50 statistics about customer loyalty programs for eCommerce in 2022

Customers are the lifeblood of any business. Loyal customer bases can help a company grow and thrive, while customer apathy can lead to stagnation or even decline. Customer loyalty programs offer one way to encourage customer loyalty with reward systems such as discounts, points, and rewards for purchases.

Loyal customer bases are key to growing and thriving eCommerce brands in the 21st century. In a world where consumers have more options than ever before, loyalty programs have changed drastically in recent years as brands seek new ways of encouraging customers to keep coming back.

Brands can find themselves chasing their tails when it comes to loyalty. The desire for market share often leads them away from the highest margin customers who will make or break profitability at any given time - but by focusing too much on short-term gains, these same businesses risk derailing long-term growth entirely. The same goes for emerging and growing online brands that must recognize that building a stable customer base rather than making a single sale is the key to long-term success.

Furthermore, is it widely recognized that customer acquisition costs are continually rising and customer loyalty programs can help decrease customer acquisition costs. Customer retention is an investment, not an expense. In the current business climate of fierce competition for customer attention, Reward programs can offer one way to establish loyalty and provide a positive impact on ROI.

While customer retention is important, so is customer engagement. Customer engagement generally refers to a two-way dialogue with customers that goes beyond the standard one-sided communication model of brands talking at their customers instead of engaging in conversation or collaboration with them on new products and services. Customer loyalty programs can be a valuable tool for brands as they communicate with customers through the brand's rewards system, giving the right incentive at the right time, to the right customer. In addition to customer acquisition cost reductions and increases in customer retention rates, customer loyalty program statistics show that increasing customer retention by 5% can increase profits from 25-95%.

Another customer experience agency found loyal customers are 5x as likely to repurchase, 5x as likely to forgive, 4x as likely to refer, and 7x as likely to try a new offering. 

In addition, the covid-19 pandemic abruptly changed consumers' spending intentions and circumstances from last year, with 73% of consumers have experienced a recent shift in their financial situations, according to a study conducted by NielsenIQ. Consumers are now deliberately prioritizing the brand attributes that matter most to them. 

Customer loyalty programs can only be beneficial when executed properly, and growing eCommerce & DTC brands can leverage these insights to create customer loyalty programs & experiences that are fit for purpose. 

Top loyalty statistics for your online store

This post explores interesting 50+ statistics from trusted sources and studies about loyalty programs & building customer loyalty over time, with the ever-changing consumer buying behavior amidst the covid-19 pandemic to help you better understand loyalty marketing and how to avoid mistakes in your loyalty program.

— Loyalty Program members boost revenue growth every year between 12% and 18% (Accenture): customer loyalty programs are advantageous for customer retention and customer acquisition, as they offer an inexpensive way to retain existing customers, while potentially signing up new ones.

— 27% of online buyers say that the reward program membership propelled them to shop more during holidays from particular retailers. (Digital Commerce 360 and Bizrate Insights) : Adapting your loyalty program for the holidays is a great way to engage your customer base and encourage them to buy more from your online store.

— 7 in 10 consumers around the world have changed the way they buy categories and brands as a result of the pandemic. (NielsenIQ) : The Covid-19 pandemic has had a major impact on consumer spending habits. Four distinct consumer groups were identified in this study, which found that saving money at all costs is essential for many of these consumers. Yet 57% of consumers say they will stick to their regular brand preferences which is a clear indicator of strong customer loyalty among brands. The key is to identify and refine their shopper segmentation as changes in consumer habits continue to evolve.

— 81% of consumers want a relationship with a brand (Merkle 2021 Loyalty Barometer): Consumers desire the most from a brand relationship is for a company to recognize and appreciate their loyalty and enthusiasm for buying products or services. A great way to show appreciation is through rewards programs and personalized customer experiences.

— 70% of consumers prefer discounts and offers (Merkle 2021 Loyalty Barometer): The most popular rewards from a loyalty program are free items, discounts, and special offers. Free samples and free services are still extremely popular.

— 45% of consumers stay loyal to their favorite brands due to regular discounts, incentives, and rewards (Emarsys Customer Loyalty Index 2021): This is incentivized loyalty, which could be reinforced through targeted incentives relevant to a customer, at the right time, and on the right channel. This drives first-time customers to repeat purchases and ultimately, creates more loyal customers.

— 23% of consumers are loyal to brands for strong ethical reasons (Emarsys Customer Loyalty Index 2021): In 2021, the importance of ethical values, CSR efforts, and "brand purpose" statements has grown considerably. However, according to this research, strong ethical values have a very limited impact on customer loyalty.

