This results in a deluge of uninspired loyalty programs flooding the market, lacking differentiation and customer resonance.

Customer loyalty expert Robbie Baxter, founder of Peninsula Strategies, author and host of the podcast “Subscription Stories,” told PYMNTS the key to a successful loyalty program is having “a clear understanding of the customer you’re trying to engage.”

Brands can get a clear understanding of their respective customer bases through “product market fit on an ongoing basis,”  Baxter noted. “Just like any good offering.”

To build a successful loyalty program, prioritize your customers’ needs and preferences. Instead of defaulting to a points-based system, delve deeper into what motivates customers and what challenges they face. By crafting a program tailored to their unique values and pain points, you can differentiate your offering in a crowded marketplace, ensuring it provides genuine value and creates lasting customer loyalty.

Amazon Prime

Launched in 2005, Amazon Prime originally addressed customer frustration with shipping times. Initially, the program’s focus was on delivering the loyalty program perks that its top customers desired, gradually expanding its offerings over time. Amazon listened to its customers, understood their pain points, and continually invested to acquire and retain more members and transform them into brand advocates.

The emphasis here is on investing in the customer rather than the product. In today’s landscape, instant gratification holds heightened significance, particularly evident in subscription loyalty programs like Amazon Prime, where members receive instant benefits. Amazon Prime members spend nearly twice as much annually compared to non-Prime members.

The annual fee structure enables Amazon to provide extensive benefits to those customers who derive the most value from their loyalty program. The free trial plays a pivotal role, allowing more consumers to assess its suitability for their usage patterns.

Amazon Prime now has more than 200 million members across 25 countries. What Amazon has done with Prime is a textbook example of product market-fit.

Subscription-Based Programs

Subscription-based loyalty programs, like My Best Buy Plus, have gained in popularity and customers enjoy them because they receive next-level benefits and rewards that free points programs can’t offer. Typically, subscription loyalty program members pay monthly or annual fees while brands receive a recurring revenue stream, elevated engagement and enhanced customer data they can use to tailor member communications.

Personalization, value and enhanced customer experience are key drivers. Unlike points programs catering to a broader base, subscription programs target top customers, enabling more tailored offerings and communication. Additionally, exclusive rewards like discounts and early access make members feel valued.

While there is certainly a place for points-based loyalty programs, Baxter noted that subscription loyalty programs “require the customer to raise their hand and make a commitment up front to a particular retailer.”  

Subscription loyalty programs require varying types of benefits, depending on the brand and the “customer segment it’s trying to serve,” Baxter noted. “But think about what benefit is most likely to drive acquisition, as well as the benefits that will drive engagement and habits. Both are important.”

Building Connections

Making loyalty program members feel like they’re part of a community is crucial to long-term engagement and advocacy.

REI was founded in 1938 when a group of 23 climbing friends, united by their love for the outdoors, decided to source quality and affordable gear for their adventures. Today the REI community has 22 million lifetime members. The program is appealing for many reasons, including a $30 lifetime membership, exclusive events (garage sales) and discounts, and an annual member dividend.

“Community is a big commitment for an organization — so before investing in building a community feeling, make sure you know the ROI and also the benefit that the community will provide,” Baxter added. “It’s not just a matter of having a community platform — you need to facilitate the connections within the community under the brand umbrella.”

For all PYMNTS digital transformation coverage, subscribe to the daily Digital Transformation Newsletter.

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On a call with analysts Thursday (July 18) discussing the quick-service restaurant (QSR) behemoth’s second quarter 2024 financial results, CEO Russell Weiner shared that loyalty reward redemptions for pickup orders have skyrocketed since the brand refreshed its program last fall.

“We said, with the new loyalty program, we wanted to drive light users and frequency there — check. We wanted to continue, obviously, to drive our delivery customers … but we also wanted to engage our carryout customers — check there. So, it really is doing every single thing that we had hoped it would,” Weiner said. “Orders with loyalty redemptions in the first half of this year are twice as high as they were under the old program in the first half of last year.”

