How to Craft an Award-Winning Loyalty Campaign (case study)

SpaWeekBlogThumbLooking to leverage your loyalty program to drive more sales, boost margins, and enhance your brand? Then you’ll definitely want to take a look at the award-winning loyalty campaign from Spa Week, the health and wellness brand whose loyalty program, MyWellness Rewards, recently won the Loyalty360 Award for Best Creative Campaign in Loyalty Marketing.

With its goal of engaging shoppers throughout the year across multiple channels, Spa Week rolled out a yearlong campaign with seasonally themed installments. Starting with January’s “Resolve to Relax” and ending with December’s “Shop to Unlock,” Spa Week used these campaigns to increase brand engagement while luring in shoppers with real added value. For example, the Thanksgiving campaign, titled “Thanks-Giveaway,” feautred a 1,000 Wellness Point giveaway, with entries granted as a reward for social referrals via Twitter, Facebook and email. Spa Week also made a charitable contribution for every new loyalty program enrollment.

“The cause marketing component fit the spirit of the Thanksgiving holiday and increased cohesion for the campaign, helping our message go viral,” said Spa Week Program Manager Anne Hanson. “Also, explicitly rewarding advocacy aligns with our brand positioning that encourages individuals to give and enjoy the gift of wellness.”

For a full inside look at creating an award-winning loyalty campaign, download the new Spa Week campaign case study:

GET THE SPA WEEK CASE STUDY

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Loyalty Makeover: Abercrombie & Fitch

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In this installment, we look at the loyalty program at Abercrombie & Fitch, the $4.1 billion fashion retailer with over 1,000 stores, and brands including Abercrombie Kids, Hollister, and Gilly Hicks. 500friends Loyalty Makeovers offer suggestions to retail brands for making the most of their loyalty initiatives.

What Abercrombie & Fitch’s loyalty program looks like today

Abercrombie & Fitch’s loyalty program, known as the A&F Club, distinguishes itself from cookie-cutter loyalty programs by embodying the brand’s tone and effectively addressing core customers. Benefits include free streaming of A&F music playlists, the chance to skip lines at events, and members-only birthday offers. Limited-time promotional offers keep the program fresh and relevant.

First impressions

Abercrombie & Fitch is attempting a turnaround, with revenue dropping 12%, to $4.1 billion, and profit falling 77%, to $54.6 million, during fiscal 2013. To counteract sliding sales and rising expenses, Abercrombie & Fitch’s reorganized management team will need to leverage the A&F Club loyalty program to retain and grow the brand’s most profitable customer segments (without increased discounting). We think A&F Club is on the right track, but we offer a few ideas we think the Abercrombie & Fitch team should consider.

Makeover ideas:

  1. Leverage loyalty to drive mobile engagement
    Given Abercrombie & Fitch’s young customer demographic, mobile experiences will be important for reaching and engaging the brand’s shoppers. While responsive design of the company’s website is a positive, opportunities remain to thoughtfully leverage A&F Club via the brand’s mobile app. For example, members could unlock an exclusive sweepstakes entry upon completion of the app’s style quiz. With geo-fencing or mobile beacons, Club members could receive personalized, limited-time gift-with-purchase offers while shopping in stores.
  2. Power Cross-Brand Customer Views
    Abercrombie & Fitch can increase its share of wallet by offering A&F Club members an exclusive offer or benefit in partner brands. While delivering more value to members, such cross-brand promotion would create a more unified view of customers, allowing Abercrombie & Fitch to target relevant opportunities through follow-on lifecycle marketing.
  3. Clarify the benefits of loyalty
    While we think A&F Club’s focus on insider benefits is right for its demographic, the company currently does a poor job explaining those benefits to customers. The dedicated A&F website page lacks details, and when we called a customer service representative to learn more, she directed us back to that page. The challenge is that most benefits are tied to limited-time campaigns, so it’s difficult to describe them clearly. Adding tangible benefits — along with clear, consistent messaging — is an opportunity to make the program more compelling. For example, early access to new styles and collections or special access to limited edition items wouldn’t burden the program with incremental rewards costs but would still complement the A&F Club’s positioning.

Zach Woith is Head of Loyalty Strategy at 500friends, which helps retail brands maximize the value of their customer relationships. Email him at zach@500friends.com. 

 

Retailers with Private Label Credit Cards Also Need Loyalty. Here’s Why.

