Loyalty Program Preferences

Two thirds of consumers say that discounts are the reason they participate in loyalty programs, according to recent results from Maritz Loyalty Marketing: however, Maritz's tracking of the loyalty marketing programs it operates itself suggests that most choose to redeem their points for gift certificates.

After discounts, consumers say that cash back is the next most popular reason (54%), followed by merchandise (49%), gift certificates (34%) and travel (29%) - but when they actually redeem rewards they have earned, consumers opt most often for gift certificates, followed by cash back, discounts, merchandise and travel.

'Consumers' stated preferences and their actual behavior in loyalty/rewards programs do not always match' according to Gail Sneed, Director, Market Development for Maritz Loyalty Marketing. "With complex rewards programs, it is important to understand consumer's behavior patterns and motivations - otherwise programs could fail to accomplish their intended goals'.

Respondents' reward preferences vary significantly with income level and age. Respondents aged 18 to 34 are more likely to favour discounts (73% do so) than older consumers (aged 45 to 54 - 54%). Discounts are also more appealing to consumers with income levels under $60,000 (71%). 'Consumer targeting is key when designing a loyalty/reward program', says Sneed. 'Demographics can impact program design significantly - in terms of what is offered as well as the method and vehicle for communication'.

Sources for the findings are the Maritz Poll, a regular national consumer opinion survey, and separate research in the loyalty area conducted in March 2004 by Maritz Research. The latter involved 1.047 interviews with randomly selected adult participants in an online panel and covered rewards / loyalty programs for retailers, hotels, airlines, credit cards and restaurants. The group's web site is at www.maritz.com

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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