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Big two top list of loyalty programs ‘doing a very good job’

Coles’ flybuys program remains the most mentioned loyalty program, with rival supermarket Woolworths’ rewards program showing a marked improvement, according to the annual ‘for love or money’ study.

According to The Point of Loyalty’s research, Coles flybuys retained first place in the Top 10 unprompted most mentioned programs as ‘doing a very good job’ (34 per cent). Woolworths Rewards in second place has improved, up from nine per cent in 2016, to 13 per cent in 2017. Qantas Frequent Flyer remained in third place since the first study in 2013.

The study shows in 2017, Australians over 18 years old are enrolled in over four programs each (4.3), the highest it has been since the first research was conducted in 2013, with millennials averaging five loyalty programs and one in seven women enrolled in ten or more programs.

“This year, key indicators of program health such as defection and reward redemption are improving,” said Adam Posner, report author and CEO of The Point of Loyalty. “Defection is declining, down from 23 per cent in 2016 to 18 per cent in 2017,”

“Also, rewards earned by members are being redeemed more than ever before, with 64 per cent of members indicating they are enjoying the benefits of their programs, up from 57 per cent in 2016,” he added.

“There is ongoing debate on the definition of ‘customer loyalty’ which impacts on the strategies to achieve the loyalty nirvana and so we wanted to get more clarity from consumers,” Posner said.

He said the research put forward a range of ‘belief’ and ‘behaviour’ indicators of loyalty to consumers, to understand what they think loyalty is, beyond enrolling in a loyalty program.

The research revealed that consumers ranked behaviour indicators of ‘purchasing more’ and ‘purchases more often’ from a brand over the longer term vs similar competitor options as the top two indicators of loyalty.

‘Trusting the brand/business with their information’ and ‘recommending the brand/business to other people’ followed as the two belief indicators of loyalty.

“While I was not surprised by the purchase behaviour indicators of loyalty, it was interesting to find that ‘trust with information’ was so highly rated as an indicator of loyalty,” Posner said. “The massive explosion of data and its availability and access, makes trust a currency of brand loyalty.”

2017 Australia’s top 10 most mentioned programs (unprompted) as ‘doing a very good job’:

1. Coles flybuys
2. Woolworths Rewards
3. Qantas Frequent Flyer
4. Priceline Sister Club
5. Virgin Velocity
6. MYER one
7. Boost Vibe Club
8. CommBank Awards
9. MyDanMurphy’s
10. Optus Perks

This story first appeared on sister site, Inside Retail Australia.

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