???????????????????????????????In his new post on DMNews, 500friends Director of Strategy and Development Arif Damji talks about how retailers with a private-label credit card (PLCC) can reap big benefits from also having a robust loyalty program. The major points Damji makes are that:

  • Loyalty programs make PLCCs look more attractive
  • Loyalty programs positively impact churn and lifetime value of mid-tier customers
  • Loyalty programs allow for direct, flexible communication with program members

Read the FULL post on DMNews here:
http://www.dmnews.com/got-plcc-what-it-is-and-3-reasons-you-also-need-a-loyalty-program/article/338520/

Ashley Bienvenu is a Customer Retention and Loyalty Analyst at 500friends. Email her at ashleyb@500friends.com.

Loyalty Makeover: Office Depot

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office_depotIn this installment, we look at the loyalty program at Office Depot, the $17 billion office supplies retailer with 1,900 stores that recently merged with Office Max. Loyalty Makeover offers suggestions to retail brands for making the most of their loyalty initiatives.

In late 2013, Office Depot completed a $1.2 billion merger with competitor Office Max. In this Loyalty Makeover we’ll look at both programs, and we’ll examine the opportunities in merging them.

What the Office Depot and Office Max loyalty programs look like today

Office Depot Rewards lets members earn rewards for purchases of ink, toner, paper and copy/print/ship services. Members can also earn rewards for recycling used ink cartridges and completing member profiles. Members who spend at least $200 in a calendar quarter achieve Choice status, which allows them to earn extra points through purchases, made either in-store or online, for products in up to 5 categories they choose. (Choice status is revoked if spending falls below $200 in a quarter.) For every 1,000 points earned, members receive a $10 rewards certificate applicable towards future purchases.

In contrast, Office Max’s MaxPerks program is more straightforward. Members get 5% back when they spend at least $500 in a one-year period. Recycling ink and toner earns members $2 for each cartridge brought into the store, up to a limit of $20 per calendar month.

First impressions

Expenses from the merger of these office supply giants, coupled with weak gross margins, led the combined company to declare a $205 million operating loss in 2013. Critical for the combined company’s future success will be boosting gross margins, which fell to 23.4% last year (vs. 26% for Staples), and a strong, unified loyalty program could play a major role.

Makeover ideas

Merging programs on this scale will be a huge undertaking for Office Depot’s executive marketing team. We humbly propose some ideas that could be helpful:

  1. Personalize rewards. The Office Max loyalty program provides the same level of rewards for everyone, regardless of spending (above the minimum threshold), whereas Office Depot recognizes high-spenders with premium (Choice) benefits. The combined company should maintain the premium tier as an incentive for customers to spend more, but should carefully analyze the spend of its mid-tier customers to see if $200 per quarter is the right threshold. (It should be just higher than the average spend of those mid-tier customers, so that it effectively encourages them to spend more.) The chain should also send personalized, automated loyalty offers (“Double points if you shop this weekend”) to members who have not purchased for a while. 
  2. Expand earning opportunities. Today, Office Depot members who have not reached Choice status can only earn points for purchases in certain product categories. This provides little incentive for these shoppers to buy other products at Office Depot. The combined company should allow points earning across all product categories to capture a higher share of wallet. For strategic product categories, Office Depot could offer bonus rewards. Office Depot could also use its loyalty program to engage with shoppers between purchases, by rewarding actions such as reviewing products, browsing strategic categories, and linking social accounts. Similarly, the chain could reward people who always buy online for visiting a store, or vice-versa, to boost omni-channel engagement. 
  3. Expire rewards based on inactivity. Office Depot gives members a calendar quarter during which they can earn rewards and only 60 days to redeem rewards coupons. Office Max’s reward cards expire 90 days after issue. Office Depot should switch to an expiration policy triggered by inactivity — for example, rewards could expire some number of days after last purchase. This way the chain can send personalized, automated rewards expiration notices and offers (“Your rewards expire at the end of the month. Buy now to keep them and get an extra point reward.”)  This structure better promotes long-term loyalty and can be used by sales staff to upsell (“You’re just 10 dollars away from your next reward level.”) An  effective expiration period should be just shorter than the average purchase frequency of mid-tier customers.
  4. Merge programs for cross-brand loyalty. It appears that, for some time anyway, both the Office Depot and Office Max brands will live on under the Office Depot corporate parent. If that’s the case, Office Depot should launch a unified loyalty program that promotes spending across the brands. One example of a company that does cross-brand loyalty well is 1800Flowers.com, whose Fresh Rewards spans brands including The Popcorn Factory and Cheryl’s (sweets).

