News

Participation in loyalty programs jumps 20 percent

July 1, 2009

CINCINNATI — Despite the recession, U.S. consumer participation in rewards programs is on the rise across all demographic segments, according to COLLOQUY research released today. The study reports a 19 percent participation growth by the general population since 2007.

Activity in desirable demographic segments is up even more. Participation by Millennials (age 18-25) has soared 32 percent since last measured in 2007. Women as a demographic are up 29 percent in the same time period.

Consumers are leaning on loyalty programs to stretch household budgets further by earning rewards for their purchases. The retail category demonstrates the highest positive impact in reward program attitudes, with 75 percent of 2,152 surveyed reporting a net neutral or positive effect on their program participation as a result of the economy. The financial services sector remained relatively flat, with 52.7 percent reporting "no difference" in the impact of the recession on program participation.

"In spite of the dire economic news of the past 18 months, consumers remain as engaged, if not more, with loyalty and rewards programs," said COLLOQUY editorial director Rick Ferguson. "In fact, U.S. consumers clearly see value in program participation, and continue to leverage their activity as an antidote to hard times - seeking added value and using rewards to stretch dollars."

COLLOQUY's study of loyalty perceptions "After the Meltdown" examined trends in six consumer segments: General Population representing a statistically distributed sample of the U.S. overall; Affluent (heads of household with annual incomes of $125,000 or greater); Millennials or Young Adults (any respondent 18 to 25 years of age); Seniors (any respondent 60 years or older); Core Women (any female respondent age 25 to 49 with an annual income between $50,000 and $125,000); and Emerging Hispanic (any respondent age 21 or older of Hispanic origin with an annual household income of $40,000 or less.

Loyalty participation by Millennials has increased significantly since COLLOQUY's last benchmarking study in 2007. According to the new study, recalled participation rates in this demographic stand at 58 percent, a 32 percent increase from two years ago. The data reveals more intriguing information about this group and their perceptions about loyalty programs, including:

• Nearly half (46.4 percent) of responding Millennials rate retail rewards programs as "more important" during the recession. This outpaces the general population, at 32.3 percent for the same category.
• 27 percent of Millennials are actively seeking to enroll in new programs to help expand their budgets.
• Somewhat expected, but still significant: Millennials are far more likely to enjoy engaging with programs through new media channels than the General Population. Over 55 percent appreciate communicating through social networking sites (39 percent for General Population), and 52 percent enjoy communication via cell phone or text message (38 percent for General Population).