For Immediate Release
Citigroup Inc. (NYSE: C)
November 21, 2017

Shoppers Boost Holiday Purchasing Power Through Customer Loyalty Programs


Citi Retail Services study shows rewards shoppers expect to save $149 this season

Chicago/New York – A new nationwide study commissioned by Citi Retail Services has discovered that more than two thirds of Americans who participate in rewards programs expect to save money this holiday shopping season through their redemptions. While the average customer expects to save $149, one in three expect to save $200 or more. The survey also found that aptly named "loyalty programs" are very effective with 86 percent of customers saying they are more loyal to the brands where they participate in rewards programs.

"In a world where everyone is talking about immediate gratification and flash sales, customers are taking proactive means to plan out their spending and stretch their budgets in a strategic way. We found that two thirds of consumers join a rewards program even if it did not result in instant savings," said Leslie McNamara, Managing Director, Business and Market Development for Citi Retail Services. "Customers are taking a holistic approach to their holiday shopping by researching their purchases, joining rewards programs and consolidating their spending at specific retailers or on designated payment products to achieve hard dollar savings during the holiday season. In fact, 72 percent of rewards users told us they think they're smarter holiday shoppers than their peers, and 67 percent of shoppers said they have already taken extra steps to accrue or redeem rewards."

Rewards Are a New Currency

Shoppers are treating their rewards like a separate currency, accruing and spending strategically to boost their holiday purchasing power and stay on budget. Citi Retail Services' survey found that shoppers:

  • Use rewards to buy more gifts than they would otherwise (50 percent)
  • Use rewards to buy gifts for someone they wouldn't otherwise (26 percent)

But some shoppers are saving those rewards for themselves: 41 percent of shoppers said they plan to use their rewards treat themselves to purchases they otherwise wouldn't make. The average shopper participates in four rewards programs and nearly 90 percent of shoppers plan to utilize those programs during the holidays to either accumulate points or redeem existing ones.

"We are seeing a general trend, but especially during the holidays, of customers making concerted efforts to be strategic about how and when they use their rewards, said Terry O'Neill, Managing Director, Head of Product, Marketing and Analytics at Citi Retail Services. "It's not just about leveraging rewards as a "bonus," but rather seeing it as a new type of currency that has a genuine impact on purchasing decisions and extends their wallet. While loyalty programs continue to evolve to include experiences, many shoppers are still drawn to the hard dollar value and are tapping into their accumulated rewards during the holidays to extend their purchasing power."

Shoppers Are Serious About Their Rewards

Citi Retail Services found that some savvy shoppers are taking steps to maximize their rewards programs. Survey findings indicated that some shoppers are consciously spending with the purpose of getting more in return—especially when bonus rewards or points promotions are underway. In order to accomplish this, shoppers buy more of something, like the common practice of buying in bulk (42 percent), or shop at odd times to take advantage of flash sales, such as very late at night (25 percent). And there is good reason to be serious about rewards—while there is no central repository of information on just how much of this "currency" exists nationally, estimates put the value of the total rewards market at more than $320 billion, projected to grow to $500 billion by 2019.

Rewards Appeal to Everyone

Shoppers across the country, in all regions, participate in rewards programs at high rates, with eight in ten consumers belonging to at least one rewards program. On top of that, each part of the country boasts a significant number of "very active rewards users," with Northeasterners (36 percent), Southerners (24 percent), Midwesterners (27 percent) and Westerners (27 percent), participating in 5 or more rewards programs. Nationwide, shoppers are concentrating their spending on fewer brands, getting more bang for their buck.

Rewards programs are also popular among all age groups with Millennials as the most avid reward seekers (83 percent). Generation X closely follows (73 percent), with approximately one in two Boomers (54 percent) participating in rewards programs.

"Rewards programs continue to be a bright spot and clearly resonate with consumers across the country, regardless of age," added McNamara. "There's an emotional element to redeeming rewards during the holiday season so we can buy thoughtful gifts for our loved ones without experiencing financial stress. This is a remarkable experience for many shoppers that deepens their relationship with a brand all through the year."

Rewarding Loyalty

"The holidays are a time when retailers give back to their most loyal customers through special deals and incentives," says McNamara. "Loyalty program members can look forward to added value when they redeem or earn new rewards from retailers that are committed to strengthening ties with their most dedicated shoppers."

Citi, the leading global bank, has approximately 200 million customer accounts and does business in more than 160 countries and jurisdictions. Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services, and wealth management.

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Media Contact
Deirdre Leahy, 212-559-3296

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