Ashley Bienvenu is a Customer Retention and Loyalty Analyst at 500friends, which helps retail brands maximize the profitability of customer relationships. Is there a loyalty program you’d like to see featured in a 500friends Loyalty Makeover? Send her a note at ashleyb@500friends.com.

Loyalty Makeover: JCPenney

loyaltymakeoverjcpenney_logoIn this installment, we look at the loyalty program at JCPenney, the $12 billion department store chain with 1,100 stores and $1 billion in online sales. 500friends Loyalty Makeovers offer suggestions to retail brands for making the most of their loyalty initiatives.

What JCP Rewards looks like today

JCP Rewards members accrue one point for every dollar they spend. For every 100 points they earn in a calendar month, they receive a $10 coupon towards future purchases (up to a maximum of ten $10 coupons per month). At the end of every month, point balances reset to zero.

First impressions

With a 2013 operating loss of over $1.2 billion, investing in customer retention and loyalty may seem like a luxury for JCPenney. However, to really get back on track, the embattled department store chain will have to prop up its gross margins, which fell to 29.4% in 2013 (typical department stores gross margins hover in the mid- to upper-30s). That means finding an alternative to discounting, which means boosting loyalty is critical. Compared to other department store loyalty programs, JCP Rewards is remarkably simple, but by eschewing a more robust loyalty program structure, JCPenney is missing out on important loyalty benefits.

Makeover ideas:

  1. Personalized loyalty rewards: Currently, JCPenney invests in loyalty at the same rate for first-time shoppers and the chain’s established, high-value customers. JCPenney has the opportunity to increase spend among its best customers by introducing one or more premium program tiers. This would allow JCPenney to show appreciation to its best customers while offering benefits (a higher rate of point accrual, for example) that encourage mid-tier customers to spend more. In addition, the company could send automated, personalized loyalty offers to customers who haven’t shopped for a while (“Double points if you buy this weekend,” for example), which can be highly effective at reducing churn.
  2. Extend point expiration: With the current reward structure, a customer loses all of her loyalty status every month. A more liberal point expiration policy would help JCPenney better drive incremental sales and long-term engagement by giving customers the incentive to make an extra purchase down the road. The right expiration period depends on an analysis of the purchasing frequency of the chain’s mid-tier customers, and should be set so that expiration reminders effectively shorten average time between purchases.
  3. Leverage loyalty to boost omni-channel engagement: Given that JCPenney’s online property, jcp.com, is a crucial piece of the company’s turnaround effort, JCPenney could do more to incent customers to engage through multiple channels. For example, JCPenney could offer double-points bonuses to in-store shoppers who make their first purchase online, and vice versa for online-only buyers who start transacting in stores. Making point balances and tier status available at point-of-sale would empower in-store personnel to upsell (“You’re just $10 away from your next reward,” for instance).

Questions? Or is there a loyalty program you’d like to see featured in Loyalty Makeover? Send me a note at zach@500friends.com.

Zach Woith is Director of Loyalty Strategy at 500friends, which helps retail brands maximize the profitability of their customer relationships. 

 

Loyalty Makeover: Ace Hardware

loyaltymakeoverace-hardware-logoIn this installment, we look at the loyalty program at Ace Hardware, the $3 billion hardware store co-operative with 4,700 locations. Loyalty Makeover offers suggestions to retail brands for making the most of their loyalty initiatives.

What Ace Hardware’s loyalty program looks like today

Known as Ace Rewards, the Ace Hardware loyalty program rewards members with in-store discounts (“Instant Savings “) and a points currency for all purchases. Members collect 10 points for each dollar spent and get 1,000 points for enrolling. Once they reach 2,500 points, they receive a coupon for $5 back on their next purchase, equating to a 2% funding rate. The private label Ace Rewards Visa Card allows members to augment their Ace Rewards point balances with up to 10 points per dollar spent.

First impressions

Ace Rewards is unusual among retail loyalty programs in that its benefits include both a preferential member price as well as the accrual of a points currency. The generosity of the program is likely a significant driver of its strong enrollment, which has reached nearly 25 million members. In-store purchasers are attracted to the preferential member prices, while online shoppers benefit from the point currency. However, strategic changes to its loyalty program could benefit Ace Hardware’s member stores in their ongoing battle with the likes of Home Depot, Lowes, and Amazon.

