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02/17/2022

Consumers Love Loyalty Programs: A Look at What Makes the Good Ones Work Well

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Loyalty Program

There are more than 150,000 convenience stores in America alone. On every corner, off of every exit, c-stores big and small are vying for business. 

While there has been a structural shift in the way consumers have shopped since COVID-19, with a good amount of foot traffic paired with delivery options, loyalty programs are playing a role in order to maintain the momentum of these new customer behaviors. 

Earning points through the money consumers spend, offering special coupons and discounts, and receiving member-only rewards are just some of the ways c-stores are grabbing new business and retaining loyal customers.

Apps have taken loyalty programs to the next level. Large c-store chains, which have an already dedicated customer base and enough locations to make them viable, have built their own loyalty apps. 7-Eleven’s 7Rewards, Circle K’s Easy Rewards, and Wawa’s rewards program, for example, are available by simply downloading and signing up.  

[Related: The Container Store to Launch a New Loyalty Program and Mobile App]

Yet, single-site operators may not have the budget or bandwidth for their own custom app and, therefore, look to third-party providers such as Uber Eats, DoorDash, and Groupon to deliver deals to consumers. 

Does utilizing a third-party app diminish the impact of loyalty programs, and how can c-store operators and third-party apps work together to improve the customer experience?

Loyalty Programs Through Third-Party Apps Can Work Well If Done Correctly 

 

C-store giant Wawa knows a thing or two about executing a loyalty program. Their app engages consumers with easy-to-use functions and a robust rewards system. However, Wawa also acknowledges that not everyone wants to download their app, and so the same shopping experience is also available through DoorDash, GrubHub, and Uber Eats. These third-party apps reach an entirely new audience — one that may not have visited that location in the first place if it wasn’t for the available perks. 

Another example specific to the c-store market is GasBuddy. While GasBuddy is primarily used to check the price of gas throughout a user’s city, it also allows consumers to view c-store offerings. Discounts and loyalty program badges are displayed for each location, reaching another group of engaged customers who are loyal to GasBuddy, but might not yet be faithful customers of the c-store.

3 Steps to a Successful Loyalty Program 

 

Whether you are building your own app or using a third-party provider, the first step in creating a successful loyalty program is making consumers aware it exists. C-stores can display signs or video screens at the pump, but with fewer people on the road these days, fewer people are apt to see any signage. Third-party apps work around this challenge, as they reach customers 24/7 on their mobile devices.

The second step is making it worth consumers’ time. Customers are inundated with ads. It is estimated the average person sees between 5,000 to 10,000 advertising messages a day. Cutting through the noise and grabbing the attention of a consumer really comes down to customization. Using location data combined with the technology behind a third-party app, loyalty programs can push relevant, personalized offers to customers to incentivize visits to the pump and maximize foot traffic in-store.

Lastly, a loyalty program must keep a customer engaged. Purchasers prefer to be rewarded based on their individual actions, as opposed to a widespread price reduction. As loyalty programs track what consumers buy, using that information to deliver even more targeted offers for a customer’s favorite items will keep a program relevant (more on that later). 

With a technology partner, businesses can utilize a pool of data to determine how and why certain promotions work and if they should be repeated.

What to Look For: Choosing a Tech Partner For Your Loyalty Program 

 

Whether building an app from the ground up or working with a third-party app, the right tech partner is essential. From advising on the types of programs that would work for a specific c-store to offering discounts and methods to attract new customers, a knowledgeable partner can assist with designing, delivering, and managing a successful loyalty program.

Designing and implementing a loyalty program is one thing, but, as mentioned, it is another challenge to keep it relevant. This is why one of the key benefits of having an experienced technology partner assist with a loyalty program is access to data. Loyalty program data includes more than just purchases, but also tracks preferences, patterns, and locations.

An innovative solutions partner will assist in bringing all of this customer data together quickly to allow operators to react on the category management side in real-time. The result is ensuring that the right rewards reach customers, increasing overall engagement.

Personalized Loyalty Programs Are a Win-Win 

 

It is reported that 43% of c-store shoppers choose a specific convenience retailer because of their loyalty program, and over 70% of shoppers increase visits to that store if they are members of a loyalty program. 

When utilizing a third-party app, it is essential not to lose the customization that speaks to consumers. The program should do more than just recognize buying frequency, but truly use consumer insights into behavior to meet the needs of shoppers. With rising gas prices and competition heating up, there has never been a better time to implement a personalized loyalty program. 

—Mindy Shouse, SVP, Program Operations, PDI

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