Consumers Concerned about Privacy in Loyalty Programs

While retailers spend millions of dollars annually to provide the latest and greatest rewards programs to shoppers, many consumers just don’t get it. Nearly a third (32 percent) of Americans say the privacy of their personal information is an important attribute of a loyalty program, according to a new survey from market research firm Mintel. In addition, more than one in 10 of the 2,000 consumers surveyed expressed frustration or dissatisfaction with too much personal information being requested during enrollment. Ten percent believe they have a lack of control over the privacy of their information, Mintel’s “Retail Loyalty Programs 2013” report found. “Reassurance of privacy is undoubtedly a key strategic tool in loyalty program engagement, but there is a paradox at play here between personalization and privacy,” said Ika Erwina, retail and technology analyst for Mintel, in a Mintel statement. “Ironically, even though loyalty program members crave a more personalized, relevant experience, they also show concern about sharing the information required to enable the retailer to deliver on this desire.” While retailers have boosted rewards programs’ personalization capabilities in so many new and exciting ways, some consumers are not experiencing that. In fact, 16 percent of retailer loyalty program participants on average believe that their loyalty programs are less tailored toward their shopping habits, according to Mintel. Millennials, in particular, don’t believe loyalty programs are geared toward them. “Given Millennials’ strong propensity toward environmental and social responsibility, retailers may need to incorporate social issues into the program to improve awareness and participation,” Erwina said. Why do you think consumers are not understanding the benefits of shopper loyalty programs? Why is the word not getting out about the personalization/customization abilities of the retail industry’s rewards programs, as well their extensive efforts to protect consumer privacy?  

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