Joan Driggs
Vice President,
Content and Thought Leadership
March 2021
CONSUMER CONNECT:LOYALTY SNAPSHOT
Q1 2021
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Executive Summary
As seen throughout 2020, consumers report they prefer to shop fewer stores and are
less inclined to clip coupons. Their desire to shop deals remains strong.
Consumers are interested in personalizing their loyalty experience.
Among subscription service vendors, Amazon Prime holds the strongest lead, followed
by Chewy for pet products, and Walmart+.
Drug and grocery channels lead in loyalty/reward adoption, with high-income households
most likely to hold reward memberships across the most channels.
Despite the turmoil of 2020 due to COVID-19, consumers’ attitudes toward their
household financial health remains similar in 2021.
Consumer sentiment took a tumble among the dual health and financial crises of 2020
but is showing strong signs of recovery in early 2021.
Consumers want to see new benefits and experiences as a reward for loyalty.
Benefits influence membership and membership influences which stores to shop.
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Consumer Sentiment Index
February 2021
Consumer Sentiment Is Trending Back Up From Dismal 2020
92.991.8
96.8
98.4
96.0
87.3
80
85
90
95
100
105
20212015 2016 2017 2018 2019 2020
81.5
Source: IRI, based on University of Michigan; Moody’s Analytics Forecasted 2021
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Despite Higher Unemployment and Economic Challenges
Consumers’ Financial Health Remains
Fairly Consistent to Year-Ago Levels
Agree With Statement Much More/Somewhat More
Source: IRI Consumer Connect™, Q1 2021
Household's Financial Situation
43%
40%
25%
46%
41%
24%
My household's financial
health is strained
My household is making sacrifices
to make ends meet
My household is having difficulty
affording needed groceries
Q1 2020Q1 2021
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Consumer Grocery Shopping Behavior
Total Population
Consumers Shopping Fewer Stores to Seek Deals
and Show Less Interest in Clipping Coupons
86%
82%
81%
72%
57%
52%
31%
27%
87%
83%
82%
71%
60%
60%
27%
26%
Order online and pick up in store
Visit multiple retailers to keep my grocery bill lower
Make an effort to purchase my needed groceries
when they are “on sale” or on deal
Buy store brand products to save money
Make additional or unplanned purchases
if in-store deals are good
Try new, lower priced brands to save money
Order online for home delivery
Clip coupons from circulars/newspapers
Q1 2020Q1 2021
Frequently/Occasionally Summary
Source: IRI Consumer Connect™, Q1 2021
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Consumer Grocery Shopping Behavior
Total Population
Good Value, Convenient Store Location and Strong Loyalty Card
Discount Programs Are Key Drivers in Choosing Where to Shop
95%
94%
94%
92%
91%
87%
74%
94%
94%
95%
92%
90%
86%
76%
Allows me to fill my basic needs
at the lowest possible cost
Good sale prices
Quick and easy in-and-out
Lowest everyday prices
Convenient store location
Assortment that allows for one-stop shopping
Strong loyalty card discount program
Q1 2020Q1 2021
Very/Somewhat Important Summary
Source: IRI Consumer Connect™, Q1 2021
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Dollar Shave Club
Subscription Services
Total Population
Amazon Prime, Chewy and Walmart+ Are the
Top Subscription Services Among Consumers
Source: IRI_SubscriptionServices_January'21_Omnibus
51%
7%
4%
3%
2%
2%
2%
1%
1%
1%
43%
Dollar Shave Club
Chewy
Amazon Prime
Walmart+
Instacart Express
HelloFresh
Shipt
Grove Collaborative
BarkBox
Thrive Market
None of these
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Shopper Loyalty Card/Rewards Membership
Total Population
Drug, Grocery and Online Paid Programs Are
Top Shopper Loyalty/Rewards Membership Choices
74%
69%
56%
51%
43%
35%
27%
26%
16%
Convenience (such as 7-Eleven, Circle K)
Specialty Beauty (such as Ulta, Sephora)
Grocery (such as Kroger, Safeway)
