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LoyalT Summary report

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Here is the 2018 summary report for LoyalT, the most complete study on loyalty program performance in Canada.

You will discover
- The methodology
- The possession and usage rate for loyalty programs in Canada
- The importance of personalized offers
- Mobile App usage
- The impact of a program on purchase frequency and concentration
- Millenials and how they use loyalty programs
- Top 10 programs in Canada

A personalized report for every program analyzed is also available. Please contact us at info@r3marketing.ca for more details.

Published in: Marketing
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LoyalT Summary report

  1. 1. Presented by and and sponsored by 1
  2. 2. © 2018 DataCandy Software, Inc. All Rights Reserved. Loyalty and gift card solutions for real and relevant results 700 brands Datacandy.com 3 400,000 members 10,000 locations Used by over
  3. 3. © 2018 DataCandy Software, Inc. All Rights Reserved. Loyalty and DataCandy Platform
  4. 4. © 2018 DataCandy Software, Inc. All Rights Reserved. Campaign Management Point s Discoun ts Punch Card RFM Segmentation & Targeting Social Media Fulfillment In-stor e Reporting & Analytics Promo Cards E-gift Corporate Orders Card Store Promotions Online Gift SMS Gamification EXTENSIONS Automated Clearing House Member Portal Wallets Bank Terminal POS Mobile AppAPI Online ordering
  5. 5. © 2018 DataCandy Software, Inc. All Rights Reserved. v Customer comments “Clients note that the solution is customer friendly and easy to use, and that the vendor is responsive, helpful, and provides good customer service and value.” Loyalty Report, 2016 Forrester DataCandy have an excellent reputation and impressed us with their gift card platform. They have proven to be responsive to our needs and mirrors our business culture in terms of serving customers with the best possible products and services. The DataCandy Gift Card platform is another step toward achieving an unparalleled shopping experience for ALDO customers around the globe.” Pascal Hebert IT Manager – Global Store Operations The Aldo Group “The DataCandy team, for development as much as for support, is composed of dynamic, dedicated and competent people. Requests are handled quickly, our needs are understood and considered and the work is always done in collaboration with all parties involved. The relationship with them goes beyond partnership. Working with DataCandy is real candy!” Véronique Painchaud Marketing and Loyalty Specialist Familiprix
  6. 6. 6
  7. 7. 7 New program development Existing program optimization Training Best practice analysis (BP-I) Our products and services
  8. 8. 8 Our clients
  9. 9. Why ? 9
  10. 10. Why ? ➔ There is no extensive study of loyalty programs for the Quebec and Canadian market ➔ There are no benchmarks available for loyalty program managers ➔ The only existing data measures members’ satisfaction or engagement However, the best measure of performance for a loyalty program is its capacity to modify purchase behaviour of members. 10 1 2 3
  11. 11. A unique methodology 11
  12. 12. Methodology ▪ Weighting according to the real distribution of the population, according to the sex, age, regions, education, presence of children and mother tongue ▪ Margin of error is +/- 1.4 %, confidence interval of 95% (in 19 cases out of 20) Canadians over 18 years old 5,000 respondents (3,000 in Québec) Data Collection from April 24 to May 11 2018 12 (Internet panel of over 400,000 respondents across Canada)
  13. 13. + Engagement Behaviour + Recommendation 3 Key performance indicators 13
  14. 14. The LoyalT score is calculated using a multiple regression analysis to determine the contribution of each key performance indicator to the final score. RECOMMENDATION 1 ENGAGEMENT 2 BEHAVIOUR 3 Interest in recommending the program to friends and family Social media subscription, newsletter and other communications consultation rate by members and points redemption in the last 12 months Capacity of the program to make members more loyal and to modify purchase behaviour (frequency and concentration of purchases) LoyalT Score 14 6 % 37% 57% Key performance indicators and measures