The program relaunch lowered the threshold for earning points and reduced the number of orders required for redemption. By targeting light users and encouraging repeat purchases, the Domino’s loyalty program has fostered a stronger customer base. The high redemption rates reflect consumers’ preference for value-driven incentives, making the loyalty program a cornerstone of Domino’s growth strategy. Additionally, loyalty promotions such as “Boost weeks” have effectively spurred transactions and customer acquisition, contributing to the company’s positive order counts.

Indeed, QSR customers want loyalty rewards. PYMNTS Intelligence research reveals that 51% report using a restaurant loyalty program, with 49% participating in these programs at QSRs.

The Cautious Consumer

As inflation and economic uncertainty have squeezed household budgets, many consumers have become more selective with their discretionary spending, impacting dining choices and frequency.

With dining out being, for many, an unnecessary expense, the majority of consumers cut back in times of economic distress. PYMNTS Intelligence data from last year revealed that 78% of consumers have been eating at home more often to save money amid inflation.

Yet Domino’s, for its part, saw sales growth domestically and abroad, though perhaps not enough for investors’ liking — the stock is down nearly 14% at the time of this writing since the opening of the market Thursday morning.

“Consumer spending [is] slow, but let’s think about what’s happened with that as a backdrop. We’ve grown orders in our delivery business, our carryout business, every income cohort,” Weiner said. “We’ve grown order count in international. [That’s] what’s going on in an economy where folks are maybe struggling to decide what to buy.”

The Aggregator Boost

The brand’s integration with Uber Eats, which began last year after the pizza chain held out against aggregators for as long as it could, is also growing. Sandeep Reddy, CFO, mentioned that sales from Uber grew to 1.9% of total sales in Q2, with the company targeting 3% by the end of the year.

The partnership with Uber Eats exemplifies Domino’s relatively recent dual-channel approach, combining the strengths of its own digital platforms with those of third-party aggregators. This strategy not only broadens the company’s reach but also ensures that it captures a fair share of the growing food delivery market.

The company is leveraging discounting to drive growth on the platform.

“Whether it’s how customers shop or part of the algorithm or a little bit of both, starting out with a slightly higher price that you can discount from is a way to get more eyeballs, and so we’ve continued to test and pivot that way, and you are seeing it in the results,” Weiner said.

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That’s increasingly the reality for businesses today.

In an era where consumer expectations around convenience and personalization are at an all-time high, digital loyalty programs have emerged as a component for businesses looking to stay competitive while capturing greater customer lifetime value.

“Customer loyalty isn’t a new concept, but it has evolved,” American Express Vice President and General Manager of Amex Offers Erin Frankcombe told PYMNTS. She noted that digital coupons, reward points and loyalty statuses that unlock enhanced benefits are now table stakes for meeting customer expectations.

While loyalty was traditionally cultivated through direct, personal interactions between shop owners and patrons, the modern landscape has been transformed by digital-first expectations and approaches, where convenience and seamless experiences across mobile and web platforms are prioritized.

Still, customer loyalty is here to stay, with rewards and loyalty programs adapting to evolving consumer spending behaviors.

“We see four key themes shaping the loyalty and rewards landscape,” Frankcombe said, citing that businesses need to adapt to hyper-personalization, sophisticated targeting, embracing a digital-first approach and reward-savvy customers as urgent priorities.

But while embracing those themes may seem daunting for some merchants, there is no need for them to set up a digital loyalty program on their own.

Partnerships can be invaluable in providing reward and loyalty solutions that help businesses maintain a competitive edge and foster lasting customer relationships, Frankcombe explained.

Evolution of Digital Loyalty Programs

In today’s world, where customization is expected in all aspects of life, from social media feeds to coffee orders, the bar for personalized offerings has never been higher.

Through rich data and insights, Amex Offers — a platform from American Express that provides card-linked offers tailored to customers based on their location and spending habits — matches value from merchant advertisers to the most relevant shoppers, Frankcombe explained.

