I recently read excerpts from The 2015 Loyalty Census, published by Colloquy, the excellent loyalty publishing, research and education organization. Several data points from the survey jumped out at me. The most important of these is that in the United States, membership in loyalty programs continues to grow, increasing from 2.65B in 2012 to 3.32B in 2014. I don’t know about you, but to me that is an astonishing fact.
While Colloquy’s focus and data survey apply primarily to consumer loyalty programs, the proliferation of incentive programs in the B2B space is also remarkable. According to the Incentive Market Study (October 2013) by the Incentive Federation, Inc., 74% of US businesses use non-cash reward incentive programs to support their activities.
Based on these findings, one would conclude that all is well – one might even say great – in the incentive and loyalty world. Not so fast!
The Colloquy census also contained the finding that while membership in loyalty programs is increasing, engagement is decreasing. In fact, Americans had a 46% active rate in 2010, which declined to 44% in 2012 and now stands at 42%. Said another way, 58% of the members in US loyalty programs are not active or engaged. It appears that loyalty, and by extension, incentive programs have reached a state of saturation.
So, what do we, as incentive program professionals, advise our clients to do in response? I think that several activities are indicated.
- First, know your competition. Assess whether you really are in a crowded space when it comes to incentive programs. If your competitors do have programs, try to determine the key features of those programs and compare them to yours. If they don’t have programs, seize the advantage and start one now. Your competitors will be close on your heels, but the first to the market with a program has a distinct advantage.
- Secondly, critically evaluate our own program’s features. Have you introduced any new point-earning opportunities within the last 1-2 years? Have you realigned the award rules to reflect changes in your strategy – or in the market itself? Have you done something as straightforward as updating the look and feel of the program web site? Without periodic updates, your program can appear stale to the program participants and possibly indicate to them that you have taken them for granted.
- Finally, consider asking your program participants what they think about the program and its relevance to them. Survey not only the active and engaged participants, but try to reach out to those who were once engaged but no longer are. I suspect that some of our readers will regard this suggestion with a bit of skepticism and concern. But a carefully constructed survey can provide invaluable data that can obtained in no other way.
Here are at QIC, we are committed to making your current – or prospective – program as effective as possible. We invite you to contact us to help you do just that.
I agree that most companies don’t do enough to engage their membership base. In the performance improvement process continually communicating to your membership is criticaly important as well as surveying them from time to time to see what elements they find most important in the program.
You have to surprise and delight them with additional facets to the program to keep it fresh.