Emily Rudin, Chief Customer Officer of CrowdTwist, sat down with Loyalty360 to discuss the results of a survey of customers’ perceptions about brands and loyalty programs. CrowdTwist is a provider of a loyalty and engagement solution that drives incremental spend, leading to better customer data, stronger insights, and more personalized experiences. It helps brands, including Pepsi, 24 Hour Fitness, and Zumiez, develop a deeper understanding of their customers.
So, what is your research all about?
We conducted research into consumer attitudes towards loyalty programs, brand engagement, emerging technologies, and shopping experiences. The research indicates that consumers are skeptical of sharing data with brands and are reluctant to try new technologies designed to enhance brand experiences. The report also finds that brands have the opportunity to deliver consumers value and build trust through engaging, omnichannel loyalty programs.
Is it that consumers are less willing to share data with everyone? Or are they only willing to share it with a finite set of brands?
Our research indicates that they are less willing to share data with brands. We conducted research into Gen Z and Millennials and brand loyalty last year and we asked those consumers the same question as we did this year, which was, “Are you willing to share data with brands in order to gain a personalized experience?” Last year we found that the overwhelming majority, 98 percent said, “Yes.” This year only 50 percent answered yes. This demonstrates an erosion of trust between consumers and brands.
Does the research find that brands are not utilizing customer data effectively?
We found that only 34 percent of the consumers we surveyed said that they purchased something that was recommended to them in the past six months. This indicates that brands are not effectively collecting or using data to personalize experiences for customers.
Do you think that the erosion of trust has to do with the Cambridge Analytica and Facebook issues?
Yes, I think this is due to concerns around mismanagement of customer data. In the past year, we have seen a proliferation of fake news, high profile retailer database breaches, and of course the Cambridge Analytica scandal, which have contributed to an erosion of trust between consumers and brands and demands for data privacy. However, loyalty program participation remains high.
How are you measuring that?
We asked about participation in the survey. 78 percent of people are active in at least one loyalty program. 57 percent have at least one loyalty app installed on their phone and reward redemption is high, which is a great indicator of participation.
How many questions did you ask?
We asked 33 questions.
Do people who participate in a loyalty program realize that there’s an implicit understanding that they’re going to be sharing data with brands?
Yes, customers opt into loyalty programs and understand they are sharing behaviors and transaction information in exchange for special perks and rewards.
What were some of the favorite programs?
Kroger, Kohl’s, Amazon Prime, Dunkin’ Donuts, and Starbucks.
Did respondents give reasons as to why those were their favorite programs?
Yes. Respondents chose Amazon Prime for the product selection and pricing, free shipping, free returns, access to streaming services, the new pantry, and wardrobe offerings. Consumers chose Kohl’s for its prices and product selection, discounts and cash back, and how easy it is to earn rewards. For Kroger, they cited personalized coupons and discounts on food and gas as the main drivers of their participation.
The benefit of a loyalty program is to get customers in direct communication with the brand. That way a brand doesn’t need to go through a third-party to collect data. Is this something you think that all brands should be doing to try to find a highly-engaged audience?
Yes, absolutely, and that’s why we wanted to ask consumers about their experiences with loyalty programs, what they want from a program, and what their expectations are. By collecting this insight, we can better inform brands about how to create one one-to-one relationships with their customers.
If you were to suggest one thing that brands can do to improve personalization, what would it be?
Brands that invest in loyalty programs provide their customers with the opportunity to opt-in and share data, allowing them to communicate with customers in authorized ways, based on the detail of information they provide. Invest in technology that can capture data and segment customers to provide compelling brand experiences for customers through meaningful communications, relevant promotions, and personalized rewards.
Can you give an example of a brand that does personalization well?
Budweiser does personalization well through their Budweiser Rewards program. They run geo-targeted campaigns to engage their customers on a local level which makes members feel like the Budweiser brand understands what they’re interested in. They leverage regional sweepstakes, customized landing pages, and personalized emails featuring dynamic content that is relevant to each individual program member.
The full report can be accessed at http://resource-center.crowdtwist.com/blog/earning-consumer-trust-with-omnichannel-loyalty.