A new study from Juniper Research has found that more than 3 billion loyalty cards will operate as mobile-only or be integrated into mobile apps by 2020, up from 1.4 billion last year. The new research - "Mobile & Online Coupons: Redemption, Loyalty & Consumer Engagement 2015-2020" - found that brands and retailers are increasingly responding to consumer demand for mobile integration, with many now offering customers the opportunity to store their loyalty cards within a dedicated digital wallet.
The research also argues that the improved targeting and personalisation made possible by digital coupons leads to greater activity rates, thereby resolving a key failing of traditional mobile loyalty cards in which the lack of relevant offers results in a downturn in usage.
The research also found wide variations amongst retailers and other reward card providers with regard to the extent of digital loyalty integration. In the UK, for example, around 40% of Nectar Card holders had acquired the loyalty app by late-2015, but less than 4% of Tesco Clubcard holders utilize the Clubcard app. The research found a similar disparity between US retailers Walgreens, where 61% of card holders had linked their card to an app, and Target, which had only 27% of cardholders linked.
The Bullet Point: The convergence of mobile devices, mobile wallets, and loyalty will transform the loyalty industry in ways more profound than at any time since the industry's modern birth in the early 1980s. As illustrated in the research, disparate levels of engagement will continue to plague the marketers, but it's not a new problem�most loyalty programmes that fail do so because of poor strategy, flawed financial models and projections, and inability to use customer data to drive relationship growth. Consumers will demand convergence�but they'll also demand relevance. Marketers who fail to deliver on either count will find themselves also-rans in the battle for customer loyalty.
You can download the full report here.