38% of millennials have left loyalty schemes due to a lack of personalisation or excessive generic contact.
Loyalty schemes have lost touch with the millennial generation, says Tim Mason, CEO of Eagle Eye Solutions at the company’s recent Loyalty Reload event. As consumers become increasingly shrewd, brand loyalty is becoming more elusive. Representatives from Eagle Eye, Weve, MediaCom, IGD and Casual Dining Group came together to discuss how loyalty is changing and how brands can adapt to the digitally-enabled consumer.
Me, Myself and I: Why personalisation gets you plus points
Customer data is providing a goldmine of information for marketers who can harness it to add context and personalise campaigns. Casual Dining Group said that there is no longer a need for blanket communications which assume everybody is the same. A successful campaign should recognise people as individuals. It’s important to recognise there is no catch-all strategy to secure loyalty, added Weve. This can mean using previous purchase information on location, the time of day and even the weather, all which can be used to deliver relevancy. Mediacom highlighted a simple but effective example with the ‘Share a Coke,’ campaign when Coke teamed up with 4OD, using only one piece of information to successfully drive engagement.
Personalisation will become ever more important as the millennial generation mature to become the major spending power. Eagle Eye’s research found that 18 to 24 year-olds were the most frustrated about receiving blanket communication from brands, listing it as the number one reason for leaving a loyalty scheme (24%). Meanwhile, this, combined with a lack of personalised rewards, accounted for why 38% of 18-24 year- olds left a loyalty program.
Desire for digital
Today, we operate with a digital filter which improves the utility of the world, says Tim Mason; largely, the impact of mobile. Mobile penetration is prolific, at 71% in the UK, and according to Weve, consumers spend an average of 552 hours per year on their smartphone. Meanwhile, consumers are increasingly using their smartphone for savvy shopping. Weve points to the boom in ‘showrooming’ – the growing trend of customers using their phone to check online for a better deal whilst in store.
Smart marketers are already making use of the ubiquity and immediacy of mobile, but it’s also an important investment for the future. Digital-enablement is becoming more crucial in terms of loyalty. Some 47% of millennials said it was important for them to be able to access their loyalty program via a mobile device, compared to 37% of respondents overall and just 16% of those aged over 55.
Convenience: the new currency
Desire for digitally-enabled schemes is also explained by the drive for convenience. As more processes become digital, mobile becomes increasingly ingrained in consumers’ lives. This is reflected in consumers’ frustration with traditional loyalty schemes. 18% of respondents who had taken part in customer loyalty schemes said their biggest issue is the inconvenience of having to remember to bring the physical vouchers or cards with them when they shop. It’s likely that this type of scheme will become unpopular if they fail to evolve and digitise.
For something to become a habit, it must naturally fit into a consumer’s routine. Whilst many consumers may say they like a brand, Casual Dining Group highlight that preference does not necessarily translate into regular purchasing. In reality, brand loyalty is a consequence of habit, a combination of utility, advocacy and convenience. Brands must earn loyalty by focusing on what convenience means to their customer.
Hyper-personalisation is now, says Tim Mason. Preferences we are seeing in 18 to 24 years olds represent the macro trends of the future. To earn loyalty from consumers who are savvier and more well-informed than ever, brands need to harness customer data for a personalised approach, make themselves convenient and embrace mobile, as it’s here to stay.
To download Eagle Eye’s research, ‘Reload Your Loyalty: Do You Even Know Your Consumers?’ please click here