Loyalty programs can build connection with consumers, increase purchase instances and provide customer insights for retailers.
A new report from guest engagement platform Paytronix revealed that operators in the 75th percentile of loyalty transaction share achieve 30% of their transactions from loyalty program members, while brands in the 90th percentile see loyalty penetration reaching 37% and beyond. The report measured key metrics such as retention, the effectiveness of personalization, email campaigns and more across QSRs, restaurants and c-stores.
“The first step toward a more effective loyalty strategy is to evaluate your current program's performance by assessing key metrics like penetration, growth rate, discount levels, and whether members' behaviors align with your corporate goals,” said Jeff Hindman, Paytronix CEO.
Key findings from the 2024 Paytronix Loyalty Trends Report include:
Engaging Guests and Eliminating Churn: The highest-performing quick-service restaurants (QSRs) achieve an average 62% monthly loyalty program member retention rate, while elite full-service restaurants (FSRs) retain 57.8% of their loyalty program members month-to-month, on average. Convenience stores lead in this area, with top performers (90th percentile) reaching an 85% average retention rate.
Loyalty Member Acquisition: The best QSRs sign up an average of 110 new loyalty members per store each month. Their FSR counterparts acquire 70 new members per location monthly, and leading c-stores add an average of 36 new members per location each month.
Personalization: Over 70% of brands’ campaigns are segmented vs. sent to their entire loyalty database. Less than 10% of campaigns leveraged predictive model scores.
Email Reigns Supreme: More than 80% of campaigns rely on email to engage guests. Although campaigns that include mobile app push messages represent over 20% of campaigns for QSRs and c-stores.
Average Spend Per Visit: For QSRs, the average spend per visit is $19.05 for brands in the 50th percentile and $30.16 for those in the 90th percentile. For FSRs, it’s $39.35 and $77.49, respectively; and for c-stores, $13.03 and $24.30.
Earlier this year, retailers including Maverik, Sheetz, Wawa and more were recognized by Newsweek for their loyalty programs. Read more about loyalty programs and their impact on consumer behavior from Upside.