Here Are the 12 Best Industries for Loyalty Programs

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The world has many industries and with advancements in tech, they are likely to continue increasing. In today’s blog post, we will be talking about the top industries for loyalty programs.

Loyalty programs are a great way to retain customers. But have you ever wondered what industries might be more fitting for a loyalty program over others?

That’s what we’ll be answering today 🙂

Why do I need a loyalty program?

Whether your store is an online or offline business, a loyalty program is one of the top ways to retain current customers and attract new ones.

Don’t take it from me, take it from the data.

According to data compiled by Neil Patel, acquiring a new customer can cost “up to 7 times more than selling to existing customers.”

In addition, the likelihood of selling to a new customer ranges between 5% and 20%. This number surges to 60% to 70% when selling to a current or retained customer.

So the need for loyalty marketing and a loyalty program is clear.

You want more customers, more return customers, and you want to grow your business.

Did I miss anything?

Industries for Loyalty Programs

Now that we have quickly summed up the main benefits of a loyalty program, it’s time to discuss the industries that work best when coupled with a loyalty program.

The industries mentioned in this article are the top ones we have seen benefit from loyalty programs, whether created by Gameball or by others. It’s worth mentioning that this list is not arranged in any order whatsoever.

Here goes:

  • Restaurants

Restaurants are one of the top areas or industries where you’re likely to find a loyalty program. Why? Because restaurants want regular consumers and fans.

Restaurants rely on customers coming to them over and over.

By having a loyalty program, restaurant and bar owners can offer perks to their customers in exchange for loyalty towards their brand. Such perks can include special discounts and free items.

It’s worth mentioning that amid COVID-19, restaurants have a bigger chance of attracting new and current customers with loyalty programs. This is especially true for restaurants, bars, and eateries that offer food delivery and takeout.

According to Restaurant.org, the restaurant industry’s sales are expected to grow by 4% year-on-year in 2020 to $899 billion.

The research, which isn’t clear if it was published before or during COVID-19, cites the reason for this growth as “consumers’ pent-up demand for restaurants [being] high.”

Similarly, ResearchAndMarkets.com expects the Restaurant Consumables market to see “a stable growth rate” between 2020 and 2026, backed by a rise in demand from emerging markets.

“Increasing family disposable incomes coupled with strengthening buyer power will support the Restaurant Consumables market growth between 2020 and 2026,” the research shows.

  • Coffee Shops

The coffee shop experience is known all over the world. That said, it has dwindled with the emergence of COVID-19.

Even prior to COVID-19, coffee shops were known to be among the top industries for loyalty programs. Many chains have such programs in place, including Starbucks.

But as countries and coffee shops begin reopening and with many now offering takeout, home delivery, or delivering to people and cars waiting outside, the need for a loyalty program grows.

You want to build – or in many cases rebuild – your relationship with your customers. Your loyalty program will do that.

Customers are eager to return to their favorite – or new – coffee shops and enjoy the experience once more. But they are also still worried about the effects of COVID-19 and social distancing.

Armed with a loyalty program, your business can entice customers and keep them coming back.

  • Fashion

It shouldn’t come as a surprise that fashion should be on the list of the best industries for loyalty programs.

Fashion and apparel include clothing, swimwear, sportswear, footwear, and any types of wear I might have missed.

The global apparel market is forecast to grow to $1.5 trillion in 2020 from $1.3 trillion in 2015, according to data published by Statista in March, citing higher demand for clothing and shoes across the globe.

“The regional distribution of the demand share of apparel is expected to stay mostly consistent in that period, although the Asia Pacific region had the highest level of growth at 4%,” Statista explains.

It adds that the three regions with the largest apparel markets are the European Union’s 28 member states, the United States, and China, in descending order.

It’s worth noting that in 2017, sportswear was the apparel category with the highest level of global market growth. It grew by 6.8% that year.

