Consumers have a high level of trust in brands. In fact, 91% of those surveyed by Blackhawk Network said that they trust their favorite brand somewhat or very much. Retail brands are trusted more than other entities, such as banks, social networks, government and the media.
“At Blackhawk, we have always believed in—and continue to believe in—the power and impact of brands,” Teri Llach, chief marketing officer for Blackhawk Network, a leading global provider of solutions and technology that help brands create rewarding experiences, told FierceRetail. “However, it was still somewhat surprising to see just how much the consumers we surveyed reported trusting in brands, especially with the increasing influence of peer-to-peer recommendations. Our survey’s respondents said that their trust in brands is higher than other entities that they interact with, such as social networks, confirming that brands are more powerful than ever.”
The study, which was conducted in October 2016 and released last week, found that 83% of consumers have used a gift card, 81% belong to a loyalty program, 42% used a reward after submitting a rebate, and 36% regularly use a mobile or contactless payment option.
These uses of points and rewards are motivated by branded value. Though shoppers are still motivated by free shipping, the survey respondents reported that they were also compelled to complete an online purchase by a gift card, 54%; loyalty points, 30%; rebates, 28%; and mobile payment option, 11%.
Rewards drive in-store purchases
Branded value can also drive consumers to purchase in-store. And although a sale is still the greatest motivator, others included a branded value offer, 48%; a gift card, 47%; or a rebate paid out on a prepaid card, 31%.
“We believe brands are as powerful as ever—the ways they connect with consumers have just evolved,” said Talbott Roche, CEO and president of Blackhawk Network. "Branded value is a perfect example: The act of paying cannot typically be circumvented in the shopping process, but it can be elevated. By going beyond just offering a branded payment solution to creating one that actually makes life easier or adds real value for customers, brands can generate greater loyalty and engagement."
“Our research confirmed that there is a powerful opportunity for marketers to provide branded value solutions that can solve a host of marketer pain points including cart abandonment, declining foot traffic, new customer acquisition or faltering loyalty," Roche added. "Even older tools like coupons can be enriched and made more effective with relevant branded value products, targeting and integrated contextual delivery.”
Branded value solutions are also a great way for retailers to drive customer acquisitions. Nine out of 10 people surveyed said they would use a gift card from a brand they have never tried before, and 72% said that targeted offers would prompt them to visit a store or website they wouldn’t have gone to otherwise.
More specifically, 39% have used a coupon to try out a new store or website and 35% said an alternative payment option has prompted them to try a new store.
Branded value builds loyalty
In addition, branded value can serve as a loyalty driver. For example, consumers report spending $27 over and above the original value of a gift card, and $29 over for an e-gift card. Further, 82% of respondents would recommend a retailer offering a rebate, and 83% said a retailer offering a rebate makes it more likely that they’ll end up making a purchase.
According to Llach, forward-thinking companies are combining the power of their brand with value to inspire consumers. Acting on that, some brands are generating greater loyalty and engagement by combining branded value with payment systems.
“It’s an elegant move, as the act of paying usually can’t be avoided by the consumer during the shopping process, but it can be elevated,” she said.
For those consumers surveyed who use alternative payments, 26% said a mobile payment option makes them feel more loyal to a retailer or brand and 77% would recommend a retailer offering something like a mobile wallet. In total, 78% believe alternative payment options increase the likelihood of them making a purchase.
Finally, loyalty rewards are still highly valued. More than 36% of respondents feel more loyal to a retailer after redeeming loyalty points, and 85% would recommend a retailer offering loyalty points. In total, 89% said a retailer offering loyalty points increases the likelihood of them making a purchase.
“The continued evolution of branded value and payments technologies—in shoppers’ wallets, on their smartphones, on their wrists or in the cloud—can create a unique path towards better customer engagement,” Llach said. “When the solutions become habitual elements of consumers’ path to purchase, add real value to their lives and impart branding along the way, businesses can reap the benefits of the positive synergies. Smart brands of the future will see that payments have become an integral step for engaging with the increasingly connected consumer."