The total value offered by a loyalty programme remains obscure according to the Value in Loyalty Programmes 2003 survey, the second annual study of this rapidly growing South African marketing tool, carried out by World Wide Worx (WWW) and Razor’s Edge Business Intelligence (BI).
The report includes an in-depth analysis of 18 rewards programmes, detailing the value offered by the programmes to their members.
“As we saw in the previous survey, most programme members do not know how much value loyalty programmes provide. They usually perceive the cash value of rewards as the main benefit, but this is often so difficult to calculate that few members make the effort,” said WWW managing director Arthur Goldstuck.
The South African consumer who gets the most benefit from membership of rewards programmes is the one who banks with First National Bank (FNB), flies British Airways (BA), shops with an Infinity card and is a member of the Discovery Vitality wellness scheme.
These rewards programmes came out top of their respective categories (financial services, frequent flyer, multi-vendor retail and wellness). Among single-vendor retail programmes, My Lancôme received the highest rating.
The hypothetical consumers who choose the best of each category would belong to any number of retail loyalty programmes, since they would know all about “double-dipping”, the simultaneous earning of loyalty points on two programmes with a single transaction. For example, when they pay for their BA flight using an FNB credit card, they earn both BA miles and eBucks, FNB’s reward credits.
“Such a tactic is known as ‘playing the game’ in the industry.
“It is very much in evidence in the US, but South African consumers are still catching on to the payback joys of loyalty programmes,” said Bruce Conradie, director of BI. – I-Net Bridge