Food/Beverage Restaurant
(such as Starbucks, Dunkinʼ)
Drug (such as CVS, Walgreens)
Online with annual fee (such as
Amazon Prime, Walmart+, Shipt, Instacart)
Club (such as BJ’s, Costco)
Mass/Supercenter (such as Walmart, Target)
Dollar (such as Dollar General, Family Dollar)
I have a shopper loyalty card/rewards membership Summary
Source: IRI Consumer Connect™, Q1 2021
Q1 2021
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High-Income Group More Likely to Have Shopper
Loyalty/Rewards Membership Across Most Channels
19%
30%
23%
74%
71%
55%
39%
37%
28%
30%
28%
14%
81%
80%
70%
64%
55%
44%
35%
Club
29%
49%
Grocery69%
Drug
35%
Online with annual fee
Mass/Supercenter
22%
Food/Beverage Restaurant
Specialty Beauty
Convenience
Dollar
66%
78%
62%
59%
37%
31%43%
60%
44%
21%
18%
9%
< $35K $55K-$99.9K$35K-$54.9K > $100K
80%
64%
60%
53%
35%
68%
52%
61%
36%
79%
71%
52%
32%
16%
70%
51%
51%
28%
10%
3%
19%
32%
55%
Specialty Beauty
47%
Drug
Grocery
Club
Online with annual fee 60%
Convenience
Dollar
70%
76%
63%
15%
66%
41%
67%
46%
Mass/Supercenter
29%
5%
17%
50%32%
15%
51%36%
Food/Beverage Restaurant
20%
34%
25%
11%
Millennials SeniorsGen Z Gen X Boomers
Agree With Statement
Source: IRI Consumer Connect™, Q1 2021
Shopper Loyalty Card/Rewards Membership
By Income
Shopper Loyalty Card/Rewards Membership
By Generation
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Reasons For Obtaining Shopper Loyalty Card/Rewards Membership
Total Population
Free Membership, Gas Discount and Ability to Spend Points Are
Main Reasons Consumers Subscribe to Shopper Loyalty Programs
74%
56%
55%
39%
38%
38%
35%
25%
13%
12%
Membership benefits made it
worth the annual fee
Personalized or special offers
It was free
Gas/fuel discount
Ability to accrue points to spend
Access to special members-only events
Cash reward
Free beverage/food item
Access to new product(s)
Option for mobile checkout
Base=Those Respondents Who Have Shopper Loyalty Card/Rewards Membership
Source: IRI Consumer Connect™, Q1 2021
Q1 2021
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Free Membership Is the Top Reason Among Income Groups
While Ability to Spend Points Is Important to Mid-Income Groups
75%
36%
38%
37%
25%
16%
14%
76%
56%
57%
35%
25%
74%
61%
57%
44%
41%
40%
35%
26%
13%
11%
77%
55%
43%
41%
47%
34%
11%
14%
Gas / fuel discount
32%
Ability to accrue points to spend)
13%
It was free
Free beverage/food item
Cash reward
Access to special
members-only events
Personalized or special offers
Membership benefits made
it worth the annual fee
Access to new product(s)
Option for mobile checkout
54%
36%
33%
12%
51%
58%
27%
23%
< $35K $35K-$54.9K $55K-$99.9K > $100K
Base=Those Respondents Who Have Shopper Loyalty Card/Rewards Membership
Source: IRI Consumer Connect™, Q1 2021
77%
41%
71%
28%
50%
28%
22%
6%
77%
60%
44%
42%
44%
28%
19%
16%
76%
56%
39%
41%
27%
16%
57%
38%
39%
28%
10%
66%
42%
46%
36%
24%
13%
16%
9%
3%
Free beverage/food item
It was free
Membership benefits made
it worth the annual fee
Cash reward
Gas / fuel discount
Ability to accrue points to spend)
Personalized or special offers
Access to special
members-only events
Option for mobile checkout
Access to new product(s)
35%
34%
55%
22%
28%
18%
72%
61%
51%
44%
35%
40%
13%
9%
Millennials Gen XGen Z Boomers Seniors
Reasons for Obtaining Shopper Loyalty
Card/Rewards Membership
By Income
Reasons for Obtaining Shopper Loyalty
Card/Rewards Membership
By Generation
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Expected Services/Benefits With a Paid Membership
Total Population
Free and Same-Day Delivery and Access to Wider
Assortment Are Top Paid Membership Expectations
58%
39%
31%
28%
27%
23%
21%
19%
16%
Access to wider assortment
than what's found in-store
Prescription delivery
Pickup
Same-day delivery
Ability to communicate with personal shopper
No minimum order for free shipping
1-day delivery
2-day delivery
Checkout from phone if I shop in the store
Base=Those Respondents Who Consider/ Not Interested In Having Shopper Loyalty Card/Rewards Membership For Online With Annual Fee
