It’s not too hard to understand why customers love rewards programs. I myself can think of at least six stores that offer a rewards program. With customers spending money frequently it’s nice to receive something in return, this is what makes rewards programs very appealing to shoppers and retailers. Let’s dig into a few statistics!
Firstly, and undeniably, consumers love the opportunity to save money or receive products on discounts. When consumers save, they feel more liberated to buy more. Studies have shown that about 22% of rewards consumers spend more on an order.
Easy to Market
Consumers prefer businesses that give back to them! In industry surveys, roughly 83% of consumers say that they are more likely to do repeat business where a rewards program is present than a comparable business without a rewards program. Consumers desire special incentives such as BOGOs, double rewards purchases, day of the week deals, etc. Surveys have shown that by about 13% consumers are more inclined to sign up for rewards programs that offer special incentives.
Consumers love rewards programs when they are clearly defined and hassle-free. Rewards programs should allow consumers to easily and quickly check in or redeem rewards such as giving a phone number to locate their rewards.
Consumers enjoy the feedback loop that rewards programs provide. Many find themselves excited by their collection of rewards and find themselves competing with others or themselves. Especially with programs where rewards expire shortly after a visit.
Market New Brands
Rewards programs provide incentives for consumers to try new brands. Studies have shown that about 55% of consumers would be more apt to consider a brand when proper incentive is provided.
Then, there is the general psychological breakdown of why consumers like rewards programs: In anticipation of receiving rewards a consumer’s “pleasure center” is activated. This anticipation of the rewards creates a desire to alleviate the craving for that reward. This eventually develops into consumers displaying pleasure seeking behaviors.
Someone may choose product X over product Y because product X has more rewards points (or qualifies for more punches/stamps) than product Y. To back this up even further, studies have shown that more than half of rewards program consumers report taking some action specifically to earn rewards.
Starting a rewards program at your store or restaurant can add additional value to your current customer base. Using a loyalty program can help you grow your outreach to new customers. With new point of sale systems and customer rewards apps it’s not hard to get started with a well defined rewards program.