#219: "For Love or Money" - Australian Consumer's Loyalty Perspectives For 2022

In this episode, Adam Posner, joins us to talk about his hugely popular “For Love or Money™ Australia” research report and insights for 2022.

Adam explains key insights from his research and discusses what compels consumers to join a loyalty programme and the “3 Bs” of loyalty: behaviour, belief and belonging. We also talked about generational differences in loyalty preferences, rewards and even currency types.

Whether you are working in loyalty marketing in Australia or elsewhere, these consumer insights offer invaluable ideas to reflect on.

Show Notes:

1) Adam Posner, CEO and Founder, The Point of Loyalty

2) For Love or Money™ 2022 Australia 

3) The Point of Loyalty website

Audio Transcript

1 (5s):

Welcome to “Let’s Talk Loyalty”, an industry podcast for loyalty marketing professionals.

I’m your host, Paula Thomas, and if you work in loyalty marketing, join me every week to learn the latest ideas from loyalty specialists around the world.

Are you leading a loyalty program in the UK and wondering what will be important in the future?

Would you love to hear a brand new research into loyalty trends so that you could figure out how to future proof your program?

Well, to launch Collinson’s new partnership with Salesforce and Salesforce’s new loyalty management module,

These two leaders in loyalty are hosting an exclusive event in London.

1 (52s): All about future proofing loyalty S being hosted at Salesforce Tower, right in the heart of the city of London on Thursday, the 12th of May.

