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Can a Loyalty Scheme Really Differentiate Your Business?
This year's Logic Group / Ipsos MORI Customer Loyalty Report delivered some interesting conclusions. For those of us working in the loyalty industry there was plenty of standard fare that we are all fully aware of reflecting a maturing public response to an accepted and familiar marketing tool - the Loyalty Scheme.
However, Ipsos MORI commented on some interesting pointers that loyalty professionals should take note of. First there was the observation that after the third year of conducting this research, the public are more familiar than ever with the concept of the loyalty scheme and their existence represents a natural way of transacting in certain consumer markets, in particular banking, retail and mobile telecommunications. This research of British consumer opinion made clear that most customers feel loyal to one or more brand or organisation operating in these sectors. This is interesting but as ever in life, we think that "the devil is in the detail."
The report highlights the issue of what Ipsos MORI call "polygamous loyalty" - so called loyal customers who are members of more than one scheme and therefore are not always entirely faithful to brands in these sectors. If we look at the supermarket sector in the UK, even Waitrose threw in the towel last year announcing a loyalty scheme (we say initiative as there is little evidence of a commitment to a consistent reward mechanism). It appears that supermarkets have, in the main, trained consumers to expect and demand membership of a loyalty scheme - it's something for nothing and who can avoid having to shop for groceries? Isn't it stupid not to join? If so, why wouldn't you join more than one, just in case you get caught "flirting with the competition?" For the mobile shopper who is able to cross-shop the category having a back-up loyalty card makes sense.
Ipsos MORI make the point that we are living in a mature landscape where they see consumers who are entirely comfortable with the loyalty schemes - earning points in return for spending with a particular brand/store. Whilst making the observation that shoppers may have some concerns about letting big companies use/abuse their personal data, their survey found this not to be a problem where the consumer was convinced of a "two-way" relationship", ie, the consumer gets something in return.
For us the interesting conclusion from these headline observations is the possibility that consumers see loyalty schemes as all being very similar or the same. The very tool that supermarkets, airlines and banks invest millions in to differentiate themselves is starting to make them look even more similar - now that's ironic!
