1. Consumer research study taking the pulse on Australian
loyalty programs and their impact on customer loyalty

2. 2 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Welcome to ‘for love or money 2015’;
the Australian research report that
takes the pulse on trends, changes and
provides new insights into consumers’
relationships with loyalty programs
and their impact on customer loyalty.

3. 3© COPYRIGHT TO DIRECTIVITY AND CITRUS
Contents
1.0 Introduction - welcome to ‘for love or money 2015’ 4
2.0 Research methodology and profile of participants 8
3.0 Executive summary of key findings trends and new insights 10
4.0 Findings in detail 18
4.1 Tracking the pulse of change to benchmark results from 2013 and 2014 18
4.2 Revealing 9 new insights that impact on brand loyalty and loyalty program success 46
4.3 28 Australian loyalty programs reviewed 62
5.0 Behind the research - the people who love loyalty 68
Copyright © 2015 to Directivity and Citrus
‘for love or money 2015’ Consumer Study into Australian loyalty programs and customer loyalty is for single use only. No part of this publication may be reproduced, stored in a retrieval
system, or transmitted, in any form or by any means, electronic or mechanical including photocopy or printing without the prior permission in writing from the copyright owners, nor be
otherwise circulated in any form of binding or cover other than that in which it is published and without a similar condition including this condition being imposed on the subsequent
publisher. No responsibility for loss occasioned to any person acting or refraining from the action as a result of the material in this publication can be accepted by the authors.

4. 1.0
Welcome to ‘for love
or money 2015’
Introduction
S
S

5. 5© COPYRIGHT TO DIRECTIVITY AND CITRUS
Directivity and Citrus together with First Point Research and Consulting are
pleased to release our in-depth research report into consumers’ relationships with
loyalty programs and customer loyalty in Australia.
This is our third research report to follow previous research reports available at
www.theloyaltypoint.com.au
What’s different in this report that will make a difference
to your brand or business?
Three goals were set for this 2015 research study:
1. To track the pulse of change to benchmark results
The 2015 research study is the first of its kind to benchmark results from
the 2013 ‘For love or money’ research study and some of the insights from
the 2014 ‘Share the Love’ study.
It identifies the pulse of change in results and insights that impact on loyalty
programs and customer loyalty including:
• Volume of memberships
• How active members are (huge change)
• Benefits members want
• Card vs mobile app
And more ...
2. To reveal new insights that impact on brand loyalty and loyalty
program success
It highlights 3 new areas and 9 new insights that impact on the lifeblood of
loyalty program success and the influence on members’ buying behaviour and
brand loyalty. It reveals answers to questions such as:-
• Do members think brands need a loyalty program to keep their customers
loyal? (the results are fascinating for certain age groups)
• Do members purchase items that they do not need because of a loyalty
program? (the hidden profit driver of programs)
• Do members want benefits for interacting with the brand through the program
such as for answering surveys, opening emails and others? (moving from
transaction to interaction)
And more!
3. To review 28 Australian loyalty programs
For the first time in our research studies, we provided members with a list of 28
randomly selected Australian loyalty programs to give members the opportunity
to identify:
• Which programs they were a member of;
• How active they are in these programs; and
• Their view on whether it is a poor or excellent program.
The results are surprising!
1
For love
or MONEY?
2013 Consumer
Study into Australian
Loyalty Programs
1© Copyright to Directivity and Citrus
2014 Consumer Study into
Australian Loyalty Programs
Share
the love
Thank you for your interest in ‘for love or money 2015’

6. 6 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Australian loyalty programs reviewed
MYER one
Amcal Rewards
Millers Fashion
Spotlight VIP
myDanMurphy’s
ANZ Rewards
Big4 Loyalty Club
Katies Fashion Club
Vintage Cellars Wineclub
Accor Hotels – Le Club
Coles – flybuys
Rays Outdoors
Virgin – Velocity
Kathmandu Summit Club
Hoyts Rewards
Commonwealth Bank awards program
The Coffee Club VIP
Boost VIP
Thirsty Camel – Hump Club
Starwood Preferred Guest
Supercheap Auto
Priceline – Sisterclub
Country Road – VIP cardholder
Village Movie Club
Woolworths – Everyday Rewards
Qantas Frequent Flyer
Rebel
Westpac Altitude Rewards
Note. The authors of this research study have no vested interest in any of the listed
loyalty programs. They were chosen randomly from the Australian loyalty program
market place.
The 28 loyalty programs were also randomly presented in the research to avoid bias
of selection.
As you continue to enhance and build loyalty program
success or are seeking to improve your customer
interactions and overall brand loyalty, then ‘for love or
money 2015’ will give you the results, observations and
insights to guide you along that journey.
Adam Posner
CEO
Peter Noble
CEO

7. 7© COPYRIGHT TO DIRECTIVITY AND CITRUS

8. 2.0
Research methodology
and profile of participants
Who gave their
point of view?

9. 9© COPYRIGHT TO DIRECTIVITY AND CITRUS
Research methodology
and profile of participants
The research was conducted
independently by First Point Research
and Consulting in the first quarter of 2015,
through an online panel of Australian
consumers (men and women aged
18 years +) who are all members of at
least one loyalty program.
The research was structured to gain
quantitative results with comparative
analysis. Free form questions were
included to gain actual feedback and
comments from loyalty members.
The total sample of N=1367, provides a
margin of error of +/- 3% at a 95% level of
confidence. Broad quotas were set for age
& gender.
2013
52%
48%
part of
NSW
18%
35%
25%
3%
9%
10%
part of
NSW
17%
30%
25%
3%
8%
16%
2015
60%
40%
16-24 25-34 35-44 45-54 55-64 65+
9% 29% 21% 16% 17% 8%
YEARS
18-24 25-34 35-44 45-54 55-64 65+
6% 18% 18% 19% 20% 19%
YEARS
Gender
State
Age
A note on this tracking study A consumer tracking study is generally designed to ‘track’ any shifts in
consumer sentiment or behaviour over time. They are sometimes conducted ‘continuously (i.e. daily or weekly),
or may be ‘ad-hoc’ or periodic measures, as is the case with this series of Loyalty studies. Tracking studies
are generally conducted with large sample sizes so that the data is reliable and robust and conclusions can be
drawn confidently about any statistically significant shifts in response to questions from one point to another.
The sample size is an important indicator of the confidence we can have in the data. With a sample of around
1,000 Australians in our studies, we expect the results to deliver the same result (within +/- 3% of the observed
result) on 95% of occasions. The implication of a sample with a 95% confidence interval is that the results,
assuming identical questions, WILL and SHOULD be very similar from one period to another. This is an indicator
of high data integrity. Any significant shift in results can be attributed to a genuine shift in consumer sentiment
or behaviour that is likely to be reflection of one of many factors including (but not limited to): A change in the
economy (eg. Higher interest rates or rise in unemployment rates); A change in competitive conditions (eg. new
arrivals in the market place); A change in marketing or advertising activity (a new product, innovation or campaign
highlighting new features or USP).

10. of key findings,
trends, results and
new insights
Executive
summary
3.0
S
S

11. 11© COPYRIGHT TO DIRECTIVITY AND CITRUS
A summary of trends,
results and insights
from 2015 …
?

12. 12 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Immediate price discounts when
making purchases
Point based programs that allow
members to redeem ‘points’ for
vouchers, products or other rewards
78%
77%
77%
% Very Important/Important
% Very Important/Important
2015 2013
1. Tracking changes in the Australian
loyalty landscape
Membership of loyalty programs
• In 2015, 84% of Australian’s are enrolled in at least one loyalty
program (2013=88%)
• Average no. of memberships in 2015=3.8 (4.0 in 2013)
• 59% of members indicate they are active in ALL of the programs
they are enrolled in, an incremental increase of 31% since 2013.
Men are more active than ever before.
(active = member presented their card or membership number when making purchases or accruing benefits in
the last 12 months)
Behaviours & attitudes
• Programs continue to be valuable to business, with 82% of
members indicating they tend to buy more from companies
whose programs they are a member of (80% in 2013).
• Programs are still a competitive advantage with 55% of
members indicating they tend to buy from companies with
a program.
• Over a quarter (26%) of members believe that loyalty
programs just don’t seem to understand how to
communicate appropriately.
80%
• Tears for tiers – tiered programs are the least preferred benefit by members 36% (same as 2013)
Different levels of reward based on
different levels of spending (eg Gold,
Silver and Bronze membership tiers)
36%
36%
Program benefits
• Money still matters and points for purchase still pleases
?

