News

New survey explores Millennials and how they view loyalty programs

May 13, 2014

PunchTab, a omni-channel engagement and insights platform, has released a new study on Millennial purchase behavior among fashion brands and retailers. According to the company, more than 1,200 Millennials participated in the study, which reveals the key buying drivers that lead them from consideration to purchase, their perception of brand loyalty programs, and the most popular loyalty programs among the age group.

Highlights from the study include:

• 60 percent of Millennial women learn about fashion brands from direct contact with others wearing the brand or word-of-mouth. The number is slightly lower for Millennial men (49 percent).
• 34 percent of Millennial women and 29 percent of Millennial men read online articles to learn about new brands.
• 20 percent of Millennial women and 10 percent of Millennial men learn about brands via social channels.

PunchTab said the study also shows a significant shift in brand and retailer perception by Millennials, once they become aware of the brand. As they begin to seek product information, nearly 80 percent of Millennials turn to online shopping sites first, followed by friends and family (70 percent), and brand websites (58 percent). The top methods for Millennials to share recommendations about fashion brands include friends and family (62 percent), Facebook (45 percent), online shopping sites (35 percent) and Pinterest (18 percent).

The study shows that incentives significantly alter the way Millennials engage with loyalty programs among fashion brands. A majority (63 percent) of Millennials would join a consumer loyalty program if given incentives. If those incentives were taken away, only 35 percent of Millennials would join a loyalty program.

Other findings include:

• 74 percent of Millennial women are currently members of one of more fashion-related loyalty programs, while only 52 percent of Millennial men are members.
• 53 percent of Millennials would follow a store or brand on Twitter if incentives were given. Without incentives, the number drops to 19 percent.
• 60 percent of Millennials would answer polls and surveys if given incentives and only 29 percent would do so without them.
• 51 percent of Millennials rated exclusive access to events and products as the most desirable type of experience rewards.

The top loyalty programs, engagement influencers and detractors

The PunchTab report also details the most popular loyalty programs for Millennials, which points to differences between genders. For Millennial men, the most popular loyalty programs include Kohl's (27 percent), Dick's Sporting Goods (23 percent), Target (22 percent), and Macy's (16 percent). The top loyalty programs for Millennial women include Victoria's Secret (33 percent), Kohl's (24 percent), Target (23 percent), American Eagle (21 percent) and Gap brands (21 percent).

Taking a closer look at what factors encourage Millennial participation in loyalty programs, PunchTab found that the top reasons are ease of participation and receiving value from the program. Top detractors for their signing up for programs include lack of value and the fear of being spammed by brands.

In addition, 75 percent of Millennial women and 64 percent of Millennial men who are members of at least one loyalty program indicated loyalty programs were at least somewhat of a consideration in where they buy their clothes.