Loyalty schemes ineffective for restaurants

28-Aug-2014 - Last updated on 29-Aug-2014 at 12:34 GMT

Loyalty schemes work more effectively for supermarkets than restaurants, the report found

Customers are more engaged in loyalty programmes for supermarkets than restaurants according to new research from GI Insight that shows only half of people who have joined such schemes are regular users.

The survey of more than 1,000 consumers in various sectors showed that loyalty schemes for restaurants and cafés lagged behind supermarkets, which were the clear winners with 79 per cent of respondents belonging to at least one loyalty scheme compared to 21 per cent who joined a similar scheme for restaurants or cafés.

The benchmarking survey on customer insight shows that although 94 per cent of consumers are engaged with at least one loyalty scheme half of those (47%) actively use the offers and only a quarter (27 per cent) believe companies are effective at analysing their needs and sending relevant offers.

Of those customers who belong to a restaurant/ café/ or fast food outlet’s loyalty scheme, 48 per cent said they are active members however only 22 per cent believe their data is effectively used to send them relevant offers.

Andy Wood, managing director of GI Insights said:” The results show that, while loyalty schemes have become pervasive marketing tools, too many companies operating them struggle to fully engage their members – and thus fully utilise the potential insight and gains to be made from better understanding customers.”

The report suggests that only 27 per cent of commercial messages sent to users of loyalty schemes are actually appropriate to the participants.

Wood said: “These findings highlight how important it is to not just have a loyalty programme but to use the data properly to send appropriate offers and deals to customers. The sectors doing it best – supermarkets and multiple brand schemes – prove the effectiveness of these programmes, but others such as fashion and children’s and DIY/ home furnishings retailers are missing a trick.”

Supermarkets have the greatest number of loyalty scheme members, followed by multi-brand schemes including Nectar card and Avios (40 per cent membership) followed by high-frequency low value transaction sectors such as chemists and health and beauty stores. The worst performers were fashion retail loyalty schemes, cinemas and theatre operators as well as book, much and gaming stores.

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