13. 13© COPYRIGHT TO DIRECTIVITY AND CITRUS
Who’s doing a good job?
97 loyalty programs were mentioned unprompted by members as doing
a very good job (see the list on page 39) and whilst the top 3 remain the
same, there has been some movement in the ranks, with two new entries.
Q Can you tell us about a specific loyalty program that you think is doing a very good job?
The 2013 top 10 most mentioned loyalty programs (unprompted) as
doing a particularly good job
Coles/flybuys
Woolworths – everyday
rewards
Qantas Frequent Flyer
MYER one
Priceline – Sisterclub
Virgin – Velocity
CBA Credit Card
IGA
Millers
Rewards Central
Spotlight
Other Programs
None
37%
22%
11%
6%
5%
2%
1%
1%
1%
1%
1%
<1%
12%
Q Can you tell us about a specific loyalty program that you think is doing a very good job?
The 2015 top 10 most mentioned programs (unprompted) as
doing a very good job
Coles/flybuys
Woolworths – everyday
rewards
Qantas Frequent Flyer
Virgin – Velocity
MYER one
Priceline – Sisterclub
Millers
Westpac Altitude Rewards
Commbank Awards
Hoyts Rewards
Other Programs
None
13%
6%
3%
2%
2%
1%
1%
1%
1%
13%
25%
33%

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Member defection
Member defection remains passive, with 22% stopping to
participate in a loyalty program (slight improvement for 2013
which was 26%).
There are many reasons for defection, these are two
critical reasons: Remember: Defection from a program = defection from a brand
I wasn’t earning points / rewards
fast enough
The rewards didn’t appeal to me
51%
59%
36%
40%
20142015
% Very Important/Important
OMG! … the card wins again – you’re kidding!
Members want the card – and this
preference has had a remarkable increase.
Getting the card into the wallet/purse is a critical piece of brand
real-estate and connection!
Card vs App
…Would like a traditional card …Would like a mobile phone app
2015 20152014 2014
12%10%
There has been a slight decrease in interest in using a MOBILE
APP to interact with a program.
57%67%

15. 15© COPYRIGHT TO DIRECTIVITY AND CITRUS
2. Revealing new insights for loyalty
program success
Impact on brand loyalty
Influence over buying behaviour
Evolving program benefits58% of loyalty program members believe that brands need a loyalty program to keep their
customers loyal.
This jumps to 71% for under 34 yo.
Members are wise to why brands have loyalty programs.
Their top 3 reasons why brands have a program are:
Loyalty programs do influence impulse purchases and buying behaviour with 16% of members having
purchased items they did not need in order to earn or maintain program benefits (this jumps to 26% for
men < 45 yo).
Move your program from transaction
to interaction!
More than half of members (53%) want rewards for
answering surveys.
This is closely followed by opening emails (46%) & this jumps to
61% for under 35’s.
Cash in the points
81% of members want cash based rewards.
Members can wait for high value rewards
68% of members prefer higher value rewards that take a longer
time to accumulate vs immediate lower value rewards.
To keep you buying from them rather than
the competitors
To encourage you to buy from them more often
To encourage you to spend more with them
69%
67%
63%
ALL reasons
?

16. 16 © COPYRIGHT TO DIRECTIVITY AND CITRUS
3. Ranking of 28 Australian loyalty programs
% rating as ‘Excellent’
Base: Respondents are ACTIVE members of the respective programs
ANZ Rewards
Westpac Altitude Rewards
Coles flybuys
The Coffee Club VIP
Hoyts Rewards
Comm Bank Awards
Supercheap Auto
Vintage Cellars Wine Club
Country Road VIP
Millers Fashion
Woolworths Everyday Rewards
Qantas Frequent Flyer
Amcal Rewards
MYER one
Rays Outdoors
Boost VIP
Virgin Velocity
Priceline Sisterclub
Spotlight VIP
myDanMurphy’s
Katies Fashion Club
Kathmandu Summit Club
Accor hotels – Le Club
Rebel Sport
Village Movie Club
51%
50%
46%
46%
45%
44%
43%
40%
37%
36%
34%
34%
34%
33%
33%
32%
31%
29%
26%
26%
23%
23%
21%
17%
16%
Banks are getting it right!
The loyalty programs of two major banks are
given strong endorsement by members
Flybuys rated much higher
than Everyday Rewards.
Country Road leads the
field in the fashion stakes
Hoyts Rewards rated
much higher than Village
Movie Club
Q. Looking still at the programs you are an active member of, indicate the impression you have of that program based on your own
experiences. Scale from 1 (poor) to 7 (excellent)
Members impression on overall quality... from poor to excellent
For the first time in our research studies, we provided members
with a list of 28 randomly selected Australian loyalty programs to
give members the opportunity to identify:
• which they were a member of
• how active they are in these and
• their view on whether it is a poor or excellent program.
Top 25

17. 17© COPYRIGHT TO DIRECTIVITY AND CITRUS 17© COPYRIGHT TO DIRECTIVITY AND CITRUS

18. 4.1 Tracking the pulse of
change to benchmark results
from 2013 and 2014 studies
Findingsindetail
4.0
1
For love
or MONEY?
2013 Consumer
Study into Australian
Loyalty Programs
1© Copyright to Directivity and Citrus
2014 Consumer Study into
Australian Loyalty Programs
Share
the love

19. 19© COPYRIGHT TO DIRECTIVITY AND CITRUS
Tracking the pulse of
change to benchmark
results from 2013 & 2014
?

20. 20 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Membership of a loyalty program
In 2015, 84% of Australians over 18 yo are
enrolled in at least ONE loyalty program.
2015 2013
Average number of program memberships
On average, in 2015 Australians recall being enrolled
in almost FOUR different programs, with no significant
change since 2013.
2013: 88% of
Australian
consumers
over the age
of 16 were
members
of a loyalty
program
2015
Membership of loyalty programs
3.88

21. © COPYRIGHT TO DIRECTIVITY AND CITRUS 21
The lovers of loyalty programs are
becoming more selective
Interestingly the 2015 study identified that 8% of members belong
to 10 or more programs, which is down from 11% in 2013.
This indicates that members who love loyalty programs are
becoming more discerning about the programs they will sign up to.
8% of members
belong to 10 or more programs belong to 10 or more programs
10+
men women
10+
9%3%
Membership of loyalty programs

22. 22 © COPYRIGHT TO DIRECTIVITY AND CITRUS
WOMEN
2013
4.7
With only a slight decrease in memberships for both men and
women, it is still clear that women have more memberships,
however MEN are more actively engaged with their programs
than women (see page 23)
Male vs female
2015 vs 2013 - Gender
WOMEN
2015
4.4
MEN
2013
3.3
MEN
2015
3
Membership of loyalty programs

23. 23© COPYRIGHT TO DIRECTIVITY AND CITRUS
Youth are moving up
Younger members (less than 45 years) are starting to trend up in
the number of programs they belong to.
2015 vs 2013 - AGE 2015 - Gender and Age
WOMEN
under 45yrs
WOMEN
over 45yrs
3.9
5
MEN
under 45yrs
MEN
over 45yrs
3.5 2.8
20132015
Under 24yrs 25-34yrs 35-44yrs 45-54yrs 55-64yrs 65+
yrs
4.1 4 4.5 4.3 4.4 4.2 3.4 3.8 3.3 3.8 3.6 3.7
More programs for women < 45 yo
Women generally, but specifically women aged under 45 years tend
to enrol in more loyalty programs.
Membership of loyalty programs

24. 24 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Active engagement in ALL
programs increases!
Members are far more engaged with
their programs in 2015.
Overall there has been a significant improvement since 2013 in the
ability of Australian loyalty programs to maintain member activity
and engagement.
59% of members indicated they are active
in ALL of the loyalty programs they are
enrolled in – an incremental increase of
31% since 2013!
Q Still thinking about those loyalty programs that you are a member of, approximately how many
of them are you an active member of (i.e. you present the card or membership number when making
purchases or accrue benefits through the program) in the last 12 months.
2015 vs 2013
Base: Total sample n= 1367
All of them Most of them About half of
them
Not many of
them
None of them
45%59% 30%24% 15%11% 9%5% 1%1%
20132015
Membership of loyalty programs