— A customer is acquired in less than five minutes, but it can take up to six months to turn a customer into an advocate: customer loyalty statistics show that customer acquisition is much easier than customer retention. Customers who are engaged with a brand for the long term will be more likely to act as brand advocates.

— The probability of selling something to a prospect is only about 5-20%, while the probability of selling something to an existing customer is 60-70%. (Marketing Metrics) : An existing customer is more likely to be aware of your company, have a higher intent to make a purchase, and be familiar with your customer service. These are more likely to spend money with you, be loyal customers, and actively recommend you to others

— 60% of customers would do more business with a Brand to be a Member of an enhanced tier (bond): Loyalty programs with well-designed and relevant tier structures perform better as participants in higher tiers feel a sense of reciprocity from the brand.

— Gen Z consumers’ use of installment programs is 57% higher than the average consumer’s (bond): Businesses are seeking more flexible payment options as eCommerce continues to flourish and customers demand more alternatives for debt access and management.

— 73% of customers say they are likely to recommend Brands with good Loyalty Programs (bond): Upper Affluent Members (annual household income >$200K) are more loyal when a program safely and securely manages their personal information. (visa) : Trust is an important building block for customer loyalty, and consumers care about how securely companies handle customer information.

— 68 % of customers spend more to maximize the benefits they receive from the rewards program (visa): Loyalty plays an increasingly important part in influencing spending and increasing the average order value. Customers are enticed to spend more money if their loyalty programs provide them with more value.

— 74% of consumers are more likely to buy from brands that demonstrated concern and provided excellent care for customers during the pandemic (Mastercard): Customer loyalty is influenced by the customer's positive brand experience. Delivering unique experiences and remaining close to customers is critical to customer retention.

— 80% of consumers are more likely to purchase the brand that offers free shipping (Mastercard): Customers are far more likely to return and make additional purchases if they have the option of free delivery.

— 86% of customers with good customer service experiences tend to spend 50% more than those without (chase): Customer service plays an important role in customer loyalty. Customers are more likely to stick with a company if it provides them with exceptional customer service, especially during critical situations.

— 92% of customers claim that customer experience is their top priority (chase): Customers are loyal to brands who provide them with the best customer experience. Loyalty programs should be designed with customer experience in mind.

— 44 % of businesses say they are focused on making their loyalty program a more digital experience for members (MasterCard): Customers are more likely to choose a brand if they can access the loyalty program across numerous channels without difficulty.

— 47% of customers say they are more willing to pay extra for a better customer experience today than they were a year ago. (HBR) : Customer loyalty is fostered by customer experience. Customers are willing to pay more for brands that provide them with exceptional customer service and experiences.

— 41 % of executives say an understanding of customer needs and wants via customer data and feedback has been important to their organization’s customer experience strategy during the pandemic. (HBR) : In the digital era, companies have more ways to understand their customers than they had in the past. Customers are more likely to return and make additional purchases if the brand understands their needs and wants through data collection, customer feedback, and customer experience analysis.

— 49 % of shoppers made impulse buys after receiving a personalized recommendation; 44 percent will become repeat buyers after personalized experiences (segment): Customers will spend more when their experience is tailored to their specific needs. A loyalty program that delivers customer-specific recommendations and a personalized experience are more likely to drive repeat purchase.

— 51% of customers say they are more likely to shop with a brand after receiving personalized customer service (segment): Customer service is a key element in the success of any business. Customers are more likely to stick with a company that offers personalized customer service and customer experience

— 54% of consumers expect to receive a personalized discount within 24 hours (segment): Customer loyalty is aided by personalization. Customers are more inclined to return and make additional purchases if they receive personalized offers at the right time, and through the right channel.

— 51% of consumers said that ‘reliable delivery' and 'free delivery' would be more important than they used to be when thinking about online shopping and 42% for ‘Free returns’ (Brandwatch): Customers are willing to pay more for customer-friendly policies such as free delivery and returns.

— When customers are loyal to a brand, 86% will recommend a company to friends and family (KPMG): Customer referral programs, which give incentives to existing and potential customers who refer their friends and relatives to a business, are yet another method for building customer loyalty. Customers are more likely to make additional purchases if they can earn rewards by referring their friends and family to the brand.

— 46 % of customers will remain loyal even after a bad experience with a brand (KPMG): Customer loyalty is often tested in critical customer service scenarios. Customers are more likely to remain loyal if their overall customer service experience is satisfying, and are more willing to turn a blind eye to customer service mistakes.