  15. 15. Provigo/Loblaw/M axi Metro IGA Longo’s Familiprix Jean Coutu Pharmaprix/ Shoppers Rexall Lawton’s Pharmasave Shell EKO Petro-Canada Esso Irving Husky BMR RONA Lowe’s Canadian Tire Cineplex Chapters Indigo DeSerres Brands and programs studied (9 activity sector) 15
  16. 16. Simons La Baie Addition Elle Penningtons Sephora Dynamite/Garage The Body Shop La Senza Air Canada West Jet Porter Via Rail Starbucks David’s Tea SAQ Club Cage Mondou PetSmart Coalition Programs Air Miles CAA Aeroplan 16 Brands and programs studied (9 activity sector)
  17. 17. Variables analyzed for each program 17
  18. 18. The personalized LoyalT report 18
  19. 19. The personalized LoyalT report 19 Recommendations : main takeaways, elements to improve, recommended strategies, etc... The performance of your program on 15 variables Your LoyalT score and the performance of your program on the 3 key performance indicators Your results compared to other programs in your activity sector and to the top 10 programs in Canada 1 2 3 4 $9,500
  20. 20. The personalized LoyalT report 20
  21. 21. Trends and results 21
  22. 22. Ownership and usage 22
  23. 23. Loyalty program usage is growing Number of programs owned, used or rarely/never used by person 23 8.9 5.9 3.0 9.8 6.6 3.2
  24. 24. Women use more loyalty programs than men 24 6,6 7.0 6.2
  25. 25. People with higher revenues use more loyalty programs 25 6,6 5.3 6.4 6.6 7.9 8.0
  26. 26. Usage rate remains high The 5 programs that are the most used in 2018 (always or most of the time) 26 Author’s note ➔ Usage rate remains high even though Canadians have more programs than before ➔ Brands with higher frequency of purchase obtain better results ➔ The rate shown for PC Optimum is the average of both programs (PC Plus and Optimum)
  27. 27. Components of a loyalty program 27
  28. 28. Importance of personalized offers 28 43% Author’s note ➔ The best programs are those using personalization and data analysis. Customers are expecting the right offers at the right time.
  29. 29. 5 Programs with the best personalized offers 29 Author’s Note ➔ SAQ stands out as this program has over 24 months of customer data history which permits to better personalize offers.
  30. 30. Mobile app usage is growing 30 16% % of respondents that always or most of the time use the mobile app
  31. 31. The 5 best programs for mobility 31 Author’s note ➔ Starbucks is first because the program integrates mobile payment, mobile orders and other mobile friendly elements.
  32. 32. Co-Branded Credit Cards 32
  33. 33. Adding a co-branded credit card improves a program’s performance LoyalT scores are significantly higher for co-branded credit card owner. PC Plus de Loblaws/Provigo/Maxi Program Members holding the co-branded credit card have a better perception of the program than members who do not have the credit card. 33
  34. 34. Adding a co-branded credit card improves PC Plus’ performance 34 (% of respondents attributing a score of 9 or 10) Author’s note ➔ This trend is also validated with other programs offering co-branded credit cards like Petro-Points, Husky Rewards and Canadian Tire.
  35. 35. Reward exchange and generosity 35
  36. 36. 41% Rewards redemption rate increases slightly 36 % of respondents redeeming their rewards in the last 12 months Author’s note ➔ Coalition program is the only category that decreased from 2017 to 2018. ➔ Several programs develop initiatives that are encouraging members to redeem. ➔ A member’s engagement rate for a program increases when redeeming.
  37. 37. 5 programs with the best redemption rate 37 Author’s notes ➔ Initiatives encouraging points redemption like vouchers (métro&moi) or contests (SAQ), mobility and frequency of visits are elements increasing redemption rate.
  38. 38. Perceived generosity according to program type 38 43%
  39. 39. The 5 programs with the best perceived generosity 39
  40. 40. Changes in purchase behaviour 40
  41. 41. The best programs increase purchase frequency % of respondents that agree (score from 7 to 10) that the program makes them buy from the company more often 42% 41
  42. 42. The 5 programs where members visit more often due to the program 42
  43. 43. The best programs increase purchase concentration % of respondents that agree (score from 7 to 10) that the program causes an increase in the concentration of their purchases 43 46%
