“Traditionally, the key drivers of consumer behaviour have been value, convenience and experience. Looking ahead, brands and retailers need to also consider choice, purpose and privacy if they are to earn and maintain their customers’ loyalty.”
- Paul Martin, Head of Retail, KPMG, UK
2020 was a difficult year for businesses worldwide. The global Covid-19 pandemic led to a drop in business because of government-imposed lockdowns and other restrictions. Additionally, the economic uncertainties of the crisis has led to changes in customer behaviour with customers cutting down on discretionary spending and focusing on buying essentials.
These new behaviours are likely to stay, with 65% of customers surveyed saying they intended to incorporate these behaviours going forward, according to McKinsey.
Responding to the challenges thrown at them by the ongoing crisis, some businesses have fast-tracked their digital transformation projects to attract customers. Others have worked to retain existing ones given the industry consensus that it is always cheaper to retain customers than win new ones.
But most businesses know that building customer loyalty doesn’t come easily. Customers have their own reasons why they are loyal to one business over the other. Broadly, however, the task of building and retaining customer loyalty is a matter of trust. Businesses gain trust when they consistently add value to their customers’ lives by consistently delivering value, quality and service.
As businesses strategise about how to build and retain customer loyalty in a post-Coronavirus world, they should consider loyalty programs. Done well, loyalty programs are crucial in establishing and maintaining long-standing customer relationships.
Though the pandemic has led to changes in customer behaviour, human beings also happen to be creatures of habit and tend to cling to the familiar – such as the familiarity of your brand or business. This is why now is as good a time as any to develop a new loyalty program or improve an existing one. Do remember, however, that using the best loyalty platform or loyalty program software in the market will certainly ensure the success of your program.
As you decide to develop, refine or upgrade your loyalty program, here are 50 customer loyalty statistics to guide you. Because the internet is an echo chamber of unverifiable customer loyalty statistics, the list below has links to the actual sources wherever available. For details on the methodology and sample sizes of these sources, please scroll to the end of the piece.
1. 91% of respondents state they have a loyalty or customer engagement program in place today. (Experian, 2014)
2. Loyalty program memberships in the US jumped by 26% to 3.3 billion between 2012 and 2014 but customers are active in only 42% of the programs. (Colloquy, 2015).
3. 72% of US online adults belong to at least one loyalty program, and on average, those enrolled in loyalty programs report that they belong to nine. (Forrester Research, 2017)
4. 44% of loyalty program members indicate they are very satisfied with the program they are part of. (Bond Loyalty Report, 2019)
5. 75% of members in a co-branded credit card or loyalty program in the US feel strongly that these programs are a key part of their relationships with brands. (Bond Loyalty Report, 2020).
6. Only 40% of US members strongly agree that loyalty programs and their associated co-branded credit cards are working together seamlessly. (Bond Loyalty Report, 2020).
7. In a 2015 global survey of B2C marketing decision makers, 81% stated that improving customer loyalty and 76% stated that aligning their brand’s promise with their customers’ experience were top priorities over the next 12 months. (Forrester Research, 2017)
8. Loyalty leaders grow revenues roughly 2.5 times as fast as their industry peers and deliver two to five times the shareholder returns over the next 10 years. (HBR, 2020).
9. Increasing customer retention rates by 5% increases profits by 25% to 95%. (Bain & Company and Earl Sasser, 1990)
10. 74% of global loyalty program participants agree that loyalty programs make them more likely to continue doing business with a company. (Nielsen, 2016)
11. 72% agree that, all other factors equal, they’ll buy from a retailer with a loyalty program over one without. (Nielsen, 2016)
12. 67% agree that they shop more frequently and spend more at retailers with loyalty programs. (Nielsen, 2016)
13. 64% of US loyalty program members say they modify the amount spent to maximise points. (Bond Loyalty Report, 2020).
14. 72% of US loyalty program members say they are more likely to recommend brands with good loyalty programs. (Bond Loyalty Report, 2020).
15. 78% of US members say loyalty programs make them more likely to continue to do business with brands. (Bond Loyalty Report, 2020).
16. In a typical three-month period, loyalty program members on average spend $42.33 more with traditional retailers than shoppers not in a loyalty program. (Forrester Research, 2017)
17. Loyalty program members are likely to rate customer experience with a brand seven points higher than non-members. (Forrester Research, 2017)
18. 39.4% consumers surveyed spend more on a product from a brand they are loyal to even if there are cheaper options elsewhere. (Yotpo, 2018)
19. 52% of the consumers surveyed say they will buy their favourite brand even if it is cheaper and more convenient to buy a rival product. (KPMG, 2019)
20. When a customer is loyal to a brand, 86% will recommend it. (KPMG, 2019)
21. When a customer is loyal to a brand, 46% will remain loyal even after a bad experience. (KPMG, 2019)
22. 74% of consumers said product quality inspired loyalty, 66% value for money and 56% customer service. (KPMG, 2019)
23. 60% of consumers say they are loyal because they feel a personal connection with the company. In India, this figure is higher at 74%. (KPMG, 2019)
24. 69% of US consumers say customer service is very important when it comes to their loyalty to a brand. (Microsoft report, 2017)
25. 55.3% of consumers are brand loyal because they love the product. (Yotpo, 2018)
26. Poor product quality is the number one reason why a brand would lose a loyal customer (51.3%). (Yotpo, 2018)
27. 76% of US loyalty program members say the experience drives their engagement with a loyalty program. (Bond Loyalty Report, 2020).