“Each card member might get different offers that are even tailored across different Amex card types,” she said, driving increased engagement and loyalty while delivering personalized experiences at scale.

Offers are also easy to add and earn, she said.

“There’s an opportunity [for merchant advertisers] to drive spend at specific times of the year or at significant moments — think Valentine’s Day, Mother’s Day or even Cyber Monday,” Frankcombe added, stressing the importance of focusing on value delivery versus sheer reach.

As for how it works?

Amex’s integrated payments model provides merchants with insights into Amex’s high-spending card members’ spending patterns. This data-driven approach allows for more effective customer targeting, performance measurement and business growth.

For instance, Frankcombe explained that a regional retailer can use Amex Offers to help attract new shoppers in a specific area or increase frequency among existing low-frequency shoppers, using a cost-effective and ROI-positive method for business growth.

The Importance of Ease of Use

Offering all the rewards in the world wouldn’t matter if the target customer struggled to use them, or they weren’t relevant. This is particularly true across eCommerce and mobile shopping, the rise of which has underscored the importance of ease and convenience in the customer journey.

Given this backdrop, a key differentiator for Amex Offers is its integrated payments model.

As Frankcombe noted, Amex operates as a card issuer, merchant acquirer and payment network, providing unique insight across the payment transaction. This integrated model, coupled with Amex’s global footprint, is a tool for merchants to help drive business.

“We can expect rewards and loyalty programs to continue to adapt to customer spending behavior by focusing heavily on hyper-personalization, unlocking growth today and into the future,” she said.

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The purpose of investing in loyalty programs is so brands can strengthen their customer relationships, gather key insights and grow revenue. Loyalty terms like acquisition, retention and usage are important in this process.

As brands dive deeper into improving their digital transformations, here are five key metrics that can elevate a brand’s ROI.

Member Engagement

This metric is the most important one for any free or paid loyalty program. If members aren’t engaged, they won’t use the program very often or at all.

This metric measures the program benefits your members are using. A high figure shows that members are enjoying the program’s benefits thoroughly. If this rate is lower, it’s time to find out what’s causing it and make suitable adjustments.

For example, Albertsons Companies saw significant increases in digital engagement in its fourth quarter and full year fiscal 2023 financial results. According to the results, digital sales soared 24%. This massive increase was attributed to the chain’s loyalty program, which saw its membership grow by 16% to nearly 40 million.

Purchase Frequency

Successful loyalty programs will result in your members spending more as they shop more.

As members use the program and earn rewards, they are likelier to shop more frequently. For example, that’s why Amazon Prime members spend nearly twice as much per year on average than non-Prime members. If you have a great loyalty program, members are likely to shop more frequently. But if this number is flat, your members might not see enough value or differentiation to engage regularly.

Two years ago, fast-casual brand Rubio’s Restaurants, which has more than 150 restaurants across California, Nevada and Arizona, launched a new loyalty program to give members more visibility and choice. Rubio’s Director of Loyalty & Digital Experience Adam Fox spoke with PYMNTS about how these changes can drive purchase frequency in the face of rising food prices.

“The reason we went with this type of program is listening to our guests,” he said. “They wanted a program where they can redeem for what they wanted to. So, this just gives our guests so much choice and flexibility whether they want to save up for free entrees or if they want if they want to feed their kids for free.”

Churn Rate

Churn refers to the percentage of members that cancel their memberships per month.

A high churn rate is usually a symptom of members not getting value out of your program or getting the wrong types of benefits. If this number is high, you should survey your members and examine your data to see what benefits they’re using and where they want more value.

One way to improve your loyalty program churn rate is to offer experiential benefits. For instance, Six Flags, an operator of theme parks and water parks, launched a metaverse experience on Roblox that includes a rewards program. Users can collect “coastercoins” in the new metaverse experience and redeem them for Six Flags rewards and activities at the company’s physical parks.

