#360: Understanding Loyalty in Europe - The European Loyalty White Paper

This episode features some incredible pan-European loyalty research which is literally hot off the presses.

Charlie Hills, MD of Mando Connect in the UK joins “Let’s Talk Loyalty” today to share their latest research report which is the first one researching loyalty insights from across Europe.

Charlie shares key insights such as the membership, appeal and impact of loyalty programs across 24 European markets, featuring input from 7 loyalty experts and 3 loyalty program owners.

We are joined also by Nick Fishbourne from YouGov who explains how this huge piece of research was conducted.

Listen to learn all about loyalty in Europe.

Show Notes:

1) Charlie Hills

2) Mando Connect

3) Nick Fishbourne

4) YouGov

5) New European Loyalty White Paper

Audio Transcript

Paula: 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.

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Hello and welcome to episode 360 of Let’s Talk Loyalty. Which firstly features an exciting announcement about the latest guest host who is joining our lineup of loyalty experts who share their global perspectives on Let’s Talk Loyalty. We’re also today sharing some incredible Pan-European loyalty research, which is literally hot off the presses.

Charlie Hills MD of Mando Connect in the UK has been a guest on Let’s Talk Loyalty a number of times, both with clients as well as sharing the UK market research reports, which they’ve been publishing in partnership with YouGov since 2018. Today, Charlie is joining us again to share the latest research report, which this time is designed to unlock loyalty insights from across Europe.

She’s joined again by Nick Fishbourne from YouGov, who explains how this huge piece of research was conducted. Charlie shares key insights such as the membership, appeal and impact of loyalty programs across 24 European markets. Featuring input from seven loyalty experts and three program owners. I hope you enjoy listening to today’s episode, all about understanding loyalty in Europe.

So Charlie and Nick, welcome back to Let’s Talk Loyalty. 

Charlie: Thank you. Great to be here. 

Nick: Yeah. Thanks for having us back. 

Paula: Oh, I’m so excited and, and full of admiration actually, is what I’m gonna say because you two have created the most extraordinary piece of research, uh, which I know is hot off the presses, and we’re gonna be talking about on today’s show, and absolutely extraordinary what you undertook both in terms of the ambition.

But my goodness, you’ve pulled it off. So super exciting times. Uh, but before we get into talking about this latest white paper, as you know, we always start our show talking about our favorite loyalty programs so we can get a sense of what is inspiring people in the market in March of 2023. So Nick, I’m gonna come to you first and foremost.

Um, you are more on the research side, so less of an industry person. So I always love to get more of a consumer perspective from you. So tell me, what is your current favorite loyalty program Nick? 

Nick: Yeah, thank you. No, definitely a, an industry outsider. I think, um, I’m gonna go a bit, a bit mainstream, bo boring if, if you will.

Um, but it is definitely Tesco Clubcard at the moment. So to give you some context on that, um, I have two little toddlers at home and, uh, a pregnant wife. And, uh, we’re currently experiencing some cost of living challenges in the UK at the moment. So the, the price of food has, uh, has gone up quite a bit.

And I think with, with Tesco Clubcard, it’s one of those things that’s very tangible in terms of what the benefit of that loyalty program is. You know, you can really see when you’re doing like an online shot. What you are saving as you go. Um, and I think for a lot of people in the UK at the moment, that’s the type of thing that a loyalty program needs to be doing and needs to be really obvious and tangible in terms of what the benefits are of being a member of it.

Um, I saw a few weeks ago that, um, Boots announced that they’re dropping their, uh, their reward scheme from four points to three for every pound that you spend. Um, which is quite a dramatic change because, um, things like Boots Advantage, uh, Tesco’s Clubcard, Sainsbury Nectar, they’re, I think they’re three of the biggest loyalty programs in the UK. 

So any big changes to those programs has quite a big impact on the, uh, on the industry. So I’m interested to see how Tesco responds to that over the next few months. 

Paula: Yeah. Well thank you for that Nick. Absolutely. I think Clubcard is universally respected, of course. Um, it is an incredibly powerful program, and you’re not the first person to say that actually loyalty programs are now being seen as an important part of managing a household budget, so whatever about our industry already proving it’s worth, I would say through the Covid Pandemic. I think particularly the situation in the UK market and plenty of places around the world means loyalty is here to stay, um, for, for very powerful reasons. As, as you said, very tangible and yes, devaluing a currency by a brand like Boots, even if there are other you know, I suppose ways that they plan to compensate people. 

I do think anytime we’ve talked about boots on this program, it has always been that it’s incredibly popular because of that 4% reward rate. So things are definitely shifting dramatically. We’ll certainly try to get Boots back on the show to talk through that decision, uh, because they’re certainly not the first to devalue their currency, and they certainly won’t be the last.

So with that said, Nick, thank you for, uh, your response and Tesco Clubcard. I’m sure you’ll be delighted. And Charlie, you’ve got an incredible perspective, of course, with all of your work with Bando Connect and of course with all of this incredible research. So pick a favorite and tell us what is your current favorite loyalty program.

Charlie: I think that’s one of the most, difficult questions you can ask somebody like me, which is your favorite program? Cuz I’m initially going, well, from a customer point of view, it’s this, from a brand point of view, it’s this, from a performance point of view, it’s this. And one of my favorite things, um, as part of doing this European loyalty white paper with all the experts that we had in it was learning about programs I’d never heard of in markets I’ve never been to. So there were some really extraordinary case studies and call them out. They’re all in the white paper, including Tesco Clubcard, which is the British kind of market representative I’d put in as one of my sort of top three.

Um, but I think taking a step, back from it all. Um, I think one of the programs I have to call out is VeryMe Rewards from Vodafone. It won best in Western Europe. It obviously earned its place, um, in the paper. And I think the continued innovation and that, that focus on giving consumers what they really, really, really want, um, means that I find it one of the most interesting programs, um, in the market now.

Vodafone have just announced their Glastonbury partnership, which is huge news for us. 

