By Dan Slavin
CodeBroker surveyed more than 440 Millennials belonging to loyalty programs from retail, credit cards, restaurants, travel and other industries in a 2018 Millennial Loyalty report. These young consumers were asked about the top challenges they face in using the loyalty programs and how they would like to engage with them. They were also asked what changes they would like to see.
From the survey, some very interesting facts were determined. Only 11% actively engage in all of the loyalty programs in which they are members. Why is that? Before we answer that question, check out the next clue: 97% of Millennials said they would actively engage with loyalty programs if they could access their rewards information directly from their smartphones.
The answer for why engagement rates are low may be due to a matter of convenience. Millennials prefer that loyalty programs be simple, and they want them to operate on their own terms: 28% of Millennials say they want to access loyalty programs via nothing more than a text link on their smartphones.
The Engagement Factor
The survey also revealed that as many as 70% engage with less than half of their loyalty memberships. That's a lot of revenue left on the table. While increased competition can certainly account for a decline in loyalty program engagement, indicators show that Millennials are very open to more engagement in general.
This is apparent when they were asked about their biggest gripe with retail loyalty programs.
Approximately 30% complained of having rewards expire before they were able to redeem them. Another 28% claimed that they didn't know when their rewards became available. Some 14% stated that it was difficult to access rewards information. Another 13% stated that it was too much of a hassle to carry the loyalty cards. Once you eliminate the complexities and increase convenience, your consumers are more likely to engage in your loyalty programs.
Smartphone Access — Have It Your Way
Remember the Burger King ad slogan, “Have it your way”? This is how loyalty programs need to be when it comes to serving Millennials. Nearly 60% of survey respondents lacked basic insight into their rewards programs, such as point balances and expiration dates. Access to program specifics is key as to whether engagement increases or suffers a decline.
With that in mind, Millennials do have a wide range of preferences when it pertains to accessing and engaging with loyalty programs. These can include email, digital wallet, apps and of course SMS text. To experience the broadest reach, loyalty programs must be easily accessible to Millennials through a wide variety of mobile channels. This not only enables a wider reach, but also adds more appeal to each individual's channel of preference.
It's more than smartphone accessibility that Millennials want. The Millennial survey also revealed that they have different preferences for accessing via smartphones: 56% prefer not having to download and use an app. The other 44% said they didn't like having to log into a web site.
When asked if they would be more likely to participate in retail loyalty programs if they could access the program easily from their phone, almost all said yes. No surprise that the vast majority of Millennials prefer to access their loyalty programs directly from their smartphones. However, mobile is a platform with several distinct communication channels (app, mobile web, text message, mobile wallet, etc.).
The New Imperative For Loyalty Programs
It is clear from the survey that consumers are looking for alternatives to apps and mobile web: each consumer has their own preference, therefore it is important to offer a variety of program access options to your customers. The study found that Millennials’ second choice for receiving their rewards was text messaging/SMS, which accounted for nearly 30% of the total. Mobile wallets, at 11%, were preferred next.
Loyalty programs aren't just about rewards and points; they also are about meeting expectations and setting a high bar for the experience factor. The majority of today's consumers want a buying experience that is almost customized per individual. They want a “make it my way” type of engagement with loyalty programs of their choice.
Because their preferences vary, it is both a challenge and a lucrative opportunity for loyalty leaders to include the right kinds of features for their program. Loyalty programs that win the hearts and minds of Millennials must give each member program access via their preferred mobile channel.
For more information please see the complete 2018 Millennial Loyalty Survey.