People buy clothes for different reasons, whether it’s a new job that requires formal clothing or a soiree event, a cocktail party or someone looking for a change to their wardrobe, or even someone getting ready to take the beach by storm (we know we are!)

The bottom line is, having a loyalty program if you sell any type of clothing can help get your repeat customers and keep them loyal to your brand.

That way, when customers think they want add a new piece of clothing to their wardrobes, your store will be the first they think of.

  • Cosmetics 

A bit similar to fashion but even more so, cosmetics is a constantly booming industry, as Gen Z and Millennial women make up a large portion of cosmetics buyers.

For a company or brand offering cosmetics, it’s important that they stay updated with the latest trends and consumer habits.

One of the world’s famous loyalty programs is in the cosmetics industry. It’s Sephora’s loyalty program, also known as the Beauty Insider Program.

Sephora’s program is considered as one of the most innovative and successful loyalty programs in the world.

The makeup company has even created a community via its loyalty program, which offers perks to both new members and mega perks to its VIPs or rather hard-core buyers.

It’s worth noting that the global cosmetics market is expected to hit $438.38 billion by the end of 2026, says to a report published by Fortune Business Insights. This figure is comparable to $297.61 billion in 2018.

  • Vitamins and Supplements

We’ve all overspent our stay at home amid this pandemic and have probably added a few pounds along the way.

But even before COVID-19 made its unpleasant presence and apparently lingering stay, vitamins and supplements held great value and opportunity when it came to loyalty programs.

The industry relies on repeat purchases. Athletes and people who work out regularly take vitamins and supplements regularly as well. They may even need to make purchases more than once a month.

“The global dietary supplements market size is projected to reach $230.73 billion by 2027, registering a CAGR of 8.2% over the forecast period,” a report by ResearchAndMarkets.com says.

It notes that the market is “backed by rising health awareness globally among consumers of all age groups coupled with a considerable rise in the number of fitness centers and gymnasiums.” The report was released in March 2020.

Moreover, Statista reports that the vitamins and nutritional supplements’ industry revenues logged $31 billion in the United States alone in 2018, projecting “a billion more in revenue in 2019.”

“When asked why they used dietary supplements, most consumers answered that they did so for overall health and wellness benefits,” Statista says.

  • E-cigarettes

A surprising or not-so-surprising industry for loyalty programs is e-cigarettes and vaping. The reason is that the e-cigarette is used several times a day, which means smokers need to constantly refill their e-cigarettes or vapes.

This offers a massive opportunity for any business with a loyalty program. Why? Because you can entice customers early on to get rewards for buying from you. Plus they will be buying regularly, making them great repeat customers.

In 2019, the global e-cigarette market hit $13 billion, according to data by imarc group.

“E-cigarettes are gaining popularity, especially among young adults and adolescents, due to the rising awareness about the harmful effects of traditional tobacco-based cigarettes,” the report says.

Moreover, MarketWatch reports that the e-cigarettes market is likely to “keep experiencing a greater level of competition with a growing number of players focusing on securing a larger market share.”

  • Hotels and Airlines

An off-the-beaten-track industry right now but one that has been known to entice customers with loyalty programs over the years is the tourism industry. This includes hotel chains and airlines.

It’s no surprise that travelers, whether for business or pleasure, like to cut down on some costs or get extra benefits during their hotel stays.

Hotel chains are able to offer that and keep customers going to their hotels regardless of the countries they visit.

However, it’s important to remember that this type of loyalty program is more long-term than others.

According research by Siteminder, around 20% of survey participants in the hotel industry said they didn’t join loyalty programs “because the offerings simply don’t interest them,” whereas 60% said they wished they could choose their rewards.

As mentioned, loyalty programs rely on the accumulation of points, which later translates into benefits for customers.

In the hotel and hospitality industry, such rewards can include discounted luxury dinners for two, room upgrades, discounts when visiting the same chain in different locations, free services, etc.