Paula: Wow. 

Charlie: You know, a really nice positive contrast, um, to some of the other news that we’re hearing about in loyalty programs as, as they struggle to, uh, to offer value. And I think that just really demonstrates a continued focus on that membership and really creating brilliant, rewarding experiences, you know, to, to capture people’s hearts, um, as well as their loyal behavior.

So yeah, great program to watch, but there are hundreds. I mean, look in the paper, there’s loads of brilliant ones. 

Paula: We’ll be looking in the paper for sure, Charlie. I have been, uh, working my way through it. Um, so I suppose first of all, it’s uh, 24 markets of data. Um, so I think it’s the first time anybody has attempted anything of this scale.

And I know obviously Nick, you’re gonna talk us through how that was actually physically achieved. But Charlie, first of all, why did you decide to expand? Because you’ve done these white papers, you know how much work is involved and you’ve had so much depth of knowledge, expertise and focus on the UK in terms of the previous papers and what the Brits want from loyalty.

And I have no doubt that has served the industry extremely well. So to expand that to 24 markets of data, honestly, I can just imagine the decision making process internally to, uh, to, to go to this kind of scale and scope. So tell us where did the inspiration come from. 

Charlie: I think I’m a sucker for punishment, if I’m completely honest. I mean…. 

Paula: I don’t think so. 

Charlie: The inspiration in all honesty, came from the British papers and from the great events that we’ve had when we’ve launched those, when we’ve repeated them. You know, we’ve done them since 2018. And I think what Nick and I find really inspiring is when we see brands using that paper, using that research to actually improve their programs.

And actually it gives people confidence to experiment and to try new things and, and to see what’s out there. And when Nick and I were talking about, you know, what next, what do we create in the next papers? I’m terrible. I was like, well, you know, Britain’s awesome. But you know, look, let’s look at Europe.

There’s loads of brilliant inspiration out there, loads of fantastic programs, um, that we can work with. We’re increasingly seeing programs move from one market to another. There’s big Pan-European programs, big global programs. You know, we’ve called out Samsung members in the paper. We’ve called out Marriott Bonvoy.

And I think most people know that we already work with Little Plus as well. You know, they’re kind of, they’re big pan-European operations. And we were thinking, well actually, you know, what can we learn from those other markets? I think, you know, the, the UK is held up as one of the most dynamic and innovative markets, but I don’t believe it’s the only place to look.

So that’s what’s inspired us really to take that same inspiration that we’ve found in, in our own market and, and look across the border. And I’m always terrible to Nick cuz as soon as I do one thing I’m like, what about the other continents? Let’s take the global view. Um, but concentrating on the current paper, I think, you know, these are 24 brilliant markets and through our partnership with YouGov, you know, we’ve been able to really look at this in a really robust, um, way, and then give people that confidence that what they’re looking at is kind of true and representative of the market.

And then I think the, the people that we’ve collaborated with, you know, the Pan-European team that we’ve pulled together. Um, all in the paper, you know, we’ve got seven brilliant in-market experts, three brilliant kind of program experts. They’ve then really helped Nick and I and the Ugo team bring that data to life.

So, you know, we are looking at impact, we’re looking at appeal, and we’re looking at understanding and. Across those 24 markets and, and our in market experts and our program leads have then brought the stories to life. And I feel like we are very much at the beginning of the journey. You know, I think we’ve, we’ve sort of scratched the surface of what’s going on and I really want to understand why.

So I want to do more of this. And, and those experts, they’ve really helped us get under, under the skin of the data. 

Nick: I think that’s, that’s the thing, isn’t it? Like commerce is so global these days. If you’re a brand and you are just looking at one market, you’re really doing yourself a disservice by not understanding what’s going on on a well.

If you are operating Europe on a, a European basis, you, there’s, there’s so many lessons to be learned from other markets and other individuals in those markets. 

Paula: Absolutely. Yeah, we’ll get into that now in a second. And, uh, but I just wanna pick up on, on what you were saying, Charlie, so you know what I’m experiencing and I think what you are feeling as well, and we’re solving it obviously in, in very different ways, but actually increasingly, uh, hopefully solving it together. 

Um, there is this hunger I feel, from the industry, from our audience, from, you know, professionals in our industry who are desperate to really delight their customers. Like what I love about loyalty people is everybody has so much integrity around how can I do something that’s innovative? How can I build something that’s super compelling?

Where can I learn about that? So we do our bit of course in terms of, you know, our show is all about education and inspiration, which is why this white paper is so perfect. And I guess it also leads me to probably make a big announcement as well in terms of like, this show will not do justice to this white paper.

We can’t possibly cover 24 markets in the depth that they deserve in a 40 minute conversation. So, um, hot off the presses, I suppose. We’re here to also announce that Charlie is going to be guest hosting, uh, six episodes of Let’s Talk Loyalty over the next six Months, and really to explore this white paper, I suppose, market by market, essentially with some of those experts and also with some specific programs.

So we’ll get to hear in more depth exactly what’s coming out of this white paper. So Charlie, I want to say welcome to the Let’s Talk Loyalty team and congrats on becoming a host. And, uh, tell us your thoughts about becoming a podcaster.

Charlie: Thank you, Paula. I remember right back when, when Let’s Talk loyalty started.

So I’ve been really excited and, and thrilled and quite kind of honored to be part of the journey. So I’m, I’m delighted and I think the experts that we’ll bring from the white paper have such fantastic stories to tell, and each market has so many interesting subtleties. You know, the way the programs are structured, the dominant sectors, the small programs, creating really innovative kind of new mechanics or new reward experiences that I’m really excited to talk about those markets.

From the people that know them best, and I’m equally excited to talk to those Pan-European program leads about what they’re doing and how they tailor those big pan-European programs to the in-market kind of subtleties and needs. So I think it’ll be great! Um, and yeah, it’s been a, it’s something I’m really, really excited about doing.