25. 25© COPYRIGHT TO DIRECTIVITY AND CITRUS
2015 vs 2013 = A massive jump
in activity in programs for
men and women.
31% incremental1
increase in activity by men in all
of their programs since 2013
37% incremental
increase in activity by women in
all of their programs since 2013
Base: Total sample n= 1367
2013
Members of a loyalty program n= 884
WOMEN 2013
41%
MEN 2013
49%
2015
WOMEN 2015
56%
MEN 2015
64%
Membership of loyalty programs
(from 49% in 2013 to 64% in 2015)
(from 41% in 2013 to 56% in 2015)
1.
Incremental increase is the difference between 2015 and 2013 as a percentage of the base of 2013. Example: MEN 2013 = 49% and
2015 = 64%. Difference is 15%, however incremental increase is 15% / 49% = 31%

26. 26 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Men vs women: As was
the pattern in 2013, men
tend to be more active
and committed to their
loyalty programs than
women
Men, men, men = love loyalty programs!
With fewer memberships than women (4.4), men (3.0) are far more
engaged in all of their programs, than women.
Level of activity (2015)
Q Still thinking about those loyalty programs that you are a member of, approximately how many of them
are you an active member (i.e. you present the card or membership number when making purchases or
accrue benefits through the program) in the last 12 months.
2015 - Base: Total sample n= 1367
WomenMen
Active in all of
them
Active in most Active in about
half
Not active in
many
Not active at all
64% 56% 18% 27% 11% 11% 6% 5% 1% 1%
Membership of loyalty programs

27. 27© COPYRIGHT TO DIRECTIVITY AND CITRUS
2015 - Base: Total sample n= 1367
Mature age women and men (over 45
years) are typically more active than
younger people. Older men are most
active
59%
67%
60%
51% WOMEN
over 45yrs
WOMEN
under 45yrs
MEN
under 45yrs
MEN
over 45yrs
Q Still thinking about those loyalty programs that you are a member of, approximately how many of them are you an active member (i.e.
you present the card or membership number when making purchases or accrue benefits through the program) in the last 12 months.
Total
Female Under
45 years
Female
45 years+
Male Under
45 years
Male 45
years+
Active in all of them 59% 51% 60% 59% 67%
Active in most 24% 31% 23% 22% 16%
Active in about half 11% 13% 10% 12% 9%
Not active in many 5% 4% 6% 6% 7%
Not active at all 1% 1% 1% 1% 2%
Membership of loyalty programs

28. 28 © COPYRIGHT TO DIRECTIVITY AND CITRUS
2015 - Base: Total sample n= 1367
Are loyalty programs still valuable to a business?
Q Listed above are a number of things other people have shared with us about how they feel about loyalty programs generally. Using the
scale below, please indicate to what extent you agree or disagree with each one.
I tend to buy more from the companies
whose program I am a member of
When choosing between two similar
companies, I tend to buy from one that
has a loyalty program
Loyalty programs have improved a lot in
recent years and tend to offer good benefits
to members
I tend to feel more loyal to the company/
brand when I am a member if their program
Most loyalty programs don’t offer me any
real value
Most loyalty programs just don’t seem
to understand how to communicate
appropriately with their members
%Agree/Strongly Agree
YES, members buy more!
In 2015, 82% of members said they tend to buy more from the
companies whose program they are a member of verses 80%
for 2013.
YES, loyalty programs are a
competitive advantage
With so much choice available it’s clear that those companies with
a program still have a competitive advantage over those that don’t.
With no change since 2013, 55% of members still tend to buy
from a company that has a program over a similar kind of company
that does not.
82%
80%
55%
48%
47%
38%
26%
55%
41%
46%
40%
27%
YES!
2015 2013
Behaviours & attitudes

29. 29© COPYRIGHT TO DIRECTIVITY AND CITRUS
Loyalty programs are improving!
Members are seeing improvements in loyalty programs (although
there is still lots of room for growth).
The 2015 study reveals that 48% of members tend to feel
programs have improved and this is a 17% incremental increase
on 2013 results. So companies and brands are beginning to get the
message that programs do need to be meaningful to members and
provide benefits that members want their loyalty.
But please don’t relax ... there is more
to customer loyalty than a program
While a program drives increased spend and is a competitive
advantage, a loyalty program still does not equal customer loyalty.
With a very small change since 2013, only 47% of members tend to feel
more loyal to a company/brand when they belong to their program.
I tend to buy more from the companies
whose program I am a member of
When choosing between two similar
companies, I tend to buy from one that
has a loyalty program
Loyalty programs have improved a lot
in recent years and tend to offer good
benefits to members
I tend to feel more loyal to the
company/brand when I am a member if
their program
Most loyalty programs don’t offer me any
real value
Most loyalty programs just don’t seem
to understand how to communicate
appropriately with their members
%Agree/Strongly Agree
82%
80%
55%
48%
47%
38%
26%
55%
41%
46%
40%
27%
2015 2013
2015 - Base: Total sample n= 1367
Q Listed above are a number of things other people have shared with us about how they feel about loyalty programs generally. Using the
scale below, please indicate to what extent you agree or disagree with each one.
Behaviours & attitudes

30. 30 © COPYRIGHT TO DIRECTIVITY AND CITRUS
And... programs can still be even
more valuable!
It is nice to see that there has been a decline (if only very slight) in
the view that programs DON’T offer any real value.
Programs are still NOT performing
with communication
Over a quarter of members (26%) believe that most
loyalty programs just don’t seem to understand how to
communicate appropriately.
Driving relevant and personal communications is still a great
opportunity for programs to improve.
Q Listed above are a number of things other people have shared with us about how they feel about loyalty programs generally. Using the
scale below, please indicate to what extent you agree or disagree with each one.
I tend to buy more from the companies
whose program I am a member of
When choosing between two similar
companies, I tend to buy from one that
has a loyalty program
Loyalty programs have improved a lot in
recent years and tend to offer good benefits
to members
I tend to feel more loyal to the company/
brand when I am a member if their program
Most loyalty programs don’t offer me
any real value
Most loyalty programs just don’t seem
to understand how to communicate
appropriately with their members
%Agree/Strongly Agree
82%
80%
55%
48%
47%
38%
26%
55%
41%
46%
40%
27%
2015 2013
2015 - Base: Total sample n= 1367
Behaviours & attitudes

31. 31© COPYRIGHT TO DIRECTIVITY AND CITRUS
Total
Male Under
45 years
Female
Under
45 years
Male
45 years+
Female
45 years+
I tend to buy more from the companies whose
program I am a member of 82% 84% 89% 79% 79%
When choosing between two similar companies,
I tend to buy from one that has a loyalty program 55% 54% 60% 48% 55%
Loyalty programs have improved a lot in recent
years and tend to offer good benefits to members 48% 48% 54% 40% 50%
I tend to feel more loyal to the company/brand
when I am a member if their program 47% 53% 54% 38% 46%
Most loyalty programs don’t offer me
any real value 38% 43% 35% 44% 34%
Most loyalty programs just don’t seem to
understand how to communicate appropriately
with their members
26% 32% 24% 32% 22%
Women under 45 years are the greatest
advocates of loyalty programs
Younger women are far more likely to
agree that they:
• Buy more from companies with a
loyalty program;
• See great improvement in loyalty
programs in recent years; and
• Feel more loyal to brands if they are a
member of their program.
2015 - Base: Total sample n= 1367
Behaviours & attitudes

32. 32 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Total
Male Under
45 years
Female
Under
45 years
Male
45 years+
Female
45 years+
I tend to buy more from the companies whose
program I am a member of 82% 84% 89% 79% 79%
When choosing between two similar companies,
I tend to buy from one that has a loyalty program 55% 54% 60% 48% 55%
Loyalty programs have improved a lot in recent
years and tend to offer good benefits to members 48% 48% 54% 40% 50%
I tend to feel more loyal to the company/brand
when I am a member if their program 47% 53% 54% 38% 46%
Most loyalty programs don’t offer me
any real value 38% 43% 35% 44% 34%
Most loyalty programs just don’t seem to
understand how to communicate appropriately
with their members
26% 32% 24% 32% 22%
Men over 45 years are the least in favour
of loyalty programs
They are:
• Less than other members to see great
improvement in loyalty programs in
recent years;
• Less likely to be more loyal to brands if
they are a member of their program.
2015 - Base: Total sample n= 1367
Behaviours & attitudes

