Driving retail sales by innovative loyalty

program
Ewa Wegorkiewicz
13th of March, Sofia

Agenda
Loyalty why to go into it?
Loyalty in Retail different approaches to different needs
Key points to make a loyalty program a success
Comarch CEMM as the tool for success

Page 2

85%
households participate in at least one
reward program*

12
loyalty programs per household on
average**

40%
participation in active loyalty
programs**
Sources:
* Loyalty & Rewards: A Market Overview, Aite Group, January 2007
**
Colloquytalk Censustalk, April 2007, pp. 3-6

Page 3

*The Loyalty Effect, by Reichheld & Teal

Page 4

So do we need to implement a loyalty program?

Your
competition

You

Your Client

Your PROBLEM
Page 5

Wrong question!
The right question is:
How to make your Clients crazy about your brand?

Page 6

This is how our retail Clients made it work

Page 7

All you need is love- Alma Market

Premium department
store chain in Poland
targeted to the Clients with
the above average income
Immense choice of high
quality products
Client satisfaction taken to
the next level- emotional
loyalty - money can`t buy
promotions
The results:
Increase in average basket
value 3 times higher for a
member than for a nonmember
Page 8

Money makes the world go round- Perekrostok

(X5 Retail Group)

The largest food retail company in Russia by sales volume

The company actively uses a multi-format strategy, developing three formats at the same time: discounters,
supermarkets and hypermarkets

The Average basket value of program members is 45% higher than for nonmembers
More than 26% of turnover is generated through loyalty transactions
More then 230 promotions active simultaneously
Page 9

Malina multipartner = multisucess

The average transaction with the
MALINA card is2640rubles, which
is20%higher than a"usual"
average transaction
IDEA:
Take advantage of
daily shopping and
all cleints activities

Russias richest consumer

database
4,581,735 cards in the market
with 8,5Malina transactions
every second of the year!
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Make your revenue grow by motivating your sales

force!
Single solution addressing the needs of
different types of B2B Partners in
traditional retail channel

Communicatio
n via SMS, Email,
Mail, WWW, Call
Center
Enrollment
invitation to selected
Partners via Sales
Representatives
Motivating by
rewarding (both
tanglible goods,
emotional rewards,
experiences )

Program data analysis &

segmentation

promotions depending
on the target group and
business need (SKU,
invoice
value, turnover, etc)
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Tripple points- focus on different sales areas

1.
Basic points

For each 100 Pln on invoice

You get points
100 z = 10 pts
We award full 100 z on Invoice
Eg. Total on invoice is 980 z
Client gets 90 pts

2.
Points for no. of SKU
on invoice

You can double your basic points

Scoring:
Number of SKU on invoice:
10-14 5 pts/100z
15-24 7 pts/100z
25+ 10pts/100 z

3.
Points for
SPECIAL ACTIONS

You can get

EXTRA POINTS
During each month a SPECIAL
ACTION will be launched
eg.
- SKU promo,
-Increase of turnover on invoice
vs. Last month

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Diversified reward catalogue

Gift catalogue with more than 130 items + special

awards
Automatic settlements checking before the redemption
Easy to get rewards
Page 13

Make your sales forces compete among each

other!

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Comarch Enterprise Marketing Management

key functionalities to make your loyalty
program
a success

Page 15

Collect and use

the data
Application form is the single
most important point of data
capture
a)Gather all data in form
b)Gather data incrementally
using electronic channels:
a) Transactional
b) Non-transactional

Anna, young mother, loves organic food and often purchases at the weekends
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Collect and use

the data
Primary Retail Segmentation Approaches
Recency, Frequency, Value (RFV): e.g. High Value Frequent Shoppers, Low Value
Frequent Lapsed
Lifestage: e.g. Young Adult, Young Family, Older Family, Empty Nesters
Lifestyle:
e.g. Organic, Fast Food, Home Cooking, TV Diners, Ethnic Dining based on basket
Data Collection
Internet Shopping: e.g. Trial, Cautious Developing, Everything

Recency , Frequency, Value Segmentation

Frequency

Visit

Recency

Frequency

Visit

Visit

Value $

Today

Time

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Make the clients

feel understood
by well targetted
offers

Basket analysis to get shopper type and

appropriate offers
Price sensitive

Health Conscious

Low far milk

Natural
Yogurt

Eco-Washing
Powder

Basket <10
items

Lowest price
cola

Organic
Carrots

Brown Rice

Brown Bread
New organic
chocolate

Current
Basket

Lowest price
noodles
Uses 2-1
offers
New large value
biscuits

No fresh items
Cheapest
washing powder
large format

Recommended

46 other shopping types tv dinners, deli divers, traditional,

ethnic explorers, meat feast, vegetarians etc
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Make the clients

feel understood
by well targetted
offers

Points & Discount Promotions as the best way for

motivation
Points are used as motivation currency. The more you collect
the more attractive Value Added Services you can get
Additional discounts, lotteries, member gets member
promotions
High-value and aspiring customers receive additional
promotions
Points are calculated for:
Customer status
Purchase of
Increase in
Relationship
Transaction
Timeand location-based
promotions
(e.g.
andnew store
specific
transaction
building rules
value
segmentation
products
value in time
openings)
Single
shopping
basket value,
single order via
phone or
internet

Cumulative
value of all
Customer
transaction in
a time period

Extra points for

purchasing
high-margin
products

Special point
rules for
customers with
Golden or
Silver stauts
in the program

Irregular
motivation and
recognition
(e.g.. points for
registration,
birthday, 3-year
participation in
th program)
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Use REAL Time

for Client
dialogue

From segmentation to effective Client

communication

Source: Gartner
20

Page 20

Use REAL Time

for customer
dialogue
Customer Self Service

Attractive tools for Loyalty Program Members

Full account management through:
Mobile Application
Loyalty Program Website
Contact Center Application

Attractive set of functionalities:

Personal data management
Ordering and tracking rewards
Special personalized offers and coupons
Access to full history of transactions and communication

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Reward
customers for
desired
behaviors

Multiple Rewarding Schemes

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Measure the
results and
improve!

Balancing Loyalty Investment Against

Return
Loyalty Program is a cost
of learning about clients

Additional
Customer Profits

>

Loyalty Program
Investment
+
Loyalty Promotions
Costs

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Measure the
results and
improve !

Constant Reporting & Analysis

Report templates with scheduled generation
Different output formats (PDF, HTML, CSV, XML)
Push and pull reports: automatic reports sending or manual
downloading
Additional analysis on a Dashboard:
KPIs presentation
Data manipulation

Creation of the customized reports by

the user with external tool
Notifications after generation
Page 24

What Comarch proposes as an IT tool for a

loyalty success
Marketing
Department

Administrator
& Marketing

Analytics
Clients

Partners

Customer
Care
Page 25

Flexible projects implementation to optimize the

costs
Our loyalty experience:
Over 80 million members
in 40 worldwide projects
over 2 mln transactions
processed every day

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Q&A

Page 27

Thank you
www.comarch.com