So hopefully I’ll, I’ll do an all right job of it. I’ll be doing my best. Everybody bear with, bear with. 

Paula: Fantastic stuff. So listen, let’s get into, I suppose, Nick, for those people perhaps listening who are not familiar with YouGov. Uh, we of course, know you very well from the work that you do with Mando Connect on this white paper, but tell us just first of all, a bit about you, a bit about the company and I suppose the whole kind of proposition about, in fact, I have to read it because I remember talking to you about this last time.

I know YouGov is the most quoted market research source in the world, so super amazing. Tell us a bit about the compant. 

Nick: That’s right. Yeah. So, uh, so YouGov have been around for about 20 years now. Um, we’re a, we’re a research data and analytics companies how we like to position ourselves. Um, and what that means is that we run market research with millions of consumers worldwide.

So I think we operate in almost 60 markets now. I think 59 at the last count. 

Paula: Wow. 

Nick: Um, Um, really we offer to research services to our clients. Either Adhoc stake services, or we offer a whole suite of syndicated data products. And it’s one of these data products, global profiles, um, that has driven the, uh, the insight for this blight paper.

So that’s where the data has come from so , if you think of global profiles, uh, so it, it’s an audience profiling tool, as the name suggests, but think of it as an enormous data bank. And the data in there is being driven by, um, thousands of consumers worldwide. So the platform has data in 48 different markets, so uh, this white paper covers 24 European markets, so half of the markets in the, in the data set.

And we’ve got data from, I think it’s 266,000 individuals globally. So it’s a, you know, it’s really broad. It’s really comprehensive. It’s really granular in terms of, um, the, the amount of data that we can get in an individual market, and each one of those 266,000 people has answered every single question within a um, thousand question questionnaire. I think it’s 1,011 questions. 

Paula: My God.

Nick: Obviously we don’t get people to do that in one hit. Um, we, we

Paula:  Good to hear.

Nick: Modules and um we incentivize people, but, um, once they’ve answered every question, we upload that, that into the, the data set.

And you know, we, we ask things around obviously demographic data, your age, gender, where do you live, um, uh, behavioral data around who’d you bank with, what insurance do you hold? Um, you know, where’d you go shopping? Um, but we also have a lot of attitudinal data in there. So, um, what are the kind of beliefs and, um, motivators that drive people’s actions?

You know, what do you feel about climate change, for example? What do you feel about, uh, things that are going on, global events at the moment? Um, so one small section of that, that questionnaire is, uh, obviously based around loyalty. Um, um, Something like only about 5% of that entire questionnaire. But obviously the amount of data that we can, we can draw from that is really quite impressive.

And it’s, it’s what’s driven, um, the insight that’s, that’s really fueled this white paper. So yeah, really, really great to continue to partner with, uh, with Charlie and Mando and, and start to increase things in scope. 

Paula: Okay. Thank you for that. And Charlie, then I guess your initial job, let’s describe it, is, is really to, to identify the pain points for people like our audience.

Of course. Understand the key questions that are going around in their minds, eh, develop those questions, feed them over to the OV team, and I guess then interpret it when it comes back. Would that be, uh, a fair description of the, the process? 

Charlie: Yeah, absolutely. I think that’s where we always start is when we’re going, well actually what’s interesting, what do people need?

And I think we had an unfair advantage in this one cuz we’ve practiced in Great Britain, you know, since 2018. So , we know the kind of the key data points that loyalty marketers everywhere kind of really need. So we knew that membership is really important. You know, what percentage of people are involved in a loyalty program, who’s a member?

How’s it trending? What’s happening? We know that appeal of loyalty programs is a really key data point as well. Do people like them? We’ve seen some significant variation in the markets actually, and that’s been really interesting to see. And then the impact that they have on those key emotional, um, and rational metrics.

So we knew where we needed to start. So we’ve obviously got a lot smaller set of data across a lot more markets, and so this to me feels like the very first chapter, um, of what we are going to explore, um, in terms of European loyalty. And you know, I’d love to get it to the point that we have that same depth and breadth of understanding of the British market that we do in each of these markets as well, because it’s such actionable insight.

You know, every time we do the white papers, there’s a few things that really stand out. You know, I think the last one in, in Great Britain was about, you know, the number of, um, programs that people are a member of. And, you know, it’s interesting to know that the answer is four for the average Britain, but the better question is, well actually, which four?

And now what do I change in my program as a consequence of that insight? So I think it’s, it’s taking, what can you do differently is a consequence of this data and, and hopefully this European view gives people, you know, some really interesting questions to ask. You know, in what other markets are their programs I can learn from is the obvious kind of one, and, and to look at the case studies and be excited and inspired by it, but  particularly in a market, if, if you are in a market that’s got really high loyalty program appeal. But you’re struggling to get people to join your program, then I think what this paper tells you is that you are doing something wrong,

Paula: Totally, totally. 

Charlie: Actually, you need to look at who’s getting it right. To then learn to then change, you know? Whereas perhaps if you are in a program that’s been really successful and got a really high membership. In a market where actually loyalty program is very low, then actually, you know, maybe you are the ground leader.

You are kind of breaking the new way and you are doing something brilliantly, and actually you need to look at other areas like how can you improve your impact or your appeal. So I think that’s the most interesting, most interesting bit.

Paula: Amazing. So give us the, the, the big news, first of all, Charlie, in terms of you know, what did we learn about membership across Europe?

Charlie: Yeah. 

Paula: As you said, you’re coming from the UK you’ve got this perspective of, of the penetration, uh, for, for people, uh, in Britain. So, you know, given these 24 markets, what’s the, what’s the range? What are we talking about in terms of how people are actually members of programs?

Charlie: Well, I think what was really reassuring to find out is that actually the majority of adults across these 24 markets are members of programs. So the loyalty industry is as big as we think it is, and it does matter as much in the marketing toolkit as perhaps we would hope that it does. You know, and I think that’s, the great thing, you know, you sort of look at the data slightly with squinty eyes at the beginning hoping that it tells you what you want to see.

