The price of dwelling is driving a dip in shopper loyalty as tighter budgets push shoppers to prioritise necessities over discretionary spending – highlighting how reward-led engagement is turning into “a key growth driver”.
That’s in accordance with buyer engagement and commerce media firm Reward, utilizing insights from over 1.4 billion transactions throughout 4,000 UK retailers and collaborating banking companions, revealed in its newest report: ‘Lessons in Loyalty: Turning Festive Peaks into Year-Round Engagement’.
Analysis primarily based on anonymised transaction and service provider information, derived from Reward’s Customer Engagement programmes, has revealed that important spend now makes up 58% of household budgets – up from 48% two years in the past.
Meanwhile, solely 61% of buyers returned to the identical retailer in 2025, down from 65% in 2024.
Paul Jones, SVP of Data & Insight at Reward, stated: “Our information exhibits that customers aren’t essentially spending much less – they’re spending smarter. In right this moment’s setting loyalty is not assured by behavior however earned by way of relevance and worth.
“The brands that understand changing motivations and can personalise their engagement are the ones best placed to retain customers.”
As shoppers develop extra discerning, loyalty programmes have turn out to be “one of the most effective levers for influencing spend and driving retention”.
During the Golden Quarter (October–December), reward engagement surges – with practically a 3rd (31%) of all annual rewards earned and over 1 / 4 (28%) spent, representing a better share usually seen throughout some other three-month interval.
However, 56% of festive buyers don’t re-interact with manufacturers within the first quarter of a brand new 12 months, underlining the problem of changing peak season participation into lasting loyalty.
Jones added: “Commerce media is altering the loyalty panorama. It connects retailers and banks round a single, information-pushed view of the client – enabling manufacturers to behave with precision and relevance.
“The winners of the 2025 Golden Quarter will be those that move fastest to activate insight, deliver personalised value at scale, and use reward-led engagement to build loyalty that lasts long after the festive season.”