Sometimes known as a rewards, points or advantage card, a loyalty program is a marketing effort aimed at cultivating customer commitment and encouraging ongoing business. But while many customers sign up, few are really active, according to Colloquy, the Cincinnati-based research and publication organization for the loyalty industry.

While the number of U.S. loyalty program members continues growing—with a current membership exceeding 3 billion consumers—consumers who sign up and then become inactive is about 58%. In 2014, the average U.S. household belonged to 29 loyalty programs but was active in only 12.

The Colloquy study, conducted every two years, recently reported that fuel and convenience retailers saw loyalty membership drop 3% since the 2013 census. Colloquy analysts suggested that retailers put more emphasis on customer engagement and less on customer acquisition and never assume that a one-size-fits-all program will make each customer’s experience truly personal.

Flash Foods, the Waycross, Ga., convenience chain, began testing its loyalty program in 2004. The following year, all stores received the program, which has offers to attract most everyone.
Dubbed “Rewards in a Flash,” the program tempts shoppers with 2% cash back on in-store food and merchandise purchases, gives special discounts on monthly promotions and regularly offers sweepstakes and contests. In addition, loyalty members receive a free drink every time they purchase 10 coffees, fountain or frozen beverages.

SLOW AND STEADY
Since its introduction, the program has not been static. In 2013, Flash Foods introduced a mobile app that provides digital loyalty card storage and permits mobile credit and debit payment using a smartphone. This year the chain added an alternate ID feature, a pin-based cash redemption feature and a simple enrollment process that allows shoppers to sign up by scanning a driver’s license at one of the more than 170-plus locations in Florida or Georgia.

“Our paperless registration allows you to join our customer loyalty program without having to take the time to fill out a paper application then wait for the application to be sent to our home office for processing,” said Jeannie Amerson, advertising and loyalty manager for Flash Foods. “Now, with a simple scan of your license, you are an instant member.”

Flash Foods is on trend, according to Deanna Jordan, senior research analyst of consumer insights for the research organization, Technomic Inc.

“Consumers need a reason to sign up, and it needs to be easy; therefore, loyalty systems will continue to move toward that goal,” Jordan said. “If you don’t have those basics, it won’t matter how elaborate and frequent the rewards are. The idea of an all-in-one system, featuring payment, loyalty, locations, rewards, etc.—the type that Starbucks has mastered—will proliferate. The only thing missing is the ordering ahead.”

“I think customers expect the retailers they shop with to acknowledge their patronage,” said Amerson. “Customers see the most value in programs that are customized and offer rewards that are relevant to them, rewards that meet their individual needs.”