Voice of the Customer Says Loyalty Programs Cumbersome

By Brendan B. Read, Senior Contributing Editor

Businesses know the value of loyal customers: it costs much less to retain them than to acquire new ones in this tough economy. Yet, retailer loyalty programs, represented by cards and applied online, can be a pain in the backside not only to use but to cash in, like the much-derided airline frequent-flier program.

A new survey of American consumers by ACI Worldwide revealed just that. While three quarters (74 percent) are members of at least one retail loyalty and reward program, and 27 percent, nearly half (49 percent) of loyalty program members never or rarely take advantage of loyalty program perks when shopping online. Only half (53 percent) of them told us they go to online retailers where they can earn discounts and rewards before looking elsewhere. 

Consumers expect to be able to use their rewards: regardless of whether they are shopping in the store or online, says the firm. Unfortunately, at the moment, loyalty programs don’t deliver.

“With so many reward schemes, Americans simply don’t have the wallet space to carry and utilize their rewards cards; the market demands retailers consolidate loyalty programs onto a single device,” said Rob Seward, senior industry marketing manager at ACI Worldwide (News - Alert).  “Consumers want and expect a consistent shopping experience whether they are in a store, online, browsing retail catalogs or on their mobile devices. When they shop online and can’t use their rewards programs, they are disappointed and question the value of the program.”

So what will get Americans to use their loyalty cards?

More than three-quarters (78 percent) of members easy online access to their loyalty memberships would make them more likely to shop at the retail websites that honor their loyalty programs online

Having a single card; 52 percent prefer to have one piece of plastic that can hold all their memberships, versus a consolidated key fob (32 percent) or mobile application (17 percent)

 “In the United States, collective loyalty programs in which multiple retailers share the costs of the program and a common currency or points system, have yet to gain widespread adoption, though ‘programs with a cause’ like uPromise have had some success,” Seward points out.  “In other countries, particularly the U.K. and South Africa, coalition programs are very well established.”

“With American consumers demanding consolidated loyalty and rewards programs, U.S. retailers need to move in this direction,” he added. “We’ve made sure our ACI Retail Commerce Server for Rewards Management can manage multiple concurrent programs for a single customer, and can consolidate the programs onto a single device such as a card or key fob, thus enabling retailers to deliver loyalty and rewards programs in a way that works for consumers.”

(source: http://callcenterinfo.tmcnet.com/analysis/articles/133565-voice-the-customer-says-loyalty-programs-cumbersome.htm)