And in membership we definitely saw that reflected. So on average across our 24 um, markets, 61.3% of adults are members of programs. So that’s nearly two in three. Um, which is a, is a really kind of significant and chunky proportion. When we then look into it, as well as spending a lot of our time coming up with an absolutely beautiful infographic that I thoroughly recommend everyone to save up. 

Our designer has done the most amazing job on it. Um, but when we then looked at, well, which markets are at the top of the pecking order and, and how do they compare to that mean average, we then see some quite interesting trends. So it Norway peaks 85.7%, which is extraordinary. Sweden is also above 80% membership.

That’s more than four and five of the population. The adult population being a member of a program. Great Britain. Great to see. 77.2 really like kind of being up there. And then there’s a big suite of kind of markets that then, um, come through and you can see that in the paper where everybody sits.

What’s then interesting is when you then look at the tail, you know, the less developed loyalty markets, Turkey and Romania sort of 31.3 and 33.3%. So you actually, in those newer markets, we are seeing, you know, that’s a big jump from 33 point, you know, 31% membership to 85.7. That’s a huge range in terms of membership.

And I think what we’ve tried to look at in the paper is, is why… Um, why does that change? And, and from talking to experts, I’m sure Paula are actually, you’d have a really clear view on it as well from all the programs that you’ve talked about. But we’ve had factors raise such as sophistication. The retail structure.

The, are there big brands who can operate big programs, or is it more of an independent market? At what point did the market sort of sit up and take notice of loyalty? Did travel, you know, did travel programs set the tone in that market, or did they move through, you know, what’s changing? So we haven’t got to the bottom of the answer as to why there is that variation, but I think we’ve got a lot of hypotheses as to the kind of things that, that influence it.

But yeah, membership was great. So the majority across the markets are members of programs. Keep in mind, 61.3%. It’s a really good stat. 

Paula: Yeah. Yeah. And of course, note to self is go and explore more in Scandinavia because, uh, , I haven’t done nearly enough 

Charlie: Definitely. But it’s definitely. 

Paula: Yeah. Yeah, I think it’s a very mature market as well, which is of course how I, I think about the UK Charlie, but I think in many ways Scandinavia has more technology advancement and that’s just cuz I’ve done some work with, with some clients in that market as well.

And you know, I think it’s a, it’s a part of the world that is very humble. and they don’t tend to actually talk about some of the incredible things that they’ve done in that part of the world. Like Spotify, I believe is a Scandinavian company. Skype came out of, uh, I think Finland, I could be wrong, but it is very technology, uh, advanced.

So I’m not surprised to hear that um, you know, consumers there are engaging or certainly joining loyalty programs, first and foremost. Um, at 86% of the population. So that’s absolutely incredible. Um, and then like, you know, just in terms of perception, like what do you think is the appeal across all of these 24 countries?

What did you see coming through in terms of what do people actually think of these programs once they’re a member?

Charlie:  Yeah, I think that’s the natural place to, to go from looking at behavior to then attitude being really important and actually our program’s getting it right. I always think appeal is quite an interesting proxy because unless there are loyalty programs there, it’s very hard to have to find them appealing or not.

So I think appeal is, is a really key metric and it’s one that loyalty marketers need to sit back and think about what does it actually mean If they like loyalty programs, why do they like them? So I’m, I’m sure there’s a lot of factors that drive that. But we look at sort of three measures. So we look at, um, do they think they’re a great way to reward customers?

Do they think all brands should offer them? Which I think is a really interesting indicator of saturation in a market or not. Um, and when they’re given the opportunity, will they or won’t they join? And I think that kind of data is really interesting when you are a Pan-European program owner of actually, should I roll it out to that market?

Should I not? What does the propensity to engage look like in that market, as well as that kind of core. Metrics. So what we found across Europe, again was, is a very positive story. Um, and I promise, you know, the involvement of YouGov here really made sure that this data is true and it is robust. And our partnership means that, you know, we never sort of fudge the statistics in any way, but it is resoundingly positive.

So across our 24 markets, 56% think that loyalty programs are a great way to reward customers. A whopping 42% think that actually every brand should offer one. Which always knocks me off my chair slightly in terms of, I think that’s really interesting. And particularly if you’re in grocery, when we think about how much grocery loyalty has changed over the last few years across all those markets, um, and 35% will join every time they’re given the chance.

So what that indicates to us is that we’ve got a real continent of loyalty fans of people who want to take part in programs and want to see what brands can offer. Our hypothesis is that as we move into greater cost of living crisis across all of these markets, that actually those figures are gonna go up as value becomes more important.

We’ve obviously got that data in Great Britain, but we can’t see yet what’s happening in Europe, but we will be looking at it because this is the first one that we’ve done. So, I think that’s really interesting. And then when you start to break it down by market, some really interesting kind of things come out.

Carl from Open Loyalty, uh, is in the paper. He’s in his old Polish expert, and he was particularly interested to see that 52% of polls will join a program every time they’re given a chance. I think that’s pretty interesting. The Polish loyalty programs, I’m like, wow, over half the population, you don’t even have to do anything. You just have to offer them a program.

Paula: And there is. 

Charlie: I’m there. Right. So they kind of came top of the list. And the Dutch were at the opposite ends. So Leon from Emma Keena and EAP Company, um, he’s one of our experts on the Netherlands. And you know, he’s got a very different challenge in his market.

Only 16% of the Dutch adult population will join each time they’re given the chance. Which is unusual because it’s such a value conscious, savvy market. But actually they want loyalty programs to work harder.  I think, we all brands should have one top of the list. Bulgarians. Oh, we don’t have a Bulgarian expert in the white paper.

If anybody knows an expert in Bulgarian loyalty, please let me know. Um, yeah, I’m really interested to see why the 59, is it because there aren’t enough programs? Is it Cuz the programs that are there are so great. You know, that was really interesting. And then, the Danish are at the bottom. So only 19% of them think that all pro, you know, every brand should offer a program. So there’s some really interesting market variation there. Um, and on great way to reward brands and businesses. Again, Nick and I were very pleased cuz it’s great when the British win. You know, we, we won Eurovision. Last year-ish, kind of, you know, depending how you look at things.

