Tuesday, 22 November 2011

National consumer survey looks at what customers want from loyalty schemes of the future / Ipsos MORI / The Logic Group

Shaping the Future of Loyalty Schemes in the UK
National consumer survey looks at what customers want from loyalty schemes of the future

It seems like not a day goes by without the announcement of a new piece of technology to help us stay connected to our friends, or brands 24/7; whether it’s to help us price check in store, or let our friends know where we are or what we’re doing.  For some, change is the next logical step, but others remain resistant to, and fear interactions with, new technology channels. 

When asked about interacting with new technology channels (e.g. mobile and social networks), only a fifth (21%) of the British public said that they liked to receive loyalty scheme offers in this way, and double that proportion said they did not (40%).

The research[1], carried out by Ipsos MORI and customer interactions specialist, The Logic Group, is the third annual comparative survey into customer loyalty. Surveying over 2,000 adults this survey explores the who, why and where of loyalty in 2011.
Just under half of the public would also prefer to receive offers from loyalty schemes whilst shopping (46%) and, similarly, 47% would like to use a credit or debit card as a loyalty card. For new technologies, perhaps unsurprisingly, there is a marked difference in how open to adoption different generations are.  When asked if they would like to receive loyalty scheme offers via new technology channels, significantly more consumers aged 15-24 and 25-34 agree (33% and 29% respectively) than their older counterparts (14%).  By the same token, disagreement is higher among consumers aged 45-54 (50%) and 55-64 (54%), versus younger groups (32%).

Antony Jones, CEO of customer interactions specialist The Logic Group said of the findings: “When it comes to developing loyalty schemes that involve new technologies, it really is imperative to consider your target customers, and those businesses offering products or services used by older consumers should perhaps be more careful about the introduction of new technology channels as part of day-to-day scheme interactions.  Encouragingly, the respondents show interest in schemes where they only need to use one card or device; pointing towards future technologies to create links between accounts and scheme rewards, mobile apps, NFC and contactless technology.”

Change, is it as good as a rest?
While those surveyed recognised that new technology can fulfil the evolving needs of customers, not everyone is willing, or indeed able to embrace these new technologies.  For older respondents the key reservations were physical barriers (feeling they may be penalised for having out of date devices), knowledge barriers and fear of the unknown, data security and being tracked. 
Respondents in focus groups were asked about a number of new technologies including mobile and social, with some varied, yet interesting findings.

1.       Mobile technology (SMS offers, applying points/rewards when you purchase using your phone, a loyalty app and receiving offers to your phone from nearby shops):   reactions to this technology were broadly positive.  Some had seen and used mobile apps before and suggested that when implemented correctly they were the future of loyalty schemes – also linking this technology to their desire to reduce the number of the cards in their wallets.  Texts and alerts to phones while shopping though could become annoying – and problematic in low signal areas.
2.       Social media (‘liking’ or following a brand to receive new offers, here schemes would be able to see what you are looking at and send you relevant offers): there were mixed reactions to this technology.  Some already used social media and were happy with how it worked, while some voiced concerns about data security.  They liked being able to sign up to a company and receive offers of relevance to them, and there was acknowledgement that both parties got something out of this relationship.  However, data sharing and security issues were an overarching fear for all. 
3.       The mobile wallet: there were mixed reactions across all ages to the concept of a mobile wallet. Those who were most negative were worried about fraudulent use, inconvenience if lost, and being a greater target for theft. There was also some negativity towards the suggested £15 transaction limit, with suggestions that this could be increased by adding a pin to the transaction to make it more secure.  More positively, people felt that this would be more convenient as a phone is always with you, and contactless technology would speed up the transaction. 

Simon Atkinson, Assistant Chief Executive at Ipsos MORI comments: “There is undoubtedly consumer appetite for using new technologies when the benefits are made clear (e.g. simplicity and immediacy); though uncertainty about the actual user experience still remains. Importantly, new technology could make interacting with a scheme more convenient and make offers and information more easily accessible.  For consumers who are worried about embracing technology changes, and the older generation in particular, the answer is likely to lie in offering existing services in tandem with new.”

About The Logic Group (www.the-logic-group.com)
The Logic Group partners with leading organisations across Europe to enhance the effectiveness, security and profitability of their customer interactions. The Company specialises in the secure management of information and transactions through the delivery of trusted payment and loyalty solutions that enable increased revenue, improved profit, and reduced operating costs and risk.
We combine our skills, experience and innovation into client solutions that drive improved customer experience, enhanced customer insight and stronger customer relationships. We believe that we have an unmatched passion and track record for building effective customer interactions. That is why the Company is behind many of the best known names in Europe for whom maximising the value of their customer interactions matters most.

About Ipsos MORI (http://www.ipsos-mori.com/)
Ipsos MORI, part of the Ipsos Group, is a leading UK research company with global reach. We specialise in Advertising (brand equity and communications), Loyalty (customer and employee relationship management); Marketing (consumer, retail & shopper and healthcare), MediaCT (media and technology), Social & Political and Reputation research.  Find us on-line at www.ipsos-mori.com or on Twitter: @IpsosMORI

For further information or to request an interview, please contact:
Tom Flisher, Naomi Barry or Olie Mitchell
Octopus Communications
08453 700655

[1] The primary research was carried out through an online quantitative survey of 2,045 adults across Britain, aged 16-64 and from a range of social grades, between 13-23 May 2011.  The survey data are weighted to be representative of the British population as a whole.
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