33. 33© COPYRIGHT TO DIRECTIVITY AND CITRUS
In 2015 some program benefits are
moving up the ranks
There have been some movements in the
ranking of benefits that members consider
to be very important from 2013 to 2015.
Exclusive offers jumps to 3rd place from 4th in 2013… members
want to feel more special!
Programs with benefits for members accrued from partnerships
with other businesses jumps to 5th place from 6th in 2013 which
means that members want more opportunities to earn
rewards outside of the business whose program they belong to.
2013 - Base: n=884
2015 ranking 2013 ranking
Immediate price discounts when making purchases 78% 80%
Point based programs that allow members to
redeem ‘points’ for vouchers, products or other
rewards
77% 77%
Exclusive offers available to members only 66% 64%
Surprise gifts or surprise rewards that arrive without
you making a redemption 64% 67%
Partnerships with other businesses/brands that can
increase the opportunity to accrue rewards or points 61% 61%
Access to more rewards based on the more you
spend with the company 59% 62%
Sending me information that is tailored and personal
to me 51% 51%
Updates on relevant news about the company and
its products or services 37% 37%
Different levels of reward based on different levels of
spending (eg Gold, Silver and Bronze membership tiers) 36% 36%
%Agree/Strongly Agree
2015 -Base: Total sample n= 1367
1
2
3
4
5
6
7
8
9
1
2
4
3
6
5
7
8
9
Behaviours & attitudes

34. 34 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Money still matters
and points for purchase
still pleases
It’s clear that transactional benefits are
still what members want.
Immediate price discounts when
making purchases
Point based programs that allow
members to redeem ‘points’ for
vouchers, products or other rewards
Exclusive offers available to members only
Surprise gifts or surprise rewards that
arrive without you making a redemption
Partnerships with other businesses/brands
that can increase the opportunity to
accrue rewards or points
Access to more rewards based on the
more you spend with the company/brand
Sending me information that is tailored
and personal to me
Updates on relevant news about the
company and its products or services
Different levels of reward based on
different levels of spending (eg Gold,
Silver and Bronze membership tiers)
78%
77%
66%
64%
59%
61%
51%
37%
36%
80%
77%
64%
67%
62%
61%
46%
37%
36%
Q Loyalty programs tend to offer a range of different features and benefits. Looking at this list above, please indicate how important each
of the following features of a loyalty program are to you.
% Very Important/Important
2015 2013
2015 - Base: Total sample n= 1367, 2013 Base: n= 884
Program benefits

35. 35© COPYRIGHT TO DIRECTIVITY AND CITRUS
Loyalty programs take
note #1
Stop blasting communications and
be more relevant.
2015 shows an incremental increase of 11% since 2013 of
members who want relevant and tailored information!
Loyalty programs take
note #2
Stop telling members how great you are!
2015 shows that members STILL do not find updates on relevant
news about the company as important.
Loyalty programs take
note #3
Tears for tiers.
Tiered programs are still not an important feature for members.
Immediate price discounts when
making purchases
Point based programs that allow members
to redeem ‘points’ for vouchers, products or
other rewards
Exclusive offers available to members only
Surprise gifts or surprise rewards that
arrive without you making a redemption
Partnerships with other businesses/brands
that can increase the opportunity to
accrue rewards or points
Access to more rewards based on the
more you spend with the company/brand
Sending me information that is
tailored and personal to me
Updates on relevant news about the
company and its products or services
Different levels of reward based on
different levels of spending (eg Gold,
Silver and Bronze membership tiers)
78%
77%
66%
64%
59%
61%
51%
37%
36%
80%
77%
64%
67%
62%
61%
46%
37%
36%
Q Loyalty programs tend to offer a range of different features and benefits. Looking at this list above, please indicate how important each
of the following features of a loyalty program are to you.
% Very Important/Important2015 2013
2015 - Base: Total sample n= 1367, 2013 Base: n= 884
Program benefits

36. 36 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Give women surprise
rewards and you will
be rewarded
Younger women do like surprise gifts
and rewards
Men over 45 yo are less keen than women
for surprise gifts or rewards... which is a
bit surprising!
Total
Male Under
45 years
Female
Under
45 years
Male
45 years+
Female
45 years+
Immediate price discounts when making purchases 78% 73% 80% 74% 81%
Point based programs that allow members to
redeem ‘points’ for vouchers, products or other
rewards
77% 70% 83% 70% 80%
Exclusive offers available to members only 66% 62% 70% 61% 69%
Surprise gifts or surprise rewards that arrive
without you making a redemption 64% 60% 72% 54% 68%
Partnerships with other businesses/brands that
can increase the opportunity to accrue rewards
or points
61% 59% 61% 58% 65%
Access to more rewards based on the more you
spend with the company/brand 59% 57% 63% 54% 60%
Sending me information that is tailored and
personal to me 51% 49% 51% 46% 54%
Updates on relevant news about the company
and its products or services 37% 38% 35% 36% 40%
Different levels of reward based on different
levels of spending (eg Gold, Silver and Bronze
membership tiers)
36% 41% 37% 32% 34%
Program benefits
2015 - Base: Total sample n= 1367

37. 37© COPYRIGHT TO DIRECTIVITY AND CITRUS
Make your points
programs more
meaningful to men
Men are less likely to prefer points
based programs.
If you are planning a program with points
and your audience is primarily men, think
carefully on how to make it meaningful
to them.
Total
Male Under
45 years
Female
Under
45 years
Male
45 years+
Female
45 years+
Immediate price discounts when making purchases 78% 73% 80% 74% 81%
Point based programs that allow members to
redeem ‘points’ for vouchers, products or other
rewards
77% 70% 83% 70% 80%
Exclusive offers available to members only 66% 62% 70% 61% 69%
Surprise gifts or surprise rewards that arrive
without you making a redemption 64% 60% 72% 54% 68%
Partnerships with other businesses/brands that
can increase the opportunity to accrue rewards
or points
61% 59% 61% 58% 65%
Access to more rewards based on the more you
spend with the company/brand 59% 57% 63% 54% 60%
Sending me information that is tailored and
personal to me 51% 49% 51% 46% 54%
Updates on relevant news about the company
and its products or services 37% 38% 35% 36% 40%
Different levels of reward based on different
levels of spending (eg Gold, Silver and Bronze
membership tiers)
36% 41% 37% 32% 34%
Program Benefits

38. 38 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Top 10: Top 2 still battle it out
flybuys still number 1, Everyday Rewards = number 2
(although it declined significantly since 2013)
Since 2013 – MYER one and Priceline’s Sisterclub drop back a place to make way for
Virgin’s Velocity which jumps to 4th.
New entries to the top 10 are Westpac Altitude Rewards (8th) and
Hoyts Rewards (10th).
A huge increase in Other Programs mentioned doing a good job (2013 was1%;
2015 increased to 13%).
The number of members who did not mention any program “doing a very good
job” has jumped from 12% to 25%, which is a huge 100% increase, indicating that
programs are still not making a remarkable impression on members for them to
highlight them unprompted.
Q Can you tell us about a specific loyalty program that you think is doing a very good job?
The 2013 top 10 most mentioned loyalty programs (unprompted) as
doing a particularly good job
Coles/flybuys
Woolworths – everyday
rewards
Qantas Frequent Flyer
MYER one
Priceline – Sisterclub
Virgin – Velocity
CBA Credit Card
IGA
Millers
Rewards Central
Spotlight
Other Programs
None
37%
22%
11%
6%
5%
2%
1%
1%
1%
1%
1%
<1%
12%
Base: n= 884
Q Can you tell us about a specific loyalty program that you think is doing a very good job?
The 2015 top 10 most mentioned loyalty programs
(unprompted) as doing a very good job
Coles/flybuys
Woolworths – everyday
rewards
Qantas Frequent Flyer
Virgin – Velocity
MYER one
Priceline
Millers
Westpac Altitude Rewards
Commbank Awards
Hoyts Rewards
Other Programs
None
13%
6%
3%
2%
2%
1%
1%
1%
1%
13%
25%
Base: n= 1385 members answered this question (some provided more than one program). Of these 1036 members mentioned a
program(s) as doing a ‘very good’ job out of 97 unique programs that they provided unprompted.
33%
Who is doing a good job?

