Following on from my first article ‘The surprise and delight of 7 (out of many) insights from For Love or Money™ 2021 – Australian Edition’, here are three more insights from the research with a personal view on whether I was surprised, delighted or variations of this theme.
The section of the For Love or Money™ 2021 research report these insights come from is - ‘Program Structures and Benefits’, where we researched:
- Subscriptions: Loyalty programs with free membership vs with a subscription fee
- Partner ecosystem: Earn and redeem rewards within vs beyond the brand specific program
- Timing of rewards: Earning rewards instantly vs earning rewards for future purchases (*new*)
- Rewards for referrals: Earning rewards for referrals vs no rewards for referrals (*new*)
- Cashback shopping platforms: Awareness and interest (*new*)
- Gamification: Loyalty programs and gamification (*new*)
I am going to go deeper on 1, 2 and 3.
1.Subscriptions: Loyalty programs with free membership vs with a subscription fee
Insight #1: Free membership preferred (76% of members).
(We researched this in 2019 as well with very similar results – 74% preferred free membership)
Comment: Not surprised with this result but it did stimulate me to give subscription programs their respect.
A research question that generically preference tests a program that has free membership with access to a limited range of benefits and savings vs a program with a subscription membership that provides access to an extended range of benefits and savings, does not give subscription programs their due respect.
The value explained is not overly compelling and specific. The benefits and rewards are generic. There is no context of a brand to enhance the program’s promise.
Why am I challenging my research findings?
- The research gives me a base data point to motivate my curiosity to look deeper at the result and explore for more insights.
- It challenges me to ask ‘why?’ and then expand my horizons into the content of free vs paid/subscription programs!
Subscription/paid programs have many permutations and combinations and creating a compelling proposition to gain insights on take-up needs to be set within the context of the brand and their customers’ behaviours along with the value promised.
I am grateful to the results the For Love or Money™ 2021 research reveals as it provides me with a platform to investigate further and learn more.
2.Partner ecosystem: Earn and redeem rewards within vs beyond the brand specific program
Insight #2: Adding partners to a program proposition – members want them! (Programs can profit from them)
The research assessed the preference of earning and redeeming rewards outside the brand’s program (with relevant partners) vs earning and redeeming rewards within the brand’s specific program.
48% of members indicated they prefer to earn and redeem rewards outside the brand’s specific program.
(We researched this in 2019 as well with very similar results – 47% preferred to earn and redeem rewards outside the brand’s specific program)
Comment: Not surprised but I am delighted.
Adding partners to a program enhances the value offered to members. It also provides the perception that programs are ‘not lazy’ and always looking to enhance the lives of their members!
Plus, adding partners can be revenue source for programs. (I have lots to share about the tips and traps of this topic in upcoming articles).
3. Timing of rewards: Earning rewards instantly vs earning rewards for future purchases (*new* in 2021)
Insight #3: Instant rewards are preferred, not overwhelmingly! Consider a blend of now vs future.
Only 44% of members indicated they prefer earning rewards/cashback instantly and 32% indicated the prefer to earn rewards/cashback to save on future purchases.
Comment: A little surprised that instant rewards are not as compelling as I thought they might be.
It’s clear instant rewards are a winner, but it’s not convincing. Which of these reward mechanisms to use will depend on the member’s buying behaviour such as frequency of purchase and time between purchases. It goes to the heart of the earn-rate debate.
That’s a quick deep-dive into 3 more insights from For Love or Money™ 2021 – Australian Edition.
There is a little more detail in the For Love or Money™ 2021 – Australian Edition in the complimentary Executive Summary or if you prefer to go deeper on the details, the comprehensive report which is available to purchase.
Have a happy loyalty day!