Retailers are off the mark when it comes to loyalty programs, as just 32% of customers find brand offers relevant, whereas 58% of retailers think they're sending out relevant offers, according to a survey by Oracle.
In fact, 19% of customers said they rarely sign up for loyalty programs and half only sign up for loyalty programs that are "relevant" to them, per the report. This again falls short of retailer expectations as 58% believe customers are eager to sign up for loyalty programs.
Shoppers are also increasingly interested in personalization and immediacy in loyalty programs, with 69% looking for personalized offers based on their preferences and 74% of consumers saying immediate benefits are more appealing to them than accumulating points.
Loyalty programs can be a great way to retain customers, but retailers often struggle to get them right — as evidenced by the shut down of the Plenti program, which Macy's and other major partners exited in January.
Oracle's study suggests retailers might be missing out, especially by not relying enough on social media. Over half (53%) of consumers said they research brands on social media before making a purchase, 43% will follow influencers who post about their favorite brands (along with sharing their favorite products or retailers there) and 37% go so far as to say that retailers are more trustworthy if they're recommended by social media influencers than celebrities.
The influence of social media on both sales and customer loyalty is well-documented — especially for Gen Z. Indeed, the youngest generation is twice as influenced by social media as by deals, and 80% said they're influenced by social media while they're shopping, leaving great potential for brands to reach out.
That being said, the group is also more selective about which brands they choose to interact with, favoring retailers that are eco-friendly and socially responsible over brands that are recommended by celebrities. And, as ever, consumers are more interested in loyalty programs that are personalized, with 87% of shoppers from a recent study saying they'd be alright with being tracked, watched or monitored if it meant a more personal loyalty experience.
"Retailers are heavily invested," Mike Webster, senior vice president and general manager of Oracle Retail and Hospitality, said in a statement. "The future of loyalty will be a balancing act between consumers desire for more anonymity, or at least direct control of their data, and an expectation for meaningful personalization that is targeted and timely."