Why is 2025 the Year of the Loyalty Scheme?

It’s a new year, so it’s time to collate our results, refocus our strategies, and strive to grow bigger than ever. One essential ingredient to catapult your 2025 to the next level is the implementation of a successful loyalty programme to ensure that you can keep pace with the competition and deliver exactly what your customers are asking for.

Loyalty Schemes have become ubiquitous across the retail sector, and have found success in service-based industries too, so no matter what your business is, you will not want to miss out on utilising this all-important tool that continues to rise in popularity.

To help you understand why loyalty programmes are so essential to success in 2025 we have put together this mini-guide to help you understand all you need to know about the benefits of loyalty schemes, reward systems, and how to build long-term customer loyalty by implementing them successfully.

The Data: 9 Out of 10 Consumers Value Loyalty Programmes

So, let us start by breaking down some cold hard facts. The eminent statistics company YouGov surveyed 1,000 adults in the UK asking them various questions about Loyalty Schemes. Their findings highlight just how essential loyalty programmes have become to the Great British public. 

The most important statistic they found is that currently 9 out of 10 Britons are already signed up for some kind of loyalty programme and 80% of those memberships are to supermarket loyalty programmes. This means that Tesco and Nectar loyalty programmes lead the way, have the most visibility and are recognised and known by most British people. We then follow with Boots, Morrisons, Asda and M&S as the next most well-known loyalty schemes. 

Loyalty programmes are well known and well-loved by Britons, but Supermarkets have found the magic formula that attracts the most people to their programmes. And this makes sense when we look into it, as supermarkets are essential retailers, they are stores we will constantly visit and never have a reason not to visit. Whether it’s daily, weekly, or even monthly shops, whether we visit the store or order online, we will always need groceries. Because supermarkets are so essential to our lives, the public is looking for ways to save money and reap rewards whilst undergoing daily, necessary tasks. If you can be given a better deal on something you already intended to purchase, then of course you’re going to take it. If the gas and energy sectors begin to offer loyalty programmes, they will see a similar success rate as we all need energy and we are all faced with the cost-of-living crisis, so wherever we can save and be rewarded for purchasing our necessaries, we will find people drawn to join.

So, whilst supermarkets dominate the field of loyalty programmes, they also teach us something about them, and that core element of being rewarded for necessity is a big driver behind creating your successful loyalty programme. 

But what if our business isn’t essential? What if we sell luxury products or provide services that people only need now and then? Well fear not, for we can always find a way to present your product as essential, and one of those ways is by leveraging FOMO in loyalty programmes. 

Leveraging FOMO to Drive Engagement

Everyone loves Loyalty Schemes, but not everyone is going to be convinced to join your loyalty scheme, they need a reason. Well other than showcasing your wonderful, unique, and innovative product or service, we can apply a little human psychology and drive engagement purposefully to your loyalty programme. One of the ways we can do this is by leveraging FOMO to encourage people to come and be part of the club.

What is FOMO, I hear you ask? If you don't know FOMO stands for 'fear of missing out' and implementing it can be very simple. Looking at those industry leading supermarkets you’ll be familiar with one of the simple techniques that has been used to provide Tesco and Nectar with such a large share of the loyalty programme market and that is ticket prices.

You’re walking down the aisle, you find the product you’re looking for, you go to see how much it is and what’s this? Two prices? Is one lower than the other? 

At this moment, you’re presented with a choice, a choice to pay full price, or a choice to find out how to pay the lower price. And who is going to want to pay the more expensive price?

You look up and around at the supermarket shelves and you see them everywhere, little yellow tickets next to the usual white ones offering lower prices for the same products.

It would be a ridiculous decision to make to choose to pay more for the items. So in our desire to not miss out on these immaculate deals, we may approach an employee and ask how to activate these lower prices, and they’ll tell you that you just need to sign up for the loyalty programme, it’s really that simple.

And as the customer, are you going to miss out on all these amazing deals? Of course not, and so you sign up and begin to enjoy the benefits of extra savings at the checkout. 

Such a simple trick but it highlights what is on offer, it shows directly the difference between being a member of a loyalty scheme and not being a member, and when the choice is presented to you like that, you cannot help but choose to sign up. 

So by presenting your loyalty programme in the right kind of way, showing customers what they are missing by not joining, you encourage them to join. You don’t force their hand in any outward way, you simply present the options to them in a way they can’t miss, and the customer will do the rest. 

The Benefits of Points-Based Rewards for Businesses

So, now we know a little about using FOMO to drive engagement, whether that is engagement with your loyalty scheme, or engagement with particular products, as those little tickets can be placed on the products you wish people to gravitate to, let us learn a little about how a points-based reward scheme can benefit your business. 

The implementation of points-based rewards will provide a few key benefits, one of which is long-term engagement. A points system is a simple system of credit in which with every purchase you are awarded a proportional amount of credit via points on your loyalty account. You must spend, engage, or interact to earn points and then those points can be redeemed for discounts and offers. It provides a steady incentive to shop to earn points and an incentive to return to spend the points that have already been earned.

On top of encouraging long-term engagement a loyalty programme encourages a larger average spend. Through a combination of desire to build up points and a feeling that more can be spent thanks to the savings earned along the way, as well as the loyalty and fondness developed for a particular brand, a points-based loyalty programme encourages a larger average spend per customer too. 

The final key benefit is that it provides an ample amount of data to collect to better understand your customers and pre-empt what they might need or want and tailor their rewards and discounts to their personal profile. Data is the currency of the future and so gaining and utilising data whilst rewarding your customers is a win-win for everyone. 

So, more customers, spending more, for longer whilst providing you with all the data and insights necessary to create award-winning loyalty programmes and enhance your business output. Rewards-based loyalty programmes are shaping up to be pretty pivotal to your business indeed. 

Building Long-Term Customer Relationships with Loyalty Schemes

With these benefits in mind, we can see how a loyalty scheme develops a deeper relationship with customers by providing them with continuous value in exchange for their loyalty. It goes deeper than the transactions, however, as a relationship is often based as much on emotion as it is on logic. And emotionally customers begin to develop an attachment to one loyalty scheme over another. 

This happens as we create a feedback loop between what a customer puts in, and what they get out of their interactions with the business. By providing value to your customers through a reward scheme they develop an emotional disposition towards you, they have memories and experiences of being treated more than fairly, of being rewarded for their time and money spent, and so they create an attachment to you. This attachment means they will consistently choose your business over your competitors, even when the same products are offered at the same prices. Creating a loyalty scheme that resonates with your customers provides benefits for years to come.

Conclusion: Why 2025 is the Year of the Loyalty Scheme

In 2025 it’s going to take something special to stand out from the competition. It’s going to take dedication and commitment to your customers, to provide value to them in exchange for the value they provide your business, and the best way to provide this on a consistent and calculated basis is through implementing a suitable loyalty scheme.

From the benefits of points-based rewards to the development of long-term customer relationships, 9 out of 10 Britons belong to a loyalty programme, they are gaining traction and becoming the expected norm. To stay ahead of the competition, begin to plan your Loyalty Scheme today by reaching out to the experts at Loyalty Works. Experience our solutions and how we can help transform your generic loyalty programme into a bespoke loyalty scheme perfectly curated to your brand and customers.