As summer heats up, so do the loyalty wars at the pump. Demand for gas and consumer packaged goods continue to recover post-pandemic and seasonal travel has begun to pick up, leaving convenience store retailers looking for ways to drive pump-to-register sales.
During the pandemic, there was a marked change in how people shopped, cooked, and ate on a daily basis, as well as their habits toward convenience foods. As a period of “new normalcy” begins to develop, many c-store operators are looking forward to what the next wave will bring and how loyalty programs will allow them to reach a broader spectrum of consumers.
Shifts in how consumers eat and shop has always been impacted by broader cultural trends. In addition to the changing nature of the U.S. family, ongoing labor shifts, increasing (sub)urbanization, evolving consumer health perceptions, and tech-enhanced lifestyles have led to fragmentation of eating routines and new ways to shop. Increasingly, consumers spend more hours outside their homes and are more likely to eat alone during the day (such as early mornings) and buy their food from outlets other than the grocery store.
Armed with these insights, C-store operators recognize that loyalty programs are an essential tool for retaining regular customers, increasing the volume of shopping baskets, and recruiting new in-store visitors.
TARGET LOYAL CONSUMERS AT THE PUMP
For most C-stores, the customer loyalty journey starts at the pump. 55 percent of loyalty members say they joined a loyalty program for fuel savings and to earn rewards for gas purchases. Once joined, it’s the loyalty membership that most influences their brand choice in gas stations. Take full advantage of this by utilizing introductory loyalty currencies, such as fuel discounts, and partnering with CPG brands to promote in-store sales (sometimes they’ll even fund these campaigns), so that customers earn even more fuel discounts. This encourages repeated purchases, creating valuable habits in your customers.
For a growing number of convenience stores, the answer to building in-store sales is customizing fuel discounts by leveraging personalized loyalty and reward programs. Modern loyalty programs allow c-stores to deliver relevant offerings that encourage customers to come into the store and increase store visits and sales. Mobile solutions that target consumers with real-time messaging, direct to their phone, while pumping gas gives brands the ability to inform customers about offers with the right tone and timing. Rewards not only strengthen your loyalty program, but also help you retain and engage your existing customers.
Building a loyalty program that increasingly drives pump-to-register spend also has additional benefits. For one, robust integration with current POS hardware can create a unified data hub that delivers intelligent customer insights and informs on marketing and digital experience efforts, allowing you to customize messaging and signage at the pump. The creation of meaningful connections between fueling and store purchases is a strong incentive for repeat visits and a foundation for the exploration of new products and services inside the store.
NEW SHOPPERS ARE BEGINNING TO EMERGE
Men have traditionally been the primary target for convenience consumer goods, but that trend is quickly changing with the introduction of loyalty programs in the c-store industry. For example, women are considerably more likely than men to be interested in earning points for engagement (76% vs. 69%), and they are likewise more apt to want to engage in a variety of activities to earn points; including posting on social media and recommending a loyalty program to a friend.
With the Punchh Loyalty, Offers and Engagement Platform, operators can identify consumers based on demographics, reward preferences, and activities to deliver relevant promotions based on 1:1 loyalty. This cultivates a data-driven strategy that helps c-stores gain access to customers’ digital IDs along with the capabilities to connect those IDs to POS data to create insights that drive personalization and real-time offers.
There is also the potential for growth among millennials in the convenience store industry. As the largest segment of the U.S. population, millennials consume one in every five household dollars. 81% of millennial consumers find the idea of a balance between current traditional and fresh/healthy foods appealing at c-stores. Shopping is more impulsive for these shoppers, as they make more unplanned purchases, are looking for immediate gratification, and enjoy the convenience of “in and out” stores. These tetendenciesake them prime candidates for segmentation and targeted loyalty messages. For more tips on how to market to the different generations, download – Omnichannel Engagement Strategies: Engaging Every Customer Segment Through Loyalty.
However, not all consumers seek elevated food and beverage options or a more engaging shopping experience. Loyal channel consumers remain dedicated to traditional convenience, in particular. For retailers to succeed, they must use their traditional channel strengths while simultaneously adding elements addressing modern consumer needs for high-quality products, shopping enjoyment, and low prices. Until now, it has been challenging for marketers to combine and iterate on customer segments to drill down into the level of personalization they need to create a truly unique 1:1 customer experience. But with the introduction of modern segmentation builders like Punchh Segments, you can now view, create, and combine complex customer segments in an intuitive, all-in-one flow and with nearly limitless levels of personalization.
LOYALTY BEFORE LOCATION
As more and more c-stores adopt loyalty programs, it’s important to find a way to stand out. As a result, c-store loyalty programs cannot just rely just on brand names, gas pumps and location to differentiate themselves.
And one of the biggest secrets in the c-store industry is how much customers love loyalty. According to PDI’s 2019 C-Store Shopper Report, 73 percent of c-stores in the U.S. participate in a loyalty program of some kind, and these programs influence where they shop. C-store loyalty members said they spent more than non-members, an average of 29 percent more per visit.
C-stores have to consider loyalty above location by always backfilling their funnel and focusing on loyalty building as a marathon, not a sprint. Brands must continuously measure enrollment, seek to activate members, and have impactful programs that drive participation rates. Punchh understands these challenges and always provides its c-store customers with a whole suite of industry experts to help deliver new campaign ideas, develop reporting and build programs that help you grow. Punchh is constantly pushing the boundaries of how c-stores can leverage their data and use predictive AI to enhance every step of the customer journey – from new customer acquisition to loyalist activation and beyond.
In the end, everything boils down to loyalty: perceived value, increased purchases, and improved customer experience. The c-store customer of today has more complexities than ever, and with Punchh you’ll be able to actively understand not only just buying preferences but also how they make the purchase, what they bundle with it, and what rewards they expect from their choices. Loyalty programs have proven to be growth-enhancing; they deliver results, and ultimately they improve your relationship with your customers. Today, retailers depend on loyalty, and you can count on us to help you to develop the loyalty program for convenience stores that you need for customers to return and tell others about you.