With such high rates of consumption, it’s no surprise that there are more than 24,000 coffee shops in the US, that bring in a combined $12 billion dollars annual revenue.

Because of such high demand, the number of coffee shops is expected to increase by 50,000 in the next few years. With that amount of market saturation, having a rewards-oriented loyalty program (such as Loyalize can help support) can be a competitive advantage to acquire more of the market share.

While new customer acquisition is an important factor when it comes to increased revenue, it is also crucial to consider this staggering statistic: on average, repeat customers spend 67% more than first-time buyers.

With that being said, you may be asking yourself “how do you simultaneously increase customer acquisition and customer retention?” The answer is simple: rewards. Access Development, America’s largest discount network, studied customer loyalty trends and found that surprise offers and/or gifts are the best way to increase customer engagement. Look at Starbucks for example, a business that has not only survived through the pandemic but thrived. In Q2 of 2020, one of the hardest-hit economic depressions we have seen over a decade, they saw an increase in its active loyalty members by 15%. This trend did not stop there, in 2021 they saw a 48% increase in YoY active users within the previous 90 days and managed to add an additional 1,000,000 members to their loyalty program in Q3 of 2021 alone!

With staggering statistics like the above, the impact rewards programs can have in both corporate and independent coffee shops are evident. Loyalize’s API solution for cashback and rewards loyalty programs is an easy and effective way to stay competitive in this crowded market.

Thank you a latte for reading – pun intended!

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There are several proven ways to increase consumer loyalty and member retention, and cashback happens to be at the top of the list.

In this article of ours, you will find some strong positive correlations between the two. But don’t just take our word for it; there are countless articles and studies backing this up.

Make sure to check out this Marketing Chart’s article that provides data showing that cashback is the most effective loyalty driver of all rewards programs.

The above-quoted article also provides statistics on the connection between rewards, customer satisfaction levels, and customer retention: whether that be for credit cards, grocery stores, bakeries, gyms, or other businesses.

At its core, cashback is so successful at increasing brand loyalty and member retention because of human psychology. A Forbes article on the psychology of rewards combines more than 19,000 survey responses with data from global management consultancy McKinsey to theorize why cashback is so effective. Consumers seek positive user experiences with instant gratification. They want to feel valued just as much as they want to know they got a good deal. Cashback more than any other promotional strategy contributes to both of those consumer desires and elicits a subconscious emotional response that can be a significant driver in repeat business.

With more than 35% of gym members canceling for cost-related reasons, Loyalize‘s cash back relationships with over 6,000 US retailers could be a completely customizable solution to the attrition problem that gyms and health clubs are facing. Depending on how gyms chose to design their loyalty programs, it could take the concept of cashback a step further and assign a fixed “value” of points (stars, trophies, “dumbbells”, dollars, etc.) to each gym member’s online purchase. These points, in turn, could be used for the gym’s services, products, or even gift memberships. This is a great way for members to achieve the instant gratification the Forbes article mentions and make each member feel rewarded for being there: strengthening customer satisfaction, overall member retention, and revenue.

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