The modern consumer is extremely budget-minded. For the most part, they join loyalty programs because they’re interested in the cost savings they offer. When we asked shoppers what they disliked about loyalty programs, an overwhelming number chose having to pay a membership fee.
What customers dislike most about loyalty programs
Loyalty programs that do charge a fee typically offer plenty of value in exchange for membership. The most prominent example is Amazon Prime; although the $119 fee to join is steep, members get free 2-day shipping, access to a massive library of movies, TV shows and music, access exclusive savings during Prime Day, and more.
Another unpopular feature was expiring points. Although adding an expiration date on points may theoretically be effective at ensuring customers come back and spend money before too long, many resent losing the opportunity to cash in on points they feel they’ve rightfully earned.
Retailers should also be wary of sending too many emails. Of the 10% of respondents that chose “Other,” most specified that they felt spammed after signing up for a loyalty club.
With loyalty programs, retailers must often reach a compromise between the programs appeal and its profitability. However, their customers shouldn’t be punished for their loyalty in the form of fees, expiring points and other inconveniences. Instead, brands should focus on the perks that customers find most valuable, while dropping the ones that may simply be adding extra cost or complexity.