And for those consumers who want to inform themselves, tough luck.
The terms and conditions of the Qantas Frequent Flyer scheme, for instance, takes one hour and 43 minutes to read and is rated by the ACCC as "difficult to read". Its privacy policy will take you another 25 minutes and is also rated difficult to read.
Almost 90 per cent of Australians are estimated to be members of at least one loyalty scheme and Australian respondents belonged to an average of 6.1 loyalty schemes.
Some loyalty schemes are themselves big businesses.
Qantas Frequent Flyer has over 12 million members, each of whom generated an average A$125 (NZ$133) in revenue for the airline. All up, the operating earnings for its loyalty scheme were A$372 million in 2017-18 – almost as much as the airline made from its international flights.
The ACCC report follows on from its report into the market power of Facebook and Google. It is another acknowledgement that consumers are unable – and often unwilling – to adequately protect their privacy interests when it comes to dealing with huge organisations that collect their data and sell it to third parties.
The Australian consumer watchdog is at the vanguard of a global push by regulators to step in and protect consumers from these businesses.
Surveys reveal Australians are increasingly concerned about how much data is collected by them, yet the ACCC report reveals the schemes are collecting a lot more data than consumers realise, not only from purchases made in the loyalty schemes as would be expected, but also through a consumer's use of a platform, apps on a device or use of third-party websites, such as Facebook.
They also draw on external data sources, including from data brokers or through data-sharing platforms.
The report also lifted the lid on psychological tactics used by the schemes to hold on to members and keep them spending. There are "size heuristics" which rely on consumers' lack of time and ability to adequately judge the value of a single loyalty point by offering huge amounts of low value points. The ACCC describes this as "an effective way to generate a perception of lots of value at a low cost".
There is also the "goal gradient effect", which relies on people's tendency to put in extra effort to achieve goal increases the closer they get to achieving the goal. As a result, loyalty scheme members increase their consumption (more flights, more stays, more rentals) as they approach the next status tier to achieve it sooner.
They also draw on "social identity theory" by making the member feel a sense of exclusivity and belonging with free access to an airport lounge, or the use of status tiers, which can act to engender stickiness between the member and the loyalty scheme, and make them less price sensitive, the ACCC says.
The ACCC raises concerns about schemes making unilateral changes that unfairly restricted the benefits available such as reducing the rate customers could earn points, or the value of points previously accumulated.
Aside from the harm done to individual members, the ACCC says loyalty schemes could also lessen competition, which is another form of harm to consumers.
Customer loyalty schemes can strongly influence their buying behaviour. This can have implications for the ability of smaller companies or new entrants without a well-established loyalty scheme to compete.
"Qantas Frequent Flyer might have a significant impact on barriers to entry and expansion for the domestic business traveller segment," it writes.
The regulator wants the Government to introduce a prohibition against unfair contract terms and certain unfair trading practices.
It's another step in the long process of clawing back consumers' rights and giving them a fair go when they deal with giant companies seeking to exploit their data.
