Modern Retail

Retailers failing to close the loyalty loop risk future revenue losses

Loyalty loop

54% of loyalty programme members haven’t received personalised offers based on purchase history

British retailers and brands are failing to maximise revenue from loyalty programmes, with more than half of members not receiving offers and rewards based on past purchase history or their personalised shopping habits.

Original research of 2,000 UK consumers in the Promotions at the Speed of Demand report from the leading omni-channel promotion solutions provider, XCCommerce, reveals that whilst nearly a third (29%) of shopper have been served rewards and offers as part of a loyalty programme during lockdown, less than half (43%) of these have been targeted towards their personal shopping habits.

With 69% of loyalty club members saying benefits and rewards are most important to them, and 61% indicating its discounts on products and services they want, retailers are failing to generate revenue from a captive market, explains Robin Coles, EMEA MD at XCCommerce:

“When consumers sign up to a loyalty scheme they expect retailers to close the loyalty loop and provide personalised rewards and offers in return.  At a time when shoppers are increasingly fickle and dispersed across a multitude of channels, to ignore this act of good faith on behalf of the consumer damages loyalty and will only lead to lost sales.”

“Too many retailers are labouring under the misconception that improving and personalising rewards is a huge challenge that will require heavy investment in time and resource.  But, by automating these processes and implementing a rules-based approach that includes the use of past sales history and shopping habits, retailers can generate a higher return on their investment in promotions and loyalty programmes,” he concluded.

The uptake of offers within loyalty programmes are highest amongst older consumers, with 42% of shoppers aged 65+, and 40% of 55-64-year-olds, using this marketing channel to access retailer promotions.  Engagement drops significantly and consistently with age, with just 13% of 18-24-year-olds accessing offers through loyalty programmes, despite 79% of 18-24s indicating they believe they are a positive way for brands and businesses to reward their customers.

“Loyalty programmes, like all promotions, need to be easily accessible and consistent across all channels, especially social media and other key digital channels like consumer apps, if retailers want to engage younger consumers and extend the value and lifecycle of such programmes,” commented Coles.

Download the Promotions at the Speed of Demand report to learn more about how technology can enable retailers to deliver consistent, timely and targeted omni-channel promotions, that encourage customer loyalty whilst protecting margins.

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