In an increasingly fragmented retail landscape, customer loyalty programs are an important tool to help retailers maximize their "share of wallet" among consumers.
A recent study we conducted at Maritz, a market research and consumer loyalty program consulting and implementation company, found that rewards-program members are more likely to have spent a greater amount of money in the previous six months across the 11 retail categories examined in the study, including home improvement, electronics, grocery, and book stores.
While it's interesting to see rewards-program members are spending more, we need to keep in mind that the programs might not directly cause shoppers to increase their purchases. It could be that those who spend more join programs to obtain rewards for purchases that they would have made even if they weren't members.
Nevertheless, enrolling shoppers who are spending more is a great way for retailers to mine the data collected from loyalty programs, in order to identify and create a dialogue with profitable customers.
What's in Your Wallet?
The study also examined various demographic characteristics (including rural vs. city living, marital status, income levels, and gender) for significant differences to determine what types of people are carrying consumer loyalty program cards in their wallets.
The study revealed that loyalty program members are more likely to be one or more of the following: female, young, living with children under the age of 18 in the household, and from the Northeast.
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