The Untold Economic Story of the Year: How Loyalty Programs Beat Inflation
The economic story of 2022 has been around one word: inflation. But there’s a second story that has remained under wraps: how loyalty programs keep customer spending in line with inflation. By studying the check sizes for customers of 64 restaurants and convenience stores, Paytronix data analysts discovered that loyalty customers kept their check sizes roughly the same, despite the rise in prices.
Of particular note, the customer segment hit especially hard by inflation was fuel purchasers at convenience stores, who saw their prices more than double between January 2020 and June of 2022 (though fuel prices have since dropped). Despite this rapid rise, fuel-purchasing loyalty members continued to buy until prices rose nearly 80%, and even then continued to spend more. As prices once again dropped, loyalty spending quickly moved to match.
Turning to restaurant concepts, QSRs saw a similar pattern from their loyalty members. Prices did not increase as rapidly as they did for fuel, but the most loyal customers of these QSRs kept increasing their spend, at times doubling the rate of the increase in menu items.
As the rest of the data brief shows, inflation is difficult to overcome, but restaurant loyalty programs provide the ideal tool to hedge against even the toughest economic circumstances.[CT1]
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