Study ranks industry sectors on loyalty scheme ROI

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By: Wise Marketer Staff |

Posted on May 16, 2007

New research from Arvato Loyalty Services has identified and ranked UK companies' ability to realise a solid return on investment (ROI) from their loyalty initiatives.

The survey of 2,600 UK consumers set out to identify how much companies, by industry sector, are both investing in loyalty activity and seeing higher customer satisfaction levels as a result.

Best and worst sectors
Respondents were asked which sector they believed to offer the highest customer satisfaction and engagement levels, in comparison to other major industry sectors. The industries included were: credit cards, automotive, retail, travel & holidays, mobile telecoms, and general insurance.

The survey found that the retail and automotive sectors were ranked highest by consumers, both scoring around 11% above average in their ability to realise a return on investment from their loyalty initiatives. The retail and automotive sectors were followed by travel & holidays and mobile telecoms, each scoring around the average for loyalty capabilities. However, the financial services sectors (credit cards and general insurers) came last in the league table, around 35% below average.

Correlation noted
According to Arvato, the findings provide an indication that there is a distinct correlation between customer loyalty investments and customer satisfaction levels, without which loyalty cannot be built.

Graham Ede, managing director for Arvato Loyalty Services, commented: "The study showed a major divergence in the capability for return on investment that different sectors can obtain from their loyalty strategies and activity. What is most interesting is that less well-recognised sectors, such as automotive, travel & holidays, and mobile telecoms, have generated high levels of loyalty penetration, which reflects those companies' commitment to key disciplines to ensure loyalty activity."

The study's conclusion was that, by undertaking rigorous staff training, regular audits of "customer experience", and appropriate communications across all channels, companies are gradually shifting their focus toward customer development and away from traditional prospect marketing. This approach, the company says, will help to guarantee that customer satisfaction levels remain high.

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