If retailers are especially good this year, they might be rewarded with more shoppers in 2019. Many, it appears, have decided the best way to collect is by offering extra-nice reward program options.
The hitch will be keeping those new members engaged after the tinsel is down. A number of retailers, from Sally Beauty to Starbucks, have relaunched or dressed up their loyalty initiatives in advance of the holidays, when more people are out shopping and therefore more receptive to enrolling in and using loyalty programs.
Nearly four in 10 holiday shoppers (39%) said they are much more likely to shop at stores where they are enrolled in loyalty programs, a 26% increase over 2017, according to research by Epsilon. But what about after? Engagement is a major challenge for loyalty program operators: 54% of memberships in the U.S. are inactive, according to the COLLOQUY Loyalty Census. Worse, 28% of shoppers have abandoned a program before ever redeeming so much as a point or mile.
A key reason for the breakdown is a reward program’s value proposition fails to hit the relevancy button after the signup offer is used. Either the rewards aren’t appealing, they take too long to earn or they’re just too complex.
Cash to Gravy: New Perks From Kohl’s, Sally and Nordstrom
More retailers are trying to remedy their own shortcomings when it comes to shopper understanding. Here’s what a few merchants are doing.
Kohl’s added sparkle to its Yes2You Rewards program by giving all shoppers $15 in Kohl’s Cash for every $50 they spent during Black Friday week and Cyber Monday. (The Yes2You program regularly gives members one point for every $1 spent and a $5 reward for every 100 points.) Additionally, elite members of the Kohl’s Rewards program, which is being tested in several U.S. markets, were given early access to Black Friday deals.
Sally Beauty relaunched its Beauty Club loyalty program as Sally Beauty Rewards just in time for the holiday season. Existing members were automatically re-enrolled and given $5 in reward points to entice spending, while new members received a $5 reward certificate for joining. The program awards 10 points for each $1 spent and a $5 reward certificate for every $50 spent. Sally also launched a dedicated “Holiday Glam” page to its website to encourage repeat visits.
Nordstrom in October introduced its new Nordy Club currency-neutral program; members can now pay for purchases however they want, meaning a Nordstrom credit card isn’t required. Members gain higher status the more they spend, and with higher status comes greater rewards, including entry to invitation-only shopping events, free alterations and access to style workshops.
Starbucks is enticing its reward program members by sending limited-time promotions directly to their apps. In November, it began using its new happy hour feature to do so, sending alerts for half-priced holiday drinks. This helps raise awareness of its seasonal lineup, while those waiting for their gingerbread lattes are free to browse its selection of holiday gifts.
Swagbucks, the digital loyalty program that rewards members for online purchases across brands, is giving extra cash back to those who shop more than 200 retailers during designated periods throughout the holiday season. Participating merchants include Macy’s, J.C. Penney, Old Navy and Best Buy.
Some merchants are using the rewards to encourage members to help others. The Texas restaurant chain JumBurrito, for example, is fighting hunger through its JumBurrito Revolutionary Rewards Card. During the “No Hunger for the Holidays” fundraiser, JumBurrito is donating 50 cents for each rewards program visit to the West Texas Food Bank. In 2017, the effort raised $11,563, enough for 46,252 meals.
Though Sears Holdings is in Chapter 11 bankruptcy reorganization, it still offered special holiday perks to members who used its Shop Your Way loyalty program over Black Friday weekend. Members received $50 cash back in points on in-store purchases of at least $50, and earned additional points by texting the words “gravy” and “turkey” to a special number.
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