Young people (under the age of 25) are far less likely to use loyalty programmes, why is this? Loyalty programmes have in the past not been innovative enough to capture the attention of the youth. Brands have had to work hard at differentiating their loyalty proposition when it comes to their rewards offering. However, younger consumers are finding more value in loyalty programmes because loyalty programme owners are finding better ways to engage younger consumers to make loyalty more relevant and accessible.

In the following section, we explore the unique characteristics of the youth segment (particularly Millenials and Gen Z) in order to better understand their loyalty behaviours and attitudes.

Both Millenials and Gen Z have grown up with electronics, the internet and social networks. Their lives have been shaped by innovation and technology and they are pioneers in challenging the status quo of mass marketing, and expect brands to stand out from their competitors. Knowing this, it becomes clearer to marketers that traditional, mass communication marketing does not grab their attention. There are distinct characteristics of this younger segment which clearly define who they are and why we need to treat them differently when it comes to loyalty programmes:

  • They are highly informed due to access to the internet and social networks
  • They are heavily influenced by brands with social media presence
  • Their purchasing cycle is highly influenced by peer recommendation, research and convenience
  • They are conservative when it comes to spending
  • They expect more than points and discounts from brands, they demand engagement
  • They expect real-time response and an excellent customer experience
  • They want to be rewarded for non-transactional interactions

Younger consumers will most likely have less disposable income than their older counterparts. Therefore, loyalty programmes which best engage the youth are often those that can offer rewards for customers' engagement rather than simply the amount spent in-store.

"Our 20-something customer base want it to be simple and engaging...They want to be rewarded for how they spend with the brand as well as how they interact with the brand."
- Jim Wright, VP Marketing, Express Next

Younger customers will typically become the most engaged with and loyal to a brand that offers a meaningful programme experience. It is important to consider what experience your programme offers to ensure it is memorable and stands out from competitors.

Article provided by Truth