If your retail business isn’t participating in the right loyalty program, you’re missing out on a huge opportunity. Research indicates that shoppers are passionate about collecting their favorite loyalty programs.
- They yearn to earn
- They’ll switch brands
- They’ll come to your store
Tapping into shopper behavior
We surveyed more than a thousand consumers who are members of multiple loyalty programs, and the results were eye-opening.
We discovered that shoppers are passionate about collecting. Their enthusiasm drives behaviors that you will want to tap into. Because when it comes to shopping, collecting points/miles trumps just about everything else, including habit, convenience and brand loyalty.
They’ll go out of their way
What is truly inspiring is how enthusiastic consumers are about earning points and miles.
Nearly two-thirds of respondents to our survey (60%) said they actively look for promotions that will help them earn more points/miles. And well over half (56%) said they never miss a chance to earn points and miles in their favorite loyalty programs — even when the amounts given are small.
One shopper summarized her/his dedication with this confession: “I drove over 10 extra miles to buy something at a store where I knew I would get points even [though] the item purchase[d] was more expensive than the store closer.”
They’ll try new brands
We also discovered that when it comes to earning points/miles, brand loyalty takes a back seat.
A solid 69% of our survey respondents stated that they would break habit and choose a different brand at least sometimes in order to earn more points/miles.
Even more compelling for retailers: slightly more than half (54%) admitted they buy more from companies when they are being rewarded for purchases.
This is consistent with data from Forrester Research, which puts the average increase in basket size of loyalty members versus non-members, when points/miles are being handed out, at 13%.
This suggests that, as a retailer, you have enormous potential both to push certain products and to increase your overall sales by awarding points/miles.
They’ll even switch stores
It turns out that points accumulation is a far bigger influence on spending than either convenience or store loyalty.
Almost half of the respondents to our survey (48%) said they will shop at a different store in order to earn points/miles.
On the flip side, a mere 20% indicated that they will not shop elsewhere. One-third (32%) sat on the fence, neither agreeing nor disagreeing.
The percentages are impressive. But it gets even more impressive when you consider how these stats could translate into numbers of real shoppers.
How big is the opportunity?
Accepted industry estimates say that 74% of Americans belong to at least one loyalty program (Colloquy, The Rules of Engagement: Loyalty in the U.S. and Canada, 2011, p. 2).
Based on our study findings that nearly half of that group (48%) could be lured to a different store by the promise of earning points/miles, this means about 178 million American adults will shop elsewhere to earn.
This figure doesn’t include the fence-sitters, the one-third who neither agreed nor disagreed that they could be led elsewhere by the opportunity to earn. If they are convinced, that would mean an estimated 192 million Americans would switch stores. Why not attract them to you!
Clearly, the opportunity is biggest for national retailers, who have an enormous opportunity to attract potentially many millions of customers.
They key is to dangle an attractive carrot.
As we discovered, the incentive doesn’t have to be large to be effective. [link to “How many points/miles should you award?”]. Small amounts of points/miles are attractive — but they need to be the right ones. Shoppers want to earn in the loyalty currencies they already collect, currencies that can help them tap into travel and other exciting rewards.
That’s how Points Business Solutions can help you. Find out how you can use Points Business Solutions to lure millions of shoppers who are passionate about collecting from you.