Do You Offer a Loyalty Program?

Recently I found a “Sperry and Hutchinson” green stamp at the bottom of an antique desk drawer. While I’d heard of these things on television or in the movies, I’m not sure I’d ever seen one before. I knew the gist: families collected them from participating merchants, saved them in books and then traded in the books for goods.

The loyalty was to the scheme and S&H, among other issuers of the stamps.

Another vintage loyalty program with legs was similarly non-specific. In the 1920s, movie goers sometimes received glass place settings or serving pieces – what would later be called ‘depression glass,’ simply for showing up. I recently learned the pieces were also distributed inside packaging – though loading a glass cup or saucer in a tub of rolled oats seems somehow ill advised to me now.

The glass has become highly sought after and collectable, inspiring new generations of loyal shoppers (though on the second, third and nth-place market). There are even societies formed around admiration for the stuff such as the Michigan Depression Glass Society

Most supermarkets and office supply stores offer ‘loyalty programs,’ recognizable by the UPC’d key ring tags and cards. Home improvement/hardware stores have gotten in on the act in recent years. Some of these programs barely survived the launch.

Even most coffee chains offer some sort of incentive for repeat business – so many stamps or punches on your card and you enjoy a free beverage. They want you to choose their go-go juice over that of their competitor next door.

Along these lines there’s a convenience store chain in this neck of the woods that offers what it calls a “Milk Club.” Basically, every time you buy a half-gallon of milk they stamp your card. After ten stamps, a free half gallon – or half-price gallon. Of course, you get two stamps when you purchase gallons. Plus juice and other drinks count too. — O.K., commercial over.

On the back of these Stewart’s Milk Club cards, the program is explained further.

“In order to offer the milk club discount, it must be shop specific. To make it easier, if you have multiple cards, we will keep your card for this shop.”

Not overly convenient, but at least an effort has been made.

As abundant as Stewart’s Shops are, and add the fact that the milk (and ice cream) tastes pretty good, it’s likely customers frequent more than one location. As such, many folks have more than one card – my wife and I recently went digging and turned up 10 cards for six locations between us. Some bear only one stamp. Others mostly filled. I think the program is barely working for us.

Here are some crusty old third-hand statistics on loyalty programs, recycled fromcustomersthatstick.com – the points they raise remain valid.

·      3 out of 4 Americans have at least one retail loyalty card

·      85% say they have not heard from the program since signing up

·      81% say they do not know the benefits of the program or how/when they will receive the rewards

Source: CustomerThink

·      84 percent of loyalty program members are likely to choose the program retailer over its competitor

·      71 percent feel their loyalty programs deliver benefits that are important to them

·      49% of loyalty program members said that they never or rarely take advantage of loyalty program perks when shopping online

Source: Loyalty360

·      Only 36% of consumers received a reward or promotion that made them come back to the store

·      44% of consumers have had a negative experience with a loyalty program

Source: NeoLan

For a retail loyalty program to succeed, without generating bad vibes it must be

1. Simple to use

2. Easy to understand

3. Offer genuine value to the customer

4. More than simple data harvesting on behalf of the company.

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