Dive Brief:

• Mobile marketing firm 3Cinteractive surveyed 3,500 U.S. internet users and found that SMS is the preferred channel for loyalty program messaging for consumers, with 48% citing it as their preferred means of receiving loyalty messages, followed by email (22%) and app notifications (20%).
• The study also surveyed 250 brand marketers, finding that only 21% of brand marketers are using SMS for loyalty program communications.
• Marketers reported using mobile wallet as their primary channel for loyalty messaging, with 28% citing mobile wallets and 21% citing SMS and push notifications.

Dive Insight:

Consumers want their loyalty program messages to come via SMS, but most marketers appear to be missing the opportunity. 

Before the advent of digital marketing, loyalty programs were seen as one of the best ways to track customer purchases and gain basic customer data such as names, addresses and phone numbers that could be tapped for additional marketing. Since digital marketing has largely taken over those roles, loyalty programs are evolving into new role in a world where marketing has become more about customer conversations and personalization rather one-way messaging. Loyalty programs can still provide marketers with valuable customer insights, but now those insights can be used to personalize the messages sent to customers.

Despite their changing role, loyalty programs are a growing area of spend for marketers in 2017, according to separate research from CrowdTwist and Brand Innovators, as reported by eMarketer. The study found that 57% of responding marketers are planning on putting more budget dollars toward loyalty programs in 2017. At the same time, marketers are still struggling to figure out how the tactic fits into their overall strategy, with 38% reporting they aren't able to call their loyalty program a success or failure.