Study: Pitfalls still linger around loyalty programs

Consumers are excited by the prospect of retailers taking their loyalty programs digital — if they can keep programs simple.



In fact, a majority of shoppers would prefer if retailers would create digital rewards programs. Not only do 71% of shoppers want the option of managing their loyalty programs on mobile phones, 70% said they would use a mobile version of their loyalty cards if they didn’t have to sign into a website or download an app.



This was according to “CodeBroker 2017 Shopper Loyalty Survey.” The report from CodeBroker surveyed 1,207 U.S. consumers across all age groups and income levels.



Shoppers want easy access to their card, status, and rewards — and most importantly, they want to eliminate the clunky plastic cards from key fobs and wallets. Specifically, 43% said physical cards are the biggest obstacle to claiming rewards, while 17% cite that looking up a missing card is most annoying. In addition, 15% said linking a card online is the biggest hassle of loyalty programs.



Data revealed that 70% of shoppers belonged to between one and five non-grocery loyalty programs. In addition, 16% do not belong to a loyalty program of any kind. Based on active loyalty members, 24% use the rewards they earn, 43% said rewards expire before they can be redeemed, and 65% attempted to redeem a reward at point-of-sale only to find it expired.



Meanwhile, 38% said they never knew if they had rewards available, and 28% said they forget to bring paper rewards certificates to redeem. Another frustration is among the 56% of shoppers who say they changed or abandoned a purchase when they realized their points had expired, according to the study.



“Given the ubiquity of cellphones, consumers want to make their phones the hub of all transactions including the ability to exploit rewards, digital coupons, discounts and other shopping incentives. Converting loyalty programs to a digital, mobile platform will resolve many of these issues and improve the customer experience,” the study reported.