Pursuing the Loyalty Factor

rutters-loyalty-cardsjpgIn the convenience store industry, successful loyalty programs adhere to a tried-and-true mantra: rewards, recognition and service, said Fred Thompson, a partner specializing in retail services practices at LoyaltyOne Consulting.

Offering rewards because everyone is doing it or simply to access customer information is only going to drive the business so far, said Thompson, who noted that using a combination of tools can deliver better results.

Thompson sees general payment tools, such as tap-and-go payment options, driving sales in the convenience store industry because of convenience and speed. “If we can provide immediate rewards at the register or at the pumps, customers really value that process—if it’s done very quickly,” he said.

While the mobile wallet is still promising, near field communication (NFC) and RFID technology are closer to providing a more meaningful experience if they can be incorporated into rewards cards. “For c-stores, it’s supposed to be all about a smooth execution of the operation, getting customers in and out fast,” Thompson said.

Simplified Process
Partnerships are part of the magic formula for Casey’s General Stores Inc. in the Midwest. The c-store chain recently teamed up with Hy-Vee Inc. grocery stores to offer their mutual customers big savings at the gas pumps.

“Such partnerships are not uncommon and are certainly nothing new,” said William Walljasper, Casey’s senior vice president and chief financial officer. “But they continue to provide substantial savings for our customers.”

That savings translates to added value for shoppers and longer term loyalty for c-stores. The Fuel Saver concept is simple, he said: The discounts (savings on advertised items in the stores) are added to the Fuel Saver card with each purchase. Customers just insert their cards at Casey’s or Hy-Vee’s pumps and watch the prices roll back, up to $2 per gallon. Although it’s still too early to calculate the positives, customers are excited, Walljasper noted.

Since consumers love their apps, many loyalty programs are also adopting Passbook apps as a mobile loyalty platform. There’s no need to carry a physical card or a keychain fob; customers simply store their program memberships and rewards programs in one simple app. “It really hasn’t gotten its critical mass yet,” Thompson said, “but I think it’s absolutely the sign of things to come.”

Thompson cited 7-Eleven’s Slurpee Nation initiative as a prime example of a successful loyalty program for three reasons: It provides tangible rewards for the customer, it reinforces the retail brand and it promotes the love of its program category.

Building A Loyalty Community Online

For loyalty programs to succeed in the future, retailers will need to tie into consumers’ online habits, according to Nielsen Media’s “State of the Media: The Social Media Report 2012.” That’s because more and more consumers are spending free time, not only connected to the Internet, but staying connected via a mobile device. The report found:
• Consumers spend 20% of their total time online on personal computers, and 30% of their total time online via mobile.
• Facebook remains the most-visited social network in the U.S. Users access Facebook via personal computers (152.2 million visitors), mobile apps (78.4 million) and mobile web (74.3 million).
• Facebook and Twitter are two of the most popular social networks, but Pinterest is one of the “breakout stars” for 2012 in social media, with the most year-over-year increase in unique audience and time spent on any social network across personal computers, and mobile Web and apps.

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