Loyalty programs are becoming more complex.
“There’s an urgency for those who aren’t thinking forward and thinking about using AI, utilizing automation, making your program run more efficiently,” said Jeff Hoover (pictured center), director of strategy and analytics at Newton, Massachusetts-based Paytronix, at CSP’s Outlook Leadership conference on Aug. 20 in Rancho Palos Verdes, California. “It’s not just a nice to have anymore. It's a must have, it's table stakes, and it’s not just about points and discounts. Those are important, but it can’t be just that.”
Hoover said convenience-store retailers must look at differentiation with value, relevance and emotional connection.
“Consumers expect that loyalty to reflect their personal preferences, behaviors and values, so the bar’s rising,” he said. “We want to look through our competition, look outside of the industry at the QSRs and things. And although you see that industry programs in c-store—a lot are actually outperforming in efficiency probably because they’re not selling burgers and fries, right. They’re selling fuel and a lot of different other categories within there, and there’s a lot of opportunity to make more money on that, utilize our vendor partners.”
Dawn Boulanger (pictured right), vice president of marketing at Tri Star Energy, said the Nashville-based company’s Twice Daily brand has been running a loyalty program longer than its other two brands, Sudden Service and Southern Traders.
“It’s kind of an evolution, obviously. I think that in our newer-acquired stores, we're still working to get toward more of that emotional connection and engagement with the guests, but you know with Twice Daily if we run any promotion, our Twice Daily and White Bison Coffee brands roll up into one app and one loyalty program. So, if we run a new drink promotion, we communicate to the masses about what that new promotion is.”
They’ll also reach out to customers who acted on an offer only once, she said. “If you purchased a ruby chocolate latte early on and you didn't purchase it three or four weeks later, we might send you a specific message,” she said, adding that they’ll personalize the message to ensure they’re connecting with customer “so they understand that we understand how they’re purchasing and what’s important to them.”
Hoover said there is a loyalty shift happening with programs and customers. “It’s their mobile first, their digital influence and, sure, everybody says, ‘You know I have that old customer that doesn't want to give their number and doesn’t want to download the app.’”
For every one of that type of customer, however, “People are maturing and growing, people are more fluid,” he said. “My son doesn’t even know how to not use digital to order. Just hand him the phone and he places the order. They’re expecting that consistency. They’re expecting also that that loyalty is embedded everywhere, not just when they’re in the store, right?”
He added, “We mentioned loyalty everywhere. Coming to the pump and being able to identify and drive people into the store—coming to the store and being able to use a great mobile app so they can engage with that. And then you know, we’re ultimately competing with those QSRs for that share of wallet.”
Regarding mobile engagement, Boulanger added it’s becoming more important every day, especially from a foodservice perspective.
Hoover said tools allow identifying lower-frequency customers—once or twice a month—where they’ll get an offer for a visit challenge or a daily deal where customers can get free coffee every day of the month or 99-cent coffee every day of the month.
However, he added, “We would never want to send that to a customer that’s visiting every day and subsidize that behavior. So, getting that person to get their first-party data and then supplementing it with surveys and things like that really allows us to understand the different customers and how we can really change their behavior. We also use that category-based segmentation where we can identify customer's best category and what might be the next likely category they purchase. They might purchase based on what other people like them buy, so we can kind of build the basket and do things like that. The points and everything is important to have a core currency, but you have to be able to talk to your customer in a one-to-one level where they change their behavior based on what you see.”
Taylor Bromley (pictured left), senior manager of third-party implementation, Altria Group Distribution Co., Richmond, Virginia, said Altria’s digital trade program includes the option Personalization Plus, which allows for personalization that lets “Altria to do consistent loyalty.”
“Altria looks at consumer purchase behavior and supports that consumer with the type of value that they need in the right stores,” Bromley said. “But then it also helps us to think through the evolving tobacco consumer. If today you’re a cigarette purchaser, but the data starts to show that you’re also starting to purchase Helix products and start to transition to a different product, we can use that data to decide what types of offers you should receive from the Personalization Plus. So on that purchase history, we might serve you up an offer for both your cigarette product and your Helix product, so you can make that decision and support that transition journey.”
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.