Reward Redemption Rate 

This metric is critical for any loyalty program. If members aren’t engaged, they won’t use your program often or ever. This shows which program benefits your members are using and how fast they’re using them. A high figure shows that members are enjoying the program’s benefits thoroughly. If the rate is low, it’s time to re-evaluate. Do members even want the rewards you’re offering? Are there certain benefits that can be replaced with others?

In April, JCPenney launched its Rewards and Credit Program, a free loyalty program for customers. JCPenney has more than 20 million Rewards members that shop there an average of five times per year. The new program will double the rate at which Rewards members earn points, ensuring every member receives money back each year. The program is free to join and guarantees $20 in CashPass Rewards.

Keep It Simple

If your loyalty program’s signup process is too complex, consumers will look elsewhere. A loyalty program must be simple to use to spark elevated engagement.

Earlier this year, CVS listened to its customers and simplified its loyalty program. Instead of members managing four separate programs, CVS officials consolidated the program into a single membership with two tiers.

Those aren’t the only relevant five metrics, but they’re arguably the most important. By diligently tracking and optimizing member engagement, purchase frequency, churn rate, reward redemption and program simplicity, brands can significantly enhance the ROI of their loyalty programs.

These metrics provide crucial insights into customer behavior and preferences, enabling brands to fine-tune their strategies for maximum impact. As digital transformations continue to evolve, leveraging these key metrics will not only boost loyalty program performance but also foster deeper customer relationships and drive long-term growth.

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The new super.money app is available on the Google Play store.

“Unlike other UPI apps, we’ll never offer you useless coupons, scratch cards or coins,” the company said in the store. “Instead, get used to up to 5% cashback on every transaction.”

The app will also offer “credit cards that improve your credit” and “personal loans that won’t take multiple red tape to get,” super.money, a Flipkart Group company, said on its LinkedIn page.

Currently, the app aims to differentiate itself from others with an uncluttered user experience and a focus on rewards for every transaction, a super.money spokesperson told TechCrunch.

The app is currently in beta, and the company will continue to refine the product based on user feedback, the spokesperson added.

The launch of super.money follows Flipkart’s separation from Indian mobile payments app PhonePe in late 2022, according to the report.

While Flipkart had no immediate plans to offer mobile payments at that time, it already offered other financial services like loans to merchants and installment payments for customers, the report said.

The Flipkart marketplace includes upwards of 500 million registered users, 1.4 million sellers and 150 million products across 80 categories, the company said in May.

Walmart has said that both Flipkart and PhonePe, which Walmart also owns, could become $100 billion businesses. The companies could go public in a couple of years, the retailer said in early June.

In March, Flipkart launched a UPI handle to enhance its digital payment offerings by adding the instant payments system. The company said at the time that the Flipkart UPI allows users to set up their own UPI handle for transactions, both online and offline, and both within and outside the Flipkart marketplace.

PYMNTS Intelligence has found that 55% of consumers in India paid for their most recent digital retail purchase with UPI. In addition, India accounts for 46% of the world’s real-time payments and logs more digital transactions than any other nation, according to the “2023 Global Digital Shopping Index: India Edition,” a PYMNTS Intelligence and Cybersource collaboration.

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As the companies said in a news release Tuesday (June 18), Marriott Bonvoy members and Starbucks Rewards U.S. members who link loyalty accounts will get the chance to earn points toward free food and beverages, as well as rewards at Marriott destinations.

“Marriott Bonvoy’s commitment to enriching moments for their customers aligns with Starbucks’ customer promise to uplift the everyday, making them the perfect loyalty partner,” said Kyndra Russell, senior vice president, North America chief marketing officer, Starbucks.

“We’re continuing to develop our Starbucks Rewards program, and through this new collaboration, we are excited to offer members even more value and enhanced benefits through travel experiences,” Russell added.

As PYMNTS wrote in April, Starbucks’ loyalty program was one of the bright spots in a recent earnings report that showed the coffee retailer seeing a drop in “occasional customers.”

Starbucks Rewards had seen an increase in 90-day active members in the U.S., totaling 32.8 million during the quarter, a 6% increase year-over year. The company also launched a loyalty partnership with Bank of America in February, offering cardholders and Starbucks Rewards members in the U.S. additional benefits by joining accounts.