So to get your free invitation, simply register on invite.salesforce.com forward slash future proofing loyalty, it promises to be a wonderful afternoon, a chance to meet and mingle with other loyalty professionals and to be inspired with some wonderful ideas for the future of your loyalty program. Hello, and welcome to today’s episode of let’s talk loyalty and interview with Adam Posner. 1 (1m 37s): Who’s been a guest on the show before a loyalty expert based in Melbourne Australia. Adam is well-known in the Australian market for his consulting firm, The Point of Loyalty, and also over the last 10 years for his Marcus report and consumer research study, that takes the pulse on customer loyalty and loyalty programs in the Australian market. Today. Adam shares with me his latest insights from the 2022 For Love or Money report. I hope you enjoy our discussion about the key points that I found most interesting. And I also hope they’re really useful for all of you listening, no matter where in the world you’re joining us from So Adam Posner, welcome back to let’s talk loyalty. 2 (2m 32s): No, it’s a pleasure to be back talking with you, Paula. 1 (2m 35s): It’s always wonderful, Adam. I feel like we’ve done. This might be our third one, or maybe even our fourth, they’re recording together, but always loved talking about For Love or Money. It’s incredible 2 (2m 46s): For, and the fifth one is free. Is that correct? Like my coffee card. 1 (2m 50s): Oh, of course, absolutely. Wonderful. Listen, Adam, you’re, you’re working extremely hard releasing your research reports again. I know it’s the 10th edition of, For Love or Money, a wonderfully in depth research report on the Australian loyalty markets, which I’ll get you to, to fully describe for our listeners. Now, in a moment before we get into the, the big topic for today’s discussion, I did put you on the spot there a minute ago and ask you to have a think about your favorite loyalty program from a personal perspective, Adam. So ignoring all of the wonderful things that you study and advise and consult on just from a personal perspective. 1 (3m 31s): What’s your favorite current loyalty program? 2 (3m 34s): Yeah, the problem that really resonates for me is a program that solves a customer problem. So it’s not just a program that gives me points and perks and birthdays and offers. It’s a program from a brand here in Australia called Supercheap auto, which is a automotive accessory brand and retail outlets all over Australia. And you can buy your car seat covers and to wash your car and basically all those accessories for, you know, keeping your car in good shape. And their program is incredible because what they do is they, they make us promise that you can buy anything at, at any at the price that it’s displayed on. 2 (4m 14s): So at full price. And then because you’re a member, if those car seat covers go on sale, they’ll automatically credit back the difference into your account. And I think that’s absolutely brilliant because it gives trust and immediately with a program that I’ll buy what I need when I need it. I won’t wait for it to go on sale because I know based on their promise that within two weeks, if that item goes on sale, I will get the credit back. And so can you imagine what that does for trust with the brand, for buying it full price, but also one of the real things that really is what actually happens to the credit, 1 (4m 56s): The credit, 2 (4m 57s): The credit is used by me to go back again and buy more. 1 (5m 2s): So it’s 2 (5m 4s): Brilliant from a business point of view and solves a customer problem. I love it. And that’s my story. And that’s the program. 1 (5m 10s): It’s a wonderful story, Adam, and you’re absolutely right. I don’t think we do know as a loyalty industry to overtly, you know, build trust with our customers in such an explicit and, and simple way, because I think sometimes, you know, there’s, well-intentioned brands that might build a customer promise like that, but leave it up to the customer to go and claim the difference or to notice, or to, to, you know, to intervene I suppose, to it, to get that credit back. So the fact that they’ve closed the loop and really said, we take responsibility for taking care of your spend, that it is going to be super cheap also to add, to live up to their brand promise. 1 (5m 53s): I think that’s extraordinary. And, and really one we’ll have to get them on the show. Adam. 2 (5m 58s): Now I’m just remind me because I’ll try and find the right person for you. So yeah. W w you should get them. I’d love to hear what they say from an internal point of view. I mean, I never worked on it on just a consumer of the, of the program. 1 (6m 10s): Perfect. And let’s say very well-informed consumer, huh. 2 (6m 14s): Well, I just love it because I keep on saying it solves an issue out there. How much do you hate going to buy a beautiful outfit? And then on the Monday you see it goes on sale. Does that make you happy? 1 (6m 27s): Oh, it absolutely is super frustrating. 2 (6m 30s): Yeah. 1 (6m 32s): Yes, exactly. And I think it is particularly for a commodity product where there’s probably a huge amount of comparison shopping in that sector. So it might not be the same with the fashion brand or sometimes with luxury retail, for example, there’s almost a, a pride in, you know, buying things at full price that there’s no association around discounting as a model, but in this sector and in anything, I think that’s seen as a commodity, it sets a genius loyalty strategy. So, and I liked the fact that you said it’s, if you’re a member, you get the credit back. It’s not just by being the customer. So it’s a difference. Yeah. Yeah. Wonderful. Okay. So that’s exactly why I asked this question, Adam, so I can get super inspired by a brilliant idea that somebody’s come up with because it’s not a unique problem in the Australian market. 