Young consumers want more from brand loyalty programs

Study shows that young shoppers seek human connections with brands - even in loyalty programs.

When it comes to loyalty programs, which are still popular (about two out of three people in the U.S. participate in at least one), younger consumers want to feel more love from brands, according to new research.

The survey, conduced by consumer engagement and activation technology company Social Media Link, reports that 38 percent of millennials and Gen Zers are more motivated by loyalty programs that help others or have a charitable cause.

Nearly three out of four (71 percent) of the 1,190 young consumer respondents said they want brands to celebrate their birthdays in their loyalty programs, and 38 percent love exclusive events and parties.

The survey, conducted with members of Social Media Link’s Smiley360 community in March, also gathered insights from 2,110 Gen X and Baby Boomers.

Overall, about two out of three consumers in the U.S. are part of at least one loyalty program, but more than half of actively quit one of them recently, the study showed.

Of those who quit, 46 percent said they ended the program because the offers, discounts and perks weren’t impressive, and nearly one in three (30 percent) said the program wasn’t active enough.

"The fact that so many members leave because the brand didn’t offer much for customers to love opens up an opportunity for marketers to pull their valuable customers back in," said Susan Frech, CEO of Social Media Link. "Perks and discounts alone won’t do it -- they’re the cost of entry; the survey suggests that human interaction, community activities and personalized engagement are what makes customers want to engage with the brand."

Younger consumers, according to the research, apprecite human interaction and connection 9 pecent more than older generations, and they seek a sense of community 7 percent more and shared values 6 percent more than their older counterparts.

"The way brands originally used loyalty programs isn’t going to work anymore with younger generations. They want that up close and personal connection to the brand," Frech said.

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