“Remember that every traveler is unique and personalization is key. The best rewards program will play to this and have the most success in developing loyalty,” says Siteminder.

A popular loyalty program is by Marriott hotels, called The Marriott Bonvoy program. It encompasses a large network of hotels in popular destinations across the United States, Asia, and Europe.

Marriott loyalty program customers can also earn rewards points when they stay at Marriott’s affiliate brands such as the St. Regis or Ritz-Carlton hotels.

  • Hair salons

When loyalty programs first began, hair salons in the United States were among the top locations to implement them. The case is fairly different in the Middle East and other regions.

But with the ongoing situation, many people have reduced the number of times they go to a hair salon. But with the world beginning to open up more, having a loyalty program should be a great fit for your business.

Mix that with great customer service and spotless table tops and customers will want to come to you rather than your competitors.

  • Pet supplies

Pet supplies are among those products that people need to buy regularly, and therefore when customers like a brand they commit to it.

Having a loyalty program can easily attract new customers to you and keep current ones engaged and hooked.

After all, pet food is known to be quite expensive, so with a loyalty program that includes special savings, promotions, and discounts, you can be sure that both customers and pets will want your brand.

  • Gyms and Spas

Another industry that’s a great fit for loyalty programs are gyms and spas. While some gyms offer spa options within the premises, these two can be two entirely different locations.

However, many gym brands collaborate with spa brands to offer a full package to people working out.

Whether your brand is a gym, spa, both, or a collaboration, a loyalty program can help excite customers. You can entice customers who go to your gym to discover your spa or the other way round.

You can even incorporate supplements and vitamins in the mix for a full workout experience. Get creative with your loyalty program and offerings.

  • Supermarkets

Last on the list but certainly not least is supermarkets.

Despite the obvious need to go to a supermarket, they can be a great industry for loyalty programs.

It’s natural that you go to the supermarket a couple of times a week. Some people like to compile everything and just buy a week’s worth of food during the weekend.

To each their own. But when it comes to supermarkets and essential products, a loyalty program entices customers.

Usually supermarket loyalty programs involve accumulating points that later translate into vouchers and discounts. They are sometimes standard.

But if you have a boutique supermarket or even a chain, a good loyalty program will excite customers and invite them to come to you.

A note however, supermarket loyalty programs shouldn’t rely on merely accumulating points with no real value at the end. That’s based on some personal experience.

You should also explain to customers how the loyalty program works. Tell them which products accumulate more points than others and what value they get when using your loyalty program.

Book Stores

Contrary to common belief, there are many bookshops still out there. And I’m not just saving the best for last.

Readers, or rather bookworms, purchase books on a regular basis and they constantly look for offers and special discounts.

Have you ever walked into a book store to just buy one book? If you’re a bookworm, like me, you’re probably thinking “Nah!”

Let’s not forget author Charlaine Harris’s famous quote: “Here’s to books, the cheapest vacation you can buy.”

Learn more about customer engagement in 10 Strategies to Grow Customer Engagement and Loyalty in E-commerce

Bonus Tip from Gameball

Loyalty programs come in various forms and differ based on industry, product, store, and business. But one method that we have found often supports loyalty programs is having a referral marketing program.

By coupling your loyalty program with a referral program, you can make your brand even more memorable for your customers. You can make the buying experience a win-win for you and your customers.

Read “Make the Most Out of Your Referral Program.”

Final Comments

It’s also important to remember that loyalty programs are about give-and-take. If you brand focuses on only “taking” from customers, people will label it a bad loyalty program and leave.

If you’re looking for some inspiration, we have compiled a list of the world’s best loyalty programs.

Now that we’ve tackled the top industries for loyalty programs, we recommend you visit this list of the top points to consider before creating your loyalty program.

1 comment
  1. This is really insightful, Nada. 😍 The introduction section is truly intriguing, not to mention, of course, the transition to the interesting, data-based list.😍 Excellent work as per usual 👏👏. Keep it up.✌️

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