Multi-Brand Loyalty Cards: A Good Idea

Abstract

The UK's leading coalition loyalty card scheme was launched at a time when questions were raised regarding the viability of such schemes. Two years into the scheme, it is now appropriate to review the scheme's relationship with its' customers and judge its' success in terms of its ability to influence card holders' behaviour. To meet the objectives a survey methodology was adopted, and a new questionnaire devised for administration to a sample of coalition loyalty card scheme cardholders. The survey achieved 153 responses from the scheme members. Findings from the study revealed that coalition loyalty card scheme holders' exhibit weak bonds between the card provider and its customers and that customers display signs of low commitment, low trust and low perceived relational benefits. There is a decisive lack of awareness of many sponsors and this confusion seemed to be leading to the use of coalition loyalty card scheme as a single-brand card. Although usage rates are on a par with other loyalty schemes, a lack of involvement seems apparent; indicating that no considerable increase in share of customer had occurred. This is mainly down to poorly targeted communications and irrelevant reward offerings. Finally, there was little to suggest that coalition loyalty card scheme are currently having much influence over consumer behaviour, as the bonds between the two parties were not strong enough to encourage this. However, this does not indicate that the current market leader is currently unsuccessful, there is evidence to suggest consumers perceive real benefits in coalition schemes and that there is a willingness to alter their behaviour if the motivation is sufficient. Implications for future research include more specific investigations into the dynamic of the relationship between loyalty schemes and consumers and further research on coalition schemes per se.