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Gone are the days when cutting back on small luxuries like trips to the coffee shop or under-used subscriptions were enough to manage a tight budget. With inflation affecting every spending category, from groceries to utilities, traditional cost-saving tactics just don’t cut it anymore. But, a strategic financial lifeline emerges as an unsung hero: cashback reward programs.
Far from being just a perk, these programs are evolving into a crucial tool to maximize spending power. Given the fluctuating economic conditions of the last few years, it's not surprising to see a remarkable uptick in usage, with shoppers steadily increasing their reward program spending since 2021.
Essentially, cashback programs return a percentage of the amount spent on purchases through specific credit cards, online shopping portals, or loyalty schemes. This means each card swipe or click on a retailer’s site can help consumers reclaim a slice of their regular expenses. Not only do cashback programs act like a bonus for being a smarter shopper, but they’ve also become game-changers for personal finances.
3 findings on consumers' preferences for cashback and rewards
To further explore this trend, we delved into how the current economic challenges are reshaping consumer spending habits and the adoption of loyalty programs. Our survey insights reveal insights into consumers' evolving preferences for earning and redeeming rewards.
Cashback takes the crown as the go-to reward
When it comes to the most satisfying reward type, cashback emerges as the undisputed champion. Our survey respondents resoundingly prefer cashback deposited directly to their accounts, valuing flexibility and immediate utility. These preferences underscore that consumers aren’t just seeking rewards—they’re looking for adaptable, practical digital assets to bolster their finances.
A notable 60% of respondents plan to increase their reliance on rewards programs in the next 12 months. This trend is especially pronounced among younger generations, with a substantial portion of Gen Z and Millennials planning to ramp up their use of such programs.
Choice and ease are the new non-negotiables
Beyond the type of rewards, the survey also highlights a crucial element: the demand for flexibility and simplicity in rewards programs. Consumers crave control and ease from their reward experiences. 50% of respondents expressed dissatisfaction with limited redemption options, while complex reward-earning processes emerged as another prevalent pain point.
This feedback underscores the need for reward programs to prioritize user-friendly, accessible experiences. Consumers are increasingly looking for programs that offer immediate, straightforward access to rewards, with various redemption options catering to their diverse needs and lifestyles.
Cashback and reward programs gain new ground due to inflation
The survey findings also point to inflation as a critical driver in the growing popularity of cashback rewards. A Wildfire survey similarly found that a third of consumers started adopting rewards programs in the past year, citing inflationary pressures as a driving force in their decision.
Furthermore, 81% of shoppers are more inclined towards online stores that offer rewards or cashback, highlighting the crucial role these programs play in consumer decision-making in the current economic climate. In an environment of rising prices and financial uncertainty, cashback rewards are not just a perk but an essential tool for savvy spending and stability.
Runa’s role in revolutionizing cashback and rewards
As cashback programs become increasingly vital for budget-conscious consumers, Runa steps in as a leader in this domain, offering a solution for businesses that not only meets but anticipates the evolving needs of today’s market. With our network of over 2,700 diverse payout options and counting, we help businesses significantly enhance customer engagement by offering more personalized and appealing reward experiences.
For consumers, our platform enables an unparalleled level of choice and personalization. This freedom to select rewards that align with their individual preferences and the flexibility to spend rewards like cash transforms each transaction into a potential saving opportunity. Businesses have a tremendous opportunity to adapt their strategies to offer real value in response to the broader economic environment.
Success story: Fluz sees remarkable growth with Runa
The impact of our approach is evident in the success story of the cashback site Fluz, which utilized our digital value infrastructure during its pivotal launch phase. By leveraging the vast Runa Network, Fluz provided an enriched reward experience that resonated with its users. This strategic collaboration resulted in a remarkable 36-fold increase in customer spending and a surge in referrals, with 70% of new users coming through friend recommendations.
Forming a strategic response with cashback and rewards
To delve deeper into the evolving landscape of consumer finance and understand how cashback and loyalty programs shape spending habits amid inflation, download our comprehensive report, From Points to Purchases: How Consumers Leverage Rewards and Loyalty Programs in Inflationary Times.