Makeover ideas:

  1. Personalize rewards: A premium program tier would allow Ace Hardware to hold on to its top customers while giving mid-tier shoppers an incentive to spend more. Inactive shoppers could get a free gift just for stopping by the store.
  2. Expand potential earning opportunities: As it stands, there the only way to earn points is through purchases (in-store or online). In order to drive engagement between purchases, Ace could award points for writing reviews, creating wish-lists or uploading project plans. This ensures that members are more invested in the currency and are more likely to repurchase sooner.
  3. Introduce a points expiration policy: There doesn’t appear to be an expiration date on points earned by members. Ace should consider expiring points after some period of inactivity, as this will create urgency around repurchasing sooner. (The right period depends on an analysis of purchase frequency among mid-tier shoppers.) Sending “reminders” to members regarding upcoming point expiration will be an invaluable tool to drive higher retention.
  4. Improve rewards fulfillment:  Today, reward certificates (coupons) are mailed to a home address. Shoppers who purchase in-store must wait for these deliveries, and can use rewards only in-store. Instead, Ace Hardware should make rewards claimable and redeemable both online and at in-store (mobile coupons or POS).

Questions? Or is there a loyalty program you’d like to see featured in Loyalty Makeover? Send me a note at arif@500friends.com.

Arif Damji is Director of Strategy & Development at 500friends, which offers THE complete SaaS loyalty solution for today’s CMO. 

Loyalty Makeover: AutoZone

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téléchargementIn this installment of Loyalty Makeover, we look at the rewards program at AutoZone, the $9.1 billion automotive parts retailer with more than 5,000 stores. Loyalty Makeover suggests ways for retail brands to make the most of their loyalty initiatives. 

What AutoZone Rewards look like today

Members sign up for AutoZone Rewards at a physical store, where they receive a Rewards Card linked to their account. For each purchase of $20 or more, online or in-store, members earn one “credit.” When members accumulate five credits, they receive a $20 voucher for in-store redemption. The expiration period for credits varies by state, however in most states members must earn their 5 credits within a 6-month period and redeem vouchers within 3 months.

First impressions

AutoZone’s financial performance has been fantastic over the last 12 months, with its stock jumping more than 42%. That said, the company could be doing even better by making some strategic improvements to AutoZone Rewards. Most notably, AutoZone Rewards accrue based on purchase frequency, rather than on purchase amount (once the $20 minimum is met), which deprives AutoZone of tools for stimulating higher purchases. Also, it’s difficult for consumers to find out how AutoZone Rewards work: AutoZone’s website FAQ advises visiting a store or calling customer service. (When I called, however, a pleasant and efficient AutoZone phone representative did a good job explaining the ins and outs.). In short, a number of changes to AutoZone Rewards would help AutoZone realize material gains in sales and profitability.

Makeover ideas:

1. Switch to rewards based on purchase amount. While the one-credit-per-purchase approach limits AutoZone’s reward liability, it does little to spur customers to spend more. By switching to a structure in which rewards accrue based on purchase totals, AutoZone can unlock the vast potential of its loyalty program. Ideally, a salesperson should be able to say, “You’re just $10 away from your next reward. Would you like to buy something else?” Similar messages should also be sent by email and automatically triggered based on member activity (or inactivity).

2. Enable online signup and redemption. AutoZone Rewards members can see their credit totals online, but that’s about it. If you want to sign up for the program or redeem rewards, you have to visit a store. This creates a point of friction for consumers who might otherwise participate, and decreases the loyalty program’s bottom-line impact. AutoZone should follow the lead of retailers like 1800 Flowers, who enable all loyalty interactions both online and in stores. AutoZone might also integrate AutoAnything.com (acquired in 2013) into its loyalty program.

3. Streamline the rules, and better explain them up front. Customers shouldn’t have to call a customers service line to understand the basic rules of a loyalty program. When I spoke with the AutoZone rep on the phone, she told me that some vouchers are valid for 18 months, while others expire in just 3 months. A more streamlined program, communicated clearly through the company’s website, would go a long way towards boosting enrollment in AutoZone Rewards.

Is there a loyalty program you’d like to see featured in a 500friends Loyalty Makeover? Send me a note at zach (at) 500friends.com. Zach Woith is Head of Loyalty Strategy at 500friends.

Loyalty Makeover: Coldwater Creek

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 In this installment of Loyalty Makeover, we look at the rewards program at Coldwater Creek, the struggling $743 million women’s apparel retailer with nearly 400 boutiques in the United States. Loyalty Makeover suggests ways for retail brands to make the most of their loyalty initiatives. 

