There’s little doubt that loyalty programs pay off for c-store operators. Loyalty program members are known to purchase more, bringing a higher basket ring per shopping trip.
How much more do they spend?
According to the June 2019 “C-Store Shopper Report: How to Fuel Customer Loyalty” by Researchscape International, commissioned by software developer PDI, rewards members spend 29% more per visit, dropping on average $11.17 every time they shop, compared to $8.66 for non-members.
Plus, 57% of loyalty members will visit the inside of the store when refueling; only 33% of non-members will walk in. The numbers are nearly reversed for refuelers who gas up and leave — 56% of non-members compared to 38% of members.
And while having a mobile app for loyalty customers is considered a must-do, don’t confuse the two.
“It feels like they’re one and the same, but they’re not,” said Art Sebastian, vice president of digital experience, marketing and loyalty for Casey’s General Stores, which operates 2,100 locations in 16 Midwest states. “Our mobile app houses e-commerce. It will house our loyalty program. It will house future capabilities like digital payment, or scan and go, and so on.”
Casey’s released its mobile application in July –— without a loyalty program in place. The company developed the app in-house and was ahead of the game as far as technology. “Plus, it just makes ordering Casey’s pizza even easier, so there was no reason to hold it back,” Sebastian said. “It could drive more revenue quicker.”
Casey’s wanted to devote more time to fine-tuning plans for a loyalty program, which it plans to introduce later this year.
REWARDS CARDS AREN’T ENOUGH
Gone are the days when a scannable loyalty card was enough to get into the rewards game and draw repeat business.
Often, customers would enroll in a rewards program to save on a single purchase, only to cast the card into a crowded console or cluttered glove box.
Technology and more savvy marketing have upped the stakes.
“C-stores are still a little bit behind loyalty in general,” said Perry Kramer, senior vice president at retail consulting firm BRP Consulting. “Where grocery and department stores, they’ve got a higher second-, third-, fourth-purchase type of numbers. But c-store is starting to catch up a little bit, and it’s happening more in the millennial space.”
Indeed, “The Loyalty Report ’19” from marketing firm Bond Brand Loyalty found that loyalty programs influence the spending of 67% of younger millennials, ages 24-29, and 62% of Gen Z’s 18-24-year-olds.
TAILOR YOUR PROGRAM
This brings us back to Casey’s, which has yet to introduce its rewards program. Sebastian said that’s by design — Casey’s wants the program done properly. “We’re building something that is a little unique and sets us apart,” he said, “and so that’s just taking a little bit more time for us.”
Sebastian said that while retailers without a loyalty program will be playing catch-up, he warned not to jump the gun. Be wary of the urge to move too quickly for the sake of simply having a program.
“I think retailers, independent operators, small or large, need to think about what’s the unique value proposition for your loyalty program,” Sebastian said. “If it’s just to have one like everyone else, I think it’ll add some positive impact but may not really be a key differentiator.”
Pilot Flying J, with 750 travel centers in 44 states and Canada, is an excellent example. Steven Root, Pilot’s senior manager of loyalty marketing, said the company’s customer base is made up of a wider sampling of the traveling public.
Like the rest of the c-store industry, travelers can fuel up and grab a sandwich and a fountain drink. But Pilot Flying J also serves a significant number of professional drivers who want more than snacks and coffee.
“For example, if you are a gas customer, you don’t need to see mobile shower reservations,” Root said, “but that’s something that’s super important to the pro driver. We do segment that experience based on who you are.”
Pilot Flying J doesn’t stop with truckers and families, either. The particular needs of the RV traveler are also on the company’s radar. Each segment has different needs.
Similarly, Casey’s strong pizza component sets it apart from much of the industry; the nation’s fourth-largest convenience store chain, it’s also the fifth-largest pizza chain.
For both c-store chains, those unique qualities had to be considered when developing their loyalty programs.
LEARN FROM BIGGER PLAYERS
The c-store industry lags behind other channels when it comes to beacon technology and geofencing, where the app sends a discount alert or reminder to a member when near a store or in a particular aisle within a store.
Kramer said that c-stores are in a wait-and-see mode, adding that quick-service restaurants have been leading the way in that space. “So I think those guys are pioneering a little bit more, and then c-stores will be fast followers,” said Kramer.