In another recent partnership, Starbucks teamed earlier with Grubhub to expand its order delivery options. The collaboration is rolling out this month to select markets in three states — Pennsylvania, Colorado and Illinois — but is expected to expand to all 50 states by August.

“Customer demand to get Starbucks delivered continues to increase, as evidenced by double-digit growth in the U.S. delivery business this past quarter, indicating that our customers continue to want convenience in their everyday lives,” Meg Mathes, vice president of digital experiences at Starbucks, said in a news release.

Elsewhere on the rewards front, recent research by PYMNTS Intelligence found that more consumers would use buy now, pay later (BNPL) programs if they knew there were loyalty rewards attached.

“The results showed that consumers increasingly opt for credit card installments for larger purchases because BNPL services lack common features of credit cards, such as reward programs and higher credit limits,” PYMNTS wrote last week. “Additionally, consumers reported that BNPL is not as widely available in stores. The study found that 38% of consumers expressed a desire for BNPL to offer more available and higher-quality rewards.”

For all PYMNTS retail coverage, subscribe to the daily Retail Newsletter.

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They seem insulated from the vagaries of inflation and economic headwinds. Who doesn’t crave an indulgence here or there — a late-night snack that, delivered to one’s door, offsets the pressures of the workday?

In many ways, cookies are an ideal business, one that inspires loyal customers. But even they need a healthy reminder now and then. As Insomnia Cookies Chief Marketing Officer Tom Carusona told PYMNTS as part of the “Better Data, Better Outcomes” series sponsored by Banyan, the company’s latest iteration of its rewards program is designed to keep customers loyal, as repeat buyers, online and offline.

“As companies scale, and as media becomes much more distributed, it’s important to try and build as deep of a connection with your customers as possible … to make sure they feel embraced by the brand that they love,” Carusona said.

That’s easier said than done in the age of the distracted consumer, where we’re all on the receiving end of a constant stream of texts, emails, pop-up ads, and TikTok and Instagram feeds. What works for one customer — a text message, for example — might not work for another customer, who might be incentivized instead by a video feed in-store.

Omnichannel Presence

The challenge — and opportunity — in cementing loyalty becomes even more complex when companies such as Insomnia Cookies operate across digital and brick-and-mortar channels, with delivery in the mix too. Since its founding two decades ago in a dorm room at the University of Pennsylvania, Insomnia Cookies has grown to more than 280 locations across the United States, and it established a presence in the United Kingdom and Canada last year. Many of the company’s stores are located near or in college campuses and cities, satisfying the collective sweet tooths of students and other night owls, with a sweet spot demographic among 18- to 24-year-olds.

Earlier this month, the firm announced the launch of its new loyalty program, Insomnia Rewards, enabling consumers to create accounts, as well as earn and redeem points online or in-store for baked goods and ice cream.

As Carusona noted to PYMNTS, the latest iteration represents a broadening of its loyalty program that had been geared toward consumers making purchases through the company’s online channels.

“With our new program, we actually have the ability to earn and redeem in our stores,” he said.

The cross-channel efforts, and data that comes alongside those purchases, helps inform Insomnia with what Carusona termed a “full view of the customer” and how they use delivery, walk into a physical store or use order-ahead options.

Since the program is less than a month old, he said, “we’re just getting warmed up — to connect the dots and enable better customer experiences.”

The app represents the most natural conduit to an optimal customer experience — for speedy transactions and building loyalty, Carusona said.

“If you’re walking into a store, you pull up the app, and if there’s a reward in there, you can add it to your order, scan it with the barcode, and then redeem right on site,” he said. “If you’re not redeeming right away, you could just scan and bank those points.”

The data will also help crystallize a long-term trend of repeat buying, moving cookies beyond a simple indulgence toward a gifting occasion, for example. Customers could get friends and family 12-cookie boxes for special occasions and parties, Carusona said. Upcoming features might involve push notifications based on anniversaries or holidays.