What Coldwater Creek Rewards look like today

Every time a Coldwater Creek Rewards member makes a purchase at Coldwater Creek, whether at a retail location or online, the amount is recorded in her Rewards account. Upon sign-up,members receive special promotions and coupons, as well as an in-store stylist, easy checkout and returns, and the Coldwater Creek newsletter. When a member’s purchases reach $400 in a 365-day period, she qualifies for ONECreek status, which grants free return shipping and a $20 birthday gift card. The top status tier, Elite, has a $1,000 purchase threshold (also over 365 days) and adds free shipping on all items, plus a 5% discount on all purchases and a $25 birthday gift card. 

First impressions

These are tough times for Coldwater Creek. In 2013, the chain saw double-digit declines in same-store sales, leading some to speculate that Coldwater Creek was headed for bankruptcy. A new CMO, Deborah Cavanagh, was hired to revitalize the brand and connect with core customers, and the loyalty program will be a key weapon in her arsenal. To reverse the same-store sales decline, she’ll have to persuade customers not only to stay with the brand, but also to spend more. As such, she should consider some important changes to Coldwater Creek Rewards that could help achieve those objectives.

Makeover ideas:

  1. Switch to cash-back rewards based on spending. Elite (top) members get a 5% discount on all purchases, but these people are already Coldwater Creek’s best customers. As a result, Coldwater Creek is likely giving away this margin to already-loyal customers who may have purchased anyway. By switching to cash-back rewards for spending (“For every $200 spent, get $10 off your next purchase”), Coldwater Creek could do a better job of spurring even its best customers to spend more. The cash-back rate could be lower for the lower tiers ($5 on every $120, for example), which would stimulate spending for mid-tier customers while giving them an incentive to strive for Elite status. Further, this change would positively impact cash flow, as the reward does not hit the bank until offset by a redemption.
  2. Create a sense of urgency with a shorter accrual period. The 365-day period for accruing purchases that determine status is easy for consumers to understand, but it means that Coldwater Creek can only go out to customers once a year with a notice of an impending deadline (“You’re in danger of losing Elite status. Spend $30 this weekend to keep it.”) A shorter accrual period would allow Coldwater Creek to more frequently use its loyalty program to drive purchases with similarly targeted communications. The right period depends on average purchase intervals among mid-tier customers. This change could also improve balance sheet liability associated with the program.
  3. Leverage rewards to engage customers between purchases. Coldwater Creek Rewards accrue solely on purchase. These days more and more retail brands, like Kate Somerville, are using their loyalty programs to reward behaviors such as browsing product reviews, leaving feedback, or sharing through social channels. These non-purchase rewards can be a cost-effective way to fight showrooming, keeping customers engaged even if they don’t plan to buy right away.

Is there a loyalty program you’d like to see featured in a 500friends Loyalty Makeover? Send me a note at ashleyb (at) 500friends.com.

Ashley Bienvenu is a Marketing Manager at 500friends.

Loyalty Makeover: Carter’s and OshKosh

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Loyalty Makeover suggests ways for retail brands to make the most of their loyalty initiatives. In this installment, we look at the rewards programs at Carter’s and sibling brand OshKosh. With $2.4 billion in annual sales and 18,000 stores, Carter’s has been selling children’s clothing since 1865.

What Carter’s and B’Gosh Rewards look like today

The Carter’s and OshKosh brands, which belong to the same company, run separate but identical rewards programs. For every $50 spent in-store with each brand, shoppers earn a $10 voucher towards future purchases of that brand. Rewards become valid one day after a purchase, and can be redeemed in-store upon presentation of a receipt.

First impressions

Carter’s brands’ rewards are simple and straightforward, making their value propositions easy to understand. Customers know that for every $50 spent in a single purchase, they will earn a $10 voucher towards their next purchase. While this simplicity is a positive, there are many ways in which a more robust loyalty program would be more effective at reducing churn and stimulating spending.