Not quite, you know, all of those things going on. But 70% of Brits think that loyalty programs are a great way to, you know, reward customers. So nice to be top of something. 

Paula: Absolutely. And of course, I’ll be pulling out the particular statistics from Ireland. So Nick, I’m very pleased that you have plenty of, uh, UK of members and, and, uh, research candidates in my home country as well, because I know we’re top of one of your charts as well.

And you know, what’s. Yeah, like I was literally, I was talking with them, you know, just, uh, about research in general with somebody the other day. And what I always find that it’s happening again as we’re talking is I start to feel super competitive. I’m just like, you know, and again, this is what these white papers and our podcast, this is what we’re here to do, is to say, look, here’s a benchmark.

Here’s something that is working or feedback that’s coming through super clearly so you can kind of see where you gotta go. So, um, I definitely picked up from my my reading of the, the white paper that Denmark is definitely a tough market. Across pretty much everything. Um, but I guess really what, what it comes down to is, is how do loyalty programs impact these consumers?

Um, and I know you’ve thought about that in great detail, Charlie, in terms of asking the questions of the, of the YouGov base. So tell us, what did you learn in terms of impact of loyalty programs across these 24 countries? 

Charlie: That people are very competitive, Paula. It’s great. I was like, it’s really funny when you look at it.

Ireland comes in the top three for most of the, um, the appeal metrics. It’s really interesting. And your, you know, your 1% point behind Great Britain, um, on great way to reward customers. So 69% of the Irish think that, uh, loyalty programs are a great way to reward. So I think that’s, really fascinating.

It’s quite an insight into people that work in loyalty as well. And we’ve definitely seen that in our market expert community that actually knows how’s my market doing? Oh, interesting. Why? What can my market learn from your market? We’ve had some really good calls. And impact is really important, um, across the piece.

And I always want to look at this more than we are able. So what we’re able to do is we ask, um, People you know, what impact do the loyalty programs have on you? And we’ve got sort of two rational metrics and two more emotional metrics. Now, if it was up to me, we’d have about 10 of these, cuz I think this is fascinating.

So in Britain we look at impact on frequency. We looked at brand appeal, but at a pan-European level, we had to choose the ones that we felt were most important. And so do loyalty programs make Europeans more loyal? 

Paula: Yes. 

Charlie: Great.  43%. Um, said that actually being a member of the program makes them more loyal to the brand.

And I think that’s great for us. That peaks in markets like Romania and France, and again, it’s the Danish who are kind of down at the bottom saying, maybe not for me. And the second sort of rational metric that we look at is spend. So 29% will spend more. Hopefully, that’s really helpful to everybody building business cases for loyalty programs.

So almost one in three will directly correlate. I’m a member of a program to, I spend more with that brand, which is particularly helpful. Um, to those of us that have done our loyalty academy CLMP course, that’s really useful on that question and now you can get it on a market by market basis.

Um, When we then look at those softer, um, metrics around emotional connection and recommendation, we see a sort of middling picture as well. So 36% say that membership of the loyalty program makes them recommend the brown more, and I think we see a close correlation between that. Because if you’re a member of the program, you’re closer to the brand, you know the brand better, you have more touchpoints with the brand.

So I think it inevitably makes sense that then it would come up more in your daily life. Of course you would recommend it more to people. So I think that metric was really interesting, um, for us to look at. It peaks in Slovakia, it’s lowest in Denmark. I feel Poor Danish people, but you know, they’re not, not so keen on, on loyalty programs.

When we then look at that last one, emotional connection, so one. So 33% across our 24 European markets say they feel more emotionally connected to a brand when they’re a member of its loyalty program. There are so many hypothesis around this who everybody from foresters to independent loyalty consultants to brands has a real point of view on, well, why does membership foster that emotional connection?

My personal view is it’s about frequency of contact. It’s a rewarding, positive experience. I think there are huge variations by sector. If you are a very emotionally warm brand. Yeah. Your loyalty program just makes you a little bit fuzzier, but actually a lot of, quite transactional, quite functional businesses have loyalty programs, and that’s your real opportunity to build a, a warm and emotional moment with your customer. 

In Great Britain, we’ve got a, a real energy crisis. Crisis, and I know, you know, that’s not unique to the market and a loyalty program with a rewarding experience as part of that is an opportunity to have a more positive conversation with your consumers.

Rather than it just all being about kind of transaction and price. So I think that impact on emotion is, is really important. Peaks in France, lowest in Denmark. Um, and again, it’s, it’s great when you then look at the four of them together to see, you know, which are the markets where it is the greatest impact and which are the markets where it’s not, we’ve developed a really nice kind of bullseye visual, so actually you can see quite simply within the white paper where you sit and actually where you track versus other markets. 

And it’s really interesting as some markets are seeing a real impact on function, some are seeing a real impact on emotion, and I think that then naturally leads loyalty marketers to a chicken and egg conversation.

You know, am I having a better emotional impact because I’m better at emotional loyalty marketing? Or is it actually the nature of the market? So Nicole Wilhelm, who is our German market expert, talks a lot about that in Germany. That actually it’s a very established, very mature market, but quite transactional.

And actually they’re seeing some real moves and some real pressures to bring in more of the, that emotional connection. The loyalty in that market. So now I think it’s a, it’s probably my most interesting bit of the paper. 

Paula: Well, I, I absolutely love it, Charlie. And I know you guys have just come back actually from Zurich, and I know Rory Sutherland was, uh, was speaking there, and as you know, he was a guest on this podcast as well.

