When it comes to loyalty programs, customers are seeking interactions with the retail brand and offerings that are relevant.
By Brad Perkins, Contributing Editor
It is often easier to entice existing customers to buy more than to gain new customers. But studies have shown that many satisfied customers do not return to a store in which they had good service.
The 2018 Maritz Wise Marketer Loyalty Landscape study showed that 68% of those surveyed were transient loyalists–those who are loyal, but also able to be convinced to shop elsewhere.
“Customer loyalty is really about connection and experience,” said Lesley Saitta, CEO of Impact21. “How connected does a customer feel with a brand or a store and what is the experience they get when they shop there?”
Building connections can be difficult in convenience, where customers often differentiate retail platforms based on location, how much a gallon of gas costs at a particular time or a deal on a 32-ounce soda. All of those offerings can provide different opportunities for store loyalty.
“A one-size-fits-all loyalty program is a thing of the past,” Saitta said. “As more retailers are analyzing their customer data, they are finding many different customer segments, each with their own identities, buying habits and lifestyles. And they are willing to provide retailers with relevant information on themselves, if they get something in return.”
Loyalty today involves more than an occasional fuel discount or free cup of coffee. Customers want interactions with the brand and offers that are personally relevant.
“It varies by customer as to why they are loyal or not loyal to a store, and it’s important for retailers to understand their customers and decide who they want to attract and how best to do so,” Saitta said.
That’s why Yesway incorporated store-level elements to its Yesway Rewards program as it rolled out last year.
“Our philosophy on loyalty is that loyalty has to be earned at the store level,” said Darrin Samaha, vice president and brand manager at Yesway, which operates 86 stores in Iowa, Kansas, Missouri, Oklahoma and Texas. “They can turn right or left, and we want them to turn into our lot.”
Success has come by tying the Yesway Rewards program, which turns points for dollars spent in-store or gallons of gas pumped into smiles that can be redeemed for anything in the rewards catalog, to its brand identity.
“Our brand is fun and friendly. That’s part of our currency. It’s the Yesway smile,” Samaha said. That smile appears on its cards and advertising.
Like Yesway, Kum & Go incorporated part of its logo into its ‘&Rewards’ program, which launched in 2016. That brand identity has helped drive a successful program in which more than 25% of members use the rewards card with each purchase.
“Our &Rewards loyalty program is our primary vehicle to drive loyalty among our customers,” said Kristie Bell, communications direct at Kum & Go. “We want to reward folks who shop with us regularly and entice those occasional shoppers to make us a regular stop.”
The program rewards everyday purchases with points and includes daily offers for repeat purchases.
“After a customer earns 250 points, he or she is rewarded with one of six rewards of their choosing,” Bell said.
Kum & Go also offers a debit card option for its loyalty card, which Yesway is currently piloting as part of its Yespay program. Kum & Go’s program also drives data capture to encourage special offers.
Capturing and analyzing data is vital to a program. Yesway partnered with Paytronix to capture the data for its programs, deliver email campaigns and review performance metrics.
“Our key metrics we look at monthly are penetration rate, conversions, registration rate, activations and visits,” Samaha said. “That’s the core data to our reporting package. Over time we’ll get more granular, especially with our segmentation capability as it relates to the demographics.”
The partnership also allows Yesway to do A/B testing, sending the same offer in two different ways and seeing which one works better.
Testing, offers and data are important to knowing what to offer customers. But it is only one piece of a successful loyalty program. The other half is interaction, both in-person and online.
“Many customers refer to the store they shop as ‘My’ [store], and that’s the ultimate in customer loyalty,” Saitta said. “They are known to the store personnel or the experience they get makes it feel like it caters to them because the products they want are there and they have a loyalty card that gives them special promotions.”
Yesway uses its store associates to sell the program, giving them in-depth training and a month-long soft launch of the program before rolling it out in stores so they are aware of all the benefits and able to encourage enrollment and use of the card or app. It also sends out a street team to each new store opening to get customers signed up for the program. By engaging at the store level, they can connect with patrons.
“The biggest change in loyalty is that customers are expecting personalization and relevancy,” Saitta said. “They don’t want to be treated like everyone else, even other members in a loyalty program or club. They want to be given messages, content and rewards that are unique to their buying habits and feel like the retailer understands who they are, what they want and when they want it.”
Yesway uses email to achieve this, targeting it to customer behavior, like birthdays or purchases. It even has “lapsed campaigns,” such as a recent one that told customers who hadn’t purchased anything with the card in a while, “We miss your smiling face”.
“We try to be clever in a way that’s honest to our brand with the messaging,” Samaha said.
Social media also plays a key role in developing brand loyalty, giving companies like Yesway and Kum & Go the ability to develop followings.
“We use social media to engage with our customers, often with witty replies to their fun posts about the Kum & Go products they love and talk about on their own social media,” Bell said. “We want to develop a relationship with our customers, so they know they can rely on Kum & Go to always deliver little extras.”
Yesway uses social media to build pages for store openings and connect to customers. It’s just another step in making customers their best advocates.
“We know what our customers are buying, so we want to try to identify that and give them more of what they want, when they want it, more quickly,” Samaha said. “Because that’s how we’re going to generate buzz about the program and build advocates. Our very best customers will talk about it.”