  44. 44. The 5 programs where members concentrate the most their purchases 44
  45. 45. Impact on retention % of respondents that agree (score from 7 to 10) that if the program did not exist, they would shop there less often 45 36%
  46. 46. Millennials 46
  47. 47. Millenials are more selective in their programs’ choices 47 3.4 3.4 2.8 10.5 9.7 5.7 9.1 7.1 6.9
  48. 48. Millennials have a higher redemption rate than any other age group 48 % of respondents redeeming during the last year
  49. 49. Canada’s Top 10 49
  50. 50. Canada’s Top 10 Starbucks Rewards Beauty Insider (Sephora) Milliplein (EKO) 50 Author’s note ➔ Starbucks earns first place for a second consecutive year. ➔ Milliplein changed it’s program this year and results are almost instantaneous. ➔ Milliplein and Scene have the same LoyalT score (66.0). However, Milliplein performed better on the Behaviour key performance indicator, which is the most important KPI determining the loyalty score. This gives the 3rd position to Milliplein.
  51. 51. Canada’s Top 10 51 Program Points 2018 2017 Business Starbucks Reward 71.6 1 1 Starbucks Beauty Insider 67.2 2 ↑ 6 Sephora Milliplein 66.0 3 ↑ 8 EKO Scene 66.0 3 ↑ 4 Cineplex PC Plus 65.6 5 ↓ 2 Loblaws Petro-Points 65.2 6 ↓ 4 Petro-Canada Câlin 64.8 7 ↓ 3 Mondou metro&moi 61.6 8 8 Metro Optimum 61.2 9 ↓ 8 Shoppers / Pharmaprix Frequent Steeper 60.0 10 ↓ 9 David’s Tea Author’s note ➔ The best programs (Starbucks Reward) has only 71,6 points on 100. There is room for improvement even for the best programs. ➔ In case of an equality, the program with the highest score for the Behaviour KPI earns the highest ranking. ➔ PC Plus and Optimum were evaluated separately because the programs merged in February and data for the study was collected in April/May. It did not give enough time for members to live the PC Optimum experience. Next year, we will evaluate PC Optimum as a whole.
  52. 52. Winners for each key performance indicator 52 Top 3 Scene Beauty Insider (Sephora) Câlin Top 3 metro&moi Starbucks Câlin Top 3 Starbucks Beauty Insider (Sephora) Milliplein EngagementRecommendation Behaviour
  53. 53. Growth champions 53 Author’s note ➔ The Simons and Inspire (SAQ) experience high growth a couple of years after their launch. Programs that had the highest LoyalT score growth from 2017 to 2018
  54. 54. The new PC Optimum program 54
  55. 55. PC Optimum : expected changes in purchase behaviour (PC Plus and Optimum % of 7 to 10) 55 Author’s note ➔ The probability that PC Optimum members will shop more often in the pharmacies, supermarkets of the group as well as the Esso gas stations are high. ➔ PC Optimum is a new private coalition program to follow closely during the next years because they are well established Canadian brands where purchase frequency is high.
  56. 56. Coalition programs 56
  57. 57. Performance of coalition programs is decreasing 57 56,2 Author’s note ➔ The LoyalT scores of the three coalition programs are well under the average LoyalT score of all combined programs (56.2). 49.6 47.6 44.4 50.8 50.8 45.2
  58. 58. The performance of coalition programs % of members shopping at 0, 1 or 2 different retailers 58 Author’s note ➔ By definition, a coalition programs should make a member shop at many retailers. However, the majority of members use the program at only 0, 1 or 2 different retailers.
  59. 59. Reminders... 59
  60. 60. ➔ Loyalty program ownership and usage is increasing; ➔ The best programs are those able to modify members’ purchase behaviour by increasing frequency and share-of-wallet; ➔ Customer-data and personalization remain key to a better performing program; ➔ Coalition programs remain at the bottom of the LoyalT ranking; ➔ Private coalition programs is a trend to track closely ◆ PC Optimum with Esso ◆ Triangle by Canadian Tire (L’Équipeur, Atmosphere, Men’s Wearhouse and Sport Chek). Reminders...
  61. 61. One last thing 61
  62. 62. To get a personalized report 62 Contact us at info@r3marketing.ca
  63. 63. October 22nd from 9 AM to 5 PM HEC Executive Education Using relational marketing to increase sales R3 training (in French only) 63 October 24th 8h30 AM to 12 PM St-James Club, Montreal All you ever wanted to know about loyalty programs To register : ww.r3marketing.ca

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