The Data Point: Do Consumers Spend More If They Belong to Membership Clubs?

Subscriptions have never been hotter, especially those offered by mass merchants to lock in loyalty and ideally increase order values. With so many now subscribed to one or more mass merchant memberships, however, runaway inflation may cause consumers to choose.

The new PYMNTS study “The Benefits of Membership: Mass Retailers and Subscription Services” extracts data from a census-based survey of over 2,100 U.S. consumers looking at subscription-based shopping trends and where mass merchant subscription loyalties lie.

• 79% of U.S. consumers made purchases at a mass merchant within the past month.

With inflation closing in, we would expect to find high levels of consumer traffic flowing to mass merchants where deals and discounts are plentiful, especially for subscription members.

Per the report, “Walmart was the most frequently cited mass merchant with which consumers shopped: 75% of respondents made purchases from the retail giant within the past month. The next most popular was Amazon, at 71%, followed by Costco at 25% and Sam’s Club at 21%.”

However, we found that only 21% of consumers who shopped at Walmart have a Walmart+ subscription, compared to the 61% who made purchases from Amazon and have Prime.

• Data Point: The total value of purchases made by subscribers is double that for nonsubscribers across all merchants — except for Walmart.

Mass merchants use subscriptions because they work for consumers, and for a retailer’s bottom-line. The study stated: “Amazon Prime members spent 113% more than non-Prime members each month when shopping online, for example. At Costco and Sam’s Club, members spend 101% and 109% more in-store than do nonmembers, respectively.”

Walmart is an exception here, with data finding that Walmart+ subscribers spend just 15% more than nonmembers each month when shopping online, and 10% less when in-store.

• 25% of consumers say price is the most important factor when joining membership clubs with mass merchants, 21% say store proximity.

Consumers prefer various mass merchants for a host of reasons from proximity to price.

For example, Walmart+ offers free shipping, free deliveries on orders of $35 or more and members-only discounts on certain gas purchases. For Amazon Prime, offering free delivery within one or two days for subscribers and free same-day delivery for orders over $35 give an idea as to the nuances between the two big competitors in the space.

In the study, 25% of respondents said access to better prices was most important to them, while 21% said “selecting a store based on proximity would be ideal.”

Get the study: The Benefits of Membership