Does Loyalty Membership Equal Increased Loyalty?

A new Upside report reveals room to grow in terms of loyalty effectiveness.

February 22, 2024

Upside released its first report in a two-part series on loyalty programs and their impact on consumer behavior.

The survey found that more than half of consumers enrolled in a loyalty program base their shopping decisions—including where to shop, which items to purchase and how much to buy—on those programs. Nearly 40% of loyalty members indicated that they would stop shopping at a specific location if the store terminated its loyalty program.

Fuel was the third-most popular category for loyalty participation in the survey. Fuel loyalty members were most likely to enjoy their rewards experience and to spread the word about it—nearly three-quarters of surveyed members say that they’ve recommended their program to someone else.

Upside said customers indicate that they are big fans of loyalty programs, but that certain findings from the survey show shortcomings for grocery, restaurant, fuel, and convenience store retailers in terms of loyalty. Varying based on buying category, insights from Upside’s data indicate that:

  • As many as half (41-51%) of respondents do not factor in a loyalty program when choosing where to buy.
  • More than a third (33-46%) of respondents have not increased their purchasing frequency since joining a loyalty program.
  • Almost two-thirds (58-63%) stated that the absence of a loyalty program at a store would not affect their shopping habits.

The findings on consumer indifference may stem from various factors, Upside stated, including:

  • Loyalty proliferation: Comparing data from the 2015 and 2023 Bond Loyalty Reports, the average shopper has nearly doubled the number of loyalty memberships in their wallet over the past decade.
  • Lack of differentiation: Loyalty programs have become increasingly similar to one another, hindering retailers from distinguishing themselves among customers.

Last year, Upside revealed a new brand identity and mission statement.