Most consumers belong to a loyalty program, but engagement lags
Membership in a retail loyalty program is not a guarantee of participation.
Close to nine-in-10 (86%) consumers say loyalty is important to them. However, a recent survey of 12,000 retailers and shoppers from personalized promotional app Upside, “Escape from the Loyalty Plateau,” indicates that engagement in loyalty programs is uneven.
Across Upside’s three key retail categories - fuel & convenience store, grocery, and restaurant – a majority of consumer respondents belong to at least one program. Grocery has the highest membership rates, with 82% of respondents claiming at least one membership, while restaurants have the lowest at 62%.
However, only 59% of consumer respondents who belong to a grocery loyalty program are regular users, followed by 49% of respondents who belong to a fuel and convenience store loyalty program and 38% of restaurant loyalty members.
[READ MORE: Convenience retailer Jacksons Food Stores upgrading loyalty program]
Despite relatively low rates of regular usage, most consumer respondents belong to multiple loyalty programs. The average member of a restaurant loyalty program belongs to 3.2 other programs (up 5% since 2023).
The average member of a grocery loyalty program is inv 2.4 other programs (up 47% since 2023) and the average member of a fuel and convenience store program is in 2.3 other programs (up 26% since 2023).
Upside also ranked the average loyalty influence scores of restaurant, fuel and convenience store, and grocery loyalty programs on a score of -100 (no influence) to 100 (absolute influence). Restaurant loyalty programs led with an average influence score of 45, followed by fuel and convenience store (42.8) and grocery (39.2) loyalty programs.
“The loyalty plateau is a structural challenge, not a reflection of any individual program’s effort," said Dr. Thomas Weinandy, principal research economist, Upside. "As the landscape has saturated, consumers now juggle multiple memberships within the same category — and no single program can command the influence it once did. The retailers who will break through are those who shift their focus from merely growing enrollment to genuinely changing behavior among the consumers who are still deciding if they want yet another app on their phone.”
The survey also shows that loyalty memberships are growing at a faster rate than engagement in programs is. The average consumer respondent belongs to 17.4 loyalty programs, up 60% from 10.9 loyalty programs in 2014. But in the same time period the average number of active loyalty memberships only rose 8% to 8.4 from 7.8.