Makeover ideas:

  1. Expand the role of rewards
    Vouchers for one-time purchases are wonderful in their simplicity, but rewards that accrue over a longer period of time will better spur incremental purchases. For example, consider two customers, one who is about to spend $95 and one who is about to spend $105. The $95 customer might buy a small extra item to reach the $100 threshold for the next voucher, but the $105 customer probably would not go up to $150. With rewards that build across purchases, both customers have an easier time seeing the value in spending more. Another benefit of long-term accrual — whether through points or dollar cash back — is that Carter’s would be able to power any of its promotions with loyalty incentives like double-points weekends. Currently, the company relies almost entirely on rampant discounting.
  2. Introduce rewards tiers
    With its flat voucher rate, the current reward system is essentially a cents-off rebate that is no more effective at promoting higher annual spend than persistent discounts. Carter’s has the opportunity to boost customer lifetime value with greater rewards for higher spending. For example, the brand could use messages such as  “$10 for every $50 spent up to $200; $15 for every $50 spent above that.” Even better would be to integrate tiers into a long-term reward structure, a la airline mileage programs, which would incent mid-tier customers to spend more.
  3. Bring rewards online, and leverage balances in store
    Both Carter’s and OshKosh brands have highly trafficked e-commerce sites (Carters is #157 on the Internet Retailer 500 list). In today’s omnichannel world, consumers expect to earn and redeem rewards no matter where they shop, whether in-store or online. By bringing rewards online, the brands can also use rewards to engage with customers between purchases, for activities such as reviewing products, linking social media accounts, or signing up for emails. If Carter’s follows our recommendation for long-term reward accrual, in-store salespeople can look up point balances and remind shoppers that they are close to a new reward or tier.
  4. Merge programs to slash attrition and boost cross-brand purchases
    Carter’s already promotes cross-brand shopping with tabs on its website (one for Carter’s, one for OshKosh). However, shoppers can only redeem rewards for the brand on which they were accrued. Cross-brand reward accrual and redemption would create additional engagement opportunities, improve attrition, and spur cross-brand purchases. (Check out 1800Flowers.com Fresh Rewards, which uses 500friends LoyaltyPlus to extend loyalty across brands including 1800Flowers.com, Cheryl’s, and The Popcorn Factory.) 

Is there a loyalty program you’d like to see featured in a 500friends Loyalty Makeover? Send me a note at ashleyb (at) 500friends.com.

Ashley Bienvenu is a Marketing Manager at 500friends.

500friends LoyaltyPlus: New products and features

Kaleb Loosbrock

After a successful holiday season in which retailers saw an average of 2-3% growth over 2012, many loyalty programs are bursting with new members. So I thought this would be a good time to highlight a couple of new 500friends products and features that can help convert these shoppers into loyal repeat customers.

1) LoyaltyPlus Convert: Turn visitors into loyal customers

Do you present new visitors with a pop up form to acquire their emails? If so, you’ve probably noticed that conversion rates — let alone repeat purchase rates— for people you engage in this manner tend to be low. To boost acquisition and conversion, check out LoyaltyPlus Convert, a new 500friends product that intelligently engages your site visitors. You can also use Convert to engage with customers between purchases.

2. Enhanced Loyalty Promotions: Keep new members engaged

Research shows that new loyalty program members can disengage as quickly as two weeks after singing up for your program. To prevent that, our new Enhanced Loyalty Promotions let you automate a welcome series of emails that keep your program top of mind. Here are the kinds of emails with which 500friends partners are having success:

  • Initial welcome: Offer a warm welcome and incent purchase for new members (for example, by offering double rewards for a limited time). Remind new members about the kinds of emails they will receive and provide a link for updating email preferences.

  • Earning recap: Explain how to earn rewards. Promote quick rewards-earning opportunities that allow your members to engage immediately.

  • Reward and tier overview: Now that members know how to earn rewards, set aspirational goals. Present actionable information such as what a member must do to reach the next tier.

  • Connect with your company: Since customers who engage with companies over social media spend 20% to 40% more money with those companies than other customers (Bain & Company Report – Putting Social Media to Work), offer new members the ability to connect with your brand in the social sphere and provide rewards for doing so.

3. Enhanced Loyalty Promotions: Reactivate inactive members

Most loyalty programs have a 56% inactivity rate. Many retailers dismiss this group, but we’re seeing huge success among those who target them with appropriate reminders.

  • Reactivation campaign : Automatically send a promotional offer (double rewards, status upgrade, etc.) to members who haven’t made a repeat purchase within your normal purchase cycle.
  • Lapsed member promotion: If members still fall through, try automatically gifting lapsed members to their next reward or reminding them of an existing reward that’s waiting for them. Target only members who haven’t purchased in quite some time.

  • Points expiration reminder: Automatically remind members when their points are about to expire, creating a sense of urgency that drives incremental purchase.

Recently, a LoyaltyPlus client saw record sales and a 5% reactivation of its membership by building out a reactivation strategy aimed at winning back inactive customers.

To learn more about implementing these strategies and tools, get in touch with our team at support@500friends.com.

Kaleb Loosbrock is Senior Product Manager at 500friends.