C-Store Loyalty Members Outspend Inflation Hikes

But customers have a limit to their in-store purchases, based on a fixed dollar amount.

December 21, 2022

ALEXANDRIA, Va.—Despite soaring inflation and consumer spending cutbacks, loyalty customers at convenience stores and restaurants are spending more, according to a new report by Paytronix.

Since January 2020, both convenience stores and restaurants have seen their loyalty member basket sizes rise almost perfectly in line with inflation. In particular, convenience store in-store loyalty check sizes have eclipsed inflation, “demonstrating the value of an in-store loyalty program for convenience stores,” writes Kristin Lynch, director of restaurant data insights for Paytronix Systems, in the report.

According to the report, convenience store spend rose rapidly at the beginning of the pandemic, as consumers shifted their shopping behavior to quicker trips to local stores. That behavior became cemented in the spring 2021 and has held steady since then.

This past summer, the difference between check sizes and average item prices decreased. As item prices have started to rise, customers are either trading down or purchasing fewer items during their in-store excursions, according to Paytronix.

“This seems to indicate that convenience store customers have a limit to their in-store purchases, which appears to be based on a fixed dollar amount,” writes Lynch. “They enter the store with a dollar figure in mind, say $10 or $20, and spend no more than that amount.”

Lynch adds, “The last few years have demonstrated loyalty programs’ value during the coronavirus pandemic and, again, with rising inflation. In both situations, loyalty customers continued to seek engagement with their favorite brands, drawing comfort from the treats they love in uncertain times.”

An earlier report from Paytronix shows that c-store loyalty members annually spend 38% more on average than other customers, and the report found fuel visits increased by 8% in 2021 for loyalty member customers. Also, the most loyal c-store customers are visiting businesses one or more times per day.

According to the report, there were 16% less loyalty members in 2021 versus 2019, and the 56+ age segment declined the most in terms of loyalty customers. However, Paytronix found that there are now more members in the 36–45 age segment than in the 46–55 segment.

A recent Harvard Business Review study on loyalty programs found three takeaways. NACS Magazine dove into loyalty programs and how they can provide convenience retailers with key consumer insights and a competitive edge.

Look for “Welcome to the Club” in the February 2023 issue of NACS Magazine to learn how c-store loyalty programs are moving beyond simple points and rewards to a personalized experience.

A free NACS webinar is available that shows retailers how to improve their current loyalty program.

Also, NACS published a free report on how convenience retailers can build loyalty program affinity beyond rewards and provides insights on c-store loyalty programs, shopper expectations, program engagement, personalization and program access/communication. Download the report: Driving Engagement From Convenience Retail Loyalty Programs.