1 (7m 19s): It’s definitely a global problem. So hopefully people listening can have a think about that for their own businesses, right? You have sent me the, the highlights and I suppose the keynotes of the latest round of your research, cold For Love or Money. It’s a wonderful piece of research. We did an episode on it last year and the audience absolutely loved it. And I hope a lot of people went to your website to download it last year. And hopefully again, this year. So first and foremost, Adam, tell me, why did you get into this huge piece of research and work? I can imagine you probably don’t have a good night’s sleep now for weeks with all of this work going on. 1 (7m 60s): So tell us why you started all of the work. 2 (8m 2s): Yeah, it’s an interesting story. I mean, 10 years ago, this year’s the 10th edition and I cannot believe my baby’s 10 years old already. It was a random conversation that I had with a friend and his names. And I’ll call him out is Pete noble. I’m here in Australia. And I was in loyalty. I was consulting and I had the business and not just, couldn’t find an Australian based study around consumers insights to loyalty and loyalty programs. So that’s show years ago and then US-based studies, but I couldn’t find anything. So I thought, well, why don’t I just do it? And I didn’t realize, so y’all story sometimes if you know too much detail, you dug deep, I didn’t realize, you know, a, the appetite for it, but where it would go. 2 (8m 46s): And so we put together a brief and we can, this is all done through with an independent research company. So I don’t do the research. I commissioned the research and a professional, and it’s done on a robust, robust Australian population of a thousand plus Australian adults over the age of 18. So it gives us a 95% confidence level and a 3% margin of error. So it really gives us a great sentiment of the population. 1 (9m 15s): Wonderful. Anyway, 2 (9m 15s): So that’s the backstory 10 years ago, a random coffee. We did the study and at that stage, it was funny. We just published the study and we had hundreds and hundreds of downloads. We couldn’t leave it free at that stage. And as you know, now I actually put a price on the main report and also the media grabbed onto it because we had brands mentioned Ben. And so it just grew from there then every year they’re on, I’ve just got a mission to keep being curious. And my mission for this research is I, it helps me with my consulting, absolutely be an educator and helps the community because the insight in Australia and New Zealand, you know, my mission is to identify insights that inspire loyalty markets, to take action, to lift their loyalty programs and strategies out of what I call the sea of sameness so that they become, you know, a real robust strategy within the business. 2 (10m 15s): And you and I have discussed this before that they’re not just a marketing work in progress items, but a boardroom agenda, loyalty strategies and programs all across the business. So that’s my passion point for the mom to answer your question, maybe in a little more detail than you might’ve expected. 1 (10m 32s): Well, you know, but I want to acknowledge you, as I said, for the huge amount of work, because I cannot imagine undertaking something of that scale and articulating it in a way that’s so powerful and so useful to such a, an important market. Actually, I do believe the Australian loyalty market is very sophisticated and increasingly so, and certainly this year’s research will indicate some of the, the big, interesting trends that are happening, but also I do love all of your kind of soundbites, Adam, and I really believe this thing about the sea of sameness. You know, it’s something that consumers I’m sure would probably actually use those words if they had the chance themselves. 1 (11m 13s): So this, this challenge that we have sometimes as a consumer to say, why would I bother joining that loyalty program? Like finding a compelling proposition can be super challenging. And I’m sure we’re where the most demanding customers in the world, given that we do this professionally. But yes, I often stand as a retail counter and challenge the poor person to tell me why you joined their loyalty program. 2 (11m 38s): It’s funny you say, tell me why, because part of my consulting, I always say to clients and your team, tell me why in 10 words or less. 1 (11m 46s): Exactly. Exactly. Yes. Yeah. And if, if this is sea of sameness type proposition, you can guarantee they will be able to Brilliant. So listen, I have picked out my top three favorites from your wonderful 10 major insights, Adam. And, but even before I talk about those three, I do love your very simple definition actually in section one where you articulate that obviously loyalty is not a loyalty program. And we’ve talked about that on this show before. So I didn’t call the podcast, let’s talk loyalty programs for exactly the same reason. And you really articulate and explain those three elements, the three BS of loyalty. 1 (12m 28s): Dare I say it. So, so I’d love you just to share that with the audience, just to get us started, 2 (12m 32s): You know, it’s continuous learning from me and a while ago I realized that everyone talks, as you’ve said about let’s do loyalty and then I’ll ask them the question, hang on a second. What do you mean by let’s do loyalty. Yeah. We want a loyalty program or do you want your customers to be more loyal? And so I, I, I believe that to get a frame of reference around loyalty is not a program. What is loyalty and give me a definition of loyalty. And then deciding once you know, what loyalty actually is to your brand, then you can decide what a loyalty program can do to drive those loyalty outcomes. So a loyalty is an outcome, and it’s based on three BS, it’s a behavior which is transactional. 2 (13m 16s): You spend more and more often, it’s a belief which is attitudinal and it’s emotional. So that’s that trust, love, and recommendation. And there’s now a belonging. It’s my third, my third beat. So behavior, belief and belonging, where you actually feel connected to the purpose of the brand, which has become far more far more prevalent these days in the last, perhaps two years. And I’m reading every way of the word, do people connect with the purpose of the brand like Patagonia and their purpose and other brands that have got a greater purpose. And these consumers are far more connected to the social connection, the cause and charity and their purpose. 