The four key segments

Qualitative research is at the core of how we develop customer centric loyalty programs that drive engagement and deliver economic impact. We have found that consumers don’t always act similar to how they responded in surveys. The greatest difference is often seen in how they begin redeeming their rewards/benefits in the program.
We are able to tie back program design survey results with actual behavior in current programs we run, across verticals. Based on redemption patterns we are able to identify four segments, or personas, based on this data:

“One and Doners” (10% of redeemers) – those that join the program, engage for a while, and burn down points on things like sweepstakes or low hurdle rewards. Many of these respondents claimed that mid and high value rewards would be of greatest interest, but they opt out and do not engage
“Practical Burners” (30%) – consumers that prefer to burn points on useful, low to mid-value rewards. They like instant gratification and often redeem for items low value coupons or gift cards. Surprisingly, the majority of these members explained their behavior during qualitative research, citing low hurdle rewards as their most valued items in the catalogue.
“Dreamers” (40%) – those who want to save for the high value rewards, but just can’t fight the impulse to burn points on mid-value items. They are tempted by new items entering the assortment and discounted point values on rewards (e.g. redeem a $10 gift card for 800 vs. 1,000 points this week only). 
“Bankers” (20%) – The scrooges of all the segments, who enjoy saving points and aiming for big ticket items. They are often better consumers who know they can achieve the higher ticket items because of their spend. In our research we found that many of these individuals ranked mid and high value rewards as their reason for joining the program.
Creating a redemption strategy that meets the needs of each persona is key to maintaining engagement and program stickiness.
Stay tuned for our second installment where we’ll discuss the pros and cons of each segment.
Please contact us for a longer conversation on how to engage with each of these types of consumers, and how we can collaboratively build a program that sets you apart from the competition.

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