Um, a, a, a couple of weeks ago, and he’s saying exactly the same, you know, and, and what I really love is, you know, first of all, to me, in its very simplest terms, the very fact that a brand does invest in a loyalty program, regardless of the proposition, I think that lands really well with consumers who, like Nick mentioned earlier, you know, are under increasing pressure per lots of different factors outside of their control.

So the very fact, particularly for an energy brand, you know, as you said, because that’s something that’s I think a real grudge purchase for a lot if us. For some of them just to be saying, look, we do try and give back to you. Here’s what it looks like, and this is what we’ve developed instinctively. I think, you know, consumers like us are kind of going, okay, well at least they’re trying.

And I think the point that Rory also made, certainly on the podcast and probably in Zurich as well, was just around the humanity. You know, like I, I laughed a lot. Like he just, he was so funny because he was talking about things like, you know, things like having a baby, for example. And I know Nick has, has, you know, literally hopefully just third child.

Um, so difference between the time of recording and time of release, uh, for that comment, but literally, Like, having a child does not make economic sense. So, you know, but it does make so much human sense and emotional sense and, you know, to build loyalty programs based on their just business logic and what the finance teams are thinking.

It misses the whole point of the intention of beautiful brands. And I know we’re gonna talk about three of them here today, again, just in brief. Uh, but yeah, I, I, I share. Your belief that there is so much more, particularly in markets like Germany, where we can invest so much more and actually build that connection with, uh, with our members.

Nick: Just to jump in there, I think you’ve touched on quite an interesting point that, you know, we, we as a, a company of data nerds, you know, we’re in the business of collecting data and, um, and fueling insight. And the, the better data we can collect then the better the insight is. And, where we’re moving as a company is starting to pull in actual behavioral data. 

Um, so it’s not just what people are saying, what people are thinking, but we are, we are developing technology that can do things like, um, for opted in panelists of course, um, you know, read their, their financial statements. Um, so we’ve, we are moving to this position of, you know, what people say and what people do, and then we can layer on the, the emotional side of things, which you’ve just been talking about.

And I think the real power of that is actually having. If you think of like a Venn diagram, you’ve got people what, what people say, what people do and what people think, and, and the real value is the overlap of those. Um if you think about the energy crisis that you’ve touched on there. Um, you might have people saying, um, you know, I’m, I’m really worried about, uh, cost of living crisis, the energy crisis.

Um, they’re saying, , uh, you know, I’m, I’m cord cutting, I’m dropping a Netflix and Prime subscription, for example. But then we can layer on behavioral data and you can see, well, you know, they are doing what they say, they’re spending less on energy below the, the average. Um, they’ve canceled their Netflix subscription.

But, oh, you know, it looks like they’re spending more on, um, uh, on Uber Eats, for example.And then we can follow up with them and say, why is that? And you can understand that they’re saying, well, actually, because we’re cutting back so up so much at the moment, we’re going out for dinner less.

We like to get takeaways. And so much of that is an emotional response. And for someone like Uber Eats, if they’re developing a, a loyalty program, a reward scheme, like that’s invaluable data. Um, so, you know, sorry to come in and fly the flag of data, but like. You know, I think what, what you guys are talking about is, is brilliant.

It’s exactly where, where commerce and brands are moving. Um, and I think the more that that’s data led, then, um, the better.

Paula: And, and you do an amazing job, Nick, of translating it from, you know, the, the data nerd language, which I don’t really understand, um, into, you know, actionable insights. So, so thank you for that one.

Um, and it’s always something I love when something really lands us true. You know, it might initially be surprising, as we’ve said, course of living in crisis. Spending more on Uber Eats, that doesn’t actually make sense. But when you look at then, as you said, the behavioral data, it makes perfect sense. 

Nick: Absolutely. Yeah. 

Paula: I, I love that kind of insight and again, once it’s properly translated into a way, but that’s what loyalty professionals listening to this episode, I think love to be thinking about. One that I remember somebody telling me, um, during the last big global recession. When I got into loyalty was what they called the, the, the lipstick effect.

The luxury lipstick effect. And again, you know, a lot of luxury brands would be perceiving or expecting or worrying that of course their, their sales are gonna drop. But sometimes if you can’t afford to go out and buy the 5,000 pound handbag, you might say, actually I, I’ll get the 50 quid lipstick , because actually I can justify that.

So, so there are really important, again, human behaviors. Insights and data that we all need to understand that drive the emotion of loyalty. And again, I think we all share the view that we’re not here to talk necessarily about loyalty programs and points and whatever. We’re here to understand how to drive profitable consumer behavior change.

So, so super interesting Nick, and thank you for that insight. I know this incredible data there. So listen, Charlie, I wanna dip in, I suppose, just at a very high level to, um, to some of the markets. Um, I know in the actual white paper itself, you’ve featured seven different market snapshots, and of course, you know, Nick and YouGov will be able to provide all of the data, of course for all 24 as required.

Um, but what stood out to you in terms of things that you learned, again, coming from your expertise in one market? And starting to collect across all these other countries, why did you even pick these seven in terms of the ones to feature in the white paper?

Charlie: So I think when we sat down and we started to look at the data, and I think we were, well actually, which are the most interesting markets, but also to get that, that broad spectrum of, of coverage.

So from the very big markets like Germany to the smaller markets like the Czech Republic from, you know, those markets, uh, Cristina Ziliani of the Loyalty Observatory, you know, talks a lot. She was also at the loyalty summit. You’re talking about the Italian market and her expertise in that Zh from an Tavo talking about the Nordics.

So I think there was a, a real ambition to just talk about a range of markets. I think if it was up to me, we would’ve done 24 markets, but I’m very aware that then, you know, the white papers would be too heavy to carry around. And actually I think there’s a real opportunity for us to know go to each market and start to, to build those stories.

So the market selection was very much more, let’s take a snapshot for this initial paper. Let’s look at who are the experts that we know, who are the thought leaders in loyalty that can add real value to this paper. Um, and I think we’ve got a really interesting and, and quite representative set of the markets um, in here.

