The type of payment consumers use is heavily influenced by their engagement in loyalty programs and mobile wallets are looking poised for increased adoption, according to new findings reported by Toronto-based loyalty firm Points, in its new report, "The State of Mobile Wallet Loyalty and Engagement in 2016." The survey, which drew on the responses of 1,500 U.S. consumers who are members of at least one loyalty program, found that 94 percent of consumers would use a mobile wallet more frequently if they could earn or redeem loyalty points and miles with every transaction.
The report noted that 68 percent of consumers have a rewards-earning credit card (52 percent of respondents have a financial services credit card, 35 percent carry airline cards, and 33 percent use travel rewards credit cards). With 63.8 percent of respondents saying they've used a mobile wallet in the past year, the authors note that "by making these transactions via mobile wallets, where debit and credit cards are stored, consumers have the ability to increase their earning potential." Points referred to the findings that consumers already interact with brands in numerous ways using their smartphones -- 71 percent use their phones to redeem coupons, 58 percent to display loyalty cards, and 45 percent to book hotels.
Points explored the capabilities customers seek from their mobile wallet: 94 percent want to be able to exchange points between different programs, 60 percent would like to be able to access all of their programs through one app, and 53 percent said they would like to receive notifications when their points balance has allowed them to earn rewards.
It concludes that for brands to capture this potential market, three factors are required from loyalty programs enabled by mobile wallets: engagement, personalization, and convenience.
"When paired with loyalty program data, mobile wallets can be used as a highly effective marketing channel," notes the report. "To encourage continued engagement, loyalty programs should be more flexible with their currencies and make them available in mobile wallets…Brands should give consumers every opportunity to earn, redeem, and exchange points and miles."
The complete report can be found here