2 (13m 57s): And that’s why I’ve pulled in belonging as, as, as the third be of loyalty. 1 (14m 2s): I love it. I love it. It’s a very important distinction, Adam. And again, for anybody who’s sitting and reflecting on their own loyalty campaigns, initiatives, and programs to keep it quite broad, I do think belonging is a critical piece. So, so important to have that in the definition. And so let’s get into them, I suppose, my first, I suppose, favorite insight item this time around was in the fifth section, all For Love or Money. And you talk about the growth in the impact of structured loyalty programs through the pandemic. And it has been my firm belief since I started in loyalty back in 2010, just after the big kind of global recession that times of uncertainty loyalty programs are an amazingly powerful tool. 1 (14m 51s): And I think that’s, what’s coming through in your research. So, so I’d love you to share the insights in how our loyalty programs in impacting consumer behavior now in 2022. 2 (15m 2s): Yeah. So the, the insight that you’ve chosen is, is very, I guess, relevant to today versus perhaps in the beginning of 2020. And we will know what’s happened in the last few years. And so I was very used to doing, looking at the impact of loyalty programs on brand engagement, across deciding to purchase from the brand impact of logic programs on actually purchasing and the impact of loyalty programs on recommending. And so those three key motivating aspects and directions, and in 2020, just for one of those three, you know, deciding to purchase the loyalty program, having influence and 63% said, yes, it did. 2 (15m 43s): But two years later post pandemic, or say two years later, it’s now 76%. So it’s got a big jump in the impact of the programs had on influencing a person’s decision to purchase from a brand and actual purchasing. Another big jump, you know, it was, it was 71% this year versus 56, 2 years ago, 56%. So another big influencing factor of members saying that a program has had an impact on their actual purchasing behavior. I call a pre pandemic, you know, cause the study was done just before and now we’re two years later. So I believe that the programs have had a huge impact over this period on, on consumers. 1 (16m 29s): Yeah. And the recommendation piece as well is, is incredibly powerful. Yeah. 2 (16m 35s): Yeah. I didn’t even, you know, I don’t want to overwhelm people with statistics, but that one in itself, the jump has been, I think 50, 46% said in 20, 20, 20, 26 of us just under 50 said that a program influences them to recommend. And this year it’s not 59. So just under 16. So now that a significant jump and members saying that programs have an influence on them recommending a brand. So those three influences decide purchase and recommend all have jumped in the last two years 1 (17m 12s): Extraordinary. And the reason I suppose I picked that as my most favorite item. And it goes back to the point you made already. We fundamentally, I suppose, believe as loyalty professionals, that loyalty programs, initiatives, and investments belong at the board level. So the conversations that we want to have, that’s exactly what that cohort and those stakeholders and those budget holders needs to understand. And I think wash what your research does is it offers an independent validation of that because we’ve all been the loyalty managers saying my program is, you know, helping people decide or buy more or recommend us more, but because you’ve a vested interest in us, it’s not as credible as you saying, this is what people are telling me when they have no vested interest. 1 (18m 2s): So I think that independent piece is super powerful. 2 (18m 5s): Oh, that’s an interesting perspective. I like what you’ve just said there, and yes it is. It’s an independent point of view versus a brand that’s siloed within their own customer base. So I think you’ve highlighted something really in which, which is good for me to hear from you, you know, as a third party, say that that’s what I’m aiming to give insights and benchmarks driving loyalty managers to go and do their own study and analysis to see how they rank, 1 (18m 32s): But also to, to avoid the risk of being dismissed. So I definitely think if I have a vested interest in proving how great my loyalty program is, it’s just not credible or not as credible. And also there’s the, the inevitable bias that they’re my pro it’s my program. They’re my members. Of course, they’re going to tell me wonderful things to my face or directly, or, you know, explicitly when I ask them. So again, there’s the, the power of professional researchers to say that this is something that’s being said, regardless of having any, any reason or any bias. So that’s why I like this, this particular one. Yeah. Super powerful. 2 (19m 10s): That’s a good one for you to, to find, to jump out at, because I do love that one as well. 1 (19m 14s): Yeah, absolutely. Yep. And as you did say, Adam, there are 10 sections and we’re not going to do all of them justice today. And the next one I wanted to pick up on, I suppose it’s probably around, you know, what people are interested in as rewards and the whole section seven is all about, you know, what is interesting, what’s sexy and there’s lots of new ways for members to be rewarded. And whether it’s, you know, you know, the existing ones, I suppose like a catalog, but then moving into the exciting ones. And, and I know you also do a lot of analysis Adam, around different demographics. 1 (19m 55s): And I was saying this to you all fair. So it’s wonderful to have insights by gender, which we’ll talk about specifically in this, you know, ways for members to be rewarded, but also the different demographics. And when I was reading this, I had to, first of all, go back and remind myself, which demographic am I? Because it’s just not something I have to remember very often, but you do cover all of them. And, but there was also just a wonderful thing. As a slight aside, I was reading something by Seth Goden this week and he was talking about what’s the next generation going to be cold. So we know about our baby boomers. We know our gen Z are gen X and gen Y and Seth go, who said that the next generation he thinks is going to be called at generation C, so C for COVID C for carbon and see for climate. 