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UK: Loyalty programs suffer generational divide

A new report from point-of-sale specialists Ecrebo reveals that loyalty programs are still wildly popular in the United Kingdom - but that legacy loyalty models may be alienating younger consumers. Will the next generation of best customers continue to respond to traditional programs - or will today's loyalty programs need to evolve to survive?
 
Ecrebo's UK Loyalty Landscape Report reveales that UK consumers report that 95 percent of UK loyalty program members are satisfied with their programs, and 91 percent use them an average of three times per week. Amongst 16-24 year-olds, participation drops to 83 percent - still a healthy participation rate amongst consumers who have yet to fully enter adulthood.
 
It's in the details, however, that the generation gap becomes apparent:
 
  • Over a third (36%) of 16-24 year olds found loyalty programs to be too complicated, compared to 27% of respondent over 25.
  • 31% of 16-24 year olds feel that joining reward programs is needlessly complex.
  • 74% of program members are more likely to join programs with personalised rewards.
  • 89% of members said ease of program use would influence where they shop. 
  • 49% of consumers would be attracted to cardless loyalty programs.
  • While two-thirds of consumers overall prefer programs that offer "exclusive access, services or products," 79% of 16-24 year olds prefer them.
  • 40% of those aged 16-24 "strongly agree" that rewards personalisation would influence where they shop - more than double the percentage of other age groups.
Money quote from Dr. Hassan Hajji, co-founder and CEO of Ecrebo:
 
"Despite the ongoing popularity of loyalty schemes, there is still work to do for retailers and brands as consumers are looking for a blend of speed of rewards, simplicity and personalisation. Our research highlights a growing demand – especially among younger shoppers – for loyalty programmes which are personalised, convenient and genuinely rewarding. In a marketplace which remains more competitive than ever, it is crucial that retailers continually reassess their loyalty offer, consider new and different ways of engaging customers and stay ahead of changing expectations and needs."
All true, and all relevent. The future of loyalty is mobile, personalized, and experiential - in the UK, and around the world.

Download the Ecrebo report here.
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