39. 39© COPYRIGHT TO DIRECTIVITY AND CITRUS
97 loyalty programs were
mentioned unprompted
by members as doing a
very good job
1 Asia Miles
2 Accor
3 Adelaide Unibar
4 Advantage Chemist
5 Amart Sports
6 Amcal
7 American Express
8 Amplify
9 ANZ Rewards
10 Autograph
11 Bakers Delight
12 Barossa Co-op
13 BCF Club
14 Bernardis
15 Boost
16 Booyah
17 Brumby's
18 Calvin Klein VIP
19 Chemplus Rewards
20 Choice Pharmacy
21 Cibo Coffee
22 Cinebuzz
23 Cmca
24 Co-op Store
25 Coffee Club
26* Coles flybuys
27* Comm Bank Rewards
28 Country Road
29 Crossroads
30 Crown
31 Cue
32 Dan Murphy's
33 Dendy Cinemas
34 Donut King
35 Dymocks
36 Easter 30
37 EB Games
38 Emirates Skywards
39* Everyday Rewards
40 Farmer Jack's
41 Gloria Jeans
42 Go Mastercard
43 Golden Chain
44 Guzman & Gomez
45 Hogs Breath Café
46* Hoyts Rewards
47 IGA
48 Jeans West
49 Katies Fashion Club
50 Kathmandu
51 Krisflyer
52 Kunara
53 Le-wrap
54 Lincraft
55 Lorna Jane
56 Lowes
57 Macdonalds coffee card
58 Mad Mex
59 Mastercard
60* Millers
61* MYER one
62 Nielsen HomeScan
63 Nike
64 NoniB
65 Petbarn
66 Petstock
67 Pharmacy Essentials
68 Pillowtalk VIP
69* Priceline Sisterclub
70* Qantas Frequent Flyer
71 RACQ
72 Restore Rewards
73 Rewards Central
74 Ritchies
75 Rivers
76 Salsa
77 San Churros
78 Spotlight
79 Starwoods
80 Sunshine Coffee
81 Super Cheap Auto
82 Sussan
83 Terry White Chemists
84 The Entertainment Book
85 LaManna Direct
86 The Village Cinemas
87 Thirsty Camel Hump Club
88 Toys R Us
89 TS14 Platinum Rewards
90 United Mileage Plus
91 US Airways Dividend Miles
92* Virgin Velocity
93 Veludos
94 Vintage Cellars
95* Westpac Altitude
Rewards
96 Witchery
97 Zouki Coffee
* Top 10 program
Base: n= 1385 members answered this question and of these 1036 members mentioned a program(s) as doing a ‘very good’ job out of 97unique
programs that they provided unprompted
Q Can you tell us about a specific loyalty program that you think is doing a very good job?
97 programs listed in alphabetical order
Who is doing a good job?

40. 40 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Why do members think they
are doing a good job
ANZ Rewards
“It is the best I’ve used. By paying for everything I
buy, where possible, with the card and then clearing the
card balance each month I’m gaining $500 to $1000 in
cash rewards cards annually at no cost and have been
for something like 20 years.”
Male 65 – 74 yo
Priceline - Sisterclub
“It actually rewards you! In several ways! You get 3%
of your total spend back -and with no expiry date, lots
of interim decent specials eg. 20% off all make-up for
2 whole days. Genuine price reductions. Affordable
luxury fragrances etc..”
Male 35 – 44 yo
Everyday Rewards
“Itssimplicity-presentyourcardwhenpaying,receive
vouchersinthemaileveryfewmonthsoronceayear,use
themonyournextshopatWoolworths.Noneedtoactivate
emailoffers,remembertotake coupons,shoponparticular
daysordecidewhattoredeempointsfor.”
Female 45-54 yo
Supercheap Auto
“They credit back the difference if your
product goes on special within 2 weeks.”
Male 25 – 34 yo
Qantas Frequent Flyer
“Lotsofwaystoearnpointsand
goodpointstorewardsratio.
goodcommunicationwithout
spammingandlotsofdeals”
Male 18 – 24 yo
Cinebuzz Rewards
“Easytoearnpointsandredeem.
It’s freetojoin&norenewalfees.Theydo
not frequently‘shiftthegoalposts’.”
Male 55 – 64 yo
Boost
“Very good use of Android
apps and promotions.”
Male 35-44 yo
My Dan Murphy’s
“You get great bargain
products based on your
preferences and what you buy.”
Male 65 – 74 yo
Flybuys
“Very interactive and
keeps me involved week
by week. Others are very
passive and wait for me to
come to them.”
Male 35 – 44 yo
Virgin Velocity
“Goodrewards,goodpartnerprograms,
veryefficientcustomerservice,flexibility
inusingaccruedpoints.”
Male 35-44 yo
Coles flybuys
“They are generous.”
Female 45-54 yo
Millers
“I have to shop anyway, so I collect
points just for doing what I have to do.
They often offer bonus points for buying
certain products or for spending a
particular amount. I can also do their
monthly survey for extra points.”
Male 35 – 44 yo
MYER one
“Lots of opportunities to save.”
Male 35-44 yo
Who is doing a good job?

41. 41© COPYRIGHT TO DIRECTIVITY AND CITRUS
…would like a traditional card
…would like a mobile phone app
…would like both
12%
31%
The card is still alive
and kicking!
With all the mobile hype, it is surprising
to see how members still want the
plastic and this preference has increased
incrementally by 17% since 2014.
Interest in using a mobile app to interact with a program has
actually declined (albeit slightly) since 2013.
Members want the card – and this preference has had a
remarkable increase!
Getting the card into the wallet/purse is a critical piece of brand
real-estate and connection!
2015 2014
10%
23%
Q Given an option for a physical membership card for your purse/wallet or a mobile phone app to
interact with your loyalty program (i.e. to earn or redeem points), which would you prefer?
2015 - Base: Total sample n= 1367
Card vs App
57%67%

42. 42 © COPYRIGHT TO DIRECTIVITY AND CITRUS
2015
2015
2015
WOMEN
over 45yrs
WOMEN
under 45yrs
MEN
under 45yrs
MEN
over 45yrs
76%
73%
47%
54%
73%
78%
41%
52%
WOMEN
over 45yrs
WOMEN
under 45yrs
MEN
under 45yrs
MEN
over 45yrs
38%
33%
16%
22%
36%
29%
17%
23%
Preference for a traditional card has grown in all demographic
segments
The preference for both has declined across all segmentsInterest in using a MOBILE APP to interact with a program has
actually DECLINED (albeit slightly) since 2013
Are our phones becoming as cluttered now as
our wallets were?
Interest in using a MOBILE APP to interact with a program is declining in
the younger age groups, indicating there might be APP fatigue
…Would like a mobile app
10%
…Would like a traditional card
67%
…Would like both
23%
Q Given an option for a physical membership card for your purse/wallet or a mobile phone app to interact with your loyalty program (i.e. to earn or redeem points), which would you prefer?
20142015 20142015 20142015
WOMEN
over 45yrs
WOMEN
under 45yrs
MEN
under 45yrs
MEN
over 45yrs
15%
13%
6%
19%
23%
6%
4%5%
Card vs App

43. 43© COPYRIGHT TO DIRECTIVITY AND CITRUS
Base: Total sample n= 1367
Base: Consumers who have defected
Member defection remains passive
Defection from loyalty programs has improved slightly,
down to 22% in 2015 vs 26% in 2014.
Remember: Defection from a program = defection from the brand!
Q Have you stopped participating in a loyalty program that you had previously
been an active member of in the last few years?
Yes, I simply stopped participating Yes, I formally requested to be
removed
20%18%
6%4%
2014
65 yrs +55-64 yrs45-54 yrs35-44 yrs25-34 yrs18-24 yrs
17%
15%
31%
21%
19%
21%
12%
14%
17%
20%
15%16%
% who ‘simply stopped participating’
2015
20142015
Defection from program
The greatest improvement in defection is in
young members, down from 31% in 2014 to
21% in 2015.

