The State of the Loyalty Industry According to Forrester

In an effort to understand the size, structure, and performance of loyalty programs, Forrester recently surveyed 50 marketers about their program strategies. The report contains important benchmarks for executives working on driving customer loyalty.

Here are some of the statistical highlights from the Forrester report titled “The State of Loyalty Programs:”

Driving Relationships with Customers is Becoming More of a Priority.

Areas of concentration include:

• 60%  engagement
• 59% customer retention
• 39% profitability/revenue
• 35% customer lifetime value
• 31% customer data collection

Top Business Objectives for Loyalty Programs:

• 70% customer retention
• 64% customer engagement
• 34% profitability/revenue
• 32% customer acquisition
• 26% data collection
• 20% customer lifetime value
• 20% customer satisfaction
• 14% customer experience
• 10% customer centricity
• 10% Customer service
• 2% competitive threat

Important Factors When Selecting a Loyalty Program Provider:

• 35% technical capabilities
• 33% thought leadership
• 32% reliability of service
• 30% strategic contribution to our business
• 29% understanding of our business
• 29% ability to design and execute innovative and differentiated loyalty programs

Greatest Challenges Facing Customer Loyalty Program Today

• 40% ensuring member awareness/understanding of the program and its benefits
• 30% measuring the results of our loyalty program – 30% (commonly ranked #1)
• 24% garnering support and budget for the program from executives
• 22% aligning our loyalty strategy with the overarching business strategy
• 22% delivering offers with a high perceived value

Loyalty Program Characteristics that are Important

• Configuration
• Tiers
• Segments
• Promotion rules out of the box
• Analytics, analytics, analytics
• Insights, insights, insights