Competition in the convenience store industry is stiff, and with a potential 152,396 stores expected to open in 2024, lasting success is going to be more challenging. So how can convenience stores set themselves apart from all that competition?
For many consumers, the difference between stopping at your convenience store—or the one across the street—comes down to one thing: Which store rewards your patronage with a convenience store loyalty program? While many consumers are choosing convenience stores based on a variety of things, including their unique products, cheery staff, or technology that improves the buyer experience, incentives based on c-store loyalty programs are a big draw for consumers who are looking for savings and value.
But what exactly is a convenience store loyalty program? It’s a marketing strategy that rewards consumers with incentives—such as discounts or exclusive offers—for spending money in your store. It is a win-win for consumers and business owners. Consumers get perks for being loyal, and convenience store owners can also see improvements in:
Most importantly, loyalty programs give customers what they want. Your audiences no longer want merely transactional or monetary gain for their loyalty; they want to know you care about them as an individual, which means flexible redemption opportunities and hyperpersonalized experiences.
According to the Paytronix Loyalty Report 2023, convenience stores experienced a 19% increase in the number of loyalty members from January 1, 2020, to June 20, 2023, and that number is rising. If you aren’t already offering a loyalty program, you now have a golden opportunity to better serve your customers and drive profitability.
Why are loyalty and retention programs critical for c-store financial growth? Convenience stores often face razor-thin profit margins. Because landing new customers can cost five times more than retaining existing ones (Clientbook), it’s wise to prioritize loyalty and retention. This is where a convenience store loyalty program is game-changing.
According to one study, 43% of shoppers visit a store because they are part of a loyalty program, and 51% say they frequent a store more often if they belong to a loyalty program. Not only that, but they spend more. Based on the Paytronix Loyalty Report 2023, convenience store loyalty programs provide the highest lift in check sizes of any segment, with loyalty member checks on average 12% higher than non-loyalty checks.
C-store loyalty customers are likely to come in more often, spend more money when they do, and recommend your store to others—all of which drives up their customer lifetime value (CLV).
Case Study: Discover how Pump & Pantry created a new loyalty program that gained over 20,000 new customers in the first year.
The question isn’t whether you should start your own convenience store loyalty program, but what type of loyalty program should you start? Here are five popular choices:
The US economy has witnessed a recent and steady decrease in gasoline consumption, starting with a 13% decrease from February to March 2020. The Energy Information Administration (EIA) expects US gasoline demand to drop by 1% before 2025.
Improvements in fuel efficiency, still-prevalent work-from-home policies, and growth in electric vehicle (EV) adoption (35% increase from 2022 through 2023, according to the International Energy Agency) means fewer people are filling up at the pump, and many are filling up less frequently.
While consumers will keep lining up for the cheapest gas in town, as a c-store owner you can only lower your gas prices so much before you start losing money. If you want to remain competitive, you must give consumers another reason to visit, including:
Loyalty programs are integral to an effective convenience store marketing strategy, enabling you to communicate with loyalty members about your offerings and services. Additionally, a well-structured c-store loyalty program provides you with the data required to:
This level of personalized communication can prompt customers to choose your store when they need gas, food, or some other useful product.
The ideal loyalty program for your convenience store depends on your specific business goals, target audience, and budget. However, some capabilities are non-negotiable: You must offer your consumers a secure, user-friendly experience that provides them with significant value.
If you are ready to develop or optimize your c-store loyalty programs, we’re ready to help. Visit the Paytronix convenience store loyalty page to learn more.