Nov 12, 2018

Consumers extend purchasing power with rewards programs

As consumers adopt new means to shop for the holidays, they continue to leverage innovative ways to extend their purchasing power. Eighty-four percent of consumers are planning to shop at a store where they are a rewards member, specifically so that they can accumulate discounts and/or rewards points. This is one of several key findings of the Citi Retail Services (CRS) third-annual Holiday Survey.

Sixty percent of rewards members have opted not to use their rewards on purchases throughout the year so they can allocate them toward a holiday gift, the study found.

Further, more than one-quarter of shoppers (26 percent) anticipate they will save $200 or more this holiday season, thanks to their rewards programs. Millennials and Gen Xers (born 1961-1981) lead the way with 33 percent and 28 percent, respectively, expecting to save $200 or more by leveraging rewards.

And with retailers continuing to see strong enrollment in rewards programs there’s an immense opportunity to engage consumers in these crucial moments. Eight out of 10 consumers are currently enrolled in at least one rewards program, with one in four (26 percent) belonging to five or more. In addition, the CRS research showed that consumers are keenly aware of which rewards programs they are enrolled in, with nearly nine out of ten (88 percent) – and 95 percent of millennials – confirming they are more loyal to stores where they are a rewards member.

Other key findings include:

• Amongst those who will buy gifts this holiday season, over a third (37 percent) plan on spending more than they did last year, and 69 percent plan to kick off their holiday shopping before, or on, Black Friday. And while millennials and Gen Xers are getting a head start on their shopping (74 percent of millennials and 77 percent of Gen Xers are starting to shop before, or on, Black Friday), Boomers are largely doing the opposite with 40 percent waiting to start their shopping after Black Friday. Given the volume of gifts both received and given during the holiday season, returns are inevitable. Almost half (48 percent) of consumers admit to exchanging a gift and purchasing another item, either for themselves or for someone else.

• But again, when it comes to returning holiday gifts, behavior is generational and therefore, evolving over time. While 74 percent and 76 percent of millennials and Gen Xers admitted to returning a holiday gift, only 59 percent of Boomers have done the same.

Citi Retail Services surveyed 1,000 U.S. adults for the third-annual Holiday Survey.

Source: Citi Retail Services