The question of the perfect rewards mix is one that has plagued loyalty marketers for decades. There’s no doubt that striking the proper balance when it comes to rewards is crucial to driving program engagement, but, just as with all other customer preferences, that balance is a constantly moving target.
A recent report from Excentus seeks to determine through which channels, and to which rewards customers are most likely to respond favorably. For the second straight year, the survey of 1,000 U.S. customers revealed that the preferred loyalty program reward for consumers were fuel discounts. These fuel rewards were preferred by 37 percent of those surveyed as compared to credit card rewards, coupons, retailer points, or instant register discounts.
The preference is unsurprising, given the (relatively) universal need for fuel. This all but ensures redemption and provides members with clear added value on their next trip to the pump.
In addition to finding reward mix preferences, the survey asked consumers about the channels used to engage with programs. The results spoke volumes: Mobile continues to be a powerhouse in engaging millennials, with more than a third relying on the platform to track and redeem awards. Reinforcing this move to digital loyalty, plastic membership card use dropped by 4 percent compared to last year’s report.
“For merchants and retailers, the findings are clear: Loyalty programs that skimp on delivering everyday value are missing critical opportunities to attract new customers and retain existing ones, increase foot traffic, and turn loyal shoppers into higher-value customers,” said Brandon Logsdon, president and CEO of Excentus. “Mobile technology has and will continue to make it much easier, faster, and cheaper to leverage loyalty programs, particularly for the growing segment of consumers who rely on their mobile devices for life’s daily activities.”
Interestingly, the report also notes that customers are looking for more avenues through which to earn these fuel rewards. Specifically, shoppers are looking to earn these incentives from convenience stores, restaurants, and pharmacies. Jumping on this opportunity, Excentus announced earlier this year its expansion into C-store loyalty.
The proof that these programs drive consumer behavior lies in the numbers: 26 percent of shoppers indicated that they shop more at stores that offer rewards, while another 13 percent said that they would switch brand or store allegiance to save money or earn rewards.