STORES Magazine - June 2008 - (Page 50)

NUTS AND BOLTS / LOYALTY PROGRAMS tion and research projects for Colloquy, Alliance Data’s Milford, Ohio-based loyalty consulting arm. Loyalty marketing continues to be a very vibrant space, she says, and “in many ways the new battleground is going to be in the retail sector.” Young adults are one of the demographic groups offering strong opportunities for growth, Hlavinka says, adding that the affluent consumer segment has become somewhat oversaturated in terms of loyalty marketing. Citing an Info Shop report, a recent Colloquy publication states that the private-label credit card market is projected to grow 56 percent between 1998 according to Schroeder. Dress Barn has been working to grow its customer database, which now includes a significant number of Maurices credit card holders, Behrens says. “Over the last year we have more than quadrupled the amount of communication that goes out to these customers.” Or perhaps a cardholder has a history of visiting a store or the company’s website once every five months. “Our job is to get that down to four [months] and then three” between visits, Miller says. “We worry a lot about timing and we worry about … the relevant message.” Behrens’ advice for fellow retailers contemplating a private-label credit card program? “Don’t do it if you think you have to.” Schroeder agrees. “If you put half an effort into it,” a credit card program won’t have the desired effect for a retailer, he says, adding he has seen that scenario play out at other retail concepts where the focus has slipped away from the cards. Senior-level buy-in Among Alliance Data’s clients, the ones that might be considered “home runs” are those that have the highest degree of seniorlevel buy-in. Of course, with all that retailers must deal with today, there are plenty of distractions. “We try to help our clients stay focused,” Miller says. That effort can come in the form of joint marketing plans and “credit ambassadors” who keep associates up to date on the credit card program. Behrens says that, generally twice a year, the retailer’s best 250 to 500 customers are sent a gift – a simple, nostrings-attached “thank you.” “Loyalty is something that we live every day,” Behrens says. “Not that we won’t ever consider a [traditional] loyalty program. But we’re not trying to ring up points and make people feel that they have to spend a certain amount.” At Maurices, she says, “it’s much more heart-and-mind and psyche driven.” “For us it’s about ‘How do I become the store they trust … that satisfies their social needs more than anything else and [makes them feel] like they are shopping with a friend?’” Schroeder says. “You can’t put that on a punch card, and you can’t put that in a point StORES system.” WWW.STORES.ORG The key to standing out is ensuring that marketing, messages and offers remain fresh and relevant. and 2010. “That growth will continue to rely on retailers’ ability to leverage the PLCC as a loyalty-marketing tool,” it says. Keep it fresh The private-label landscape is becoming more crowded, Miller says, but “we actually think that validates what we can bring to our clients.” The key to standing out is ensuring that marketing, messages and offers remain fresh and relevant, she says. Maurices has nearly 650 stores (many in smaller markets) and is opening new locations at a rate of about 75 per year, 50 STORES / JUNE 2008 Monthly credit card statements also present an opportunity to strike a chord with customers. Alliance Data’s analytics team can help retail clients examine a shopper’s recent purchase behavior and gauge what they are most likely to be in the market for next. Messages that go out with the statement can be selected accordingly. “This really ties back to the analytics,” says Miller. She offers, as a hypothetical example, a shopper who always buys the same item: Her monthly statement might include a message about a cashmere sweater sale in order to help broaden her buying habits. http://WWW.STORES.ORG

Table of Contents Feed for the Digital Edition of STORES Magazine - June 2008

STORES Magazine - June 2008 Contents Executive Editor's Page President's Page Tesco Tests Carbon Labels What Shoppers Think 10 Things You May Have Missed Numbers Worth Counting Full Price/Markdown Retail People Cover Story: Boom - or Bust Green Retailing Concept2Watch Online Marketing Building Traffic Water Management Branding Digital Marketing Loyalty Programs Special Report: Taking on Teens Supply Chain - Robo Crop Human Resources Supply Chain - Directory Assistance Loeb Retail Letter Arts Update Point of View NRF News Retail Crossword Retail Industry Calendar Last Laugh

STORES Magazine - June 2008

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