2 (20m 42s): So 1 (20m 44s): Super cool. 2 (20m 47s): Sure. There’ll be the right age yet for my study, but I will watch up 10 years time. They might, that’s 20 years. We’ll we’ll book another session with you. 1 (20m 58s): We totally will. Yeah, there you go. 2 (21m 1s): But he has a different, good pick generations and the genders. So that’s why they’re where every brand that’s got a program. They might have a different cohort or, you know, generational skew and they’d be more interested because they, more than the other one gen Z on their next strategy or in their program or they’ve got bid. So what’s the nuances that comes through. 1 (21m 23s): So tell us those nuances that, and then specifically in this whole section about tracking new ways for members to be rewarded. 2 (21m 30s): Okay. So in, I think it was in 2020, again, I, for the first time she’s got a double check, it was 20, 20 years. I looked at the market around the world to see what’s different about what programs are doing in terms of different ways for awarding or engaging their members rather than the traditional, you know, type programs that we will know. And there’s, there were seven or eight that identified and I included one that’s standard of what do we all know, which is the earning rewards for a catalog because everybody’s doing that airlines and so on. And then I explored others like, you know, and they’re becoming more prevalent now, cash back to, to, to save your money and your telco and your electricity and utilities. 2 (22m 14s): So solving more, more cost of living in services problems, right? Sure. Water recycling, that’s become more prevalent two years ago. They’re all quite new, early cash back into your super to help you save your super funds. So that’s your, your, your retirement fund. Again, quite unique a few years ago, I wanted to see those early shares. There’s another thing that’s become more prevalent early cryptocurrency. You know, that’s also become far more hot topic and this year, and then even a funny one from one of the pizza brands that we’re giving people, the points for purchasing a competitors’ brands, which was wow, why would you do that? Just so unique and very bright. Anyway, long story short, I took those notes eight and I researched them in 2020 to see how they ranked it and their appeal, any 3d printing to identity again. 2 (23m 3s): So two years later, interestingly, and, and I’m not quite sure why, but earning rewards from a catalog, the good old staple diet, the standard has actually increased in appeal. Funnily enough, it’s still ranked number two, but it’s increased over, over that period. I don’t know why maybe people are safer feeling safe. I’m just hypothesizing. I don’t know why specifically what really fascinated me is when you get to your question, when you break down all those rewards based ideas into your demographic, as you say, your gender and your generations early cryptocurrency, which is so topical now ranks low on, on all of those apes. 2 (23m 48s): But if it can be more of appeal to men and to gen Z or gen Z significantly more. So for example, I’ll just give you a quick stat on that. So generally the population said that 32% were interested. We’re interested in early cryptocurrency as a reward, right? For me, it’s 37 and for genes and at 44%. So quite a significant differences. And that’s when you dig into the data and you dig into that, that you suddenly realize that certain ways of rewarding members appeal to certain audiences, 1 (24m 20s): Which is super important. And again, you know, the whole idea about obviously building our proposition with our member profile, our ideal member profile in mind. We’ll definitely be very well-informed if you do have, perhaps I’m thinking back actually to your super cheap also guys, you know, they probably have more of a male bias for example, and I know I’m totally generalizing there and, but if they do then it’s for them perhaps to suddenly think, Ooh, maybe cryptocurrency is something that we should be exploring for our members as well. Whereas it might be less prevalent for a brand that has more of a female bias. So definitely important to understand that 2 (25m 0s): I exactly, and, and, you know, without getting into any of that specifics, you’re, you’re spot on it’s about understanding who your audience is getting to get a sense of where the skew is and finding the appeal. So for me, that was the most fascinating in this section is where perhaps, you know, cryptocurrency is a bit of, it has moved over two years. There’s a lot of talk about NFTs and loyalty programs, and maybe you should find, find, get some people on your, on your show to talk about that at some stage, because a lot of brands are exploring that right now, especially in their loyalty programs. So yeah. Interesting area that you found again, another one of those nuggets hidden under the rock of a hundreds and hundreds of insights. 1 (25m 43s): Exactly auto. Absolutely. Yeah, no, I can imagine. And just give us a sense then the finished report, I know it, Sam, you know, what’s out now and it’s been in design for, I dunno what to just say, six or eight weeks it’s taken just to, to have a beautifully presented. So, so what kind of depth of presentation are, is the report? 