28. Sub-par customer service will drive away 23.5% of loyal customers. So even if your product is really good, experience matters. (Yotpo, 2018)
29. Customers want easier sign ups. As many as 6 out of 10 consumers across the world agree that loyalty schemes are too hard to join and/or earning rewards is too difficult. That proportion increases to 80% in Brazil and mainland China. (KPMG, 2019)
30. Customers want flexibility. 81% say it’s somewhat or very appealing to be able to earn rewards regardless of whether a purchase was made in store, on a website or on a mobile device. (Nielsen, 2016)
31. Customers appreciate gamification. When loyalty programs use gamification – like goal-setting, countdowns, and virtual rewards – programs see an almost two-fold lift in enjoyment. 56% of programs surveyed employ game mechanics in their loyalty programs. (Bond Loyalty Report, 2019)
32. 60% of members expressed interest in partnerships introduced to them through their loyalty programs. 27% say their program has a partnership, and 75% find the partnership appealing. (Bond Loyalty Report, 2019)
33. Customers rate monetary rewards high. 51% say product discounts are among the three most valued benefits. These discounts are particularly popular in Europe (62%). (Nielsen, 2016).
34. 59% of US online adults who belong to a customer loyalty program say that getting special offers or treatment that isn’t available to other customers is important to them. (Forrester Research, 2017)
35. For customers who regularly participate in a majority of loyalty programs, 69% find special treatment important. (Forrester Research, 2017)
36. 56% of US online adults want enhanced customer services such as member-only events or services. (Forrester Research, 2017)
37. Overall, only 37% of respondents identified points and rewards as one of the most effective ways to secure their brand loyalty. But points and rewards based programs are popular in emerging economies such as mainland China (54%), Mexico (50%) and India (49%). (KPMG, 2019)
38. 67% somewhat or strongly agree that they join these programs only to get free products or discounts. (Nielsen, 2016)
39. 69% of loyalty program members say that they are more likely to participate in a loyalty program if a mobile app is available. (Nielsen, 2016)
40. 66% of global respondents agreed they’d shop more at online retailers if these sellers provided loyalty benefits similar to those of traditional in-store retailers. (Nielsen, 2016)
41. 25% of US loyalty program members strongly agree that program representatives make them feel special and recognised, but programs getting this right experience 47% higher engagement. (Bond Loyalty Report, 2020).
42. Loyalty program members in the US who receive relevant offers that become more relevant over time are eight times more likely to go out of their way to use them. (Bond Loyalty Report, 2020).
43. 39% of those who regularly participate in loyalty programs they join are interested in redeeming their points for experiential rewards such as tickets to a concert or private cooking lessons. (Forrester Research, 2017).
44. Millennials are even more likely than older generations to agree that programs make them feel more loyal to a brand. (Forrester Research, 2017)
45. 67% of young millennials are highly influenced by loyalty programs. (Bond Loyalty Report, 2019)
46. 96% of millennials say companies should find new ways to reward loyal customers. (KPMG, 2019)
47. 81% of millennials say being a member encourages them to spend more within the company. (KPMG, 2019)
48. 78% of millennials would switch to a company that offered a better program. (KPMG, 2019)
49. 61% of millennials would prefer to donate their rewards to a good cause rather than redeem them personally. (KPMG, 2019)
50. Millennials rate many non-monetary loyalty program benefits more highly than boomers. Non-monetary benefits include frequent flyer points, higher priority service, exclusive access to sales or merchandise, personalised products or service experiences, recognition as a valued customer, charitable donations. (Nielsen, 2016)
Bond Loyalty Report, 2019: This report surveyed more than 55,000 customers across 200 programs in more than 20 markets across North America, South America, Asia Pacific and Europe.
Bond Loyalty Report, 2020: This report, in its 10th edition, surveyed more than 68,000 customers in 34 markets across the Americas, Europe, Asia Pacific, Middle East between December 2019 and March 2020.
Colloquy, 2015: Customer Loyalty in 2015 & Beyond Are You Wasting Your Money? For this report, Colloquy conducted a survey of more than 2,000 US and Canadian loyalty-program members.
Experian, 2014: Driving Customer Loyalty, Experian Data Quality, 2014. Two hundred respondents in the US took part in the research, produced by GMI for Experian Data Quality. Individuals from small and large businesses in marketing, data management, customer service, IT, sales, finance, management and operations departments who had knowledge of data management practices all took part in the survey. These individuals came from a variety of industry sectors, including manufacturing, automotive, retail, financial services and travel.
Forrester Research, 2017: How Consumers Really Feel About Loyalty Programs. Forrester Data Consumer Technographics North American Retail And Travel Survey, Q4 2016 (US), was fielded in October 2016. This online survey included 4,585 respondents in the US between the ages of 18 and 88.
HBR, 2020: The Loyalty Economy, Harvard Business Review, January-February 2020.
KPMG, 2019: The Truth About Customer loyalty, 2019, KPMG International. It surveyed 18,520 consumers from more than 20 countries about customer loyalty and how brands and retailers can attract and retain customer loyalty through enhancing customer loyalty programs.
Microsoft, 2017: The Microsoft State of Global Customer Service report, 2017, polled 5,000 people from Brazil, Germany, Japan, the United Kingdom and the United States.
Nielsen, 2016: The Nielsen Global Retail Loyalty-Sentiment Survey 2016 polled more than 30,000 online respondents in 63 countries to understand what drives consumers to participate in retail loyalty programs.
Yotpo, 2018: Yotpo’s State of Consumer Loyalty 2018 report presents findings from a survey of 2,000 US adult (18+) consumers, conducted by AYTM for Yotpo in July 2018.