Dominica Pezzolla, a 27-year-old who lives in Hoboken, N.J., belongs to six loyalty programs, including CVS, DSW and Express. She joined these programs for the rewards and savings, saying she redeems perks every few months at the retailers and a few times a month at the drugstores.
"It's especially beneficial for us as customers when you receive rewards at stores that you already shop at on a regular basis," she said. "You would be making purchases there anyways, so having reward points just makes it that much better."
Getting it right
Creating a successful rewards program offers retailers a new set of challenges. Just as the shopping landscape is oversaturated with options, so, too, are loyalty programs.
Personalization—which includes offering shoppers deals based on past purchases—is a must, experts said. Collins added that personalization can come in a broader form, with retailers catering their rewards toward their specific customer base.
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VF Corp.'s The North Face is one label that successfully incorporates its brand story into its rewards program, Collins said. Like any other program, the outdoor apparel brand allows shoppers to earn points that can be used on future purchases. But the points can also be used on outdoor activities, such as free lift tickets or lessons with a famous skier.
"When you think about the rewards themselves, it's all really aligned with the North Face's brand promise," she said.
LVMH's Sephora also has a solid rewards program, as its tiered strategy gives shoppers an incentive to spend, Collins said. The Beauty Insider program, which has grown to 14 million active members since its 2007 launch, gives shoppers a point per dollar spent, with different rewards that can be unlocked when reaching between 100 and 10,000 points.
Sarah Choi, vice president of Sephora Beauty Insider, said its loyalty members spend more per trip than the average nonmember, and they shop there more frequently. The company has found that members of its VIB Rouge level—which is reserved for those who spend $1,000 or more in one year—spend four times more than its other customers.
"We believe our program has been highly successful because we have built this program around the client insight that she loves product, and have built our loyalty eco system around giving her more of what she loves," Choi said.
Although loyalty programs' main purpose is to drive spending among existing shoppers—by getting them to buy new items as opposed to subsidizing existing purchases—Forrester found that one-third of companies see them as an opportunity to acquire new customers. PwC had similar findings.
"We're not just fighting to get them in the door. We're fighting to get them back out of the other retailer's door or website," PwC's Johnson said.
And with many analysts forecasting a wave of store closures ahead, PwC found it reassuring that when faced with a retailer shuttering its closest location to shoppers, nearly 60 percent said they would find the retailer's next nearest location and go there. Forty-four percent said they would remain loyal and would start or increase their ordering from the store's website.
Still, it should be sobering that more than 4 in 10 shoppers also said they would be willing to turn to a competitor when faced with a local store closing. As a result, when under pressure to close underperforming stores, PwC recommends assessing online sales in a particular region before deciding to shut down a store.
"There's the pressure for underperforming stores to be decommissioned, but at the same time, if you lost that customer to your competitor's brand you may have lost them for life," Johnson said.
—By CNBC's Krystina Gustafson. Follow her on Twitter