The major supermarkets, several other retailers and non-retail businesses are spending big pitching their loyalty programs already this year.
Their pitches tend to cast their loyalty program as key to unlocking value for shoppers. Value in this context should read as lower prices. It’s a big business code word. Value is bandied about in meetings as if they are doing something good for shoppers when, in fact, it’s marketing fluff to get people thinking they are saving money.
I think their increased focus on loyalty is their response to inflation and consumer sentiment associated with this.
Shoppers are concerned about prices, especially in must-purchase settings. From data we see, with want purchases, discretionary purchases, price is less of a concern.
I have found the best way to pitch value, real and genuine value, is through an easily understood loyalty program that does not compare to the poor-value over-hyped programs from the supermarkets and similar.
Seriously, what is a loyalty point worth anyway?
At my software com pay, Tower Systems, the specialty retail POS software / newsagency software has a good loyalty points facility in it, it’s the discount voucher loyalty program that many hundreds of my own retail customers prefer. I use it in my own shops and have done consistently since it was released 9 years ago.
Each voucher has a dollar value. People understand $$ more than %.
On average, 19% of vouchers are returned and of those returned, a third are redeemed the day of, a third within 7 days and the last third within 28 days.
Guys are more likely to redeem right away whereas girls are more likely to redeem a week or more later.
Discount vouchers work particularly well with habit-focussed shoppers.
In settings where shoppers don’t want the vouchers, there is an opportunity for a local charity connection, which extends the reach of the discount vouchers, better connects the business to a local charity and helps leverage that charity’s community to support you.
My advice, if you’re interested, is to take note that the major retailers are pitching loyalty more this year already. Consider what you can do in your business to engage with shopper interest in value.
Now for a sales pitch:
Find out more:
- www.towersystems.com.au
- 1300 662 957
- sales@towersystems.com.au
Thanks for reading.
Tower serves 3,000+ local specialty retailers across a range of product channels and are grateful to serve beyond our POS software, with retail advice and inspiration – to help local small business retailers compete and enjoy their businesses more. This is where local value can be nurtured and shared.
I have seen this in my regional town. The Coles is pushing their thing and the Woollies. They are offering bonus points to get people to buy certain products. It was a lot of back to school stuff 2 weeks ago. I only noticed when a customer mentioned it, and then I had a closer look.
I use discount vouchers but I have to say we have dropped the ball.
I was a novice about this loyalty side of the business a year ago and went with points. Like you say, there is doubt about what a point is worth, even though our points were worth more than the supermarket. We moves a few months ago to showing actual dollar values as you say and it is working. People still get duped by the supermarkets but not as many now in our town.