points-based mobile app program.
However, price is a driving force in the context of customer retention. More than a third (35%) of consumers ranked price as the most significant factor in whether they would return to a brand or shop elsewhere. This indicates there are more opportunities for brands to keep customers engaged if they offer free or discounted products as part of their programs to elevate the customer experience around the point of sale, the study revealed.
Other key findings from the report include:
• More than half (51%) of consumers are actively engaged with at least three or more loyalty programs. • Almost half (45%) of shoppers don't want technology that they perceive as invasive and annoying when shopping with a brand. • Two-thirds (66%) of consumers reported being most likely to make impulse purchases in-store. • Almost 90% of consumers said that their favorite brands are communicating with them the right amount.
"Consumers now have more options at their fingertips than ever, and they want products and services whenever, wherever and however they've come to expect them," said Dave Andreadakis, chief strategy officer at Kobie Marketing.
"While we found price to be a driving factor in consumers' decision to make repeat purchases, the customer experience is paramount before, during and after the point of sale,” he said. “With this in mind, marketers should focus on engaging early and often, delivering tiered rewards with earlier, smaller redemption opportunities and encouraging simple sign-ups in the beginning."