Beware: UK shopper loyalty drops in Golden Quarter as customers ‘spend smarter’

As household budgets remain tight and shoppers become more selective, loyalty across UK retail is slipping with just 61% of shoppers having returned to the same retailer in 2025, down from 65% last year.

That’s “a decline that signals growing pressure on brand relationships”, according to data from customer engagement/commerce media group Reward.

Drawn from 1.4 billion anonymised transactions across 4,000 retailers, and published in ‘Lessons in Loyalty: Turning Festive Peaks into Year-Round Engagement’, the report shows essential spend now accounts for 58% of household budgets, up from 48% two years ago, “leaving shoppers with less discretionary income and a sharper focus on value that feels personal and meaningful”.

As consumers grow more discerning, that means loyalty programmes have become “one of the most effective levers for influencing spend and driving retention”, the report said. 

It notes that during the Golden Quarter (October-December), reward engagement surges, with 31% of all annual rewards earned and 28% spent, “representing a higher share typically seen across any other three-month period”.

Yet 56% of festive shoppers don’t re-engage with brands in Q1, “underlining the challenge of converting peak-season participation into lasting loyalty”.

Paul Jones, SVP of Data & Insight at Reward, said: “Our data shows that consumers aren’t necessarily spending less – they’re spending smarter. In today’s environment loyalty is no longer guaranteed by habit but earned through relevance and value. The brands that understand changing motivations and can personalise their engagement are the ones best placed to retain customers.

“Commerce media is changing the loyalty landscape. It connects retailers and banks around a single, data-driven view of the customer – enabling brands to act with precision and relevance. The winners of the 2025 Golden Quarter will be those that move fastest to activate insight, deliver personalised value at scale, and use reward-led engagement to build loyalty that lasts long after the festive season.”