 What we then, um, talked about was, well, actually, what are the most interesting things? So we started to have some calls, um, with the markets. And Radek, Voxwise is our, is our Czech Republic, um, expert in the paper. And, and his view was very interesting in terms of what can we learn, how do we pitch it and what are the most interesting things?

And, and, you know, a big voice in those meetings. Um, and it was great to just see the case studies. So I think my, you know, one of my key things is, well, which are the most exciting case studies in the paper that these people who’ve worked in loyalty for, you know, 15, 20 years actually want to call out. So from Britain, I called out Tesco Clubcard, the Costa Club, um, which I still think is a fantastic example of a program rewarding for sustainable behavior.

And I love the fact they switched back to beans from points. I thought that was really, And, and BMW Inside Edge, which are, are calling out, you know, really an interesting way of building loyalty in the company car space. Um, Christina, my pronunciation goes all over the place here. It’s terrible. Um, but Christina in Italy called out Soge Greener, um, a really interesting program in the environmental sustainability space with some really kind of clever things happening there.

She called out the Lavasa program. Anybody who knows me knows I’m a massive coffee fan, so I was like, this is really. You know, I would always think to look to Espresso. But not actually, you know, Lavasa being really interesting. And then Alfa Pro, which is a sort of a sporting goods business with a really interesting product that’s got sort of two tiers within the loyalty program to grand, some great examples. 

Um, from Leon in the Netherlands, we saw Hema. Now I have got no hope on this one. Magilla, Albert Heijn. I’m one of the most innovative brands in the Netherlands and also the largest supermarket. Jane, I apologize to all our Dutch listeners for that murdering of, of the pronunciation.

Leon will do a much better job when he’s on the podcast that I’m hosting in a couple of months. And some really interesting, um, this is about spot on savings. Okay, now that’s the trend we’ve seen happen quite a lot in Great Britain, that that shift from sort of points to actually like, here, get a voucher now.

Get a voucher now. You know, little started it. Wake throws have followed soup Boots have announced that, you know, they’re moving to that model. And Jja from an Tavo talked about Club Mattas and Ikea family. An obvious contender from the Nordics. You know, how could we talk about anything without talking about Ikea family?

I know they’ve kind of been on the podcast as well and some big innovations. You know, the, the beloved Alan Key becoming part of the loyalty mechanic, and Carl Open Loyalty, talked about Zac Rossman and Moja Biro, um, which is, I know, great. Right. A discount supermarket chain in Poland. You know, again, re doing some really interesting things with member identification.

Again, we saw that, and I think it was, that for me is, is where to look at actually, to look at all the exciting examples. I think that’s where the richness of it lies, And my second is, is probably to say, then look at the loyalty gauge. Because I think what we then need is a simple way of going, well, actually, where are the most loyalty engaged markets and where are they not?

And it’s great to break it down by membership, by appeal, and by impact. But actually, as loyalty marketers, we have quite a lot on our plate. Um, so it’s also quite handy to have that visual representation of, you know, where do the markets sit in that pecking order and what’s, what’s driving what in each of the markets.

And I think that was really interesting to me. So I love the fact that Ireland was at the top that tickled me thinking about this podcast. 

Paula: Thank you. Yeah. 

Charlie: Across membership appeal and all four impact metrics. You know, the Irish really love loyalty and it’s made me think, you know, we operate in that market, but actually I want to know more.

And I want to find out more what’s happening in that market that other markets can learn from. You know? And then at the opposite end of the spectrum, you’ve got the Dutch hoop. Are actually quite strong for membership, as you can see, but actually appeal and impact not so good in that market. So I think the loyalty gauge in itself is, is probably the biggest learning in the paper.

It’s a very simple visual just to look at and you can see where your market is and, and what your market’s doing well at and what, it’s not. 

Paula: Amazing. 

Nick: I like it from a, uh, non-industry boards because it’s such a, as you said, it’s such. Overall kind of pan-European visual representation of what’s going on in each market.

And you can understand like a pecking order and kind of where the opportunity might be, where uh, uh, an established market might be. So yeah, I, I really like it. I’m disappointed you didn’t get to call it the loyalty barometer though, Charlie. 

Paula: Cool. 

Charlie: I know, I love that word, but somebody’s already got it. So the loyalty gauge works well.

Um, and I particularly like the kind of, you know, the speedometer graphic as well, cuz everyone knows I’m a sucker for a good infographic. So, um, yeah, it’s, it’s a really useful tool and, but people have asked me, you know, what are the top three takeouts from the paper? 

And I think the top three takeouts are, read it because it’s really interesting how it applies to you. I don’t know enough about your market or your program or your sector to say actually what the key takeout is from it. Um, personally for me, it’s actually now finally having robust data to make those decisions on and to adapt our strategies for the programs that we are working on by market.

Across those different variables, but I think everyone will have a different three when they look at this, depending on, you know, which lens they’re looking at, um, their data from.

Paula: Well, I’ll be of course celebrating the loyalty gauge Ireland top of the pack. So no question in my mind. So I’m super glad that you referenced that, Charlie.

And uh, yeah, I wanna give a shout out to our friends in the Irish Loyalty Awards, which are actually coming up in May. Um, so that’s also another important industry event. So check out the Irish Loyalty Awards. I think, um, we’re, we’re, we’re a small country that I feel punches above its weight. And again, it’s reports like this that kind of bring that to the fore in terms of what do we believe in, how do we behave?

But also as I think about the audience, you know, if I’m sitting in a global role or a regional role, as you mentioned, Charlie, you know, choosing which markets to roll out a loyalty program too, can be dramatically helped by understanding something like the loyalty gauge. You know, I was talking with, for example, McDonald’s recently, and that’s one of the biggest stories globally in terms of loyalty because they were relatively late.

In fact, they only launched a year and a half ago, a loyalty program. In their home market in the United States. And it was exactly because what they were doing was testing and learning in other markets around the world and then proving it in their biggest market. So I think there’s amazing insights when you talk to loyalty professionals to go, oh my goodness.