— 66% of customers choose a retailer based on convenience, while only 47% choose a retailer based on price/value (Kantar): The gap in importance between low prices and the all-around customer experience is narrowing. Customers are more likely to choose and stick with a brand that offers convenience and provides an exceptional customer experience.

— One in seven Millennials do not belong to any program. Of those who do, 81 percent say their membership increases their spend with the company concerned – compared to just 66 percent of Baby Boomers (KPMG)

— 37% of all online buyers visit retailer websites/apps before the moment of purchase (Kantar): Today’s shopper journey is broader than ever. Customers are more than ever researching products online, where they might end up on your site.  You might use online loyalty programs software widgets to display sign-up incentives and market to them later.

— 56% of eCommerce professionals are allocating funds to data and analytics, making it the top eCommerce service budgeted for (kantar): You can't manage what you can't measure. Analyzing your consumers' loyalty metrics is critical for determining how effectively your loyalty programs are operating and making adjustments as you go.

— 62% of mobile users use their gadget to purchase fashion brands online (study by Carney): But how is this linked to customer loyalty ? As mentioned earlier, customer loyalty is determined by customer experience. As a consequence, you risk losing a significant portion of your existing customers and potential new buyers if you don't optimize your online store for mobile users.

— 68% rate their LTV-to-CAC (lifetime value to customer acquisition cost) ratio as average, below average, or very poor (CMO Council): LTV is a measure of how effectively a brand recognizes and retains profitable, long-term client connections. Using loyalty analytics and aggregated data, growing eCommerce brands can use loyalty programs to help customers get more from their purchases and cultivate customer loyalty and retention through investments in customer experience capabilities and real time feedback loops.

— Top-performing loyalty programs can boost revenue from customers who redeem points by 15 to 25 percent annually, by increasing either their purchase frequency or basket size or both (mcKinsey & Company): Redeeming a free product or soft benefit builds far more loyalty than accumulating thousands of points. Low burn rate could mean poor redemption experience, expensive reward thresholds, unappealing or less relevant rewards or they simply forget that they are part of the loyalty program. Reducing the price of redemption and offering consumers various choices to convert their points can significantly boost sales and revenue in the long run.

— 58% of consumers indicated that the most important way a brand can interact with them is through surprise offers and gifts. (Merkle Loyalty Barometer Report 2021): Consumers indicated that a company's most powerful tools for interacting with them are surprises and delight, as well as making shopping faster & more convenient. These elements are even more important in 2021 with both the economic and physical challenges resulting from COVID-19.

— 57% of consumers indicated that they did not change brands due to the events of 2020 (Merkle Loyalty Barometer Report 2021): While the misfortunes of 2020 had a significant influence on shopper purchasing behaviors, consumers who liked a brand stayed loyal despite the difficulties of the pandemic.

— 64% of consumers say they like to receive personalized offers based on past purchases and 60 percent would like to personalize the way that they can earn.(Merkle Loyalty Barometer Report 2021): Loyalty marketing softwares can help brands create customer profiles that offer personalized experiences and targeted offers, increasing the relevancy and connection they have with the program and the brand.

— Two-thirds of shoppers (66%) admit to having a brand that they love and trust (emarsys): This loyalty type can be hard to gain, and even harder to measure, but once you have built it, it can last a lifetime. It will take time, effort, and a customer-focused mentality to achieve and foster true loyalty.

— 70 % say trusting a brand is more important today than in the past – a shared belief among age groups, gender and income  (Edelman): Trust acts like a customer experience multiplier - it drives customer loyalty and advocacy, which directly impacts the bottom line.

— 75 % of people with high brand trust say they will buy the brand’s product even if it isn’t the cheapest, it is the only brand of the product they’ll buy, and they will immediately check out a new product from that brand to purchase (Edelman): In 2021, Trust is more significant than ever in driving customer loyalty, and brand trustworthiness can increase the likelihood of customers buying your products, and staying with your brand even if there are cheaper options elsewhere.

— 60 % of people with high brand trust say they’re comfortable sharing personal information with the brand, and they pay attention to the brand’s communications  (Edelman): The customer is now in control, and it's critical that brands understand what their customers are looking for. This means brand trust is now a more important driver of customer loyalty, replacing brand affinity as customer loyalty now has to be earned, not just bought.

