LOYALTY RESEARCH, THEORY & SURVEYS

New Rakuten Study Reveals That Shopper Loyalty Hangs In The Balance

55% of shoppers will be looking for the lowest prices when shopping, while only 5% of retailers believe shoppers will forego loyalty to trade down for cheaper brand alternatives.

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Rakuten

SAN MATEO, Calif., April 14, 2025 /PRNewswire/ — Rakuten, the leading Cash Back shopping platform, released a new study in conjunction with The Harris Poll revealing a disconnect between shopper brand loyalty and retailer confidence. More than half (55%) of consumers say they plan to prioritize products with the lowest prices when shopping in the coming months, while only 5% of retailers think shoppers will choose to trade down to lower quality products and less expensive brands than the ones they’re accustomed to.

Retailers understand that shoppers will prioritize price, but they believe that brand loyalty will remain intact with 33% believing that shoppers will look for ways to save and stack incentives to continue purchasing their preferred brands. An additional 32% believe that shoppers will shift their purchasing to discount retailers that feature their favorite brands.

“Consumers are looking for value, but the cost of doing business is increasing for retailers,” says Julie Van Ullen, Chief Revenue Officer at Rakuten Rewards. “Retailers are in a very difficult position. They cannot assume that shopper loyalty will remain intact if they choose to pass the added costs onto the consumer by raising prices, but they also cannot afford to offer discounts. Instead, retailers will need to leverage other incentives like Cash Back that allow retailers to attract value-seeking shoppers without adjusting prices at all.”

Consumer budgets are tightening

Rakuten’s study reveals that consumers are struggling with their every-day purchases, impacting the opportunity for retailers to engage shoppers and drive revenue.

• 19% of consumers said they cannot afford to pay their household bills, and 17% cannot afford necessities like food and gas.
• Only 36% of consumers said they can afford all their daily expenses in addition to non-essential items.
• Over a quarter (28%) cannot afford personal purchases like new clothing, makeup, electronics, and more.
• Roughly two-fifths (41%) plan to shop less than in previous years

Retailers understand that consumers are financially stressed, with 74% saying shoppers are more concerned with the affordability of everyday purchases than last year. Regardless, 73% of retailers remain optimistic that they will meet their company’s sales objectives for the first half of 2025. This optimism is backed by an increase in spend with two thirds (67%) saying their marketing budgets increased over last year.

Ongoing economic and political volatility is crashing consumer sentiment

Inflation remains top of mind, with most (39%) consumers citing inflation as having the most impact on their 2025 shopping plans. Shoppers remain pessimistic about inflation, as 77% believe prices will continue to increase throughout the year.

Grocery prices have a large impact on how shoppers spend, even beyond the grocery store, with 57% saying that rising grocery prices has caused them to cut back on non-essential shopping. Shoppers are split on how to address rising grocery prices: 41% are spending more at the grocery store to purchase from the same brands they’re accustomed to, while 39% are shifting to cheaper alternatives. 13% said they are completely abstaining from buying products affected by price hikes, like eggs.

“For retailers to meet their sales objectives, they will need to earn a significant share of an increasingly limited consumer spend,” says Van Ullen. “As shopper wallets tighten and marketer budgets increase, it’s time for retailers to get aggressive with their promotional strategies.”

Retailers are dipping into performance marketing, but brand awareness remains the priority

While retailers are sensitive to shopper sentiment and the impact of inflation on household budgets, they believe that shopper loyalty will remain. This is reflected in how retailers are choosing to spend their increased marketing budgets for 2025.

A majority (83%) say they are prioritizing social media spend, followed by search (65%) and display (50%). Only 36% of retailers are prioritizing performance marketing channels like affiliate to drive sales.

While performance marketing isn’t their top priority, this tactic is receiving more attention from retailers this year, with 30% of marketers planning to reallocate some of their upper-funnel budget towards lower-funnel performance drivers. Nearly half (48%) say they will be increasing their spend in offering incentives like loyalty-based rewards and Cash Back.

“This year, retailers will need to prioritize marketing strategies like Cash Back that are proven to drive sales,” says Van Ullen. “These strategies are effective for incentivizing shoppers and providing them with permission to buy, without the need for retailers to discount and eat into their margins. Reallocating marketing budgets away from general brand awareness and focusing on conversion and getting people to hit the Buy button is a step in the right direction, but more retailers will need to make affiliate marketing a priority if they want to meet their sales objectives.”

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About Rakuten
Rakuten is a leading shopping platform that offers Cash Back on purchases from all your favorite brands. By partnering with thousands of brands in apparel, health and beauty, dining, grocery, travel, on-demand services, subscription boxes and more, Rakuten helps members save and get more on everyday purchases. Since its founding in 1999, Rakuten has become the largest and most rewarding shopping experience, and its members have earned $4.6 billion in Cash Back just for shopping through Rakuten. For more information, visit Rakuten.com.

Rakuten^® is a registered trademark of Rakuten Group, Inc., registered in the U.S. and other countries. All other trademarks are property of their respective owners. ©2025 Ebates Performance Marketing, Inc.

Media Contact: Steven Shaw (steven.shaw@rakuten.com)

Methodology:

These surveys were conducted online within the United States by The Harris Poll on behalf of Rakuten. The retailer survey was conducted from March 10 – 17, 2025 among 101 retailer marketers in the US. The consumer survey was conducted from March 6 – 10, 2025 among 2,058 U.S. adults aged 18 and older. The sampling precision of Harris online polls is measured by using a Bayesian credible interval. For this study, the sample data is accurate to within + /-2.6 percentage points for the consumer survey and +/- 9.6 percentage points for the retailer survey using a 95% confidence level. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact steven.shaw@rakuten.com.

SOURCE Rakuten Rewards