By Elizabeth Rowe
A recent survey by the Federal Reserve showed that consumers aren’t using mobile payment options for three reasons: lack of security, lack of ease and lack of benefits. Although new mobile features have garnered a lot of attention recently, most are missing a core component: loyalty. Without a robust loyalty and rewards strategy, the member experience can suffer and cause a variety of concerns for consumers.
So what can we do to remedy this? The first step is a refresh of our use of loyalty and rewards programs as they are central to moving mobile payments into the mainstream of the American wallet. The following insights will serve as stepping stones:
Behavioral changes. Loyalty programs are changing the way consumers shop and make purchases. A 2014 SteelHedge survey found that 82% of consumers are more likely to shop at a retailer offering a rewards or loyalty program than at other retailers. Another survey, by 60 Second Communications, found that 57% of respondents say they have “changed when and where they shop in order to maximize their rewards.”
Increased enrollment. Loyalty program enrollment is on the rise. A 2015 survey by Bond Branding found that the average number of loyalty programs in which consumers are enrolled continues to climb – from 10.9 programs per member in 2014 to 13.3 programs per member in 2015.
Greater selectivity. As consumers sign up for more and more programs, they are simultaneously participating in fewer. Bond Branding found that while the number of programs consumers are enrolling in jumped 19% over the previous year, the number of programs in which they are actively involved shrank from 7.8% to 6.7%. With more options, consumers can focus on the programs they see as having maximum value.
At PSCU, we understand the importance of offering a robust loyalty and rewards program for credit union member owners and their members, and addressing any potential safety and user experience concerns they might have. CURewards Mall empowers credit unions to reward members with points in a way that is faster and more effective than ever. The program includes 400 online and 10,000 local, regional and national brick-and-mortar merchants.
The Mall fully integrates with the CURewards website for a seamless and engaging member shopping experience that stimulates card usage. PSCU credit union members enrolled in the company’s loyalty program can also use the CURewards mobile app to view merchandise redemption options, review offers and check on points. In addition, members can request to receive communications from their favorite retailers about special point offers or purchase discounts. Overall, PSCU reports that members with rewards cards spend 60 percent more and conduct 30 percent more transactions than non-rewards cardholders.
As consumers express concerns about new platforms and tools such as mobile payments, it’s more important than ever to gain and keep their trust. Ramping up loyalty offerings and campaigns is a great way to show them you value their business and membership, and are listening to their concerns. Plus, the end result of gaining a loyal supporter will be an invaluable reward for your company that will pay off in both the short and long term.
Elizabeth Rowe is a financial services strategist for PSCU. As an ambassador for credit unions, Elizabeth works with PSCU’s Product, Technology and Advisory Groups to bring a larger context to the strategies deployed by our internal and external customers. Her work emphasizes the threats and opportunities presented by emerging payment channels and form factors, economic and regulatory trends and impacts of changing consumer demographics.