Among the many retail changes that the pandemic has spawned, increased c-store sales volume is a positive one for operators. Some may look at this as a once-in-a-generation windfall. But, without a way to stay connected to those new customers, many operators will be leaving years of potential revenue on the table.
Loyalty programs are intended to drive increased and ongoing purchases. And they work. According to PDI’s 2020 The Road to Rewards Report, 63% of consumers surveyed said they belonged to a c-store loyalty program, with 60% of all loyalty members saying they would shop more frequently at stores where they could earn rewards.
At the same time, the report found that only 64% of c-store retailers have a loyalty program in place. If you’re one of the 36% who are still without such a program, here’s some guidance on how to set one up, maintain it, and gain all the benefits these programs offer.
Customers Value Value
Per the report, over half (51%) of loyalty members surveyed said they would switch brands or shop at a different store if they could earn more valuable rewards. That number was even higher for fuel savings members (54%). These shoppers are definitely looking for value.
But “value” doesn’t necessarily mean discounting. Alerts about special promotions and bundles, or special recognition at check-out make for a more satisfying shopping experience. High-value loyalty programs feature smooth, efficient transactions at the pump and inside the store as a benefit for their members. Testing and learning customer preferences can yield increasingly higher returns—which brings us to the data.
Dissecting the Data
While increased sales and profits are always welcome, the greatest return on a loyalty program investment is the customer data it generates. According to the Shopper Report, 81% of retailers said they plan to use the data gathered from their loyalty program to power their offers, advertising, or promotions efforts. And 37% of US operators said they were using or planned to use loyalty member data to develop cross-brand insights and selling opportunities.
In order to seize those opportunities, you’ll want to have a POS data capture and analytics system that can integrate with customer/member accounts. These types of systems have become table stakes for groceries. Similar systems for c-stores can actually be even more sophisticated, leveraging time of day and item data to provide carefully targeted loyalty rewards. When integrated with marketing platforms, these systems can automate and deliver a steady cadence of compelling offers that will help you realize the full value of your loyalty program in terms of increased store visits and customer spend.
This also empowers you to more closely coordinate with vendors and suppliers to fully leverage your promotional and merchandising activity. Passing suppliers’ offers through your loyalty program reinforces the value of membership and engagement.
Just as important as delivering offers that customers prefer is reaching them in the channels they frequent. And those channels are on their mobile devices. Per the Rewards Report, 70% of US retailers had the right technology to send personalized messages and offers, which pairs nicely with the 62% of shoppers who opted-in to receive digital communications from their rewards program. In other words, mobile first is the new normal.
In addition, 40% of c-store loyalty members say they currently use their app to track and redeem rewards. A mobile app, in effect, lets customers carry the store with them, enabling push notifications and direct communications with operators. This can be especially valuable for connecting fueling stops to store visits. These apps are now common enough that many vendors offer white-label versions for custom branding and customized functionality.
The Rewards of Better Rewards
As stated earlier, ultimately a c-store loyalty program is about the rewards offered. Per PDI, earning rewards or saving money motivates c-store shoppers to spend more than they originally planned (51% versus 46% of all loyalty program members), shop more frequently at stores where they can earn rewards (63% versus 60% of all loyalty members), and interact with their most-used rewards program at least weekly (59% versus 54% of all loyalty members).
This is where operators can really differentiate themselves. While fuel discounts are perennial favorites, 52% of consumers surveyed said they would be interested in more personalized rewards. This is where customer data can pay huge dividends. By formulating loyalty programs that leverage individual shopper data, operators can unlock the powerful visit and spend performance that’s waiting to be tapped.
If you don’t already have a loyalty program in place, it’s now easier than ever to deploy and manage one. And the tools to do it are better than ever. Most of all, the benefits to operators are greater than ever.
With so much new business coming through c-stores, it’s good to remember: Loyalty is a two-way street. Learn how you can make loyalty a priority by checking out our Insights and Analytics page.
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