44. 44 © COPYRIGHT TO DIRECTIVITY AND CITRUS
‘Earn ‘n Burn’ rate is the
major reason for defection
and getting worse.
I wasn’t earning points / rewards
fast enough
I no longer shop there or use
their services
The rewards didn’t appeal to me
Too much of a hassle to participate
There were too many cards in
my wallet
I chose to participate in other
programs instead
I was getting too many emails / mail
from them
They didn’t communicate with
me enough
I just forgot about it
It was too confusing
I was concerned about my privacy
It felt like they knew too much
about me
51%
59%
42%
42%
36%
40%
26%
25%
13%
23%
23%
16%
18%
16%
13%
13%
15%
14%
19%
12%
14%
9%
15%
8%
In 2015, the ‘Earn ‘n Burn’ rate is still a major reason for defection
and increasing to 59%, an incremental increase of 16% over 2014.
Card clutter jumps by 77%
In 2015, too many cards jumped to 23%, an incremental increase
of 77%. So make sure your program is valuable enough to be in
their wallet/purse!
GREAT NEWS! Programs are getting simpler
In 2015, ‘it was too confusing’ dropped by an incremental
amount of 37% - which means brands are starting to simplify
their programs.
Privacy not so much of a concern
In 2015, privacy concerns are reducing.
Q Which of the following, if any, have contributed to you stopping participation in a loyalty program? Please select all that apply.
Base: Consumers who have defected
20142015
Defection from program

45. 45© COPYRIGHT TO DIRECTIVITY AND CITRUS
Some vocal points of view
“The card simply didn’t work and
the staff couldn’t have cared less
when I sought their assistance.”
“It was a pissant little
scheme that gave about
point nothing of a percent
discount provided you
purchased cackloads
of product.”
“Their customer
service was awful.”
“I only shopped with this
company online, but their
rewards could only be used
in store.”
“Points expired
too quickly”
Total
Male Under
45 years
Female Under
45 years
Male
45 years+
Female
45 years+
I wasn’t earning points / rewards fast enough 59% 57% 56% 64% 60%
I no longer shop there or use their services 42% 40% 43% 40% 44%
The rewards didn’t appeal to me 40% 41% 35% 47% 40%
Too much of a hassle to participate 25% 29% 24% 28% 20%
There were too many cards in my wallet 23% 22% 25% 16% 24%
I chose to participate in other programs instead 16% 17% 12% 19% 17%
I was getting too many emails / mail from them 16% 21% 19% 16% 13%
They didn’t communicate with me enough 15% 14% 11% 17% 17%
I just forgot about it 14% 9% 19% 12% 15%
It was too confusing 12% 16% 9% 16% 10%
I was concerned about my privacy 9% 9% 8% 10% 8%
It felt like they knew too much about me 8% 10% 5% 12% 5%
Reasons members defect by age, with
men over 45 more concerned with
rewards appeal and not too concerned
about card clutter
Defection from program

46. 4.0
4.2 Revealing 9
new insights that
impact on brand
loyalty and loyalty
program success
Detailed findings

47. 47© COPYRIGHT TO DIRECTIVITY AND CITRUS
We explored 3 key areas and reveal 9 new
insights that impact on the lifeblood of
loyalty program success and the influence
on a members’ buying behaviour.
1. The impact that loyalty programs have on
brand loyalty
2. The power of a loyalty program’s influence over
buying behaviour
3. Evolving your loyalty program benefits based on
members’ behaviour
This research gets ‘under
the skin’ of members to
find out what makes their
‘loyalty’ heart beat.
?

48. 48 © COPYRIGHT TO DIRECTIVITY AND CITRUS
The impact that loyalty programs have on brand loyalty
Brand switching: Do loyalty programs have any
influence on whether members switch brands?
Loyalty programs do have an influence on brand switching, which
means members are up for grabs! (Two sides to this coin = you can
capture your competitors members and they can capture yours!)
28% of members have switched brands on at least one
occasion to get more benefits from a loyalty program
Men under 45 years are the most fickle and
whose loyalty can be bought!
42% of men under 45 years have switched brands on at least
one occasion to get more benefits from a loyalty program. This is
significantly higher than any other segment!
Insight for loyalty
programs
Keep a keen eye on your younger
male segment and find reasons to
keep them engaged in your program
WOMEN
over 45yrs
WOMEN
under 45yrs
MEN
under 45yrs
MEN
over 45yrs
I have switched brands on at least one occasion to get more benefits
from a loyalty program
Base: Total sample n= 1367
% Strongly agree/ Agree
22%35%
42%
20%
Impact on brand loyalty

49. 49© COPYRIGHT TO DIRECTIVITY AND CITRUS
Connection of brand loyalty to loyalty programs:
Is brand loyalty inherently connected to the strength of
a loyalty program?
WOMEN
over 45yrs
WOMEN
under 45yrs
MEN
under 45yrs
MEN
over 45yrs
21% of members are
connected to the brand
through the strength of
their loyalty program.
I wouldn’t be loyal to a brand that didn’t have a strong loyalty program
A strong loyalty program
does play it’s part in
keeping members loyal
to a brand, particularly
younger men.
% Strongly agree/ Agree
21%24%
26%
17%
Impact on brand loyalty

50. 50 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Do members think brands need
a loyalty program to keep their
customers loyal?
Yes, loyalty programs are an important
strategy to keeping customers loyal.
Over half (58%) of loyalty program members believe that a
brand needs a loyalty program to keep their customers loyal.
...that brands need a loyalty
program to keep their
customers loyal.
“It’s nice to be rewarded for being
loyal, and with so many companies
out there that have loyalty programs,
it’s easy to find another company that
has a loyalty program and can price
match a product”
Female 35 – 44 yo
nominated Jeanswest as a program doing a very
good job
“I feel good”
Female 35 – 44 yo
nominated The Coffee Club as a program
doing a very good job
“It’s a great way for customers to
feel valued”
Male 25 – 34 yo
nominated Country Road as a program doing a
very good job
Impact on brand loyalty
58%
42%
do believedon’t believe

51. 51© COPYRIGHT TO DIRECTIVITY AND CITRUS
More reasons why members believe
brands need a loyalty program
“I think if consumers are loyal to a brand
they should be rewarded in some way and a
redemption scheme is a good way of rewarding
loyal consumers.”
Female 18 – 24 yo
nominated QFF as a program doing a very good job
“Genuine loyaltytobrandshasbecome
a thingofthe past,due toinformation
overload,socompaniesmustfindother
waystogenerate ‘loyalty’.”
Male 55 – 64 yo
nominated Virgin’s Velocity Program as doing a
very good job
“Brands that offer Loyalty programs
tend to be higher profile & motivated to
seek customer loyalty.”
Female 55 - 64 yo
nominated Flybuys as a program doing a very good job
“Itisencouragingtobegivenback
somethingforchoosingabrand
over others.”
Female 45 -54 yo
nominated Hoyts Rewards as the program doing a
very good job
“Just nice to be rewarded
for loyalty.”
Female 55 - 64 yo
nominated Everyday rewards as a
program doing a very good job
“Because I could probably
get the same thing for less
money elsewhere.”
Female 25 – 34 yo
nominated Vintage Cellars as a program
doing a very good job
“I think it helps
consumers keep a certain
company in mind.”
Female 65 – 74
nominated flybuys as a program
doing a very good job
“Keeps customers feeling
like they’re part of the
company”
Male 25-34 yo
nominated MYER one as a program
doing a very good job
“It’sthewayofthefuture.Those
companieswithnoloyaltyprogramsare
laggingbehind theircompetition.”
Male 25 – 34 yo
nominated QFF as a program doing a very good job
Impact on brand loyalty

52. 52 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Younger members view loyalty
programs as central to brand loyalty
“These daystherearealways an
alternative thatwillhavealoyalty
programthatgivesthecustomermorefor
theremoneythenthosethatdon’t”
Female, 18-24 yo
nominated Flybuys as a program doing a very good job
“Because it will make
people happy”
Female, 18-24yo
nominated San Churros as a program
doing a very good job
“It shows that the company cares
and rewards loyal customers.”
Male 25-34yo,
nominated QFF as a program doing a very good job
WOMEN
over 45yrs
35-54 years
WOMEN
under 45yrs
Under 34
years
MEN
under 45yrs
55+ years
MEN
over 45yrs
48%60%71%
52%
66% 67%
52%
71%of under
34 yrs believe
that brands need
a loyalty program
to keep their
customers loyal.
Base: Total sample n= 1367
Base: Total sample n= 1367
Believe that brands need a loyalty program to keep customers loyal.
Impact on brand loyalty

