Retailers are finding a silver lining to the recession’s dark cloud: loyalty program participation is growing.
Participation in rewards and loyalty programs rose by 19 percent across the board since 2007, according to Colloquy’s white paper, "After the Meltdown: Consumer Attitudes and Perceptions About Loyalty Programs in the Post-Recession Economy."
Retailers saw the greatest shift toward rewards programs, with 75 percent of consumers reporting that the economy had a neutral or positive influence on their participation. The smallest increase was experienced in the financial services segment, which remained fairly flat. Over 52 percent said the economy had no impact on their enrollment decision.
"In spite of the dire economic news of the past 18 months, consumers remain as engaged, if not more, with loyalty and rewards programs," said Rick Ferguson, Colloquy's editorial director, in a statement. "In fact, U.S. consumers clearly see value in program participation, and continue to leverage their activity as an antidote to hard times—seeking added value and using rewards to stretch dollars."
The greatest engagement increases (32 percent) were among Millennials, those 18- to 25-years-old. More than 46 percent of Millennials rated retail rewards as "more important" during hard economic times and 27 percent said they are looking to join new programs to help stretch their dollars.
Additionally, Millennial respondents were most likely to enroll in rewards via new media mediums. This number is not surprising as more than half already communicate via social networking (55 percent) and text messaging (52 percent). Only 39 percent and 38 percent of the general population, respectively, engage in these activities.
"Millennials represent a golden opportunity in a time of economic darkness for loyalty marketers," said Kelly Hlavinka, Colloquy partner and coauthor of the white paper, in a statement. "This demographic is receptive to the wish-list of loyalty initiatives—eager to join programs, eager to build relationships with their favorite brands and eager to engage with new media channels. This shows a powerful opening for loyalty marketers to build sustainable loyalty with the next generation of American consumers."
The white paper, released on July 1, derived its findings from the responses of over 2,000 consumers and examines trends in six demographics: General Population (overall U.S. sample), Affluent (heads of households earning more than $125,000 annually), Millenials, Seniors (those age 60 and older), Core Women (any female between ages 25 and 49 who earns between $50,000 and $125,000 annually), and Emerging Hispanic (anyone of Hispanic origin with an annual income of $40,000 or less).