What Features Do Members Want From Retail Loyalty Programs?

December 6, 2016

nielsen-most-appealing-retail-loyalty-program-features-dec2016Retail loyalty program members value flexibility over personalization in their programs, according to a Nielsen survey [download page] of more than 30,000 internet users across 63 countries. Indeed, the most appealing features among program members are points or rewards for purchases made across various channels (81%) and the ability to choose among several types of rewards (79%).

Close behind, many value the opportunity to earn bonuses by doing a specified activity. This is more appealing to Millennials than Boomers, and is in fact tied with the ability to choose among several types of rewards as the most desirable feature of a retail loyalty program for the younger generation.

In comparing Millennials’ responses to those of Boomers, the Nielsen survey shows that Millennials value all program features at a greater rate than Boomers. However, the gaps in preference are particularly large in some areas, including:

  • Personalized product or service recommendations (69% of Millennials finding appealing, compared to 45% of Boomers);
  • Tiered programs with exclusive rewards for customers in a particular level or status (69% vs. 45%);
  • Points or rewards for sharing products and pages on social networks (72% vs. 40%); and
  • Integration with third-party apps that consolidate loyalty program information (63% vs. 29%).

The study likewise found some sizable generational in gaps in preferred reward benefits. While Boomers were more likely than Millennials to say that product discounts (57% vs. 48%) and rebates or cash back (54% vs. 41%) benefits were among their top-3 valued rewards, Millennials were more likely to point to non-monetary benefits such as higher priority service (15% vs. 6%), personalized products or service experiences (12% vs. 3%) and charitable donations (10% vs. 3%).

That aligns with other research into loyalty preferences, which has also found Millennials more likely to favor programs that offer special services like concierges as well as hands-on experiences.

Returning to the Nielsen study, the analysts highlight key loyalty program attitudes across the world, pointing out that:

  • In the Asia-Pacific region, several marketers show a strong appetite for mobile app-based programs;
  • In Europe, mobile apps are less commonly used by retail loyalty program members, for whom monetary perks tend to be far more preferred than non-monetary ones;
  • In the Middle East and Africa, non-monetary perks – such as recognition as a preferred customer and personalized products and experiences – are important to sizable share of consumers;
  • In Latin America, there’s plenty of room for growth, with respondents there reporting the lowest incidence of program participation; while
  • In North America, flexibility is key to respondents, who report very high levels of program participation.

The full study is available for download here.

About the Data: The Nielsen Global Loyalty-Sentiment Survey was conducted March 1-23, 2016, and polled more than 30,000 online consumers in 63 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America. The sample includes internet users who agreed to participate in the survey and has quotas based on age and sex for each country. It is weighted to be representative of internet consumers by country. Because the sample is based on those who agreed to participate, no estimates of theoretical sampling error can be calculated. However, a probability sample of equivalent size would have a margin of error of ±0.6% at the global level.

The Nielsen survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60% internet penetration or an online population of 10 million for survey inclusion.

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