53. 53© COPYRIGHT TO DIRECTIVITY AND CITRUS
And here’s why members don’t think
brands need a program
“A good company will find effective ways to connect
with their customers without a loyalty program. Vintage
cellars would probably get business from me regardless
based on their regular discounting program. Qantas
gets business from me regardless because they have
acceptable legroom compared to the other domestic
airlines (they are shitful in almost every other regard
though, so I guess leg room is enough for me ...).”
Male 45 – 54 yo
“IfI reallylike abrandanditdoesn’toffera
rewardsprogramI’dstill gothere.I’drather
getexactlywhatI wantthangetadiscount
onsomethingI don’twantasmuch.It’snice
toreceivediscountsonthingsyouwouldhave
paidthe full amountforanyway.”
Male 18 – 24yo
“Loyaltyshouldbeearntwithgood
productsandservice.“Loyaltycards”
are just a trick to harvest data and make
consumersfeellockedin.”
Male 18 – 24yo
“Too long to get rewards.”
Female 25 – 34yo
“If the brand is good
enough it should stand
alone regardless of loyalty
program.”
Male 35 – 44yo
“I think people will buy what
they like regardless of the
incentives.”
Female 55-64yo
“I think people will buy
what they like regardless
of the incentives.”
Female 55-64yo
“I don’tchoosethebrand becauseof
the loyaltycard, I choosea brand based
on reputation.”
Male 25 – 34 yo
“Goodquality and
customerservice
alonecangetloyalty.”
Male 55-64yo
“Freestuffisn’t theonly reason people
becomeloyal, ethical behaviour as well
as caring for all stakeholders a company
has can keep customers moreloyal than
economic loyalty wherethecustomer is
only loyal for their own benefit.”
Female 35 – 44 yo
Impact on brand loyalty

54. 54 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Why do members think
brands offer a loyalty
program?
When working out WHY your business/
brand needs a program, reflect on the
members’ point of view and see if there is
any alignment.
Q We are interested in why you think brands offer loyalty programs. Please indicate how important you believe each of these factors are to
a brand that offers a loyalty program to its customers (select as many as you think are important).
To keep you buying from them rather than
the competitors
To encourage you to buy from them more often
To encourage you to spend more with them
To attract new customers
To keep up with what their competitors are doing
To collect your data so they can improve their own business
To measure the impact of their own marketing
To collect your data so they can give you more relevant
offers and benefits
To encourage you to recommend them to other people
To recognise you as an important customer
To reduce the need to discount prices
69%
67%
63%
53%
52%
51%
50%
47%
41%
40%
30%
1
2
3
Competitive advantage
Buying more often
Spending more
Base: Total sample n= 1367
ALL reasons
Impact on brand loyalty

55. 55© COPYRIGHT TO DIRECTIVITY AND CITRUS
Most important
reason brands offer a
loyalty program
Competitive advantage is the number
one reason that members think brands
offer a program.
Interestingly, data comes in at 4th.
Q And which of these do you believe is the single most important reason that a brand offers a loyalty program?
To keep you buying from them rather than
the competitors
To encourage you to spend more with them
To encourage you to buy from them more often
To collect your data so they can improve their own
business
To recognise you as an important customer
To attract new customers
To collect your data so they can give you more relevant
offers and benefits
To keep up with what their competitors are doing
To measure the impact of their own marketing
To reduce the need to discount prices
To encourage you to recommend them to other people
18%
11%
8%
4%
4%
3%
3%
2%
1%
Base: Total sample n= 1367
MOST IMPORTANT reason
24%
23%
Impact on brand loyalty

56. 56 © COPYRIGHT TO DIRECTIVITY AND CITRUS
The power of a loyalty program’s influence over buying behaviour
The inherent benefits that some programs
provide are powerful enough to influence
incremental impulse purchases – even if
the item(s) purchased is not needed.
Loyalty programs DO
influence impulse purchases!
If 16% of your loyalty member base purchased an extra
item (that they would not normally) , then what is the total
value of that towards your revenue?
Total base (vol) x 16% x $extra item = $?
Loyalty programs and impulse purchases:
Do members purchase items that they do not
need because of a loyalty program?
16% of members have purchased items they did not need, just to earn points or maintain
program benefits.
Younger men are more impulsive!
26% of men under 45 years have bought something they don’t really need in order to earn more points
or maintain program benefits. Again much higher than any other segment!
I have bought something I didn’t really need in order to earn points or
maintain program benefits
MEN
under 45yrs
WOMEN
under 45yrs
WOMEN
over 45yrs
MEN
over 45yrs
11%21%
26%
8%
% Strongly agree/ Agree
Influence over buying behaviour

57. 57© COPYRIGHT TO DIRECTIVITY AND CITRUS
Evolving your loyalty program benefits based on
members’ behaviour
Points for purpose: Do
members want opportunities
to donate or redeem points/
rewards or vouchers to
charities or local community
initiatives?
Give members ‘Points for Purpose’
Over a quarter of members of loyalty programs (27%) want
to donate or redeem their points/rewards to charities or local
community initiatives.
Which means that programs should consider providing this as an
option for their members.
27% Opportunities to donate or
redeem my points/rewards
or vouchers to charities or a
local community initiative
Evolving loyalty program benefits

58. 58 © COPYRIGHT TO DIRECTIVITY AND CITRUS
From transaction to interaction: Do members
want benefits for interacting with the brand
through the program such as for answering
surveys, opening emails and others?
Evolve your program’s benefits from
transaction to interaction
There is keen interest in non-transactional
rewards.
Completing surveys and opening emails
are the best opportunity for additional
engagement.
Programs need to move
from one-dimensional
“transaction-based”
rewards by adding
“interaction-based
rewards” as a deeper way
to engage members.
Rewards offered for answering surveys from
the loyalty program
Rewards offered for opening emails from the
loyalty program
Rewards offered for attending specific
events
Rewards offered for referring friends to
the program
Rewards offered for sharing information
about the program on social media
% Very Interested/Interested
53%
46%
20%
18%
17%
2015
Q A number of alternatives are being considered by loyalty programs to reward Members for things other than spending money with them.
Please use the scale below to indicate how interested you would be in each of these alternatives.
Base: Total Sample n= 1367
Evolving loyalty program benefits

59. 59© COPYRIGHT TO DIRECTIVITY AND CITRUS
Younger members are most inclined to take up the
opportunities for ‘program interaction’
Total
Under
35 years
35-54 years 55 years+
Rewards offered for answering surveys from the
loyalty program 53% 55% 45% 40%
Rewards offered for opening emails from the
loyalty program 46% 61% 48% 51%
Rewards offered for attending specific events 20% 31% 20% 13%
Rewards offered for referring friends to the program 18% 25% 19% 13%
Rewards offered for sharing information about the
program on social media 17% 27% 18% 10%
Base: Total Sample n= 1367
Evolving loyalty program benefits

60. 60 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Cash in the points: Do members want to
accumulate cash rewards or accumulate points to
redeem for non-cash rewards?
It’s all about the money, money…81% of members want
cash based rewards.
This represents
a CLEAR
OPPORTUNITY for
loyalty programs to
ensure CASH based
rewards is a benefit
Strong preference across all segments for cash
based rewards.
Q Given an option within a loyalty program to accumulate cash
rewards (or cash discounts) OR to accumulate points (that can be
redeemed for non-cash rewards), what is your preference?
81%
19%
Prefer CASH based Prefer POINTS based
WOMEN
over 45yrs
WOMEN
under 45yrs
MEN
under 45yrs
MEN
over 45yrs
81%
84%
75%
19%
16%
25%
20%
80%
POINT based rewardsCASH based rewards
Base: Total Sample n= 1367
Evolving loyalty program benefits

