Why Smart Consumers Are Rethinking Loyalty Programs
Remember collecting books of stamps from the grocery store as a kid, turning them in for toys and candy once you filled up enough pages? Or hoarding frequent flyer miles from business trips over the years, saving them for an eventual tropical vacation?
Loyalty and rewards programs used to feel so gratifying, giving you benefits for supporting brands you loved. But let's be honest - most have lost their luster, becoming more soulless corporate tracking tactics than fun perks. Do the hoops they make us jump through truly pay off anymore?
The Crispy Chicken Sandwich Debacle
The infamous Crispy Chicken Sandwich War is a prime example of loyalty programs limiting customer freedom...
Many fans had amassed big stacks of chicken sandwich reward points with Brand A over the years. But when viral buzz erupted about rival Brand B's new sandwich, legions felt irresistibly compelled to try it.
The trouble is, using those hard-earned points for a free A sandwich requires providing oodles of personal information during sign-up and tracking every purchase through their app for continued "status." All that data fills marketing databases.
Did people stay locked into Brand A's program or temporarily jump ship? Social media split with impassioned arguments both ways. Not exactly the carefree experience fast food chicken is supposed to offer!
Do Programs Actually Change Buying Habits?
Loyalty programs promise the world early access to sales and new products, freebies and discounts for big spenders, and elite status unmatched by the common masses!
But do point systems truly make people alter purchasing behavior or just offer perks to those already buying frequently? Most folks likely aren't handing hard-earned cash to companies they don't genuinely like.
And how many abandon loyalty plans after the short-term new member high wears off? One study showed airline mile collectors spent, on average, only 25% more in their first year before dropping back to previous spending levels. Perhaps programs don't wield quite as much psychological influence over us as they claim.
Read the Fine Print's Fine Print
Take a closer look at common loyalty program policies as they tend to benefit corporations more than members:
- Brands can revoke earned perks at any time for nearly any reason;
- Companies rarely offer fair warning before devaluing points/miles;
- Loyalty status expires quicker than that milk leftover from last month;
- Byzantine terms and conditions that nobody fully reads or understands.
It's not exactly empowering for customers. Paints a picture of hulking conglomerates wielding all the power while we scramble on command for a few breadcrumbs of pseudo-rewards. For whom is the structure actually designed?
And all these intrusive data requirements frequently fuel targeted advertising, too! Relentless bombarding with "personalized" offers for more, more, more of what brands want you to buy. The price paid for a few discounts and free snacks here and there.
Privacy Matters Too
But perhaps the most insidious aspect of traditional loyalty programs is their vacuum-like sucking up of consumer data, shopping patterns, and personal details.
Mobile apps and extensive registration forms coerce participants into handing over phone numbers, home addresses, emails, ages, and incomes in exchange for points, which get stored indefinitely on some server farm, sold, or shared with unspecified third parties. It's not exactly comforting.
However, savvy people are finding privacy-protecting solutions to still enjoy loyalty perks without overexposure. Services like Quackr let you create a disposable free phone number online to provide at sign-up rather than your real personal contact info. Voila! No follow-up marketing calls or texts.
Burner credit card options offer similar single-use numbers that can't get connected with your name or other spending activity. And virtual mailbox addressing shields your home location from data trackers. Small acts of rebellion!
Digital Loyalty Innovations
Beyond classic punch cards and paper coupons, brands invest heavily these days in digital tools to take loyalty programs to the next level.
Mobile apps, facial recognition, predictive modeling, machine learning algorithms - the tech gets pretty advanced! Marketers boast next-generation personalization and real-time engagement powered by collecting and dissecting more customer data than ever before.
Programs like Starbucks now auto-reload your balance when it gets low. Amazon Prime automatically orders household staples you tend to re-purchase. Retailers can detect exactly where you wandered in the store via your phone and then later serve up digital ads for what exhibit caught your eye. Creepy or cool convenience?
Rethinking Relationships
Rather than the traditional corporatized loyalty route, what if we shifted our perspective to direct reciprocal relationships between customers and cherished small businesses instead?
Shopping with independent bookshops, boutiques, craft vendors, and community restaurants we already love (where owners recognize us by face!) offers a two-way bond no behemoth chain can match.
Sure, big national programs provide conveniences and occasional score deals in exchange for independence. We each decide what matters more. But with a little deliberate creativity, perhaps we can really have the best of both worlds.
