This article has been reviewed according to Science X's editorial process and policies. Editors have highlighted the following attributes while ensuring the content's credibility: Whether you love a loyalty discount at the supermarket or frequently forget your loyalty card, loyalty programs (LPs) can be an essential support for families and households amid growing cost-of-living pressures. The number of LPs offered by retailers is increasing.
Globally, the loyalty management market is projected to grow in value from $17.38 billion in 2026 to $51.65 billion by 2034. The market will continue to expand as cost-of-living pressures force households to seek discounts, coupons, gifts and vouchers to reduce their shopping expenditures. New research led by Edith Cowan University (ECU) analyzed survey data from more than 800 Australian supermarket customers to better understand what influences customer engagement with LPs and how effectively the programs affect loyalty to retailers.
The findings are published in the European Journal of Marketing. The findings will help retailers design LPs based on what is most important to customers. ECU Professor of Marketing and Service Science Sanjit Roy from the School of Business and Law said the research found that customer behavior and retailer loyalty are driven by customers' characteristics and capacity to engage with LPs.
"Many customers don't have the time to do a mental cost-benefit analysis. What am I getting, and what am I giving up? Retailers know this, so they'll prompt you at the checkout before you pay, either at a self-service checkout or through a customer service representative asking: 'Do you want to scan your rewards card?
Do you want to scan your Flybuys card?' Retailers know how to reinforce our habit," Roy explained. "But as customers, we are losing more than we are gaining. If we earn one point for every dollar spent, and every 2,000 points we receive a $10 voucher—is it worth handing over our personal data when discounts and promotions aren't being personalized or tailored to our buying habits as a reward for our loyalty?
Therefore, is it worth signing up for loyalty programs?" The results show that LP engagement leads to retailer engagement and customer loyalty—both in attitude and behavior toward a customer's retailer of choice. "If a customer predicts there will be a future discount on an item they frequently purchase, they may wait a week or two to buy it and buy more of the same product. But if they don't have the capacity to wait—like a parent desperately needing diapers or with too tight a budget to buy in bulk—they will miss out on the discount despite their loyalty to the retailer," Dr.
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