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Report: Challenging and redefining consumer loyalty

3 min read


(Photo: Flickr user Lauren Parnell Marino)

Loyalty programs and other loyalty efforts are fairly common among food retailers, brands and restaurants, but in today’s digital world, loyalty programs have the potential to go beyond the traditional punch card or discounts. With consumers who are constantly connected to their smartphones and other devices and overall shopping behavior changing at a rapid pace, the time is right to take a deeper look at loyalty programs to see what more can be done to create efficient, affordable programs that work for both businesses and consumers, according to a recent report by loyalty management firm Points.

Specifically, the report takes a look at several common assumptions about consumer loyalty and challenges them based on today’s consumer landscape, highlighting some themes that have also appeared in SmartBrief‘s coverage of the food retail, consumer packaged goods and restaurant industries. We took a look at the report and broke down some of the themes that have been covered throughout our newsletters over the past few months:

Thinking beyond cash-back and other traditional rewards structures in an effort to attract high-value consumers

The report points out that the majority of a retailer’s business most likely comes from a small number of very loyal customers. “Awarding customers with loyalty earnings [as opposed to discounts] creates a bounce-back effect where money comes back into the business. Loyalty also contributes added value by feeding retailers steady information about shoppers’ in-store habits, allowing them to more successfully personalize the shopping experience to meet their top
customers’ needs,” according to the report. Some companies are already trying to capitalize on their most loyal customers by offering them more than a traditional reward structure:

Using loyalty messaging as a way to establish relationships and connect with consumers

“Loyalty programs offer members non-intrusive reminders of the merchant relationship and of the earning they have experienced,” according to the report. Consumers pay attention to messages that are related to loyalty programs, which gives companies the opportunity to deliver targeted promotion and often leads to a boost in conversion rates, the report said:

Leveraging partnerships to make loyalty programs more effective and affordable

Multi-partner loyalty programs are a way for retailers, brands and restaurants to get more out of their consumers in a more affordable and effective manner, according to the report. “Multi-partner programs are able to mitigate common pain points that merchants typically experience with proprietary and even coalition loyalty programs,” the report said:


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