Best Buy Starts Loyalty Program
Best Buy Co. Inc. kicked off its first loyalty marketing program in mid-July with a 5 million-piece direct mailing to existing customers. The campaign is being supported by television commercials, freestanding inserts, in-store signage and an employee training program.
The nationwide rollout of Reward Zone followed a yearlong pilot program conducted in Southern California. That effort, which initially focused on the company’s entertainment offerings (music, movies, video games and software) has been expanded to encompass everything the chain sells, according to Karen Maurice, director of relationship marketing for Best Buy, Minneapolis.
The mailing consisted of three major tests. Roughly 1 million pieces were purely informational, inviting customers to come into the store and register for Reward Zone. Another 2 million featured a clip-out coupon that recipients brought to a store to receive a membership card, and the rest contained an actual membership card.
Reward Zone started with a fairly healthy base of participants. The company waived the $9.99 sign-up fee for 375,000 of its top customers and enrolled them automatically. Another 65,000 joined during the pilot period.
The program awards 100 points to consumers for every dollar they spend at Best Buy. Members receive a $5 reward certificate for every 12,500 points they earn, and get quarterly statements that detail their account activity and provide information about other offers.
Soft benefits include exclusive game demonstrations, product giveaways, previews of upcoming CDs and movies via Web streaming, and participation in “You Be the Critic,” a feature that enables members to critique new artists.
The pilot exceeded the company’s expectations in terms of increasing sales, profits and frequency of visits, Maurice said. The program went nationwide July 13.
From July 20 through Aug. 23, the company planned to give away $25,000 a day through a sweepstakes. Participants would earn a sweeps entry for signing up and another chance for every transaction they made.
Best Buy used Cincinnati-based Frequency Marketing Inc.’s Loyalty Solutions Platform as the program’s technology backbone. FMI also helped with Reward Zone’s national rollout.