2 (26m 2s): Well, it’s 101 pages. So anyone who wants to do some, like reading in bed one night, but 101 pages to read the report, but I do give a free executive summary as you know, which is just a snapshot of some of them, of some of the areas just quick, should we start, as you said, sound soundbites. So I’m going to give a little bit more detailed. Some it’s too much to Jack actually give it, you know, the info. So the dig somebodies always free to download, to get people interested and there’s still some value in them off and get feedback that there’s some great insights in that, on its own, but the full report is going to be available for purchase. And I haven’t got a price quite nail, but it will be on their website when people go there, download it. 2 (26m 47s): Yes. So, and then I also present the research to brands and their marketing teams, which also comes part of the consulting practice that I provide. So yeah, people report this year and that’s something I haven’t mentioned to you. In fact, I forgot to mention it to you, but it’s coming soon. I did a special edition this year and this special edition is actually looking at what I would have seen in my study called the six currencies of collection that members care about. So, you know, the, see what I call the six currencies of collection of members care about and how you build your structure, your program benefits structure. So your financial layer, your memory or experiencial layer, your utility, or time-saving layer, your personal personalization, ego status layer, your choice giving me choice layer and your social community layer. 2 (27m 39s): So those are research them in this study. I did a special edition where I actually provided 61 different benefits under each of, in total that belong to those six currencies. And I got members in the research panel to evaluate them all and from an appeal point of view. So I’m releasing a totally unique report in a few weeks time that just looks at those six currencies and all of the benefits underneath it. 1 (28m 10s): Nice, nice, nice. And is that one that you’ll be charging for Adam or is that, 2 (28m 14s): And also be again, I invested big time this year, but it’s very much for loyalty managers who really want to know how to build their programs, practices and benefit layers so that they really connect with their, with their cut with their members. And it’s now I’ve got a ranking and a rating and procedures and standards and it’s across all the genders and generations. So it’s another biggest report. It’s about 30 odd pay. It’s not as big as this, one’s 30 odd pages, but it’s a decent size insights. 1 (28m 44s): Okay. Super, super interesting. So listen, my other favorite one then again, just out of the top 10 is this whole app subscriptions or not, and, and you know, I’m passionate about subscription and yes, it’s been around in various formats for, for many, many years, but I definitely think it’s evolving probably the most dramatically of any other format maybe that we’re talking about at the moment. So I’d love you just to talk us through what you’ve learned in terms of the receptiveness to subscription started programs in Australia. And of course, the big insights which you highlighted about the subscription guilt as being a big issue that loyalty marketers need to understand. 2 (29m 28s): Yeah. I think subscriptions are unhappy, talked about a lot in your Sharday. You’ve had some great guests and, and real specialist in that area and it’s very topical because, you know, they absolutely boomed through sort of the pandemic and all the streaming services, the food delivery services, the, you know, even QSRs, you know, I remember one of your, your narrow bread, I think it was on your shot and of the key, you know, they’re all being so subscriptions are, and whether it’s gyms and other categories, they’re out there and they’re always out there. I mean, we all, we all join them. So what I’ve identified few years ago with something, what in my mind was, you know, do we feel guilty for having a subscription that we don’t actually use? 2 (30m 13s): Sure. So I was tapping into a, an emotional inside that I thought, you know, that I was feeling I’m not using Netflix or I’m not using Amazon prime and I’m paying this, I feel guilty. Should I cancel my cancel? Should I use it? Shouldn’t I use it. And I thought, well, let me try and put a stat, a statistic, an insight against subscription guilt. 1 (30m 33s): Yeah. 2 (30m 33s): And I asked exactly that. Do you feel guilty for not using some or all of the benefits that you pay for in, in a subscription and in 2019? So in 2019, 30% of the members who responded to that question said, yes, I actually do. And I thought, wow, that’s why a third, I’ve got this feeling to answer it again in 2022. And it’s gone up, you know, 20%, it’s 36% have now said they feel guilty. Wow. So it’s a really interesting strategy or insight, insight for strategy for subscription managers, people. 2 (31m 14s): Do you really know if your customers, your members of your subscription program feel guilty about being there because they’re not using it. And do you care? And this is a big question. Do you want to ignore those who aren’t using the service or do you want to, in some way, keep identifying the value that they can get? 1 (31m 34s): Yes, yes. Yeah. And you’ve reminded me of them because when I did one of the, the episodes that you were first there about subscription at one of my guests did share that Netflix, for example, had decided now this was a few years ago, and I think they’re struggling a lot more now. So I’m not sure if this still applies, but their decision at the time was they were identifying what they call zombie accounts, which is exactly this idea that people am subscribed and maybe forgot or fully disengaged. And again, those definitions I’m sure vary, you know, from time to time, but they were taking the decision to actually stop charging those people so that they were actually going to remove them. 1 (32m 15s): And I think it was a tiny percentage. Again, I think Netflix has traditionally probably had very, very high usage, I would say probably through the pandemic as well. And maybe before it became so competitive as an industry. But I do think if you’ve got some big customers, you know, you need to make a decision as to what you intend to do about that. And I’ve certainly seen some great work, for example, where, you know, subscription and loyalty programs really spend an awful lot of time researching and looking at early activity levels to make sure that they’re constantly reminding those subscribers how much more they can get. So I think there’s, there’s a window of opportunity to alleviate the guilt or prevented. 