Frugal Friends Podcast How Loyalty Points and Programs Cost You More
Jul 23, 2024
Loyalty programs might sound like a great way to save money, but they can actually lead to overspending. The hosts delve into the psychological tricks companies employ to keep consumers engaged and often spending more. They share personal anecdotes and insights on how to critically evaluate the value of rewards. Listeners also hear a success story about utilizing employer benefits, and enjoy some light-hearted discussions about nuts and quirky car promotions. It's a blend of savvy savings advice and playful banter!
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Why Companies Use Loyalty Programs
- Loyalty programs are marketing tools to encourage repeat purchases and brand loyalty by offering deals or freebies.
- Jen and Jill note these programs can introduce you to new places but also lower your barrier to spend more than usual.
Trying A New Restaurant Via A Signup Offer
- Jen signed up for Red Robin rewards and used an email coupon to try the restaurant, which became a new favorite.
- She appreciated the intro discount but warns it also triggers follow-up marketing nudges.
Many Programs, Few Active Uses
- The average US consumer joins ~17 loyalty programs but only actively uses about half.
- Jill highlights how frequent texts and emails from programs can be annoying and nudging without added value.