In the lead up to Christmas 2002, with an estimated 31 billion at stake, many British consumers felt that the major retail groups were doing nothing to reward their loyalty, according to banking and retail strategy consultants, Cims Group.
Despite the launch of the Nectar coalition loyalty programme by BP, Barclaycard, Debenhams and Sainsbury's (Sept. 12, 2002), there is still a gap in the perceived loyalty rewards given by supermarkets, banks, department stores and petrol stations.
While supermarkets come out top in terms of customer loyalty rewards, few people believe that other companies - such as department stores, banks and fuel retailers � do enough to reward their loyalty.
Consumer opinion
Cims commissioned a study to ask a representative sample of 2,000 UK consumers if they thought particular retail groups would reward them for their loyalty in the run up to Christmas.
- Some 39% felt that none of the major retail groups (including fuel retailers, banks, utility companies and mobile phone operators) rewarded them for their loyalty.
- Supermarkets came out looking best, with more than one in three people (35%) saying they felt rewarded for their loyalty. Women, still often the managers of the family budget, felt more strongly about this (41%) than their male counterparts (29%).
- Only 4% felt that their bank rewarded their loyalty. Despite many of the banks having set up loyalty programmes, the Cims research suggests that many of these schemes are failing to impress consumers. And, while 16% of the under-20's felt they were rewarded, only 3% of the over-60's felt the same way. Independent research from MORI indicates that those with fee-paying packaged accounts are 20% more satisfied than those with basic current accounts.
- Surprisingly, in spite of the fierce loyalty of British football fans to their teams, 98% felt they were getting little back from their teams' club. Also ranked at 2% satisfaction were corner shops, mobile telephone operators, and fuel retailers.
- Electricity suppliers and car dealers trailed the rankings with no loyalty votes at all.
Regional focus
Different results were found around the various geographical regions of the UK. Northerners were most likely to say they felt unrewarded by all of the major retail groups (63%), while consumers in the West Midlands were least likely to feel unrewarded (29%).
Northerners were also least likely to feel rewarded by their supermarket (16%) in contrast to the Welsh, of whom 49% felt their supermarket rewarded them the most (49%).
"The financial and retail communities have focused too much time on the internet as the driving force behind the consumer revolution," said Jonathan Grisdale, head of corporate development at Cims. "Now that the internet hype has been and gone, the true battlefield for service companies will be how they reward relationships with their customers."
Grisdale points out that a number of major companies have made moves into reward programmes but it is imperative that they launch programmes that are appropriate to the needs and lifestyles of their customers.
The survey's findings seem to suggest that, in the rush to launch rewards schemes, many companies are making a lot of noise about doing so, while their customers are failing to feel the real benefits.
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