1 (33m 0s): Let’s say 2 (33m 2s): I love that. And I think that’s the insight that I, you know, again, back to the research and looking for insights to help program managers take an action. Like you’ve just said, so another one of those that are the hot or not, and how topical it is. I thought subscription, guilt would be worth talking about and you both have good one again. 1 (33m 21s): Exactly, exactly. And there’s a program I subscribed to here, which is a well-known program, two for one on that on restaurants. And, you know, and you buy this, you know, it’s, it’s quite expensive, actually. It’s about a hundred euros to buy for the year. But I do have that then as my benchmark to say, I have to save a hundred year-old one on some nice meals. And before I feel like I’m winning. 2 (33m 43s): Exactly. No, it’s a great personal example. That’s exactly the point. So yeah, 1 (33m 48s): Exactly, exactly. So, so what else did you learn then? Just about subscription specifically, Adam? I know there’s a long, 2 (33m 56s): I mean, I was trying to get a gauge on, on who’s a member of by definition subscription programs. It was no big, big statistical differential to jump out at me. So that was really just getting us, there was actually one on a generational levels. Ask a very general question and you’ve got to be careful and research about framing up a subscription-based question because it’s all about the value and the brand that it has to speak expressed in order to get a gauge on, you know, appeal or take up. Yeah, you can’t talk generically. You’ve got to really sell the value for them. So my research is generic and therefore I’m very careful about, you know, asking, would you join a program that has lots of value and extended benefits for a fee versus join a program, which is free. 1 (34m 48s): Yeah. 2 (34m 49s): Very generic statements because you don’t know what I mean, but lots of value in extended benefits. 1 (34m 54s): Yeah, that’s true. 2 (34m 55s): So that my question is very generic and that’s why I’m just following that generally. But I didn’t notice that again, gen Z are far more likely versus the population to join a subscription program, which, which has a greater value and extended benefits. But I just want to say with a big call-out that I’m not expressing what they are and just watching specifically what’s happening with the various generations around three versus fi 1 (35m 25s): Yeah. And, and their trends. So again, Adam, you know, we’ll never, we’ll never know specifically about that individual was thinking, but at the same time, we have to make assumptions that this report versus last year’s report, there’ll be similar assumptions being made in the reader’s mind. So yeah. So your job is to, to draw out the parallels. So least we can see directionally, where are things doing that we need to be thinking about? Hmm. 2 (35m 49s): And we thought then it’s to program, sorry on that. When people who want to build a subscription program, if you use the research as the basis to say, okay, that’s interesting. So 25% of gen of gen Z will join a subscription program. So we can use that potentially in the beginning of our modeling. So we can then say, if you’ve got X number of members joining and then this generation, then 25% pay so that you can, they can start using that. They can validate it with their own audience or they can start using the benchmarks to build the models. 1 (36m 18s): Yeah, yeah. No, very good point. Very good point. The other one that came out in this section as well, Adam is one that to me is always a huge concern when, you know, talking about planning a program and it’s this whole idea of benefits connected to a cause or a charity, because I do think that it always sounds like such a wonderful idea members and research. They always do, you know, very much say, oh yeah, that’s something that we want as an option in terms of the benefits of our program. But you’ve called this Sam, there’s an issue within this, that loyalty marketers need to understand. And you’ve called it the say, do gap, which I think again is a very succinct way to understand what actually happens when brands do decide to go that direction. 1 (37m 4s): So when they explain that for the audience, please, Adam. 2 (37m 7s): Yeah. It’s, it’s, it’s a common in research where you’ve got to be careful about now. I’m obviously I’m, I’m providing research, but you always got to remember that in reality, in business, you’re going to use data. You’re going to use research and you’re going to use reality as in, you’re going to test and learn. You’re going to go to market so you can ask your customers. So would you donate your, you know, your points or your benefits to a cause or charity that you care about all that we provide, then you find a high proportion say, yes, I will. And then when you actually in reality, give them that opportunity. What the position is, CVS. They will, it’s far less in reality. So they say they will buy back. 2 (37m 47s): Don’t actually that they do get, so that’s what I’ve seen in reality, even my research, I did it differently this year. So I first asked how appealing, how appealing is it for you to earn rewards through a program that you can donate to a cause a charity I got up, I think it was, and I’m just reminding myself, you know, 40% said, yeah, it’s appealing of fairly appealing for me to, for their proposition. Yeah. Although of donating, they took it further. And I then asked the question about, so if you do have an option to earn reward sort of program that you can donate, how are you likely to respond? 