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Gen Z Eschews Loyalty Programs

Generational marketing is important to the success of most enterprises but not all generations react similarly to the messaging of brands. 

According to a study released recently by Kobie Marketing, only 15 percent of Generation Z report being actively engaged in three or more loyalty programs compred to the consumer average of 41 percent across all age groups. In essence, the generation that is most likely to make loyalty-driven purchases has the fewest actual number of loyalty program members.

The “Loyalty in the Age of the Connected Consumer” report from Kobie reveals several key differences across generational preferences for loyalty programs and sheds some light on the factors that may appeal to today’s connected consumer. The report indicates that almost one-third (28 percent) of privacy-aware Gen Z respondents cite exposing too much personal information as a reason for not joining loyalty programs, demonstrating the need for transparency from those brands who wish to appeal to the youngest generation.

“Our research provides a snapshot of current consumers’ expectations and preferences around shopping and brand loyalty,” said Dave Andreadakis, chief strategy officer at Kobie Marketing. “Gen Zers are cautious, digitally savvy consumers who work hard. They’re loyal to the brands that communicate with them on their terms, brands who provide clear value and respect their privacy. For marketers who can deliver genuine experiences to this emerging cohort of shoppers, there is plenty of opportunity to strengthen relationships with them and cultivate brand loyalty.”

The same report found that the oft-overlooked Generation X is the most likely to belong to and partake in in loyalty programs. In fact, almost two-thirds (62 percent) of Gen Xers are members of three or more programs. Gen Xers are also more engaged program members, with 51 percent actively earning and redeeming points in at least three programs.

“While consumers are united in their preference for simplicity and convenience, we know that different types of programs work for different segments of shoppers,” said Andreadakis. “Beyond generational differences, consumer life stage, societal trends and the adoption curve for new technologies all intersect to drive individual consumer behaviors. To create experiences that convert buyers into loyal customers, marketers must also move beyond a one-size-fits-all approach.”


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