When I meet with newsagents at industry events and conferences the most common question I’m asked at the moment is about the new discount vouchers approach to shopper loyalty. Better than the old and me-too approach of VIP card points-based programs, discount vouchers are changing shopper behaviour as I outline in a new video:
The beauty of discount vouchers is the ability to tweak management levers to customise the program specific to the needs of your business.
An outstanding presentation, Mark. Thank you. Given how important you believe your voucher programme to be, how do you feel about what seemed to me to be a relatively low redemption rate? That is, the vouchers are influencing the behaviours of some customers, but not all that many. Do you have any views about the redemption rate? Do you have any plans for trying to increase the redemption rate? What do you believe is a ‘satisfactory’ redemption rate?
Megan, the redemption rate is good by standards for loyalty systems. I’ve spoken to a range of loyalty experts to check this. That said, we were at 10% redemption for months and are now at 13% so there is movement.
I do see this as a work in progress, something we need to play with to get the levers right for our needs and for the type of engagement we want. I hope that makes sense.
I certainly see the results as changing over the next six months to a year.
To me it looks a lot like you are allowing the magazines to become a lost leader for you.
I would be concerned with the Margin on Magazines and the other would be Greeting Cards as there the back bone of most Newsagency sales.
I have not seen any other offering like it though and if the redemption is not eroding your GP then it looks to have merit.
I have started using discount vouchers this week.
Only positive feed back from customers.
They love them
Bretts, I can understand why you’d say that magazines are the loss leader. If I follow the data they are not since the GP funding the magazine purchase is coming from higher GP categories. The magazine is more the reward.
Thanks for the response, Mark. Do you have a quantifiable goal for the discount vouchers: % of vouchers issued that are redeemed? $ value of sales made in the newsagency that include a voucher redemption? some other measure?
Do you have any ideas at this stage for Phase 2 of the voucher programme? That is, ways to mix it up, refresh it, trying approaches that might see more or different customers engage with it? What would be the trigger for embarking on Phase 2?
Megan I do have this information but at this stage I’m not going to forecast it here. I’m happy to share privately with any newsagents using the voucher program and then talk abut next steps here once implemented and I have results data.
My apologies Mark.
No worries. Mo concern is that I’ve seen discussion on this here used by others ignorantly. Often next steps are store specific for good loyalty engagement.
WOW reading the CM today on page 9 , i see all types of businesses are getting into discount vouchers . If you take your fuel receipt in you get 30c a litre off . They have called it PUMP AND SAVE . Oh and forgot to mention it is a brothel .
Hmm. There’s no doubt that discount vouchers are more effective to drive more immediate purchases. Every day we hear from customers that the prefer them to points.