Gain Loyalty by Growing Trust

Identifying and meeting customers’ needs and wants, while also respecting their privacy, is the formula for cultivating a successful rewards program.

By Erin Rigik, Associate Editor.

Convenience stores know loyalty is crucial to keeping customers coming back for more, but it’s what you do with the information collected—and how you maintain your customers’ trust—that can make or break your loyalty success.

The real key to mastering loyalty marketing is bridging the gap between meeting the diverse needs of customers and building loyalty and trust, noted LoyaltyOne CEO Bryan Pearson. Pearson is the author of a new book that debuted in May called, “THE LOYALTY LEAP: Turning Customer Information into Customer Intimacy,” which quickly hit bestseller lists.

He suggested the following four actions for interpreting meaning from the trending data your company is gathering from its customers.

1 Invest in reaching the members you already have using multi-faceted communication strategies. Social media, for example, can grow your business via word-of-mouth, rather than the mass membership-type enrollment drives of yesteryear.

Winston Salem, N.C.-based WilcoHess is one company taking the multi-faceted approach. This summer it partnered with OpenStore by GasBuddy to reach its consumers on a new level. It rolled out a redesigned Website, www.wilcohess.com, which features individual store profiles, a CEO blog and a newly designed store locator.

In addition, the company launched an innovative mobile application: ‘WilcoHess On The Go’ to provide customers digital in-store deals and coupons that can be scanned at point of sale (POS), as well as real-time gas prices, an on-the-go store locator, social media promotions, and a Spin & Win game.

“With these social and mobile initiatives, our company will be better equipped to meet our customer’s needs on a much more tailored level, as well as offer more personalized deals and ultimately build brand loyalty,” said Larry Lytle, vice president of marketing for WilcoHess. “Our industry is changing, and we are committed to being on the leading edge of emerging technologies and strategies that will allow us to adapt to the shift that is reshaping the fabric of the American society and, subsequently, our customer. It falls in line with a new direction for our company; a direction where we will focus on building customer relationships in a new way and communicate with them on a more personal level.”

Targeting smartphones is an effective strategy for communicating with today’s convenience store customers. Promotions such as text messaging coupons can have immediate rewards. By their very nature, c-stores are a destination for time-pressed customers.
“The mobile phone is the first portable marketing device people carry with them all the time, and this opens up a whole bunch of location-based marketing opportunities,” Pearson said.

2 Create new value propositions. In other words, make sure the rewards are resonating with your customers. Move beyond basic discounts, and consider coalitions with other merchants (read about BP’s new coalition pilot program with Kmart on p. 10). Or look to align with causes that hit home with your customers.

Cenex Zip Trip stores, for example, participated this year in growing The Salvation Army’s Backpacks for Kids Campaign for the third year running. “We helped raise $26,216 in Spokane, Wash., and Coeur d’Alene, Idaho, and over $5,000 in Billings, Mont.,” said Ian Johnstone, general manager for Cenex Zip Trip stores.

The Salvation Army uses the funds to buy backpacks and fill them with essential school supplies for children in need—a cause that resonates with customers. Johnstone first read about the program in his local newspaper.

“I called to see how our stores could get involved because there weren’t enough donations to provide backpacks for all the kids who needed them,” he said. Now customers can make a $1 donation at a Cenex store and sign a flyer that the store then displays. As added incentive, customers who opt to make a donation get a free soda the next time they visit the store.

3 Break free from the data wasteland. “Are we really using our insights to transform the entire customer experience or just drive sales?” Pearson said. He recommended creating custom-made experiences to meet the needs of your unique customer base.

The Pilot Flying J team—which caters to a large customer base of professional drivers—is adept at learning what its customers need and delivering it to them.

Most recently, the company doubled its loyalty efforts during the entire month of September to recognize Driver Appreciation Month. Pilot Travel Centers and Flying J travel plazas offered double rewards points on professional drivers’ MyRewards cards from Aug. 28-Oct. 2.

“For decades, professional drivers have stopped at Pilot Travel Centers and Flying J travel plazas to refuel, eat, shower and rest while they’re on the road,” said Jimmy Haslam, CEO of Pilot Flying J, which operates more than 600 retail locations. “That’s our renewed focus at Pilot Flying J—that the driver comes first, and it’s our job to appreciate, respect and thank them for what they do. That’s why we’re treating September as an opportunity to recognize our valued customers.”

In addition to double rewards points for the entire month, Pilot Flying J also celebrated National Driver Appreciation Week—Sept. 17-22—by offering additional staff to meet drivers when they visited stores and gather feedback for the company.

“We want to hear from drivers—what we are doing well, what we could improve, what needs aren’t being meet,” Haslam said. “We’re striving to make each driver’s day the best it can be, and we rely on driver feedback to provide the exceptional service our customers deserve.”

Putting its money where its mouth is, based on earlier customer feedback, Pilot Flying J, in July, launched a $49 million project to remodel and upgrade its network of showers to make them cleaner, more modern, more relaxing and comfortable for drivers.

4 Be transparent and responsible. Pearson noted that customer willingness to share personal information depends on his or her comfort level. So don’t be irresponsible with the data; use that personal information in a way that will directly benefit your customers. He also suggested that operators limit how much data they collect to the information they actually plan to use, ask for the customers to opt in and fully disclose how they intend to use their information.

“It’s about creating that win-win relationship,” Pearson said.

Loyalty Trends Watch

In 2012 loyalty programs at c-stores continue to evolve. LoyaltyOne CEO Bryan Pearson noted loyalty trends this year include:
• A focus on value and away from simply offering discounts to build sustainable growth.
• Maximizing the reach of customer rewards by forming partnerships between merchants.
• Enterprise loyalty—or freeing up customer information internally so it can be used by all parts of the organization—is a growing practice that can help drive new revenue streams.
• Leveraging technology on a social, mobile and local level.

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