Partnerships between banks and petrol stations drive loyalty

Loyalty programmes have grown in both number and the rate of adoption in South Africa, becoming a vital part of consumer engagement across a variety of industries. As competition in the market increases, strategic partnerships are emerging as a crucial asset. Loyalty partnerships offer brands a useful tool to increase touchpoints with consumers and influence consumer behaviour, and in turn provide more meaningful rewards.

The link between banking loyalty programmes and fuel retailers, one of the first cross-industry partnerships to develop in South Africa, has grown significantly since 2010. This trend mirrors a broader narrative of cross-industry partnerships being increasingly integral to customer loyalty strategies.

“Fuel is a largely commoditised and price-regulated industry, in which location, service and convenience are some of the only points of differentiation. Given that payment for fuel and transport represents an increasing share of the average South African’s expenditure, the partnerships between banks and fuel retailers have become ever more relevant to everyday consumers,” says Gordon Dodge, a consultant at consumer insights and research business Eighty20.

Recent insights from BrandMapp provide valuable perspectives on consumer preferences and brand loyalty among the “economically active” demographic. The analysis highlights the impact of several bank-fuel partnerships, underscoring their significant sway over consumers’ decisions on where to refuel their vehicles.

Leading the way, says Dodge, is the Standard Bank UCount partnership with Astron/Caltex, which offers R10 back for every litre of fuel, depending on a member’s tier, which has resulted in an 83% increase in the proportion of customers spending at Astron/Caltex in comparison to their competitors.

The partnership of FNB eBucks and Engen offers members up to R8/l back, depending on tier and products. “This partnership has grown significantly over the years and has resulted in a 33% increase in behaviour change,” he says.

Sasol’s partnership with Absa allows members to earn up to 30% back on fuel spend, based on their tier. “This partnership indicates a strong brand awareness, with a 22% increase compared to its highest competitor,” says Dodge.

“Overall, our analysis indicates that loyalty programmes wield considerable influence over the consumers’ choice of petrol stations, ranking closely behind the station’s location. This insight is critical for brands, as it underscores the importance of forging strategic partnerships that align with consumers' lifestyles and preferences,” he says.

Banks that have embraced this trend are seeing their loyalty programmes become a significant differentiator in the market, he adds. “By strategically leveraging rewards, these programmes are able to reinforce loyalty not only to the bank but also to the fuel retailer. This creates a win-win scenario of banks retaining customer loyalty, fuel retailers enjoying a diverse and highly engaged customer base and consumers benefiting from enhanced relatable rewards,” says Dodge.

These cross-industry partnerships represent a dynamic and ever-evolving terrain of loyalty marketing, he says.

“They reflect a deeper understanding of consumer needs and an appreciation that loyalty extends beyond mere transactions to the overall experience and value proposition. For businesses, the implications are clear: partnerships that create added value for consumers are key to differentiation and customer retention. This example highlights the importance of brand alliances, deliver outstanding value and promote lasting consumer loyalty.”

The big take-out: Partnerships that create added value for consumers are key to loyalty programme differentiation and customer retention.