Customer loyalty schemes in Australia
CUSTOMER LOYALTY SCHEMES IN AUSTRALIA
* About nine in 10 adults are members of a loyalty scheme
* The average Australian has four to six loyalty cards
* There have been 2000 reports about loyalty schemes to consumer law regulators in five years, a substantial proportion about frequent flyer programs
TOP FIVE SCHEMES IN AUSTRALIA
* Qantas Frequent Flyer - 12.3 million members
* Woolworths Rewards - 10.9 million
* Velocity Frequent Flyer - 9.1 million
* Flybuys - 8.3 million individuals/6.3 million households
* Priceline Sister Club - 7.1 million
OTHERS INCLUDE:
* Myer One (more than five million members)
* Cinebuzz Rewards (1.5 million members)
* Schemes of major hotel chains such as Accor, Hilton, Intercontinental Hotels Group and Marriott, plus car rental companies
* Four major banks - ANZ, CBA, NAB and Westpac - and American Express have own rewards programs for credit card holders
WHAT ARE CONSUMERS' CONCERNS ABOUT LOYALTY SCHEMES?
* Earning points - Unilateral reductions in rate at which points are earned; the extent points are earned with affiliate and partner programs; the 'booking class' (for frequent flyer programs)
* Points' expiry - A source of considerable consumer angst, it can be a particular issue for those who accrued point balances with a high redemptive value, sometimes accumulated over decades
* Redeeming points - Unilateral reductions in redemptive value of points; the imposition of taxes and charges to redeem certain rewards; restrictive redemption opportunities
WHAT ARE SOME OF THE ACCC'S CONCERNS ABOUT LOYALTY SCHEMES?
* Whether consumers receive the advertised benefits
* Unilateral changes to terms and conditions that may be unfair to consumers
* Poor communication about how schemes work
* Poor disclosure about how consumer data is used and shared, including selling the insights to other parties without consumer knowledge
* The sharing of consumer data with unknown third parties.
Source: ACCC draft report on customer loyalty schemes
