Is Loyalty a Key Differentiator in Fuel Retail?

May 22, 2025

When it comes to the competitive market of fuel retail, many service stations are implementing the same tactics to ‘win’ and keep customers – making it difficult to stand out from the competition. One of the ways retailers try to differentiate themselves, is by delivering added-value services, such as loyalty programs.

A well designed and implemented loyalty program can be a powerful tool for fuel retailers, helping to facilitate customer retention, as well as improving the customer experience, increasing customer spend (as well as c-store margins), and gathering insightful data that can help retailers better understand customer behaviour.

Loyalty programs are so popular that 90% of companies have some form of program in place and it’s not hard to see why…

79% of consumers have established some form of relationship with the brands they purchase from – either a membership, retail subscription or loyalty program – and loyalty program transactions can account for as much as 50-70% of total fuel sales. However, for retailers looking to implement a loyalty program, customers are looking for one that is easy to use (53% of respondents), offers great discounts (39%), and is easy to understand (37%).

Loyalty is More than Collecting Points

A loyalty program on its own is not enough. Fuel retail businesses have to earn their customers loyalty and a ‘standard’ loyalty program, although helpful, is not a sure-fire way to generate a long-standing, loyal customer – especially as the average consumer belongs to at least 19 loyalty programs but only 9 are active. Customers expect more, so fuel retailers need to tailor their fuel retail loyalty program to meet evolving expectations.

Discounts

Customers want more than just discounts; they are looking for personalised and engaging experiences. They need tangible benefits to keep them interested and encourage repeat visits. If a service station solely relies on the price of fuel – something which is extremely volatile and, according to KPMG, changes as much as 650 times a year – providing the occasional monetary discount won’t encourage customers to remain loyal long-term. There is little to no incentive.

Technology

Out-of-date technology and equipment is not enticing to customers; it can give the illusion the service station has very little to offer or won’t be able to meet their needs. Old technology, is also incredibly unhelpful when retailers try to collect, merge, or use customer data – something which is key to offering personalised experiences and rewards.

Experience

Loyalty, and subsequently retention, is largely driven by the overall customer experience as 86% of consumers are willing to pay more for a great customer experience, with those customers spending up to 140% more than those who experience negative interactions. In addition, one in three consumers (32%) would walk away from a brand or company they love after just one bad experience and 92% would completely abandon a company after two or three negative interactions.

Simply put, loyalty programs need to extend beyond fuel savings to offer customers a truly seamless experience while at a service station, such as; personalised rewards, unique customer benefits, non-fuel purchase rewards, partnerships with other retailers etc.

Differentiating with Loyalty

Customer data is the most powerful tool a company has for building an effective rewards system but to differentiate one fuel station loyalty program from the next, retailers need to focus on unique rewards, personalised experience, and streamline omnichannel integration. A good loyalty program should make customers feel valued, fostering long-term loyalty.

Offer Unique and Meaningful Rewards

Go beyond delivering discounts. Customers prefer experiential rewards – such as VIP access, personalised offers etc – as they can help create deep emotional connections with a brand or company, one that resonates long after the initial experience. With 65.2% of companies planning to add experiential rewards to their loyalty program offering, it’s certainly something fuel retailers need to consider. Customer data is a powerful tool when utilising loyalty programs, so retailers need to be able to understand what their customers value and offer rewards that meet their needs and preferences – they should be tailored to the individual.

Focus on Seamless Omnichannel integration

Fuel retailers should aim to create a seamless and consistent experience when customers are visiting their service station, while making it easy for customers to participate in their loyalty programs. This means customers should be able to earn and redeem rewards, track their progress, and receive personalised communications regardless of the channel they choose to engage with.

Cut Out the Competition

Before you can truly differentiate your service station and loyalty program, retailers must first understand what their competitors are offering and if it’s working. By identifying competitor loyalty programs, retailers can gain valuable insight into trends and customer expectations, while identifying opportunities to differentiate their own loyalty program offering. Then retailers can clearly communicate their unique value proposition to create awareness of what makes their service station, and loyalty program, different from the competition.

Delivering on Data

For any loyalty program to have long-term success, in terms of customer loyalty and retention, retailers need to be regularly analysing data to identify areas of improvement. This means adjusting the loyalty program, as time goes on, to meet ever-changing customer expectations. Analysing customer and loyalty program data will also enable retailers to measure the success of the loyalty program, allowing retailers to ensure their service station can stay ahead of the curve – continuously innovating and improving the loyalty offering to keep customers engaged and satisfied.

Conclusion

As the fuel retail and convenience industry is largely undifferentiated, loyalty programs – in addition to discounts, technology, customer experience etc. – provide a great way for businesses to stand out. Unique rewards, a seamless experience, and personalised offers go a long way to create a distinctive value proposition. This makes fuel retail loyalty programs crucial for business success – they are the catalyst of customer engagement, increased revenue, and being able to better understand the customer.

Differentiating your loyalty program from competitors is critical to capture customer attention and foster long-term loyalty. By truly understanding the importance of a distinctive loyalty program, retailers can create a loyalty scheme that truly resonates with their customers, enabling their brand to stand out from the competition and build a loyal customer base – one where they can reap the rewards long into the future.

If you’re a fuel retailer looking to build and retain a loyal customer base, then reach out to us for guidance and assistance to help you improve your forecourt offering. With innovative products and solutions from secure payment and fuel retail/POS solutions to dispensers, DFS has you covered.