Loyalty Programs Drive Higher Rings in Convenience Channel

NEWTON, Mass. — Loyalty programs are making a significant impact on convenience stores and restaurants as memberships rise, according to a new report from Paytronix.

Across the board, the overall number of loyalty members surged 19 percent between January 2021 and June 2023, indicating a consistent annual increase of approximately 6 percent, according to the Paytronix Loyalty Report 2023. Loyalty members not only increased their number of monthly visits, they also consistently spent more, resulting in checks that were 5 percent larger than nonloyalty members' checks.

[Read more: Subscription Services Emerge as Next Evolution of Loyalty]

"This report, drawing from real-world data and insights from our Strategy & Analytics Team, underscores what we've advocated for years: the advantages of engaging loyalty programs for restaurants and convenience stores of all sizes," said Jeff Hindman, CEO of Paytronix. "As guests increasingly expect more from their relationships with brands, we anticipate that loyalty programs will continue to grow in value while becoming more cost-effective due to advances in predictive technology and artificial intelligence."

The annual report examines the momentum of loyalty in full-service and quick-service restaurants (QSRs) while analyzing c-store market trends.

Key findings from the Paytronix Loyalty Report 2023 include:

• Convenience store loyalty programs generate the highest increase in check sizes across all segments, with loyalty member checks 12 percent higher.
• Loyalty guests who provide their email addresses are 100 percent more likely to visit, while full-service restaurant visits occur 25 percent more often and QSRs see an increase of nearly 50 percent.
• The annual cost of loyalty programs for restaurants is decreasing as the market matures.
• Forty-two percent of QSR guests order online more than 90 percent of the time, while only 35 percent typically order in-store.
• Both QSRs and full-service restaurants witness the highest redemption rates of rewards on some of the least popular days to visit.

"At Rutter's, our slogan is 'Why Go Anywhere Else?' Upholding that slogan makes the affinity built from our loyalty program, Rutter's Rewards, more vital than ever," said Chris Hartman, vice president of fuels, advertising and development at Rutter's. "Reports like this one confirm what we've seen: that loyalty is less about simple transactions and more about building lasting relationships with our customers and encouraging guest engagement."

Data referenced in the Paytronix Loyalty Report 2023 was sourced from the Paytronix database of in-store and online transactions that occurred between Jan. 1, 2020 and June 30, 2023, unless otherwise noted. The full report is available here.

Newton-based Paytronix provides customer engagement solutions and loyalty programs for restaurants, retail chains and convenience stores.