Cincinnati — Membership in loyalty rewards programs has reached 1.3 billion in the United States, according to Colloquy, a research and consulting firm that tracks loyalty marketing.
The firm performed a study in the fourth quarter of 2006 to analyze the scope of loyalty marketing and found that the average U.S. household belongs to no less than 12 loyalty programs. However, it also found that “active participation” in these programs is a blended average of 39.5 percent across all 12 of the sectors it analyzed. Of the 12 programs per average household, only 4.7 are generally actively participated in.
The study was based on information obtained from over 1,000 loyalty program sources across 12 business sectors including airlines, financial services, hotels, restaurants, gaming, grocery, retail fuel, specialty retail, drug and discount stores, department stores, Internet and miscellaneous. The company explained in a release that active participation varies by industry, but that basically an active participant is distinguished from a one-time user or an inactive name in a database.
Kelly Hlavinka, the firm’s senior director, stressed in a release that while “fat membership roles” may appear impressive, it is only the active loyalty-program members that truly matter to a business in the long run. “Marketers must adopt highly targeted enrollment strategies and allocate resources where they accomplish the most good. That means enroll the right customers, drive active participation programs, employ reward bonuses selectively and use loyalty data throughout the organization to increase customer insight,” she advised.
Based on the study, the firm found that the airlines, financial services, grocery and specialty retail sectors account for 57 percent of total loyalty program membership. The findings also led the organization to conclude that “gaming companies’ healthy profits will allow them to incubate the best loyalty practices in coming years.”
To read a complete report on the census, Colloquy has made its white paper called “CensusTalk: Sizing Up the Loyalty Marketing Industry” freely available at www.colloquoy.com/whitepapers.