Survey Unearths Consumer Concerns Over Mobile Loyalty Schemes

Brands face a challenge in communicating the benefits of mobile shopping technologies, according to a new study from The Logic Group and Ipsos Mori

A fifth (21 per cent) of the British public said that they liked to receive loyalty scheme offers in this way, and double that proportion said they did not (40 per cent).

The research is the third annual comparative survey into customer loyalty, and surveyed over 2,000 adults in the UK.

Just under half of the public would also prefer to receive offers from loyalty schemes whilst shopping (46 per cent) while 47 per cent would like to use a credit or debit card as a loyalty card. 

For new technologies there is a marked difference in how open to adoption different generations are. When asked if they would like to receive loyalty scheme offers via new technology channels, significantly more consumers aged 15-24 and 25-34 agree (33 per cent and 29 per cent respectively) than their older counterparts (14 per cent). By the same token, disagreement is higher among consumers aged 45-54 (50 per cent) and 55-64 (54 per cent), versus younger groups (32 per cent). 

For older respondents, the key reservations were that their device would be too old to take advantage, fear of not being able to use new technologies, data security and being tracked. 

Antony Jones, CEO of customer interactions specialist The Logic Group says: “When it comes to developing loyalty schemes that involve new technologies, it really is imperative to consider your target customers, and those businesses offering products or services used by older consumers should perhaps be more careful about the introduction of new technology channels as part of day-to-day scheme interactions. Encouragingly, the respondents show interest in schemes where they only need to use one card or device; pointing towards future technologies to create links between accounts and scheme rewards, mobile apps, NFC and contactless technology.”

In focus groups, SMS offers and loyalty apps, and location-aware offers were broadly positively received, according to the survey. People link this technology with peoples desire to carry fewer cards in their wallets. The concerns were that text alerts when shopping could come annoying. 

Social media received a more varied reaction, according to the survey. They liked being able to sign up to a company and receive offers of relevance to them, and there was acknowledgement that both parties got something out of this relationship. However, data sharing and security issues were an overarching fear for all. 

There was mixed reactions across all ages to the concept of a mobile wallet. Those who were most negative were worried about fraudulent use, inconvenience if lost, and being a greater target for theft. There was also some negativity towards the suggested £15 transaction limit, with suggestions that this could be increased by adding a pin to the transaction to make it more secure. More positively, people felt that this would be more convenient as a phone is always with you, and contactless technology would speed up the transaction. 

Simon Atkinson, assistant chief executive at Ipsos MORI says: “There is undoubtedly consumer appetite for using new technologies when the benefits are made clear (for example, simplicity and immediacy); though uncertainty about the actual user experience still remains. Importantly, new technology could make interacting with a scheme more convenient and make offers and information more easily accessible. For consumers who are worried about embracing technology changes, and the older generation in particular, the answer is likely to lie in offering existing services in tandem with new.”