Australians flock to loyalty programmes amidst living costs surge

Global data and insights company, Pureprofile, in conjunction with retail advisory firm, Retail Doctor Group, has unveiled that 95% of Australians are members of loyalty programmes. The study also found that a rise of 18% in these programmes' usage was reported over the previous year. This comes as cost of living pressures have been escalating, leading consumers to maximise value from every purchase.

Among the data collated from over a 1,000 Australian consumers, one noteworthy finding was that half of the participants would consider switching to a rival retailer if they provided a more advantageous loyalty programme. Other critical findings include 45% of consumers stating they would frequent a retailer more often if a loyalty programme was available, while 27% affirmed such a programme would instigate them to spend more.

The study highlighted the influence of consumer perspective on loyalty across different sectors. Anastasia Lloyd-Wallis, COO of The Retail Doctor Group, stated: "The top reason for loyalty across the fashion (77%), homewares (63%), and takeaway food (41%) categories was because consumers liked the look and feel of a brand or a retailer." Interestingly, grocery sector, which registered the highest levels of loyalty, saw a whopping 60% of consumers remain loyal merely due to their membership in a loyalty programme.

On the flip side, the study also examined the reasons behind disloyalty. In terms of fashion and homewares, over half of the consumers cited following a sale as their primary reason for disloyalty. In the takeaway food sector, 51% of consumers were simply eager to try something new, while 63% prioritised the cheapest option available when it came to groceries.

Commenting on the findings, Lloyd-Wallis noted: "Consumers have demands when it comes to these programmes. They want personalisation, systems have to be easy to use, and they want to see their loyalty rewarded quicker – in fact, access to special discounts was the most important consumer consideration with these programmes."

The study also unravelled that loyalty programmes do not impact all age groups equally. Their influence recedes with age, as 70% of Gen Z and Millennials stated being influenced by such programmes, compared to only 35% of those aged 65 and above.

Among the top-ranking loyalty programmes according to Australian consumers are Everyday Rewards, Flybuys, McDonald's MyMaccas Rewards, Dan Murphy's and Qantas Frequent Flyer. Reflecting on these preferences, Martin Filz, CEO of Pureprofile, remarked: "Groceries are a clear and consistent focus, followed by affordable treats such as drive-through meals and larger ticket items such as travel."

Despite the evident sway of loyalty programmes, Filz emphasised: "Connection to a brand is the most important driver of loyalty, even more so than price." He urged retailers to think comprehensively about customer experience, being conscious of in-store experiences, staff interactions, and smoothing online journeys. Filz highlighted: "Every touch point is an opportunity to win or keep loyalty which is of paramount importance in the current environment."