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Changing Up Loyalty Engagement

Despite the prevalence of rewards programs, a large number of customers are going inactive.
a loyalty key chain fob

Loyalty programs are enticing. In theory, retailers get repeat customers and customers get rewarded for something they are already doing. However, theory is not always reality. New research from PayiQ found that approximately 69 percent of their customers will go inactive in a loyalty program, with 42 percent of those customers leaving it entirely.

On the face of it, those numbers are startling. But look at the number of apps on your phone or store tags hanging from your key chain (yes, I'm old school and still have those). How many do you really use? For me, it's two out of six. Why? Some are stores that closed nearby locations — I'm looking at you, Staples. And some offer rewards that do not appeal to me. For example, my neighborhood market offers free coffee yet I have never taken a sip of coffee in my life.

As Tom Byrnes, senior vice president of marketing at PayiQ, noted during a recent Convenience Store News webinar, it's easy to attract customers to your loyalty program; the challenge becomes keep them engaged. Stores need to adopt new methods of outreach to meet customers where they are. One method, he suggested, is to start using point-of-sale credit card data to analyze shopping habits and pinpoint areas of engagement or outreach for individuals.

The concepts of personalization and engagement have been shouted from every corner rooftop for a while now, but one-size-fits-all loyalty programs still exist in the industry. Why? Easier, sure. But if customers stop participating what is the point?

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