Source: IRI Consumer Connect™, Q1 2021
Q1 2021
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Among Generations, Gen Xers and Boomers Expect
Free Shipping Without Order Limit From Paid Membership
39%
31%
30%
21%
22%
17%
28%
65%
41%
19%
21%
18%
45%
33%
26%
35%
19%
19%
21%
65%
29%
18%
24%
19%
Checkout from phone if
I shop in the store
No minimum order
for free shipping
Access to wider assortment
than what's found in-store
Same-day delivery
26%
Pickup
Prescription delivery
1-day delivery
2-day delivery
Ability to communicate
with personal shopper
55%
58%
38%
20%
35%
20%
25%
22%
31%
17%
24%
< $35K $35K-$54.9K $55K-$99.9K > $100K
Base=Those Respondents Who Consider/Not Interested In Having Shopper Loyalty Card/Rewards Membership For Online With Annual Fee
Source: IRI Consumer Connect™, Q1 2021
41%
15%
41%
36%
34%
35%
15%
24%
25%
54%
41%
28%
32%
26%
24%
31%
18%
24%
61%
48%
36%
32%
34%
21%
26%
20%
24%
60%
38%
23%
52%
24%
30%
24%
18%
12%
7%
14%
17%
No minimum order
for free shipping
Same-day delivery
Ability to communicate
with personal shopper
Pickup
Access to wider assortment
than what's found in-store
1-day delivery
23%
2-day delivery
Checkout from phone if
I shop in the store 17%
Prescription delivery
29%
28%
17%
14%
MillennialsGen Z Boomers SeniorsGen X
Expected Services/Benefits
With a Paid Membership
By Income
Expected Services/Benefits
With a Paid Membership
By Generation
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Loyalty Across the Generations
Gen Xers Lead in Loyalty Program
Adoption and Use, Followed by Millennials
Source: The truth about customer loyalty, KPMG international, 2019
Source: https://home.kpmg/xx/en/home/insights/2019/11/customer-loyalty-survey.html
Loyalty Program Adoption Writing Positive Reviews
Loyalty Program Use
Enrolled in one of five loyalty
rewards programs
Likely to write positive review
About a brand they are loyal to
Make purchases that earn rewards/benefits
several times a week
54%
57%
60% 71%
66%
59%
40%
44%
40%
Millennials
(born 1982-1999)
Generation X
(born 1965-1981)
Baby Boomers
(born 1946-1964)
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Willing to Pay for Annual Membership
Total Population
More Than Four in 10 Consumers Are Willing
to Pay for Annual Membership of $50 or Less
20%
10%
14%
3%
5%
1%
48%
$50
$100
Under $25
$25
$75
Not willing to pay
$125 or more
Base=Those Respondents Who Consider/ Not Interested In Having Shopper Loyalty Card/Rewards Membership For Online With Annual Fee
Source: IRI Consumer Connect™, Q1 2021
Q1 2021
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Influence of Shopper Loyalty Card/Rewards Membership Program on Shopping at Store
Total Population
Shopper Loyalty Programs Influence Choice of Stores to Shop
Agree With Statement
Source: IRI Consumer Connect™, Q1 2021
22%
51%
17%
10%
Extremely influential
Not very influential
Somewhat influential
Not at all influential
Q1 2021
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Reasons for Canceling Shopper Loyalty Card/Rewards Membership
Total Population
About a Third of Consumers Cite Membership Fees
as the Main Reason for Canceling a Loyalty Program
Agree With Statement
Source: IRI Consumer Connect™, Q1 2021
32%
30%
28%
16%
12%
6%
6%
3%Did not know I was signing up for a shopper
loyalty card/rewards membership
I no longer shop at the retailer
Due to privacy concerns/do not want
to share my personal information
Do not need the products the retailer sells
I don’t want to pay for membership
Didn’t want to pay an annual fee for membership
Not worth the hassle
I have too many loyalty cards
Q1 2021
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Across Generations, Gen Z Cites the Most
Reasons for Canceling a Loyalty Membership
34%
31%
26%
17%
11%
6%
5%
4%
32%
29%
25%
18%
13%
8%
7%
3%
32%
34%
33%
14%
13%
6%
6%
3%
33%
28%
31%
17%
13%
9%
6%
1%
I no longer shop at the retailer
I don't want to pay
for membership
Did not know I was signing up for a
shopper loyalty card/
