EMA Journal • PMAA Journal Fall 2018 • Making A Loyalty Rewards Program Your Own

Having regular customers who shop at your c-store again and again is a big help to your bottom line. To make this frequent shopping habit more likely, many c-stores offer loyalty rewards programs.

Research done by KPMG in 2016 found that customers like loyalty reward programs. Two-thirds of the 700 consumers surveyed said they had made a special trip in the last six months to shop at a store with a loyalty program, and 60 percent said they would shop at a store with slightly higher prices to earn a loyalty program award.

Loyalty programs are a big factor in deciding which c-stores consumers choose. While a 2018 survey of more than 1,000 shoppers done by loyalty program provider Excentus found 44 percent of shoppers select a c-store based on location, they also learned 43 percent visit a c-store because it has a loyalty program. The research found 51 percent of customers shop more frequently at c-stores or chains where they are loyalty program members than at other c-stores, and 22 percent shop at the membership c-store exclusively.

Many different kinds of benefits can be included in these programs. The rewards you give your customers and how they earn them is up to you. Making participation easy is important, both in the registration process and when earning and redeeming rewards. The best programs let customers shop as they prefer, either by presenting a card, using a smartphone app or providing their phone number.

Discounts on gas are a popular option. You can do this by issuing free instant-gas-discount membership cards or a downloadable app giving an immediate per-gallon discount. These can be private label debit cards linked to the customer’s checking account, which act like bank debit cards when used to purchase gas. Customers can either swipe the physical card or use a smartphone app. Zipline is one company offering cards of this type (www.zipline.biz). They provide payment processing and will help you set up a special card for your store. Each transaction is PIN-protected and auto-generates a payment transaction email sent to the customer.

Another type of loyalty program lets shoppers earn points for buying gas and in-store items. Sometimes these programs give a small reward, like a fountain drink, just for signing up. Different reward methods are available. The program could give increasingly higher per-gallon gas discounts based on how many points the customer had earned. Alternatively, the point earnings could be spent on car washes or inside the c-store. To avoid customers taking unfair advantage of the loyalty program, it is best to exclude certain purchases from qualifying, like alcohol, lottery tickets, tobacco and money orders.

In addition to earning points, the membership program could reward spending on multiple purchases of specific items, like buying nine coffees and getting the 10th free, or purchasing five carwashes and getting the sixth one free. Any product in the store you wish to promote can be one for which customers earn free items. C-stores can also hold sweepstakes for prizes, with customers using their points to enter.

Loyalty program members could also be offered special discounts on certain products. The products included could change regularly so customers would be incentivized to stop in frequently to get these deals. By capturing customers’ email addresses during the sign-up process, information on these and other product promotions can be sent out. Be careful not to email too frequently, as this can turn off customers.

When deciding what rewards to offer, think about your current customers and the new customers you wish to attract. What sorts of rewards would appeal to them? Would they prefer discounts or getting free items? What can you do to personalize the rewards to your store by offering something customers can’t get elsewhere? For example, you could let customers order in-store items or prepared food using the app while pumping gas, and then your employees could deliver the purchases to their cars at no extra charge.

Implementing a loyalty rewards program is not free, although a good program will more than cover its cost with increased business. These programs require software and other technical support. While some c-stores have developed their own in-house loyalty programs, there are a number of companies experienced in doing this for c-stores. They include KickBack Rewards Systems (www.kickbacksystems.com), Paytronix (www.paytronix.com), Tecmark (www.loyaltymarketing.com), Hatch Loyalty (www.hatchloyalty.com), Loyaltygator (www.loyaltygator.com), Belly (www.bellycard.com), Klosebuy (www.klosebuy.com) and Patron Points (www.patronpoints.com). Review how programs from several of these companies and others you find online work, and find the one most suitable for your c-store.

Not only do these companies help set up the loyalty program and offer continuing support, the provided software uses your existing POS system to keep track of members and what points and rewards they have earned. Many can gather data to analyze what your members are buying. Use that information to develop new benefit ideas to get members into your store even more often. Remember that loyalty programs evolve over time. Your program should respond to changing customer shopping patterns.

Your loyalty program will be worthless if no one signs up. To keep that from happening, train employees so they can promote the program and answer any questions customers pose about registering, earning points, and redeeming rewards. While this is particularly important in the early days of a program, continued employee training encouraging them to tell customers about the loyalty program will help it thrive.