Actually, coalition loyalty does work in America

Wise Marketer Staff

Despite the high profile nature of Plenti's missteps and the name-recognition of its partners, multi-merchant loyalty has succeeded in the US – just not where you're looking.

We've written extensively here about Plenti's rise and apparent fall. There is a lot to talk about there – especially due to the high-profile nature of the coalition partners. But unlike much of the media covering this topic, we have tried hard to present a balanced, informed view and to do it in a way that, although may contain strong opinion, is always based in data, fact and experience.

So let's turn our attention where coalition loyalty has worked in the U.S. – in fact it has, and is working very, very well. Fuel Rewards has reached 13 million members in its 5 years of existence and has rewarded participating brands with double-digit growth year after year. On sheer participation and adoption metrics, Fuel Rewards has proven that coalition loyalty can succeed. After all, 13 million consumers and hundreds of coalition partners can't be entirely wrong.

A successful loyalty program is not just about brand size or partner name recognition, but about understanding your customers – whether you are a national retailer, a regional grocer or a local convenience store. Fuel Rewards might not have the size or reach of Amex but it was able to achieve what Plenti fell short of – build a successful coalition loyalty program from the ground up, reaching double-digit growth year after year.

Coalition loyalty is a multi-merchant approach and each partner has its own goals and interests. As such, it is imperative that it’s as easy as possible for merchants to participate. This flexibility makes for a successful coalition, allowing merchants to achieve their own results without bearing responsibility for the program’s success. Fuel Rewards’ value proposition is the rewards currency itself, not any single brand. If Plenti had been able to achieve that same kind of across-the-board flexibility they might still have a healthy pulse.

An Ipsos study of consumer attitudes and behaviors toward loyalty programs and the currency that powers them, “The Road to Rewards 2017” from Excentus, shows that programs with a fuel savings currency have been steadily increasing. Memberships in fuel loyalty programs have risen 10% in the past two years, with 64% of Americans participating in a program that helps them save on the cost of gas.

  • 20% of consumers reported shopping specifically at stores where they can earn rewards that help them save on the cost of fuel, and 22% will shop exclusively at a convenience store where they are a loyalty program member;
  • Fuel savings (30%) have also surpassed cash-back (29%) as the rewards currency with the highest consumer engagement, with consumers earning and redeeming fuel savings every few weeks or monthly;
  • 31% of consumers (up 20% from last year) are using their loyalty program’s mobile app to manage their rewards, including redemption—by far the largest jump of any channel.

The data also found that consumers want to save on fuel regardless of gas prices: 73% stated it is important to earn rewards that save on fuel when the price of gas rises, and 58% echoed the identical sentiment when the price of gas falls.

Yes, the demand for, and need for fuel makes fuel rewards a unique, near universal and valuable loyalty currency that consumers love and prefer over cashback and other rewards. But Fuel Rewards is a valid counterpoint to the current discussion around why some retailers are re-thinking their participation in coalition loyalty.

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