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Here’s What Inspires Millennials To Join A Loyalty Program

In the on-demand era, convenience and customization are key.

Approximately 78 percent of Millennials belong to two or more loyalty programs, according to new research from Kobie Marketing — a positive statistic for omnichannel marketers, who see a higher number of repeat purchases as well as data and targeting benefits when consumers sign up for loyalty programs.

But what motivates this much-discussed demographic — now with over $200 billion in purchasing power — to join a loyalty program, and to stick with it?

Per Kobie Marketing’s Loyalty in the Age of the Connected Consumer report, 86 percent join to collect and redeem points for rewards, 78 percent to access discounts, and 28 percent for convenience (e.g. skipping the line at Starbucks).  This desire for both convenience and near-term rewards in particular is higher than that of any other demographic.

“’Whatever I want — whenever, wherever, however I want it.’ That’s what loyalty looks like now,” the report states. “To make loyalty engagement a habit and create advocates out of repeat shoppers, you need to understand exactly what they expect from a loyalty program.”

Rewards On-Demand

As we’ve written previously, the on-demand economy has conditioned consumers to expect programs and services to fit into their lifestyle, not the other way around. After all, who wants to wait for a cab in the rain when you could call an Uber to your doorstep?

Kobie Marketing’s research follows this pattern: 34 percent of Millennials won’t join if the enrollment process for a loyalty program is too long, and they also expect to see results quickly. As such, it behooves marketers to offer smaller rewards — or customized redemptions — in order to keep younger consumers coming back.

“Membership [is often] a failure for younger people on an operational level,” Loren Gray, founder at Hospitality Digital Marketing, told GeoMarketing in 2016. “They don’t want reward far in the distance; immediacy is key. If they’ve visited several times, they want to see something for that – otherwise they don’t care.”

Gray cited the experience at hotel chain Citizen M, which offers extras like free on-demand movies, as an example of a chain doing well at turning Millennials into repeat customers. But there are plenty of other options for marketers depending on their vertical: Longer use of higher-speed wifi at the coffee shop? A tailored birthday discount on a favorite product? The opportunities for smaller rewards and personalized touches are extensive if retailers are willing to get creative.

In conclusion, “Millennials say they want status, but even more, they want
perks like cutting wait times,” the report concludes. “They’re the ones skipping the line at Starbucks because they’ve already ordered ahead via Starbucks Rewards — and they’ll be first to claim their free birthday Frappuccino. Show Millennials you care by offering them exclusive perks such as early access to sales or member-exclusive deals.”

About The Author
Lauryn Chamberlain Lauryn Chamberlain @laurynchamberla

Lauryn Chamberlain is the Associate Editor of GeoMarketing.com. A New York City based journalist, she specializes in stories related to retail, dining, hospitality, and travel.