61. 61© COPYRIGHT TO DIRECTIVITY AND CITRUS
Now vs the future: Do members want immediate lower value
rewards or accumulate higher value rewards over a longer time?
The prospect of accumulated, higher value
rewards has most appeal.
If you develop a program that has high value rewards that give members
the opportunity to acquire over longer period you will win as they will
spend and stay with your business longer!
Members can wait for high value rewards and patience pays off!
Q Given an option for ‘immediate rewards’ (eg. a discount or voucher of a relatively low
value) OR rewards that take a longer time to accumulate (but are of much greater value),
what is your preference?
68%
32%
WOMEN
over 45yrs
WOMEN
under 45yrs
MEN
under 45yrs
MEN
over 45yrs
65%
70%
62%
35%
30%
38%
28%
72%
Prefer ACCUMULATED rewards Prefer IMMEDIATE based
IMMEDIATE based
rewards (lower value)
ACCUMULATED rewards
(higher value)
Base: Total Sample n= 1367
Evolving loyalty program benefits
VS

62. 4.0
4.3 - 28 Australian loyalty
programs reviewed
Detailed findings

63. 63© COPYRIGHT TO DIRECTIVITY AND CITRUS
MYER one
Amcal Rewards
Millers Fashion
Spotlight VIP
myDanMurphy’s
ANZ Rewards
Big4 Loyalty Club
Katies Fashion Club
Vintage Cellars Wineclub
Accor Hotels – Le Club
Coles – flybuys
Rays Outdoors
Virgin – Velocity
Kathmandu Summit Club
Hoyts Rewards
Commonwealth Bank awards
program
The Coffee Club VIP
Boost VIP
Thirsty Camel – Hump Club
Starwood Preferred Guest
Supercheap Auto
Priceline – Sisterclub
Country Road – VIP cardholder
Village Movie Club
Woolworths – Everyday Rewards
Qantas Frequent Flyer
Rebel
Westpac Altitude Rewards
28 Australian loyalty
programs reviewed
For the first time in our research
studies, we provided members with a
list of 28 randomly selected Australian
Loyalty programs to give members the
opportunity to identify:
• Which programs they are a member of
• How active they are in these; and
• Their view on whether it is a poor or excellent program.
The results are surprising!
Note. The authors of this research study have no vested interest in any of the listed loyalty
programs. They were chosen randomly from the Australian loyalty program market place.
The 28 loyalty programs were also randomly presented in the research to avoid bias
of selection.

64. 64 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Ranking of 28 Australian loyalty
programs based on membership
Coles flybuys
Woolworths Everyday Rewards
Qantas Frequent Flyer
MYER One
Virgin Velocity
Priceline Sisterclub
Spotlight VIP
Millers Fashion
Comm Bank Awards
Hoyts Rewards
myDanMurphy’s
Village Movie Club
Boost VIP
Katies Fashion Club
Amcal Rewards
Accor Hotels – Le Club
Westpac Altitude Rewards
Supercheap Auto
Rebel Sport
ANZ Rewards
Kathmandu Summit Club
Rays Outdoors
The Coffee Club VIP
Starwood Preferred Guest
Vintage Cellars Wineclub
Country Road VIP
BIG4 Loyalty
Thirsty Camel
73%
72%
52%
32%
29%
28%
21%
16%
8%
7%
7%
7%
7%
7%
6%
5%
5%
5%
5%
5%
4%
4%
4%
3%
3%
2%
1%
1%
Program membership in
Australia is skewed heavily
towards flybuys and Everyday
Rewards as well as the Qantas
Frequent Flyer program. This
is because of the extensive
memberships that these
programs have.
Q Looking at the list, please indicate which loyalty programs, if any, you are a member of.
% who are ENROLLED members Base: Total Sample n= 1367

65. 65© COPYRIGHT TO DIRECTIVITY AND CITRUS
AustraliansareHIGHLYACTIVEwithintheprogramsthey
haveenrolledinto(Top14/28)
Member activity is highest
when the opportunity to
engage is frequent.
Q Which of the programs you selected, if any, are you an active member of, i.e. you have presented your card or membership number when making a purchase in the last 12 months.
% who are ENROLLED members % who are ACTIVE members
Coles flybuys
Woolworths Everyday Rewards
Qantas Frequent Flyer
MYER one
Virgin Velocity
Priceline Sisterclub
Spotlight VIP
Millers Fashion
Comm Bank Awards
Hoyts Rewards
myDanMurphy’s
Village Movie Club
Boost VIP
Katies Fashion Club
73%
72%
69%
32%
25%
72%
52%
32%
29%
15%
22%
14%
11%
7%
5%
6%
4%
5%
4%
28%
21%
16%
8%
7%
7%
7%
7%
7%
Base: Total Sample n= 1367
Active = member has presented their card or
membership number when making a purchase in
the last 12 months.

66. 66 © COPYRIGHT TO DIRECTIVITY AND CITRUS
Membersimpressiononoverallquality–frompoortoexcellent
ANZ Rewards
Westpac Altitude Rewards
Coles flybuys
The Coffee Club VIP
Hoyts Rewards
Comm Bank Awards
Supercheap Auto
Vintage Cellars Wine Club
Country Road VIP
Millers Fashion
Woolworths Everyday Rewards
Qantas Frequent Flyer
Amcal Rewards
MYER one
Rays Outdoors
Boost VIP
Virgin Velocity
Priceline Sisterclub
Spotlight VIP
myDanMurphy’s
Katies Fashion Club
Kathmandu Summit Club
Accor hotels – Le Club
Rebel Sport
Village Movie Club
51%
50%
46%
46%
45%
44%
43%
40%
37%
36%
34%
34%
34%
33%
33%
32%
31%
29%
26%
26%
23%
23%
21%
17%
16%
Banks are getting it right!
The loyalty programs of two major banks are
given strong endorsement by members
Flybuys rated much higher
than Everyday Rewards.
Country Road leads the
field in the fashion stakes
Hoyts Rewards rated much
higher than Village Movie
Club
% rating as ‘Excellent’
Q. Looking still at the programs you are an active member of, indicate the impression you have of that program based on your own
experiences. Scale from 1 (poor) to 7 (excellent)
Base: Respondents are ACTIVE members of the respective programs
Top 25

67. 67© COPYRIGHT TO DIRECTIVITY AND CITRUS 67© COPYRIGHT TO DIRECTIVITY AND CITRUS

68. 5.0
The people who love
loyalty programs
Behind the
research

69. 69© COPYRIGHT TO DIRECTIVITY AND CITRUS
People behind the research
Established in 2007, Directivity provides customer loyalty and retention
strategies and programs for organisations operating in sectors as
diverse as accommodation, leisure and entertainment, trade, education,
manufacturing and retail.
Adam Posner (CEO and founder) is one of Australia’s leading loyalty
program strategists and has been a data-driven direct marketer for
23 years.
He started his loyalty life in the mid ’90’s with a shopping centre loyalty
program initiative called “Scratch & Save”.
Since then he has been involved in a range of loyalty and retention
programs from large retail programs such as the flybuys program re-
launched in 2012 as well as developing financial ‘Return on Loyalty’
models for pharmacy, entertainment and large accommodation
networks.
Adam is also the author of one of Australia’s only practical book on
loyalty programs – ‘Give-back to Get-back - 9 steps to a profitable
loyalty program’ and is a frequent speaker on customer loyalty
and retention.
Citrus is a Retention Marketing Consulting firm focused on helping
retailers & consumer brands to grow the size, engagement & value of
their customer audiences through data-driven, personalised marketing
automation programs across email, mobile, social and the web.
Peter Noble is the CEO & Head of Strategy for Citrus. With more than
17 years’ experience in the digital marketing space in Australia, Peter
has lead the Citrus team to deliver world-class 1:1 marketing programs
for leading brands such as Agoda, Yalumba, Seek, Coopers, adidas,
TaylorMade, and the Victoria Racing Club, amongst others.
Peter is a passionate advocate of the power of loyalty programs
to create long-term brand loyalty, particularly through digital
communications across email, mobile, social media and the web.
Peter has featured as a keynote speaker at many key marketing
conferences around Australia and Asia and has featured in many articles
discussing the importance of loyalty and retention programs to brands.
Peter has been a member of the Australian Marketing Institute
since 2002, and is a Certified Practising Marketer (CPM), the peak
professional benchmark for marketers in Australia.

70. THE LOYALTY POINT
www.theloyaltypoint.com.au
Directivity
Adam Posner
t. 0433 818190
e. adam@directivity.com.au
w. directivity.com.au
Citrus
Peter Noble
Level 8, 100 Albert Road
South Melbourne
Victoria Australia 3205
t. +613 9681 5333
e. peter.noble@citrus.com.au
w. citrus.com.au