Club programs are a staple in the convenience-store industry. It’s easy to see why: They help to motivate customers to visit more often, since they are working toward getting a free reward, and they drive repeat business.
But while club programs are a tried-and-true method for c-store loyalty, there are three strategies to take these programs to the next level and start making an impact on your brand's bottom line.
Reduce the number of club programs offered.
Most c-stores have around 15 to 30 club programs. If you look at this from the customer perspective, this can seem confusing and hard to understand. Try reducing the number of club programs offered and focus more on the items that are moving and generating revenue for your store.
Ask yourself if your club programs are spurring new trial from your customers and if customers are purchasing additional items when they make a club-program purchase. If you are not seeing an uptick in purchases or revenue from your club programs, then remove them and try different tactics to ensure you are not cannibalizing sales.
Help your customers reach their rewards.
Some economists and social-behavior therapists have done some research on punch cards and club programs. They tested out two versions of a punch card—one with eight punches to get a free item and one that had 10 punches. The catch was the card with 10 punches already had two filled in, so the customer only needed to get eight punches, so the cards were, in effect, equal.
The study found that the group with 10 stamps began visiting at a high rate of frequency, and a higher percentage of this group completed their card. Even though both groups needed to make a total of eight purchases, the group that viewed their card as giving them assistance spent more. The takeaway: Simple changes in how customers see a program can make a big difference in response.
Target and segment based on behavior.
It's crucial to any program to be able to collect and use customer behavior data, such as which items they are purchasing and how frequently they are going to your store. For example, if you know a customer is a busy mom on the go who prioritizes convenience and makes quick trips to your store to shop for staples, then you can target your milk-club program to her. Not targeting and segmenting runs the risk of customers stumbling into rewards instead of working toward them, which cannibalizes your sales and does not do anything to change their behavior.
Making small changes to the way c-stores run club programs can have a big impact on revenue and generate more loyalty among customers. Watch the webinar "How to Manage Your Club Programs" to learn more about the tactics you can implement to take your club programs to the next level.
This post is sponsored by Paytronix