The COLLOQUY loyalty marketing census: sizing up the US loyalty marketing industry

Abstract

Purpose

This article aims to examine US loyalty marketing industry size and analyzes growth trends.

Design/methodology/approach

The article provides a discussion on COLLOQUY's benchmark‐setting measurement.

Findings

US loyalty rewards program membership has reached 1.3 billion, according to COLLOQUY research that provides the first comprehensive census‐taking of loyalty marketing since the modern loyalty era began with frequent flyer incentives in 1981. COLLOQUY's benchmark‐setting measurement, based on a fourth‐quarter 2006 analysis of a dozen business sectors, reveals that the average US household belongs to 12 loyalty programs. In a key finding, the COLLOQUY census shows that “active participation” in loyalty programs is a blended average of 39.5 percent across all sectors analyzed, a number that COLLOQUY experts characterized as “dismal.” Of the 12 programs per average household, 4.7 yield active participation. The census results raise a major question. Does the participation data mean the loyalty empire has reached a saturation point? The response from COLLOQUY experts: “Loyalty memberships are flying dangerously high. Fat membership roles may look good in a press release, but active loyalty program members are the only members who count.”

Practical implications

The loyalty marketing industry has experienced significant growth. Low active participation rates signal that millions of customer files in a database do not signify a successful loyalty strategy. Smart enrollment strategies should suggest a finite population of best or highest potential spenders.

Originality/value

The article provides proprietary business‐to‐business research on the size and scope of the US loyalty marketing industry.

Citation

Ferguson, R. and Hlavinka, K. (2007), "The COLLOQUY loyalty marketing census: sizing up the US loyalty marketing industry", Journal of Consumer Marketing, Vol. 24 No. 5, pp. 313-321. https://doi.org/10.1108/07363760710773139