Footwear Programs Just Do It
Just when it seems every apparel marketer is kvetching about slim margins, shoe retailers are blowing out the doors with loyalty programs.
The challenge is to match the promotion to the audience. As a rule, “retailers are not receptive to loyalty programs,” says Rob Ley, director of business development for Minneapolis-based consulting firm BI. They worry about slower ringing at registers and technology upgrades. But a strong program can overcome those objections.
For example, Galyan’s, an outdoor-activity retailer based in Plainfield, IN, has a low-tech punch card for frequent shoe buyers. The Shoe Club card is one of the richest footwear loyalty schemes available, says Ley. It promises a $100 voucher for every 12 pairs of shoes purchased, good toward storewide purchases.
Galyan’s has offered the punch card for six years. The primary goal is to cement its relationships with athletes. Runners typically buy a new pair of shoes every six weeks to three months, and Galyan’s wants to sell them the sport-specific shoes as well as cross-trainers, insoles and general-activity shoes at this frequency, says Joan Hurley, a Galyan’s spokeswoman. Shoe Club is a subtle way to secure loyalty across an athlete’s product needs.
That’s also appealing to families, who may need multiple pairs of shoes at back-to-school time and again throughout the year. Shoe Club has competition in the family market from national discounter Famous Footwear of Madison, WI. That company’s Celebrity Club rewards program was launched in select markets in 1996 and nationwide to more than 925 stores in 2000. Famous Footwear tries to be all things to families, and its loyalty program targets moms. More than 2 million women, ages 25 to 49, with school-aged children, in middle or upper-middle income households, have joined the Celebrity Club loyalty program.
Club members receive award certificates worth up to $25 quarterly with targeted mailings intended to establish relationships, not just alert them to sales. “Welcome to the neighborhood” mailings recognize when members move, and birthday mailings extend gifts to best customers. Members who haven’t shopped in a while receive special attention. E-mails inform members of promotions and reinforce direct-mail offers. “Rewards members spend considerably more money and purchase considerably more pairs than non-members. They also shop more frequently than nonmembers,” says Val Hartjes, customer relationship manager.
If the shoe store fits…But do you want your customers to be loyal to your store or the brands you carry? Why not both, asks Brooks, an athletic shoe manufacturer, which is opening mall-based stores that sell only its products. “Sports Authority, Oshmans and others, are probably in the same mall carrying their stuff,” says Bill Hanifin, director of business development for loyalty program developer Frequency Marketing, Inc., Milford, OH. But Brooks wants a higher profile through branded outlets. “I haven’t seen other shoe manufacturers except for Nike with NikeTown stores taking this path; I wonder if it will start [a trend],” he says.
Possibly, says Ley. “The whole business model is based on walk-in traffic in malls,” he says. It all comes down to what the consumer wants: access, price, quality.
Foot Locker, a mall favorite with 12- to 24-year-old males, is a case in point. Such buyers don’t have the patience to tally loyalty points toward a delayed reward. They want instant rewards — and quality. “Foot Locker…knows the sports and the shoes that you need to perform better,” says Hanifin. “It is probably a good appeal considering that the big-box sports retailers don’t have much product knowledge on the sales floor.”
