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Beyond loyalty points:

What attracts consumers to revenue-driving loyalty programs?

A bird’s eye view looking down at a point of sale transaction with a person holding a smartphone displaying a barcode that’s being scanned by the cashier.

As the lifeblood of CMX™ campaigns, the CVS ExtraCare® loyalty program provides invaluable first-party data and deep insights into our customers’ shopping behaviors to inform our audience insights and campaign planning.

We wanted to know WHY customers choose loyalty programs in the first place, and how to make them as valuable to shoppers as possible. We partnered with the Path to Purchase Institute and surveyed 1,000+ consumers across various industries. Here are key insights from the study, along with their implications for RMNs.

#1: Rising prices on everyday items make rewards crucial.
Access to discounts, promotions and coupons a consumer can use today are the top drivers of loyalty program participation.

#2: Convenience and accessibility matter.
75% of shoppers prefer in-store shopping for everyday items, often buying across categories. However, for two-thirds of shoppers who recognize the ease of online shopping, flexibility in reward redemption is critical.

#3: Grocery and drug categories have long-standing loyalty program members.
Nearly half of shoppers in these categories express interest in personalized promotional offers.

#4: Generational differences impact loyalty preferences.
Gen Z values personalized recommendations, instant gratification and exclusive access, while older generations prioritize consistent savings over time.

How RMNs can maximize the value of loyalty

Frequent purchases provide a wealth of granular data, providing insight into how shoppers react to pricing and promotions, as well as predicting future needs. RMNs can leverage this data and tailor campaigns to resonate with consumers, improving their shopping experience with relevant deals and rewards, driving category and brand discovery with hyper-relevant communications.

  • Advertisers can personalize offers in real time, using solutions like dynamic creative optimization or in-app deals.
  • Through closed-loop reporting, RMNs can provide advertisers with precise measurement and attribution of purchases to campaigns.
  • Personalization and simplicity drive rewarding experiences at scale. RMNs can tailor offerings to individual preferences, fostering long-term customer loyalty.
  • Loyalty programs must evolve and offer rewards that appeal to all demographics. RMNs can analyze data to understand how these factors impact program enrollment and engagement.

By understanding and acting on these insights, RMNs can strengthen their loyalty programs, enhance consumer value and improve their ability to serve advertising partners effectively.

CVS understands the need to evolve and attract new shoppers, and enriched its ExtraCare offerings with an updated loyalty program launched earlier this year.

ExtraCare membership data including, “25+ years of equity in the market”, “74M+ loyal health and wellness shoppers” and “2024 redesign is strengthening loyalty and attracting new younger customers” Sources: Axis Harris Poll 100 Reputation Ranking. Axios.com. May 2023. CVS Internal Data 2023. ©2024 CVS Health and/or one of its affiliates. Confidential and proprietary. Man shopping in CVS holding a red CVS shopping basket while inspecting a beverage product he pulled from the cold beverages section. Red call out dots about ExtraCare members say, “Loyal Average 10-year tenure”, “Highly-Engaged Drive 67% sales (online and in-store)” and “Active Shop an average of 10 categories”.

Data quality is the foundation of an RMN’s power

Loyalty programs enable personalization and customization for media campaigns and shopping experiences at levels not achievable with third-party data, credit card data or other weaker signals. As such, questioning the source and strength of data used by RMN partners is crucial. This can inform personalized content strategy from simple direct mail pieces to sophisticated programmatic digital campaigns. Engaged participants who shop across multiple categories provide invaluable insights into consumer behavior, serving as a guiding light for understanding consumer preferences and driving effective marketing strategies.