Nearly one-third of consumers cite privacy as concern in loyalty programs

Ease of earning, redeeming points and monetary rewards singled out as attractive features

CHICAGO — A growing number of consumers are concerned about their privacy when they sign up for loyalty card programs, according to a new survey.

Market research firm Mintel found that 32% of Americans believe the privacy of their personal information is an important attribute of a loyalty program, and one-tenth or more express frustration or dissatisfaction with too much personal information being requested during enrollment and lack of control over the privacy of their information. The report was based on a survey of 2,000 adults.

More than half of respondents cited ease of redeeming rewards, ease of earning points and monetary rewards as factors that made loyalty programs attractive. Meanwhile, 36% found access to exclusive deals and coupons attractive, and 22% sought easy enrollment options.

"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," Mintel retail and technology analyst Ika Erwina said. "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."

About 16% of participants in loyalty programs say their programs are less tailored toward their shopping habits, with 20% of millennials saying so.

"Age is strongly related to the type of loyalty program in which people belong," Erwina said. "While supermarket loyalty program memberships are likely to be cited by individuals ages 35 years and older, 18-year-olds to 34-year-olds tend to enroll in food service, mass merchandiser, online retailer, convenience stores or fuel or dollar discount store programs."

Erwina also said club store memberships were popular among younger people and suggested that retailers incorporate social issues into programs to improve awareness and participation.

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