Jeff Fromm argues that as loyalty programs continue to proliferate, consumers are increasingly focused on the tangible benefits these programs offer and whether the effort and time investment required for participation are worthwhile.
GLOIn his article recently published in the Forbes Jeff Fromm argues that as loyalty programs continue to proliferate, consumers are increasingly focused on the tangible benefits these programs offer and whether the effort and time investment required for participation are worthwhile. Gen Z consumers, in particular, carefully consider the quid pro quo of sharing their personal data with a brand in exchange for perks such as personalized experiences or exclusive offers.
At the recent CRMC conference, renowned strategists and marketing leaders responsible for popular loyalty programs like Adidas’ adiClub, Delta Airlines’ SkyMiles, AMC Theatres’ AMC Stubs, GNC Nutrition’s myGNC Rewards, Starbucks Rewards, and others were interviewed.
A prominent recurring theme that emerged from these conversations was the significance of flexibility. Modern consumers highly value the ability to exercise control over how they utilize and redeem their rewards and points, opting for the freedom to do so at their preferred time and place and as frequently as possible.
Stephanie Meltzer-Paul, the Executive Vice President of Global Loyalty at Mastercard, stressed the importance of flexibility in loyalty programs, observing, “Customers nowadays desire flexibility in utilizing their points or even opting for cashback. This is a topic we consistently address with our customers.”
Meltzer-Paul also noted that, on average, consumers participate in 17 loyalty programs but actively engage in only eight of them. She highlighted how loyalty program participants have become more discerning and now scrutinize the value proposition by conducting a thorough evaluation of the program’s benefits, ultimately asking themselves, “Is joining this program truly worthwhile?”
According to a 2022 PWC study, 43% of respondents regarded a loyalty program’s flexibility in rewards as one of the most crucial aspects of a personalized experience offered by a company.
When asked if anything surpasses flexibility in importance, Meltzer-Paul responded that the program’s value must remain paramount. While flexibility and redemption options are significant, they can only go so far if it takes an extended period to accumulate meaningful rewards. The real measure of success lies in whether individuals perceive the value of redeeming their accumulated rewards.
