The past 15 months have hit small to mid-sized businesses (SMBs) hard. Mom-and-pop shops around the world have struggled to get by since March 2020, when mandated business closures and capacity restrictions as well as their resulting economic shocks brought the global economy to its knees. Many are still struggling to recover.
It is not all doom and gloom for small-town SMBs, however. The months that followed have also shed light on the role these businesses play in their local communities, with many consumers rediscovering their importance. Forty-five percent of consumers across Australia, Brazil, the United Kingdom and the United States believe it is “very” or “extremely” important to purchase from the businesses in their communities, in fact, and 53 percent say it is even more important to do so now than it was prior to March 2020.
Many of these consumers are also interested in using local businesses’ loyalty programs — if they are available. Fifty-seven percent of the consumers across all four countries — 277 million total — would like to use these programs, hoping that using them might give them more reason them to shop with the very businesses they see as central to their communities.
Not just any rewards program will do, however. There are certain benchmarks that such programs must meet for consumers to feel that they are worth their while, and local businesses are on the hook to meet those benchmarks or risk losing the boost that rewards programs can provide.
Making Loyalty Work For Small Businesses, a PYMNTS and Pollinate collaboration, explores which types of loyalty and rewards programs can help these local businesses gain more ground with the shoppers in their communities. We surveyed 4,519 consumers from Australia, Brazil the U.K. and the U.S. to learn how many of them might like to use local loyalty businesses’ programs, which tangible benefits they hope these programs can deliver and which organizations they trust most to operate those programs.
Our research shows that many consumers do not necessarily trust local businesses with the personal data these businesses require to provide personalized rewards offerings, however. Only 10 percent of consumers within the nations we studied said they would trust the businesses in their areas with this data, in fact, signaling a strong need for third-party providers to step in and act as intermediaries to facilitate such services.
Banks are in a uniquely qualified position to serve in this role. Not only do many consumers say they would like banks to operate their local businesses’ loyalty programs — many of them also say they would trust banks with their transactional data more than any other type of entity. Fifty-five percent of the consumers in our study who would like to use local loyalty programs say they would want banks to operate those programs, and 43 percent say they would trust banks with the personal data they need to do so.
Determining which entities are best-equipped to deliver the local business rewards programs consumers seek is just one of the considerations businesses must make to implement successful rewards engagement strategies. Making Loyalty Work For Small Businesses provides a firsthand account of which rewards features will go the furthest in driving sales.
To learn more about what consumers want from local businesses’ rewards programs, download the report.