Asked by PYMNTS about the preferred payment modalities, Carusona said that credit cards remain a key method embraced by Insomnia’s younger consumers. The company has also been working with select universities so that meal plan balances can be used to buy Insomnia’s baked goods and deliveries.

“We’re excited to finally have an experience that is much better for our consumers,” he said. “It’s going to be faster, it’s going to be more value, and it’s going to create a deeper emotional bond. That’s what we’re trying to do. One of our big goals is to create a community of ‘Insomniacs.’ We’re kind of a cult brand, and we want to make sure that our customers feel that they’re getting love from us, not just from cookies but from all these different channels. So, I’m excited that we’re finally moving in the right direction, and I can’t wait to see the results.”

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By the Numbers

The report “Card-Linked Offer Growth Hinges on First-Time Users,” a PYMNTS Intelligence and Banyan collaboration, drew from a February survey of more than 2,100 U.S. consumers to better understand how and why they started using card-linked offers.

The results revealed that 41% of consumers who make more than $100,000 a year prefer to earn rewards on overall spending at a specific store, while only 18% prefer discounts on specific products, 30% are indifferent and 11% are unsure.

These figures showed that higher-income shoppers are likelier than the average consumer to want store-specific rewards, as only 37% of the sample overall exhibited the same preference.

The study also found that younger consumers — namely, Generation Z shoppers, millennials and bridge millennials — were disproportionately likely to want store-specific rewards. As such, by offering card-linked rewards, retailers have a good chance of winning the spending of wealthier and younger shoppers.

On the Other Hand

Conversely, there may be drawbacks for retailers in offering card-linked rewards across their offerings rather than focusing on item-specific perks.

“I think card-linked offers have been a rather blunt instrument in a retailer’s marketing toolkit,” Jehan Luth, CEO of Banyan, told PYMNTS in a 2022 interview. “One of the biggest reasons it’s a blunt instrument is because as a retailer, I cannot drive traffic to certain items. Instead of traditional loyalty offerings that may not be consumer-personalized, the overlaying of SKU-level data or item-level data in rewards and offers makes card-linked offers a much more versatile and powerful tool in the toolkit for retailers.”

The space may be due for a change soon, as the Consumer Financial Protection Bureau (CFPB) investigates the way that credit card rewards programs are designed following a rise in consumer complaints about such programs.

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And with the recent trend across the payments landscape of financial services firms like JPMorgan Chase and PayPal creating their own ad networks that use data from user purchases, the integration of payment systems and the use of personalized data to enhance customer experience and drive loyalty is top of mind for companies looking to establish a competitive moat of repeat business.

That’s because, in the evolving digital and connected economy, the integration of payment systems and the activation of personalized data are no longer optional — they are essential for unlocking the full potential of payments and maximizing customer lifetime value.

Unintegrated payments, after all, are standalone transactions that lack connectivity with other business processes and data systems. These disjointed payments fail to provide businesses with the crucial insights needed to enhance customer experience and streamline operations. Without integration, payment data remains isolated, preventing businesses from understanding consumer behavior, preferences and spending patterns.

Driving offers to customers inside various ecosystems means using data, and accepting the digital payments that provide that data, in the right way. Effective personalization goes beyond addressing customers by their names; it involves understanding their preferences, anticipating their needs and providing relevant offers and rewards seamlessly tailored to distinct behaviors.

And leveraging payments data for ongoing personalization doesn’t just have its place in the consumer payments realm. The principles of integrated payments and personalized data, as well as the value of rewards and benefits, can increasingly be applied to B2B payments and operations.

See also: The Trickledown Consumerization of B2B Payments Helps Firms Win Business

Unlocking Better Business Relationships

By consolidating payment data with other customer information, businesses can gain valuable insights into purchasing behaviors, enabling personalized marketing and even tailored offers.

“Given the high correlation of customer satisfaction to the payment experience … Whenever there’s a transfer of payment or money, there’s an opportunity to enhance [the process] and drive a better customer experience for consumers as well as businesses,” Wally Mlynarski, head of merchant solutions and receivables at Bank of America, told PYMNTS.