2 (38m 27s): Will you donate some of your rewards, none of your awards or all of your, did the sun nano wall and well, three, 3% said unlikely to, to donate any. 1 (38m 46s): Yes. See, it’s extraordinary. Yeah. 2 (38m 50s): And again, so again, it’s just, and that’s just in research, right? I’m not in reality. So, but I did, I did just as a little nugget here, again, another one of those under the rock was there’s, there’s a small proportion and gen Z jumped out. It’s amazing. But then 6%, 6% said, I’ll actually donate all of that. All of us. That’s what I’ve said in my research and 11% for the gen ed. So I’m just finding the edge. The more and more I dig deeper in research, you find new insights. It helps because I’m getting approached and consulting land, you know, about building programs that help a cause or a greater purpose. And I feel even, it’s totally just got to realize the reality as well. 1 (39m 33s): Yes. It’s definitely about managing expectations. And what I think is, you know, as human beings, we like to think of ourselves as being very generous. So, you know, it makes us feel good about ourselves, but then if you’re in the choice and there’s literally an option of option, a, you know, fly free flight home to Ireland for Paula versus option B donate to a charity, you know, that’s a much bigger decision and how do I make that decision at that point in time? So you’re absolutely right. So the expectations at the outset. Perfect. And when you quickly just mentioned the, the, the whole piece around card linking out, and because I think that’s a really big trend, I suppose, as well from the technology side. 1 (40m 17s): And I know it was a new question within this section for you this year and a couple of concerns that came out in your research, but for me, card linking is still quite immature. So that seems to be, I think what you’re concluding as well, but I definitely feel, you know, when we have this conversation this time next year, I’m pretty sure you’ll be telling me this one is jumping up again. I’m hoping. 2 (40m 38s): Yeah. Again, this has come out of my real life experience with consulting that I’ve been helping certain clients where there’s a, this element of card linking. And we all know what that is, which is when you eat, you actually give over your credit card, your debit card into your membership. So that every time you use that card, you earn the points and benefits. So you are handing over a piece of, you know, quite sensitive payments payment. So we did some research with the client and we got a feedback from their customer base. So I thought I’d put it into the wider population to see, you know, how it, you know, is there a preference for certain people to actually, how do they feel about it? And then she writes from read through the results that it’s still relatively unappealing as in theirs. 2 (41m 26s): I think it was well over 60% said, no, they wouldn’t want to connect their credit or debit card into a membership directly through card linking. Whereas, you know, there’s a whole range of other people who will, and again, when you look at the generations, there are another, the, you know, there’s some of them far more comfortable. I not trust the brand. You guys, my credit card, you know, no worries on only the points you’ve told me the benefits, no problem, but it’s another sort of card linking payments area within the whole technology and loyalty space, but I’m just watching and, and measuring. 1 (41m 57s): Wonderful, wonderful. So, listen, that’s all of the sections I want you to explore today. Adam, what else did you want to highlight for our listeners before we finish up? 2 (42m 9s): Yeah, look, I’ll finish up with the last section, which we shouldn’t forget about, which is the data section, the data privacy. And I’ve tracked that around a whole range of, of questions I’ve got, I’ve got something called the net data. Trust score, program name is busting the data, but I asked a brand new questionnaire, which is a call out for, for those people who are looking at at, you know, first party and zero party data strategies as cookies become more of an issue. So, you know, everyone’s rushing to all three programs to solve the party problems as I call it. And I just, it’s a big call out to say that if you ask me for data, you gotta use it, use it with compliance and sensitivity because members have asked it in the research, expect you to, and they, they have high expectations. 2 (43m 1s): So don’t just ask for it, use it, use it, sensitively, use it wisely, use it relevantly. And now I’ve got a statistic and an insight about higher expectations around that. So it’s just another new one that I wanted to call out for, for your audience amongst all the others. So, yeah. Wow. We’ve had, we’ve, we’ve been through some of the good ones. There’s so much more 1 (43m 23s): Totally tell everybody where they can find your reports at them. 2 (43m 27s): Yeah. Thanks Paula. It’s available through my website and the website is The Point of Loyalty dot com.edu. So The Point of Loyalty is all one word.com.edu. And it’s very clearly up in lights. It says For Love or Money, and we’ll go, you’ll go there and you’ll see the Australian. As I said, there’s a free executive summary. You can pay for the full report or there’s an option for me to personally present it as well, which has a paid element. So, you know, I will reveal insights here and there and, and, but it’s there for the, for the, for those who are keen and interested. 1 (44m 2s): Okay. Well, listen on that note. I want to, again, thank you for all of the work for coming to share this with our global audience. Super interesting to have this research coming through every year. So Adam Posner, CEO of The Point of Loyalty and of course the author of, For Love or Money. Thank you so much from that stole glossy. 2 (44m 23s): Thanks really appreciate it. 1 (44m 27s): This show is sponsored by the wise marketeer. The world’s most popular source of loyalty marketing use insights and research. The wise market tier also offers loyalty marketing training through its loyalty academy, which has already certified over 245 executives in 27 countries as certified loyalty marketing professionals. For more information, check out the wise market tier.com and loyalty academy.org. 1 (45m 8s): Thank you so much for listening to this episode of let’s talk loyalty. If you’d like us to send you the latest shows each week, simply sign up for the let’s talk loyalty newsletter on let’s talk loyalty.com. We’ll send our best episodes straight to your inbox. And don’t forget that you can follow let’s talk loyalty on any of your favorite podcast platforms. And of course we’d love for you to share your feedback and reviews. Thanks again for supporting this show.