rewards membership
Didn't want to pay an annual
fee for a membership
Do not need the products
the retailer sells
Not worth the hassle
Due to privacy concerns/do not want
to share my personal information
I have too many loyalty cards
< $35K $35K-$54.9K $55K-$99.9K > $100K
Agree With Statement
Source: IRI Consumer Connect™, Q1 2021
55%
45%
34%
17%
17%
5%
9%
19%
10%
7%
34%
30%
32%
12%
5%
2%
30%
15%
12%
4%
6%
2%
22%
19%
13%
11%
3%
7%
2%
Didn't want to pay an annual
fee for a membership
Do not need the products
the retailer sells
I don't want to pay
for membership
14%
I no longer shop at the retailer
I have too many loyalty cards
Not worth the hassle
Due to privacy concerns/do not want
to share my personal information
Did not know I was signing up for a
shopper loyalty card/
rewards membership
37%
5%
30%
0%
33%
23%
30%
27%
16%
7%
Gen Z BoomersMillennials SeniorsGen X
Reasons for Canceling Shopper
Loyalty Card/Rewards Membership
By Income
Reasons for Canceling Shopper
Loyalty Card/Rewards Membership
By Generation
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Survey Question
Indicate if You Agree With the Following Statements About Loyalty Programs
Consumers Are Interested in Personalizing Every Element
of Their Loyalty Experience, From Earning to Redeeming
Source: https://www.merkleinc.com/thought-leadership/white-papers/2020-loyalty-barometer-report
85%
76%
74%
73%
72%
67%
64%
Recognize me as a member
Personalize the way I earn based on my purchases
Allow me to select benefits and rewards I receive
Personalize the way I earn based on my preferences
Show me products/services based on preferences
Offer personalized rewards
Show me products/services based on purchases
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 20
Source: https://home.kpmg/xx/en/home/insights/2019/11/customer-loyalty-survey.html
About
Benefits
for retailers
Challenges
for retailers/
customers
Point-based loyalty
reward cards with
point accumulation
on every purchase
Access to purchase-
related data
Low customer
participation/retention
— unused points act as
liability for the retailers
Advanced loyalty
reward cards, offering
vouchers/coupons in
addition to redeemable
points
Multi-brand, tier-
based loyalty reward
cards with an option to
use across multiple
retail brands
Privilege loyalty
program with
personalized and
customized offers
Umbrella loyalty
program with
enhanced convenience
— everything under
one ecosystem —
along with rewards
Enables cross-selling,
product bundling —
using insights derived
from transactional data
Enhanced customer
engagement — one
card for a group of
retailers
Increased engagement
— offers ecosystem
of value, service and
content; additional
income as subscription
fees
Ability to offer
integrated experiences
between online and
offline channels; tracks
the entire consumer
behavior inside the
ecosystemUnable to meet
growing customer
demand of those who
seek more value than
just reward points or
vouchers
Expensive scheme for
retailers with little
customer insight
around each individual
brand
No tier-based rewards;
no single interface
to access grocery
shopping, video
or music
Available in China and
U.S., but other countries
may rely on outside
delivery, with no
home/overnight delivery
Phase
01Phase
02Phase
03Phase
04Phase
05
Examples* MasterCard Rewards
*Note Examples based on above program definitions
DSW VIP program Lancôme tiered
loyalty programRun Everything Labs
Rewards
Amazon Prime
Retailers Expand From Point-Based Loyalty Programs
Retailers Are Moving Toward Integrated and Unified Rewards
Programs to Provide Personalized Offers and Experiences
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To Succeed, a Loyalty Ecosystem Should Be
Centered Around Seven Design Principles
Shared Consumer in Mind
The program must be highly personalized to the individual consumer, leveraging the full stack of consumer data across brands
to offer personalized messages, offers and experiences. Brands should mutually understand the value of the consumer.
