Loyalty Trends: Top 5 Loyalty Pain Points – Global Loyalty Trends Report 2022
Catch up on key loyalty insights through our “GLTR 2022 Mini-Series”, where we break down some of the core topics discussed in our full report and emphasize some of the more intricate details.
In the sixth instalment of our series, we are breaking down the most notable loyalty trends from the survey and market research conducted.
Starting off with the contemporary pain points identified by top loyalty executives from various loyalty programs.
So what are the top rated pain points faced by loyalty programs in 2022 and why?
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Top 5 Pain Points
Low Member Engagement
Low Member Acquisition Growth
Low Nr. of Engaging Rewards
High Partner-Management Costs
High Points Liabilities
What Are «High Points Liabilities»?
As previously estimated by Forbes, in 2021 there were as much as 100bn dollars in unclaimed loyalty points. These unclaimed points are not only wasted but also converted directly into liabilities when brands are summarizing their balance sheet.
Points Conversion and Liabilities
50% of loyalty executives that selected «High Points Liability» as a pain point, were more likely to answer “No” when asked whether their loyalty program enabled the conversion of points.
«High points liabilities» as well as low growth and engagement are consistent with a low number of redemption options. In turn, more quality reward options will drive engagement and reinforce the value that all members extract from any loyalty program.
What type of strategies and rewards can be adopted to boost these keys elements of loyalty (member engagement and growth)?
Stimulating Engagement and Revitalizing Rewards
Brands need to start offering more quality and engaging rewards. One way to create leverage and offer new redemption options is by enabling the conversion of points.
Allowing members to exchange from one loyalty point to another and access a wider array of redemption options from another program’s rewards portfolio.
This not only combats the low member engagement that 71% of brands reported, but also helps solve another prominent pain point that brands face, «Low Number of Engaging Redemption Options».
Key Takeaways (TL:DR)
- Forbes estimated that in 2021 there were as much as 100bn dollars in unclaimed loyalty points, which were not only wasted but also converted directly into liabilities for brands.
- Brands need to start offering more quality and engaging rewards, for instance by enabling the conversion of points.
- Allowing members to exchange from 1 loyalty point to another and access a wider array of rewards.
- The Top 3 Pain Points Included:
- 71% – Low Member Engagement
- 71% – Low Member Acquisition Growth
- 54% – Low Nr. of Engaging Reward
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