Customer clubs under the microscope

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Loyalty clubs, customer clubs and bonus cards abound, but how do they affect consumers? Today, 75 percent of Danish consumers are now members of a customer club. For companies, the purpose is to retain customers, but do they work? Which clubs do Danes use most? Which ones are the best and which clubs do customers recommend to others?

A research team comprising three departments at CBS addressed these questions and found some answers. In 2015 the team conducted an extensive research project based on 275,000 Danish club members and cardholders from ten different loyalty clubs: Club BR, Club Matas, Coop, Forbrugsforeningen, Magasin Club, H&M Club, IKEA Family, Imerco+, Lo Plus and Sportmaster. The project is presumably the largest of its kind in Denmark.

The study confirms the researchers’ assumption that many brands launch loyalty programmes and customer clubs without having thought hard about creating a meaningful relationship with customers. Companies instead think short-term, focusing on services such as discounts on products and services, which is also what customers expect as a minimum. Their study also shows that many of the concepts for customer clubs and loyalty clubs are designed with the same model and the same tools, resulting in various challenges concerning customer expectations. The study also shows that, especially in e-commerce, a large gap exists between expectations and what members experience.

On a -100 to +100 scale, the highest overall rating members give one loyalty club in the study is 52.1, while the lowest overall score given is 10.0.

The study is based on free-text comments by more than 12,000 members, the interaction of 400,000 unique users on the clubs’ Facebook walls and a survey of 275,000 members. The research team’s goal is to give companies the opportunity to use the insights gained to design and develop loyalty concepts with more meaning and value for both customers and companies alike.

Professors Torsten Ringberg, Professor Ravi Vatrapu, Associate Professor Mogens Bjerre, Associate Professor Eric Bentzen and Lecturer Per Østergaard Jacobsen are behind the project.

Their research report was presented at a conference at CBS on 2 November 2015 and can be purchased at www.academicbooks.dk