More Than Just a Thank You…
Bashas’ Supermarkets’ card rewards customers IS A “THANK YOU” all a customer needs to hear? Perhaps, but sometimes not just a spoken one.
A series of promotions aimed at the 1 million Bashas’ Supermarkets’ Thank You cardholders has allowed the supermarket to stimulate, and even change, shoppers’ behavior.
In “How to Effectively Build Customer Relationships,” a session at December’s National Center for Database Marketing conference in Orlando, FL, Christie Frazier-Coleman, vice president of loyalty for the Phoenix-based chain, described how Bashas’ reward programs have captured 70% of all transactions. This number represents 85% of its sales.
For Frazier-Coleman, loyalty involves more than just repeat purchases. Bashas’ follows the rule of thumb that its programs should be a reaction to consumers’ needs, not to its competitors’ actions. As a result, the supermarket has gone beyond the industry’s practice of cutting prices in hopes of generating sales.
The purchase data recorded on each account is used to acknowledge the chain’s best customers, and to move second-tier shoppers to that top level. To do so, the company uses a mixture of incentive programs and category and product penetration analysis.
One such effort was its instant 5%-off coupon toward purchases above $50. During the two months the program ran, it generated a 12% gain in average order size, and store visits jumped nearly 18%. More than a quarter of Thank You cardholders received at least one coupon, and almost a third of all tickets were redeemed.
The coupon was issued at checkout so the cashier could have a quick dialogue with customers, thanking each of them for their purchase and noting their reaction. While sales did taper off after the promotion ended, they didn’t fall back to previous levels – and the chain had a host of valuable purchase information as well as an increase in revenue.
Instead of offering a fixed series of benefits to customers, Bashas’ can use the Thank You card to tailor a rotating series of programs to a store’s geography, a consumer group or even a season. A late-year Turkey Rewards program, in which shoppers were given a chance to earn one of two sizes of birds, was embraced by 12% of the store’s cardholders. Order sizes jumped only 3.3%, but those who participated loved it – 85% of shoppers who signed up eventually received a turkey. Because of this uptick in purchase patterns, 30% of the chain’s customers moved from the mid-tier group to the upper-tier customer classification.
Future plans for the Thank You card call for Bashas’ to use more customer information, rather than shopping cart data, in its promotions. The company has already explored New Mother, New Mover and school tie-in programs. These would not only allow shoppers to volunteer household data, but further cement the relationship between vendor and consumer.
