Loyalty programmes remain popular amongst economically active South Africans

The popularity of brand loyalty programmes in South Africa has remained high in tandem with the overall levels of economic prosperity. According to a new report from boutique consultancy Truth, 75% of “economically active” South Africans are currently engaged in brand loyalty programmes.  

Since the setback from a global dip in oil and commodity prices in recent years, the South African economy appears to have made its way back to a growth trajectory. A stable economy has also put the consumer and retail market of the country back into upward mobility.

The country’s top retailers have registered steady growth over the last two years, which is expected to increase further in light of rapid digitalisation of the sector. On the consumer side, the propensity to spend has increased, although the participation in brand loyalty programmes appears to have registered a small dip.

South African Customer Relationship Management (CRM) consultancy Truth has released a report in collaboration with consumer insights consulting firm WhyFive, which details the attitudes towards brand loyalty programmes in South Africa. The report is based on responses from more than 25,000 South Africans.

The report restricts its focus to adults above the age of 16 who belong to households with income in excess of R10,000 – those most likely to be engaged in loyalty programmes. Of these “economically active” individuals, the report found that 75% are engaged in loyalty programmes.

 This figure represents a minor decline from last year, when it stood at 79% for the economically active population. This is the first dip registered in participation in the last four years, a period over which the engagement has increased steadily. According to the report, the dip represents a stabilisation and maturity in the market.

“This is not necessarily a bad thing at all; in fact it shows a level of maturity in the market. However, when we take a deeper look under the skin of these factors influencing usage, the story gets more interesting. It is a combination of consumers being more astute, as well as, brands aiding this to happen: i.e. helping / educating members get the most out of the programmes they belong to in order to increase participation in these programmes through increased redemption and higher levels of engagement,” says the report.

Participation in loyalty programmes also appears to change in accordance with demographic factors. Women tend to engage more in loyalty programmes than men, as per the report, given that the average economically active woman in South Africa belongs to more than six loyalty programmes, while the average man belongs to 4.

The most popular loyalty programmes are largely consistent between men and women, although programmes such as FNB eBucks and Woolworths WRewards appear to be more popular among men than Dis-Chem Benefit or Edcon Thank U. Nevertheless, FNB eBucks and Avios are the only two programmes that are used more by men than by women.

Age is another demographic factor that affects usage. Individuals aged between 16 and 49 increased their participation in programmes the most over the last year, while only 17% of those above 50 upped their participation. On the other hand, 52% of those above 50 maintained a constant level of participation, which is much higher than the figures for the other age groups.

Overall, Clicks ClubCard emerged as the most popular loyalty programme in South Africa, with 72% participation from economically active individuals. Pick n Pay Smart Shopper followed with 60%, while Dis-Chem Benefit and Edcon Thank U trailed with 49% and 47% respectively.