2020 Loyalty Marketing Trends for Convenience Stores - HubSpot
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2020 Loyalty
Marketing Trends for
Convenience Stores
It’s about choice, technology and ever before as a result of technology-based loyalty
programs. It allows retailers to offer personalized,
data (but not too much data) customized rewards, offers and experiences to
customers, which enhances their engagement.
Across all retail segments, including convenience Like Netflix and Amazon, it gives the customer the
stores, loyalty programs are big business, and it’s feeling that retailers know them, are interested in
no wonder. They’re proven to boost growth, they their preferences, offering what they want and need
are not expensive for the retailer to implement, and even before they know what that is.
they enhance your relationship with your customers.
It’s a gold mine of data for retailers, but that data
When you consider that, according to Harvard is sitting on a slippery slope. It’s the “too much of a
Business Review, acquiring a new customer is five good thing” syndrome. As consumers get more and
to 25 times more expensive than retaining one you more savvy about data privacy, and high-profile data
already have, and that, last year, according to CS breaches across all industries make people more
News, C-store operators said decreasing store visits wary about giving personal information, retailers
and attracting new customers were their two main must walk a fine line about the type of data they’re
concerns, loyalty programs are a no-brainer. collecting and using. The perception out there is:
U.S. consumers have 3.8 billion memberships in Shopping preferences = good. Email addresses or
consumer loyalty programs. Today, it’s all about other personal information = bad.
the customer experience, creating personalized, In the end, it all boils down to value, customer
choice-driven programs that will meet and exceed engagement, increased purchases and an improved
consumers’ ever-heightening expectations. customer experience.
Whether it’s a point system, discounts, cash back or
members-only coupons, retailers need to balance In this white paper, we’ll delve into today’s loyalty
the financial costs to them, versus increased program landscape, highlighting current stats,
customer loyalty and increased purchases as a challenges and opportunities; examining what
result. makes a great loyalty program in this current
market; profiling successful loyalty programs and
In addition, today we have access to more (and best practices in other industries; and highlighting
more personalized) customer preference data than trends to look for in the year ahead.
2020 Loyalty Marketing Trends for Convenience Stores 1
Loyalty stats, challenges and opportunities
The loyalty landscape is stronger now than ever.
Retailers are able to give more personalized and
meaningful options to customers, which creates What makes a
loyalty and repeat business. Win-win! But there
are some conflicting stats out there that show the great loyalty program?
challenges and corresponding opportunities that
still exist. A great loyalty program should...
• Consumers belong to an average of 13 loyalty • Give consumers the power of
programs, but are active in only about half of choice. Offer it via email, text, push
them, according to Brand Bond Loyalty.
notifications or a card.
• 55% of customers say they abandon their
loyalty program if they realize points have • Be relevant to most of your customers.
expired. • Support and align with your
• 71% of consumers decide to join a loyalty corporate goals.
program because of money off every
purchase. • Encourage customer referrals by
offering valuable rewards to the
• 63% join for free products. sender and receiver.
• 81% of consumers are loyal to brands that are
• Focus on consumer engagement
there when they need them, but want their
by making the program visible and
time to be respected.
accessible onsite.
• 94% of consumers name a good customer
experience as the main reason they stay loyal. • Leverage customer data to offer more
personalized rewards and experiences.
• According to Excentus’ C-Store Shopper
Profile 2018 report, 43% of shoppers visit • Not ask for too much information.
a convenience store because of its rewards Customers are becoming sensitive
program. to that.
• 42.5% of consumers belong to a C-store
• Drive customers from the pump into
loyalty program.
the store by offering rewards for
• C-store operators say keeping up with merchandise purchases in addition
technology, mobile apps for tracking and to fuel.
redeeming and customer fraud were their
main challenges with rewards programs.
points for every purchase, and those points should
What does it all mean? It means customers like
add up quickly. And for goodness’ sake, the points
and appreciate loyalty programs for the savings
should never expire.
and other rewards, but don’t want too much
intrusion in the form of too-frequent emails or text And since only 42.5% of customers belong to a
messages. It also means customers should get C-store loyalty program, it means there’s room
to grow.
