This document discusses the results of a survey of over 3000 loyalty program members. It finds that: 1) Customers want relevant communications from brands on their own terms, rather than frequent emails, and will disengage if their expectations are not met. 2) Younger customers prefer rewards like prize draws and partner offers, while older customers prefer exclusive access and previews. 3) Not all customers are active on social media, so brands should use a variety of channels for communications. 4) Loyalty programs are still effective at increasing customer spending, though the relationship varies by age.

1. Your customer:
Always on or
switching off?

2. Contents
On my terms
I still want relevancy!
Don’t assume I’m social
Technology bites
Loyalty still works
2
4
5
6
3
Hi,

3. On My Terms
2
Customers are savvy about loyalty programmes, and are prepared to trade
their data for a reward - but on the agreement we’ll use this information wisely.
And what happens if we don’t? Communications are simply ignored - almost
half of our customers didn’t bother unsubscribing but stopped reading emails.
Or, even worse, some customers react so badly that they actually stop
spending with a brand (a more common reaction in males than females, with
almost 9% taking this action).
We commissioned a survey of over 3000 loyalty programme
members to understand the impact of retailer communication
strategies. What this has demonstrated more than ever before is
the importance of delivering on your customer’s expectations.
“Our survey showed that 40% of customers disengage but don’t unsubscribe when they receive
too many emails from a brand - Email campaigns that take a one size fits all approach are
damaging– a customer unsubscribing signals the ultimate disengagement with your brand”

4. Competitions /
Prize Draws
Free Gift with
Purchase
Offers on other
brands e.g. Luxury
cosmetics, spa days
Discount
In store events
Exclusive products
Double / bonus
rewards
New Season
Launch Previews
Specific product
offers e.g. £50
off coats
Early access
to sale
20%10%0% 40%30% 60% 70% 90%50%
40-59 60+
80% 100%
16-39
“I still want relevancy!”
3
But what your ROI doesn’t show is the number of customers
disengaging from your brand due to the volume of emails
received, and the future revenue you will lose as a result.
At the most basic level there are still fundamental differences
between genders. The survey showed that more females are
happier with frequent email communications than men (32%
want once a week vs. 25% of men)
Looking at age there are again trends in the type of
offers customers want to receive – with older customers
showing a preference for exclusive products and previews,
whereas younger customers like prize draws and offers on
partner brands.
So firstly, ask your customers how often they want to be
contacted and use this as your primary segmentation. Then
you need intelligent targeting to ensure that in those distinct
(limited) opportunities per year you send the absolute
best offer you can to engage and delight your customer.
This ensures that you meet their expectation and every
contact is valuable.
In a world of cheap electronic communications it’s all too easy to keep
sending a high volume of emails which appear to have a good return.
So let’s explore the
key findings from this
year’s survey panel...
Discount remains the most important aspect of a
loyalty programme; double rewards, early access to
sales and product specific offers are also significantly
important. The younger a customer is, the more
important free gifts with purchases become. Older
age groups view access to sales, double rewards and
new season launches, along with product specific
offers more important than younger customers.

5. 4
The relationship between age and social media
usage is linear, from 93% of the 16-24 age group
rating themselves as regular users, down to 14%
of the 70+ age group.
However, only 55% of our panel were regular
social media users overall. This means that a
mass market brand should not assume that the
whole base is socially active – some may even
find a focus on social off-putting.
Those that are social will be using frequently,
with 86% stating they visit sites at least once
per day. Consider your channel choice for the
widest reach – we found that 17% of all males
we surveyed use twitter regularly compared to
10% of all females.
Brands are now able to measure the impact
of social on loyalty – does liking something on
Facebook deliver more engaged customers and
incremental revenue? 70% of 25-29 year olds
we asked, said they use Facebook regularly,
and 54% of the same demographic said they
have connected with a brand socially at least
once or twice.
Q. Are you a regular user of social media applications, for example Facebook & Twitter?
“Don’t assume I’m social”
16 - 24yrs
25 - 28yrs
30 - 34yrs
35 - 39yrs
40 - 44yrs
45 - 49yrs
50 - 54yrs
55 - 59yrs
60 - 64yrs
65 - 69yrs
70 - 74yrs
75yrs +
0% 25% 50%
YES NO
75% 100%
17% of all males we
surveyed use twitter
regularly compared to
10% of all females.

6. Technology bites
Enhancing retail marketing with technology
by integrating loyalty data in order to offer a
personalised customer experience had
mixed reviews.
We specifically asked our panel about ‘iBeacon’
technology which sends targeted messages to a
customer’s smartphone as they enter a store.
Males under 30 on our panel were the most
impressed group, with 32% saying they would like
this service.
15
It would make my visit to
the store more worthwhile
- especially if it were an
‘exclusive’ to me as a loyalty
card holder - almost a reward
for the brand loyalty
However, on average 45% disliked the idea,
with comments focussed on:
Preferringanoffertodrivetothestorebeforehand,
not once you’re already there. This suggests good
suitability to large department stores, driving
you to areas of the store that you may not
have considered.
The technology detracting rather than enhancing
the retail experience; having to look at your
handset in store or being annoyed when you
notice the message later on!
“This would be
great so long as it’s
really relevant”
I do not check my mobile all the
time, so I’d be irritated if I found
out that I had a personalised offer
but hadn’t used it because I hadn’t
looked at the phone. I’d rather not
get the offer at all.

7. We asked our panel about the impact of being on a loyalty programme and found that
the relationship with increased spend continues to hold and has not declined year-on-
year; with 68% of customers indicating that they spend more with a brand due to being a
member of the loyalty programme.
Age affects the relationship with the programme; with younger customers more motivated
by the reward mechanic (receiving reward vouchers) and being more likely to spend more
to reach specific thresholds than older customers.
We have also found that new joiners to the programme are not necessarily new
customers to the brand, demonstrating that loyalty programmes are constantly evolving
and adding new features and benefits e.g. auto-enrolment when online shopping. The
primary proposition for loyalty hasn’t changed, but as channels become more seamless
the customer’s appetite for loyalty continues to grow.
Whatever the cause, the result of retailers being able to track customer spend, in
particular to join up the offline and online behaviour, is more valuable than ever in driving
your customer journey planning.
6
“Loyalty stronger than ever”
68% of customers
indicated that they spend
more with a brand due
to being a member of the
loyalty scheme.

8. www.ikano.co.uk
@ikano_UK
Ikano Bank is awesome with numbers,
but even better at relationships.
And that, ultimately, is what
turns customer loyalty into
a business’s success.
? Do you want to build a new loyalty or
customer engagement programme?
? Do you want to improve an existing one?
? Or, do you simply want to turn customer
data into actionable insight?
No matter what stage you are at with your customer
engagement we have the intelligent, intuitive insight to
help you achieve ROI and drive incremental revenue:
Wherever you are with customer
engagement, we have the
intelligent, intuitive insight to help
you achieve greater ROI and
drive incremental revenue.
For more information please contact:
Barry Smith
barry.smith@ikano.net
07551 671 825
0115 850 3644