— 76% of consumers would pay for a premium loyalty program (Claruscommerce): Premium loyalty is becoming the standard for young, up-and-coming consumers, according to this study. Gen-Zers are actually more likely to have premium loyalty memberships (70%) than traditional loyalty memberships (63%). This gap may widen as Generation Z' s earning power and disposable income rise. This study suggests that It's worth looking into a premium loyalty program if you want to appeal to a younger demographic.

— 90% of consumers say they’re likely to choose a retailer where they’re a premium loyalty member over another one offering a lower price. (Claruscommerce) : Loyalty members are highly devoted to their favorite merchants, They also work as brand ambassadors, spreading good word of mouth by promoting the brand's products and services.

— 73% of premium loyalty members shopped more with their favorite retailers during the pandemic (Claruscommerce): Consumers are willing to pay for premium loyalty programs for a wide variety of products and services. This is proven by the fact that members are eager to return for more, which suggests they have a lot of fun and are excited to be part of the program.

— The percentage of premium loyalty members who shopped even more often — once a week or more — grew from 58% in 2020 to 67% in 2021 (Claruscommerce): Premium loyalty members’ long-lasting loyalty to their favorite brands amid disruptions like the covid-19 pandemic is an important lesson for brands looking ahead to weathering the next storm.

— Two-thirds (64%) of consumers said free shipping would entice them to invest in or renew a premium loyalty program, followed by instant discounts that customers can conveniently use whenever they shop (53%) and free giveaways (47%)  (Claruscommerce): Free shipping maintains its lead from 2020 as the most popular perk in premium loyalty programs. As an eCommerce brand, you could leverage membership levels and tiers to create premium status for your customers and allow them to access such perks that go beyond simple discounts.

— Three-quarters (72%) expect to see benefits within the first week or immediately, compared to 70% in 2020. (Claruscommerce): Make sure that the cost of redemption is reasonable enough for consumers to appreciate the advantages of being a member of your program quickly. Expectation for instant gratification are rising and are even stronger than last year.

— The global loyalty management market was valued at USD 4023.5 million in 2020, and it is expected to reach USD 13,800.2 million by 2026 (Mordor Intelligence): Key organizations in a variety of industry verticals, with the main emphasis on client retention and creating long-term customer partnerships, have incorporated loyalty management. It is expected to gain further popularity in the coming years.

— 60% of millennials and 57% of Gen Z respondents had purchased a product that featured a “buy now, pay later” (StitcherAds): Millennials and Gen Z are willing to spend more on products that offer flexible payment options. eCommerce brands could consider providing this service for consumers who want to test out a brand without committing to an expensive purchase.

— 75% of customers are a single poor experience away from severing ties with your business (Sitel CX-Trends): This recent research shows that this is the reality among both U.S. and U.K. consumers. In addition, Sitel says that consumers are now basing their CX expectations - and rating the service they receive - on the best experience they have ever had with any brand – whether it operates in your vertical or not.

— 75% of customers are a single poor experience away from severing ties with your business (Sitel CX-Trends): This recent research shows that this is the reality among both U.S. and U.K. consumers. In addition, Sitel says that consumers are now basing their CX expectations - and rating the service they receive - on the best experience they have ever had with any brand – whether it operates in your vertical or not.

Key takeaways

The covid-19 pandemic disrupted shoppers' buying behaviors (75%) and how brands deliver customer experiences. It forced brands of all sizes to rethink their customer retention strategies to remain competitive and gain extra revenue from existing customers. Yet it also demonstrated that brands who prioritized long-term bond-building had gained a wide range of loyal customers who despite difficult times, still chose to interact with their favorite brands. Customer retention emerged as the top customer experience priority for brands, which is driving new customer acquisition and customer loyalty.

The key is to determine and fine-tune their shopper segmentation as consumer habits continue to evolve while investing in technology innovation that allows them to provide more convenience and tailored CX across channels.

Brand trust is also becoming an important building block to customer loyalty, as privacy concerns rise with customer data becoming more valuable to brands in a soon-to-be cookie-less world. Brands need to find a balance between customer experience, personalization and customer privacy as this will contribute to their loyalty-building efforts.

Furthermore, studies show that premium loyalty programs can help brands increase customer retention by creating a sense of status and exclusivity that encourages customer loyalty, such as free and fast shipping, instant discounts, giveaways, and other benefits.

Marketers and customer loyalty programs managers and eCommerce store owners need to take note of these statistics, as many seek ways to improve customer loyalty and retention among shoppers, especially as they experience a rise in customer expectations. Shoppers are now basing their CX expectations on the best customer experience they've ever had with any brand, so brands must gear up to meet these expectations.