Efforts by many retailers to improve the offerings in their frequent-shopper rewards programs have not driven any significant increase in consumer participation over the past two years, according to WSL Strategic Retail.A spring report from the research firm’s “Pulse of Shopping Life” report series found that 83% of U.S. consumers belong to at least one retail loyalty program, the same percentage that reported participation in 2010. What’s more, participation in any specific retail channel is still less than 50%, creating what WSL concluded is “a big miss for retailers, who desperately need to connect with shoppers on something other than sales and price reductions.”That statement alludes to the historic criticism of most retail loyalty programs: that they have been little more than discount cards that qualified their holders for weekly sales and other price reductions, have left reams of valuable shopper-specific information unanalyzed and, therefore, have done nothing to foster real customer loyalty.A number of companies have revamped their programs in recent years to present “stickier” rewards (most commonly credit toward future purchases) and offers based on personal purchase history. But results from WSL’s study (based on a May survey of roughly 1,200 consumers) suggest that “shoppers are sending a message that the rewards being offered are not rewards they value,” according to the firm.Thus, only 48% of consumers say they belong to a loyalty program in the supermarket channel, a figure that is down 6% from a survey conducted by WSL in 2010. The decline is surprising considering that many supermarket operators have stepped up their efforts over the last two years, with the strongest trend being loyalty incentives tied to gas discounts.On the other hand, participation increased from 41% to 45% in the drugstore channel, where CVS/pharmacy has made its ExtraCare program the focal point of marketing activity and where — in what may have had a greater impact on the increase — Rite Aid rolled out a Wellness+ program in May 2010. (See “Rite Aid Launches …” in Related Articles.) Channel leader Walgreens will launch a “Balance Rewards” program in September. (See “Walgreens Loyalty …”)Participation also increased in the mass merchandiser channel, from 16% to 19%. Yet the growth and total participation level are notably low here, given that Target undertook a major restaging of its rewards activity in fall 2010 (see “Target Revamps …”) and Kmart initiated its Shop Your Way Rewards program in late 2009. (See “Kmart Touts …”)Programs in warehouse clubs also now enjoy 19% participation, thanks to Sam’s Club’s fall 2009 introduction of a digital eValues program. (See “Sam’s Club Goes …”) Also of note for traditional retailers is the reported 15% participation rate for programs offered by etailers such as Amazon.com. (See chart at right.)Among specific retailers, Kroger enjoys the strongest participation level within its customer base, with 81% of shoppers claiming to have used their card in the prior three-month period. Kroger’s program, which mines purchase history to deliver shopper-specific offers but also offers gas rewards and other universal incentives, has been viewed as the gold standard in recent years. (See “Kroger Stays Focused …”) The company claims that nearly half of all U.S. households have a card for one of its chains, which would put total participation somewhere in the 55 million-household range.CVS’ aforementioned ExtraCare program was next, with a 78% usage rate among shoppers in the period. The program has roughly 69 million cardholders who can receive customized offers through several delivery vehicles in addition to a host of universal deals. (See “Expo Keynote …”)Safeway followed at 76% participation, a total that theoretically should increase now that the supermarket operator’s shopper-specific Just for U program has gone national. (See “Safeway Expands …”) Although cardholder totals were unavailable, Safeway claims 30 million unique households in its shopper base.Elsewhere, Rite Aid is the only other retailer tracked by WSL that gained participation levels better than 50% in the prior three-month period. The Wellness+ program has about 52 million members. (See “Wellness is a Plus …”)But exactly how effective these loyalty programs are in attracting new shoppers to the fold is not clear from the survey. What's more, only 35% of respondents say they “go out of their way” to shop at stores where they have a card. WSL therefore advises retailers to examine their customer profiles to identify creative solutions that can “provide the extra nudge needed to earn [shopper] loyalty.”