Businesses are built on relationships, and those enduring ties help build recurring revenue. For merchants competing in today’s crowded and highly transactional eCommerce environment, this can be daunting. Brands that thrive are experts at creating more personalized experiences and ongoing relationships that pave the way for more predictable growth.
These merchants leverage data and tools to understand and anticipate their customers’ needs, developing deeper relationships with consumers. Online merchants skilled in this emerging category, called Relationship Commerce, aim to create frictionless experiences using an array of strategies that include memberships, subscriptions and loyalty programs. In fact, 79% of all consumers enjoy at least one of these commerce relationships.
Consumers embrace brands who embrace them, and customers overwhelmingly prefer to purchase from brands they feel understand their needs and preferences. Our data shows that 77% of consumers with retail subscriptions buy more products from the brands they have relationships with than those they do not.
These are just a few of the key findings found in Relationship Commerce: Building Long-Term Brand Engagement, a PYMNTS and Ordergroove collaboration. We surveyed 2,826 consumers who have entered into commerce relationships with brands — participating in a combination of subscriptions, memberships and loyalty programs — to gain a clearer understanding about the relationships they have with their preferred brands and their propensity to shop and spend more with those merchants.
Seventy-nine percent of consumers have established some form of commerce relationship with the brands they purchase from — either a membership, retail subscription or loyalty program — and 17% of consumers have all three types.
The growing popularity and ubiquity of subscriptions, memberships and loyalty programs points to Relationship Commerce being a potent economic competitive differentiator for online merchants. Bridge millennial and high-income consumers who earn more than $100,000 annually are the demographics most committed to building relationships with multiple brands.
Seven out of 10 consumers with commerce relationships say they will buy more products from those brands, with millennials standing out as the group most likely to increase purchases.
On average, 75% of consumers with commerce relationships will buy more products from the companies they partner with, and a striking 90% who believe these companies understand their buying preferences are likely to purchase more products from them. Millennials are eager to embrace the power and potential of Relationship Commerce: 80% report they will likely purchase more from brands they have relationships with.
For merchants, retail subscriptions yield the strongest connections with consumers, followed by loyalty programs.
Seventy-seven percent of consumers with retail subscriptions buy more products from these brands, 37% will spend more money with these brands and 63% are interested in joining a loyalty program with these same brands.
Consumers with existing commerce relationships are more likely to build additional types of relationships with these brands.
Consumers reward the brands they have positive relationships with by increasing the value and frequency of their purchases and seeking to create deeper connections with them. We found that 63% of consumers with retail subscriptions are interested in enrolling in loyalty programs with their Relationship Commerce brands, and 36% of consumers who believe they have better relationships with brands will increase the number of retail subscriptions with them.
Six out of 10 consumers involved in commerce relationships have more positive experiences with these brands because they believe their connection transcends the transactional.
As impressive as that number is, an even larger percentage of consumers in retailers’ Relationship Commerce programs report they feel the brands better understand their buying preferences. Seventy-two percent of consumers with retail subscriptions, 65% with retail memberships and 67% who participate in retail loyalty programs feel this way.
These findings offer a window into a more nuanced narrative about Relationship Commerce strategies and how data-rich direct-to-consumer tools of subscription, membership and loyalty programs can forge deeper relationships with consumers that result in predictable, recurring revenue.
To learn more about how customers and brands are navigating their layered commerce relationships, download the report.
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