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Big opportunities for convenience stores to maximize loyalty programs

customer-loyalty-radarWhen it comes to loyalty programs, the good news is that most convenience stores have one in place. The bad news is that operators aren’t maximizing their programs’ potential, according to the latest report from PDI.

The C-store Shopper Report: How to Fuel Customer Loyalty confirmed the popularity of c-stores and their loyalty programs alike: 89% of adult consumers have visited a c-store in the last six months, and 42.5% of consumers said they belong to a c-store loyalty program, up 6% from 2017.

The report, which surveyed 2,221 U.S. consumers and 239 retailers, paints a picture of an overcrowded market and fierce competition for customer loyalty, while presenting a number of opportunities. The findings also provide valuable insights for Canadian retailers looking to maximize loyalty programs.

“Loyalty programs are extremely popular because they work. The good news is most c-stores have a program in place. The not-so-good news is that they haven’t maximized their programs to increase foot traffic and encourage higher spending,” said Brandon Logsdon, senior vice president, Marketing Cloud Solutions at PDI. “Our latest report provides first-hand data that c-store owners, operators and marketers can use right away to understand their customers better and improve the performance and outcomes of their loyalty programs.”

For example, the study reinforced what most c-stores know: members of loyalty programs are highly engaged individuals with a keen awareness as consumers. Fuel savings remain the number one motivation for c-store shoppers to join a loyalty program for the fourth year in a row, as regardless of good or bad economic time and whether the prices are rising or falling.

Among other key findings are:

  • C-store loyalty members spend more on average than non-members: $11.17 vs. $8.66, respectively. Additionally, c-store members spend on average 29% more per visit.
  • Most c-stores (73%) have a loyalty program in place, with the majority of retailers (97%) saying their programs have been in place for more than a year and many of them for more than five years.
  • C-store operators identified decreasing store visits and attracting new customers as two of their biggest concerns. Additionally, 42% said they feel that training staff to talk about their loyalty program with customers is their top challenge.
  • Other challenges facing c-store operators are keeping up with technology and the pace of change (55%), preferring a mobile app for tracking and redeeming (52%) and concerns about customer fraud (43%).

“Having a loyalty program is not enough in today’s competitive market. What’s crucial is the program’s ability to keep existing customers returning and spending more with every visit, and convert regular consumers into loyal members,” Logsdon stressed.

While 72% of c-store operators collect customer data, they don’t necessarily use or take advantage of the information to improve their loyalty programs, according to the report. Some of the opportunities that are within reach for retailers upon collecting data are: encouraging participating in a loyalty program, personalizing messaging and communications, and developing and deploying customized offers and promotions.

Originally published by Convenience Store News.