Brand Synergy
The program must be structured to elevate brand equity. Every brand must have an important role in the given ecosystem and
provide value to that ecosystem through its products and/or services.
Diversity of Products and Services
The program must provide consumers with value through tangible goods, services or experiences in order to reinforce the
program’s underlying appeal. Brands should develop common features and benefits together.
Seamless Consumer Experience
Sign-ups, use and redemption must be intuitive and responsive, keeping the program simple for consumers.
All-In Brand Commitment
Companies must be willing to commit to the partnership, allocating adequate marketing spend and having clear agreements
about sharing consumer data in a way that adheres to all relevant regulations.
Alignment on Governance Process
Brands should enter the partnership with aligned strategies and goals, defined roles and responsibilities, and a process for
managing risk effectively.
Data and Tech Focused on Connectivity
Brands will need to ensure, within the confines of the shifting regulatory landscape, that their data can be exported or used as
needed — for example, through the use of application programming interfaces (APIs). Brands within the ecosystem need to
commit to standards and processes for tracking key performance indicators, adhering to regulations, and establishing
protocols for connecting technologies and sharing data.
Source: https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/preparing-for-loyaltys-next-frontier-ecosystems
1
2
3
4
5
6
7
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 22
About the Consumer Connect Index
The Consumer Connect Index (CCI) is intended to monitor
consumers’ financial health and their purchase behavior in terms
of brand loyalty, attitudes toward organic/natural food and
beverages, perception of national vs. store brands, and frequency
of using retailer and manufacturer coupons.
CCI uses the data collected through the Consumer Connect
Survey every quarter, which is benchmarked to Q1 2020
(indexed at 100).
Higher CCI index means that consumers have better financial
health, are more loyal to certain brands in each category, give
higher importance to organic/natural food and beverages, have
better perception toward national brands, and use retailer and
manufacturer coupons less frequently.
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 23
Measures
CCI is measured based on responses to five questions:
1. My household’s financial health is good (Agreement Scale)
2. Store brands are a better value than national brands (Agreement Scale)
3. Download coupons from a retailer/manufacturer website (Frequency Scale)
4. Good selection of natural/organic food/beverages (Importance Scale)
5. I have a few brand(s) in each category I will stay loyal to (Frequency Scale)
Calculation
Calculate weighted
proportion for each
question by 3 age
groups — (T2B for all
questions except B2B
for the 3rd question).
Get total weighted
proportion based on
each question
CCI = (current
quarter’s weighted
average of all 5
questions divided by
the average of Q1
2020)*100
Sample and Assumptions
The Consumer Connect Survey is fielded to a nationally representative Consumer Network sample of over
2,000 respondents every quarter. Sample demos are comparable over time and changes in the state of the
economy and the CPG industry are reflected in each quarter.
Methodology
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Confidential and Proprietary.24
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