You know, there are differences, but there are learning. So, well done for bringing the, the loyalty gage there. And I suppose the final question I had, I know we’re running out of time, was just you, you’re showcasing three particular programs, Charlie, so I’d love you just to touch on exactly, you know, why you felt that that was an important part of this white paper as well.

Um, you know, as distinct from the pure research at a country level.

Charlie: Yeah, I think that’s a really good question. And again, it’s silly me talking to you about it cuz you and I feel exactly the same way about this and I think, you know, it’s great to see the data, it’s great to see the insight, but a lot of the learning comes from the real stories and the real world application.

Um, so we sat back, we looked at the data, we thought about three interesting sectors, and we came up. Probably with about 20, we came up with loads of brands. 

Paula: You’re just podcast. 

Charlie: I know. It’s terrible. Right. The podcast was a great source of interesting programs, um, as are all the conferences that are happening at the moment.

And then we sat back and thought, actually, you know, it’s a lot to ask a program to contribute to a white paper. So who do we know then became a factor as well. And I think, you know, Vodafone was a natural because of the win for best in Western Europe, I think. Amazing.  The International Loyalty Awards would’ve, you know, this is a bit strange.

Why, why haven’t you? The winner for best in Western Europe in the European white paper trolley. So I think that was a, a natural inclusion. Yeah. And Marriott Bonvoy such a fantastic program. So big, such gorgeous imagery. It just makes me want to travel every time I totally, to think about Marriott Bonvoy, but I don’t think it would be fair to not have a travel, um, program in, and then in all honest, the, for the others, we were just thinking, well, who were really interesting brands doing really interesting things.

You, it was hard to choose telco, electronics, retail, grocery, beauty, there’s so many brilliant programs. Um, but we selected Samsung members because of the nature of the brand, because people love the brand, because it’s technology, it’s such an interesting program. And because they tailor it so much in each of the markets, I thought that was a particularly interesting story.

So whereas Marriott takes more of a global view adapted to local market conditions. Samsung members is very much a kind of a European program, but with very different expressions in each of the markets. So we thought they were two quite different ways of doing it, and really, and obviously Samsung spoke at the loyalty summit as well.

So there are some great presentations there for more depth, um, wow from the program for those that want it. But in all honesty, I think more programs should be looking and participating in all this kind of thing. And again, if it was up to me, it’d be so heavy. The white paper, you wouldn’t be able to carry it.

Paula: It’s gonna become your full-time job, Charlie, this, uh, this region gig you, you love a tomb, it too much. So most importantly Charlie, where can people get the white paper now? Uh, that’s hot off the presses. Tell us where to find it. Yeah. 

Charlie: Absolutely. So the full white paper is available to download from our website, so www.mandohyphenconnects.co.uk.

You can also find it on LinkedIn, so the Mando Connect site or Charlie Hills, um, LinkedIn. Um, and then we’ve also got executive summaries and Canna key snip. graphics of all the kind of main, um, graphics within it. So if anybody would like it, anybody needs it for a presentation, please just get in touch with me, um, and we’ll send you some stuff over.

A big ambition for us for this paper is that lots of people are using it and lots of people are finding it really helpful and it’s an opportunity for us to learn more about, um, loyalty in Europe, but also to share. So please get in touch. We’re happy. Happy to send it. 

Paula: Amazing. Yes. And of course we’ll link to Mando Connect. We’ll link to your profile, Charlie, of course, as well on LinkedIn in the show notes for this episode. So no problem. Or of course anyone can reach out to me if you need to be put in contact either with Charlie or with Nick. So parting words of wisdom, Nick, I’ll come to you first and foremost, again, you’ve, you know, you’ve been through.

So much with Charlie creating all this incredible research, you must be very proud actually, I guess, in terms of what your database is, is delivering for a whole industry, which as I already said, is hungry and desperate for insight. 

Nick: Yeah, definitely. Um, yeah, we are starting to do quite a bit together over the years, aren’t we, Charlie? I think I’m teeing up for a, a career change to move into the multi-sector. Um, yeah, no, it’s, I mean, I, I find it really interesting. As I said, I, I don’t work in the industry. It’s not what I do day-to-day, so I really like these collaborations with Charlie cuz it, it kind of opens up a completely new world to me.

Um, I think, I think what the data shows is that you know, loyalty as it is in the UK across Europe, is just a really good marketing tool for engaging consumers, like engages hearts and minds, as you were saying, and, and wallets of course, um, so yeah, it’s always fascinating for me and yeah, happy to be part of it.

Paula: Great stuff. Excellent. And of course we’ll make sure to, to link to your profile as well, Nick, and to YouGov the show notes. So Charlie, any final words of wisdom before we wrap up? 

Charlie: Not really, other than, I reckon we should do a global one, don’t you, Nick? 

Paula: Hot off the presses.

Charlie: Yeah, I think my, my words of wisdom, uh, read it, use it, get in touch to find out more about it.

If you are a program who wants to be part of it, let me know. If you’re a market expert who wants to comment on it, let me know. I think we are very much at the beginning here. I feel like this is chapter one and I really want to build my knowledge of, of what it looks like across Europe and actually how we translate those learnings from one market to another.

So, uh, get involved and use it and I hope it helps. 

Paula: Wonderful. Okay. Well, with all of that said, I want to again, uh, congratulate you both on delivering such an extraordinary piece of work. So Charlie Hills, MD and Head of Strategy at Mando Connect and Nick Fishbourne, Group Account Director at YouGov.

Thank you so much from Let’s Talk Loyalty.

Nick: Thanks, Paula. 

Charlie: Thank you.

Paula: This show is sponsored by The Wise Marketer, the world’s most popular source of loyalty marketing news, insights, and research. The Wise Marketer also offers loyalty marketing training through its Loyalty Academy, which is already certified over 500 executives in 38 countries as certified loyalty marketing professionals.

For more information, check out thewisemarketer.com and loyaltyacademy.org.

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