The inclusion of rewards and benefits not only incentivizes timely payments and loyalty but also can add significant value to B2B transactions. By embracing these advancements, B2B businesses can improve efficiency, foster stronger partnerships and scale their operations more effectively.

“In a B2B business, the finance function itself is part of the customer experience,” Aanchal Kochhar, head of product at Capital One Trade Credit, told PYMNTS. “You can delight customers and capture more customers when underwriting is seamless, the credit process is seamless, and how money flows is seamless and with less error. There is a lot of growth potential.”

By integrating payment systems with additional services like financing options, supplier-side businesses can provide more value to their clients, making their offerings more attractive, while offering rewards such as early payment discounts can incentivize buyers to pay invoices sooner, improving supplier cash flow.

Automating payment processes and linking them with other systems also helps minimize manual entry, which in turn reduces errors and saves time for firms, boosting their operational efficiency and leverage.

Read more: 15 Experts Explain the Strategic Side of Payments Modernization

Data — especially user-permissioned, receipt-level data — will have the power to change the way business is done, Banyan President Alpesh Chokshi told PYMNTS in a discussion posted Monday (June 3).

While the traditional value proposition of payment systems focused primarily on transaction speed, security and cost, the modern value calculus includes rewards and benefits as crucial elements that influence payment acceptance decisions for both smaller firms and enterprise businesses.

For small businesses, integrated payment systems with built-in rewards and loyalty programs can be game changers. These features help attract and retain customers in competitive markets by allowing firms to offer personalized discounts, track customer preferences and engage customers through loyalty rewards, thereby driving repeat business and increasing lifetime value.

Larger enterprises benefit from integrated payment systems by leveraging extensive customer data to drive sophisticated loyalty programs and personalized marketing strategies. These businesses can analyze vast amounts of data to identify trends, segment their customer base and deliver highly personalized experiences at scale.

“We talk about our loyalty program not as a cost center, but as a profit center to the business,” Rite Aid Chief Marketing Officer Jeanniey Walden told PYMNTS.

Integrated payments and the strategic use of personalized data are also pivotal in scaling digital payments.

By offering rewards and benefits, businesses can encourage the adoption of digital payment methods, which are more efficient and secure than traditional payment options. This shift not only reduces operational costs but also provides a treasure trove of data that can be used to further refine personalization strategies and enhance customer loyalty.

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What do these consumers say keeps them from returning to card-linked offers? Irrelevant offers and unappealing deals.

But the naysayers should give these offers another look.

These are just some of the findings detailed in “Card-Linked Offer Usage Over Time,” a PYMNTS Intelligence and Banyan collaboration. The report examines the future growth dynamics of card-linked offers. It draws on insights from a survey of 2,108 U.S. consumers conducted from March 20 to April 6, exploring how and why they started using these offers.

Other key findings in the report include the following.

Former users view the lack of relevant offers as the key reason they have not yet returned.

Relevancy and savings are key to drawing consumers in. Data shows that for 22% of former users, a lack of relevant offers is not just a deterrent for using cards but the key reason they do not return. These consumers’ perceptions do not match how these offers have changed.

Card-linked offers are becoming more attractive in areas consumers care about — relevancy and savings — if only former users would notice.

Nearly two-thirds of card-linked offer users are more satisfied with the relevancy of the offers they received this year than the previous year. Current users are noticing more improvements in their offer programs. But the same is not true for former users, who remain outside of the programs. Providers that target past users and position how the programs have improved could have a competitive advantage.

More than half of past users are at least somewhat likely to use the offers again in the future.

Most card-linked offer users will likely use them again. However, 63% of cardholders have not received these offers in the last year or noticed if they have. Here, providers have missed out on an opportunity. The report explores which past users are more likely to return.

Providers must target consumers who have never used these offers and reengage previous users to grow usage. Download the report to learn more about how card-linked offer providers can deliver a one-two punch to unlock the next wave of growth.

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