2020 Loyalty Marketing Trends for Convenience Stores 2
Loyalty best practices in other retail segments
Target Circle Sephora Beauty Insider My Starbucks Rewards
Target Corp. revamped its It’s a traditional point system To compete with the
loyalty program this year, rolling with a twist: flexibility. increasingly competitive
out the new name, Target Customers get points for coffee marketplace, Starbucks
Circle, in October 2019. The every purchase, but they have simplified and streamlined
free program gives members a a choice about how to use its loyalty program this year
1% discount on everything in those points. They can redeem to include a larger range of
stores and online, and for every them for gift cards, discounts redemption options for the
purchase made, customers on purchases, limited-edition points customers earn with
earn votes to help direct products and in-store beauty purchases. They can now earn
Target’s charitable giving to 800 tutorials. rewards quicker, at just 25
nonprofits nationwide. Also, points, or they can accumulate
there are personalized perks points for greater rewards. Also,
tailored to the customer based Why it works for Sephora: points no longer expire.
on purchase preference data. Popularity. Sephora Beauty
The program is based entirely
Insider has 17 million members,
on the Starbucks app. No punch
which account for 80% of
card, no sign in. To earn loyalty
Why it works for Target: Sephora’s annual sales. Those
points, which they call “stars,”
Engagement, greater spending, numbers show that most
customers must order or pay
and data. In their six test of Sephora’s customers are
through the app.
markets, more than 2 million participating in the program.
customers have already enrolled
and are spending more than
Why it works for Why it works for Starbucks:
those who aren’t.
Data. Starbucks learns
customers: Flexibility and
customers’ usual drink orders,
choice. Customers love the
frequently visited stores,
Why it works for customers: personalized way they can
seasonal preferences for
Ease of signup and immediate choose to use their reward
specialty drinks, and more.
discounts. If customers already points, earning discounts on
All of this information allows
have a Target branded debit otherwise expensive products.
Starbucks to personalize offers
or credit card, RedCard, the
that are relevant to customers.
app-based Cartwheel savings
tool or a Target.com account,
they’re automatically enrolled.
Why it works for customers:
If not, a quick phone number
Ease of use and rapid
at the checkout is all it takes.
accumulation of points.
Like RedCard, the discounts are
Customers who order and pay
applied to the next purchase.
on the app skip the long line,
and earn two “stars” for every
dollar spent.
2020 Loyalty Marketing Trends for Convenience Stores 3Trends and Technology
How technology supports and
enhances loyalty marketing programs
Loyalty programs that use technology, like an app,
can seem like a game you play on your phone.
It’s not only fun for the user, it creates a sense of
personal competitiveness, too.
If your customers earn points or stars (or whatever
your unit of measure is) for purchases, accruing to
win rewards, discounts or other perks, that gives
them an incentive and a personal goal.
Random rewards and offers enhance the experience
as well.
Data and AI are allowing brands to kick their loyalty
programs up a notch by gathering consumer data
about purchasing preferences (hello, Starbucks) and 4. Technology will continue to be important to
using it to offer personalized rewards. the rewards experience. It’s because it’s easy
to use, and makes purchasing easy and fun.
It’s also because we’re accustomed to doing
3 main loyalty trends for 2020 everything else with our smart-phones, why
What will we see in the loyalty landscape in the not loyalty, too?
coming year? Look for these trends: Loyalty programs will continue to be an important
part of a C-store’s success in 2020. The best
1. Brands across all retail segments will be
programs are inclusive, easy to use, engaging, and
refreshing and updating their loyalty programs
use technology to enhance the experience.
in 2020, following the lead of successful brands
like Target and Starbucks. A traditional loyalty
program isn’t going to cut it anymore. Some
brands are upgrading, others are completely
revamping. At Tecmark, we specialize
2. Consumer preferences are changing. They in loyalty programs for
want personalized rewards, simplicity, ease of
membership, and points that don’t expire. convenience stores.
3. Customers are becoming wary of supplying Contact us to find out more.
personal information. People are pushing back
at loyalty programs that ask for too much
information up front. Collecting data on buying
preferences is fine, but asking for things like
addresses, birthdays and sharing one’s contacts
is being viewed with wariness and skepticism.
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