Why Aussie consumers want more from loyalty programs

Loyalty programs offer plenty of freebies for consumers who use them wisely, but many are not happy about the effort needed to achieve rewards.

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Exclusive: Nine out of 10 shoppers belong to consumer loyalty programs but about half don’t think they’re worth the effort, research has found.

As Christmas shopping swings into top gear, a new report by the Commonwealth Bank has found that many consumers are unhappy with how slow their loyalty program rewards flow.

It found supermarket loyalty programs are the most popular, followed by airlines then department stores, but one-third of consumers are put off by restrictions on when and where they can use their points.

CommBank’s executive general manager of everyday banking, Kate Crous, said Australians felt they could not collect points fast enough “to do the things they want to do”.

“Customers are just looking for value in loyalty programs and a lack of complexity,” she said.

Many shoppers structure their purchases to earn the most loyalty points. Picture: iStock

The research also found a gender divide in where loyalty lies the most.

Supermarket schemes are more popular with women while airline loyalty programs are favoured by men.

Consumer finance specialist Lisa Montgomery said many men saw collecting airline points “as a hobby”, and business owners often funnelled all their spending through reward cards to hoard points.

“A frequent flyer or other loyalty program will only work for you if you are invested in making it work for you,” she said.

“It’s understandable that some Australians stay away from loyalty programs because the fine print can be so detailed and sometimes can lead to a nasty taste in their mouth.”

Ms Montgomery said some people thought their spending was earning them rewards when it wasn’t, while others did not realise a program had changed its rules or benefits.

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Woolworths has changed its popular rewards program benefits several times in the past four years, and credit card rewards have been significantly watered down.

Earlier this month the Australian Competition and Consumer Commission voiced concerns that loyalty schemes were collecting customer data and sharing it with third parties.

However, the schemes remain hugely popular, with the CommBank research finding 17 million Australians belong to at least one loyalty program.

the bank is launching a rewards program where its six million CommBank app users can claim cash back through fortnightly offers by shopping at partner retailers including Coles, Caltex and JB Hi-Fi using a CommBank Mastercard.

Ms Crous said some customers who spent $50 at Caltex would receive $5 cash back, while spending $100 at Myer could deliver $15 cash back.

“Not every customer will get the same offers … it’s very personalised to that customer and their shopping,” Ms Crous said.

@keanemoney

Originally published as Why Aussie consumers want more from loyalty programs