How Loyalty Is Taking a Front Seat

Loyalty PanelLoyalty providers are meeting customer expectations with innovative programs.

By David Bennett, Senior Editor

Today, loyalty programs aren’t only providing Americans with savings at the pump and inside the store, but are enabling convenience retailers to boost sales and engage their customers in ways like never before.

Loyalty was in the spotlight at the 2015 NAG (National Advisory Group) Conference Tuesday, Sept. 15, as a panel of experts explained how various loyalty programs are changing the retail landscape. The program, “Generation Loyalty: Why Loyalty Programs Connect with Convenience Store Customers,” provided attendees an overview of the U.S. loyalty landscape, and what might be coming down the road.

Moderator Nikhil Joseph, emerging technologies analyst at the Mercator Advisory Group, said studies show that retailers that can develop and sustain distinctive loyalty programs that change customer behavior enjoy a true competitive advantage.

Joseph pointed to how consumers are using their smartphones while they are physically in a store, searching for immediate deals, comparing prices and engaging with social media, regarding loyalty opportunities.

However, in an age where Americans are inundated with information, enticing them to key in on loyalty program messages can be a challenge for brick-and-mortar c-stores because patrons might not pay attention to what stores are selling.

“In a world with abundant info, attention is a scare resource,” Joseph said.

One of three panelists for the session, Howard Curtis, who last week departed MAPCO Express as director of marketing after five years with the Brentwood, Tenn.-based c-store, told NAG attendees to reach consumers more effectively through loyalty initiatives, they should strive to accomplish for objectives:

  • Transform the customer experience;
  • Embrace the mobile mind-shift;
  • Turn data into business insights; and
  • Become a digital disrupter.

FABULOUS FORMAT
Fred Smith, president and CEO of Fabulous Freddy’s car washes, which has locations in Nevada and Utah, said the company’s loyalty program center’s The Freddy Card, which has generated a loyal customer following where the company operates. However, since launching its first app just a month ago, Smith told those in attendance that the company has signed up 80,000 members, based partly on the level of engagement the app offers, including such features as coupons, games, surveys and social media capabilities.

Still he credits the company’s growing loyalty stature on its customer approach, which centers on personalized interaction and making patrons feel welcome.

“Fun interaction builds loyalty,” Smith said.

KICKBACK MOVES AHEAD
Fabulous Freddy’s using the Kickback Points Program, which is quickly becoming the gold standard for the convenience retail industry.

Scott Leonard, director of loyalty programs at Phillips 66, advised attendees that if they aren’t involved in a loyalty program, they should heavily consider it. Among the advantages is that increased loyalty grows satisfied customers, such programs reward customers and decrease customer defection, and a loyalty program recaptures lost customers at a rate three to four times more than other means.

To assist Phillips 66, 76 and Conoco-branded retailers in their efforts to drive sales and grow customer visits, Phillips 66 selected the KickBack Points program in 2011 to strengthen brand loyalty across its network. One of the leading fuel retailers in the U.S., Phillips 66 marketers are now driving repeat business and cultivating loyal customers through participation in the KickBack Rewards program, which now offers consumers cross-merchandising options with a retailer coalition that includes Jiffy Lube and OK Tire.

Now, with more than 1,000 convenience retailers enlisted in the program, Leonard said KickBack has exceeded expectations from the consumer and retailer experiences.

Using KickBack’s analytics, more retailers such as Fabulous Freddy’s are gaining operational advantages, such as learning when their customers shop and what they are most likely to buy, Leonard said.

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