News | June 12, 2009

Retailers Now Claim Largest Share Of U.S. Loyalty Marketing Program Memberships, COLLOQUY Research Shows

The U.S. Retail sector, led by Specialty Retailers, Grocers, Mass Merchants and Department Stores, now constitutes the largest collective market for U.S. loyalty reward program memberships, outstripping Travel-Hospitality and Financial Services aggregate memberships, the 2009 COLLOQUY Loyalty Census shows.

COLLOQUY's latest census research shows that across-the-board Retail loyalty program memberships now number 701 million, representing 39% of the U.S. loyalty market. That compares to 556 million in Travel-Hospitality, which includes Airline, Hotel, Gaming, Car Rental and Cruise programs, representing 31% of the market, and Financial Services credit card programs at 422 million for 23% of the market. The 2009 COLLOQUY Loyalty Census measured the scope of U.S. loyalty marketing in 2007 and 2008.

A loyalty marketing program recognizes and rewards the best customers of a business. The complete 2009 COLLOQUY Loyalty Census covers 13 industry sectors. The Census tabulates program memberships, not unique individuals. COLLOQUY'S 2009 measurement shows that total membership in U.S. loyalty reward programs is 1.8 billion.

COLLOQUY provides a full report on its 2009 census-taking in a white paper titled, "The Big Sort: The 2009 COLLOQUY Loyalty Census." The paper is available free of charge at www.colloquy.com/whitepapers.

Based on the 2009 COLLOQUY Loyalty Census, Retail sector reward program membership roles are as follows:

  • Specialty Retail 191.3 million;
  • Grocery 153.3 million;
  • Mass Merchants 124.8 million;
  • Department Stores 92.8 million;
  • Drug Stores 73.9 million;
  • Fuel-Convenience 51.2 million;
  • Restaurant 13.7 million.

"In our 2007 Loyalty Census white paper, we predicted the next loyalty battleground would be in Retail and we were right. With the Travel category in maturity and the Financial Services category likely to contract, we expect retailers to be at the forefront of innovative loyalty marketing for years to come," said COLLOQUY Partner Kelly Hlavinka, who co-authored the white paper about the 2009 COLLOQUY Loyalty Census with COLLOQUY Editorial Director Rick Ferguson.

"The current economic climate may spell short-term doom for many venerable Specialty Retail brands but in terms of loyalty marketing, Specialty Retail had a great couple of years since our last Census predicted double-digit growth," said Ferguson. "Using multi-tender vehicles, private-label or co-branded credit cards, Specialty Retailers are fighting back against Wal-Mart and other mass merchant discounters by using loyalty offerings to build emotional bonds with their best customers."

In other key Retail sector findings from the 2009 COLLOQUY Loyalty Census study, white paper authors Hlavinka and Ferguson wrote:

  • Grocery's 153.3 million membership count represents a 23% increase since the 2007 Loyalty Census, as the shift away from two-tiered pricing and toward promotional currency continues. Wal-Mart remains the dominant U.S. grocer, though grocers big and small are fighting back with a renewed emphasis on shopper data and customer centricity. COLLOQUY predicts a spike in loyalty program activity.
  • In the short term, Department Store investment in loyalty programs will suffer, mainly because most still are tied to store credit cards and those portfolios are in dire shape. Once the recovery begins, the smart players will exhibit renewed focus on improving the customer experience, and that focus will depend on effective use of shopper data.
  • COLLOQUY is quite bullish about the Drug Store sector, despite the economy. While most retailers are experiencing double-digit sales declines, retail pharmacy sales increased 1.5% last year. Drug store operators have consolidated and now realize that the loyalty program is the best device for tracking individual behavior.

COLLOQUY is a provider of loyalty marketing publishing, education and research. Its 2009 Loyalty Census is based on information from its own archives, program web sites, sponsor-company press releases, annual report filings, third party publications and research reports. The results of COLLOQUY's 2009 Loyalty Census study will be presented in a webinar cosponsored by The Direct Marketing Association, June 25, 2009. Registration and information available at www.the-dma.org/seminars/loyaltyweb/20090625.shtml.

About COLLOQUY
COLLOQUY comprises a collection of publishing, education and research resources devoted to the global loyalty-marketing industry. COLLOQUY has served the loyalty-marketing industry since 1990 with over 30,000 global subscribers to its magazine and www.colloquy.com is the most comprehensive loyalty web site in the world. COLLOQUY's research division develops consumer and B-to-B research studies and white papers including industry-specific reports, sizing studies and insights into the drivers of consumer behavior. COLLOQUY also provides educational services through workshops, webinars and speeches at events throughout the world and is the official loyalty-marketing partner of both the Direct Marketing Association and the Canadian Marketing Association. COLLOQUY also operates The COLLOQUY Network, a global consortium of practitioners certified in COLLOQUY's proprietary methodology. For more information, visit: www.colloquy.com.

SOURCE: COLLOQUY