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Retail loyalty doesn't always depend on a card

By Peter Clark, Marketing Factbook

 

Most British shoppers (93%) said they would not stop shopping with a retailer if it dropped its loyalty card programme, and only 17% of shoppers said they currently choose where to shop based on their participation in loyalty schemes, according to a report on on loyalty schemes by YouGov SixthSense.

While 86% of shoppers use a loyalty card on a regular basis, 50% of the shoppers surveyed said they do not think it is worthwhile collecting points. Almost a quarter of participants said they would now prefer retailers to offer more promotional deals rather than points.

More than half of participants in loyalty card schemes (52%) said they prefer to convert points into a money-off discount at the checkout, reflecting the thrifty nature of shoppers in the current economic climate.

However, 19% of respondents said they prefer to save up points to earn a treat, while a significant 10% of loyalty card users said they collect the points but rarely, if ever, redeem them.

Only three schemes in the UK were reported to have achieved significant usage (redemption) levels: Tesco Clubcard (66%), Nectar Card (55%) and Boots Advantage Card (48%) lead the way, indicating that a significant number of British consumers actively participate in more than one loyalty programme.

According to James McCoy, research director for YouGov SixthSense, "Loyalty schemes need to do more to create customer loyalty. The schemes are best suited to retailers that are used frequently or where loyalty cards can be used in multiple stores, so that points and rewards accumulate at a fast enough rate to keep people interested."

Participation was found to be highest among wealthier consumers, which suggests that simply spending more means they can also accumulate points more rapidly and therefore earn more rewards, making participation more worthwhile. However, McCoy warned that retailers still need to do more to ensure that their loyalty schemes engage all types of customer.

The full report on loyalty card usage in the UK is part of a series of 60 reports on the food, drink and grocery retail sectors, and is available to purchase directly from YouGov SixthSense.

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Source: YouGov SixthSense
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