C-Stores And Customer Loyalty Programs

What kind of customer is the hardest to acquire? The answer might surprise you—it’s not tied to gender, race or even income level. The most elusive customer is a new customer.

Investment in customer retention is generally far more profitable than that required to add new customers. C-stores, in a highly competitive industry with considerable foot traffic—should consider existing customer satisfaction to be paramount—above new customer acquisition.

One of the best ways a company can engage and reward its customer base is through a loyalty program.

The Fuel Factor

C-stores are unique in that they sell something a consumer needs—fuel—along with many things they want, like beverages and snacks. Converting a “fuel-only” customer to one who regularly enters the store to shop for other goods is the primary goal of many c-store owners. However, currently only one-third of customers visit the store during an average fuel stop. Since the average spend inside the store is $8, converting even a small portion of those customers to the “fuel-plus” customer can have a significant impact on the bottom line.

Connecting a loyalty program to fuel purchases allows a business to capitalize on its most popular transaction—the one at the pump.

One approach is to integrate the loyalty program with the credit card being used, so the customer is free to continue her normal routine without any extra steps. Once she realizes her everyday purchases are now earning cash back or discounts on other items, she is that much more motivated to come inside.

Keep It Simple

One way to dissuade a customer from joining a loyalty program is to make it complicated:

  • Asking for too much data (email address, mailing address, phone number, date of birth)
  • Using multiple platforms to complete the signup process (register, handheld device, mail-in forms)
  • Generally requiring too many steps to complete

A study conducted in January 2014 not only found that an easy signup process encouraged customers to join, but that an immediate reward also played an important role. So a company revamping its loyalty program might consider the advantage of offering an instant discount after joining.

A Strategic Opportunity for C-Stores

Surprisingly, despite fierce competition, c-stores generally lagged behind other industries in the development of loyalty programs. Research has shown that while 64% of consumers participate in a grocery loyalty program and 52% in a drugstore/pharmacy loyalty program, a mere 35% participate in a convenience store or gas station loyalty program.