supermarket club/reward cards

[AlsoNamedBort]

When I worked at Kroger’s, I learned about how they find out how much you spend on average on groceries and send you coupons based on that. Say, for example, you spend about $60 a week. They’ll start sending you “Spend $70 and save $7” coupons. So then when the coupons finally stop you’re used to getting $70 worth of groceries a week. And then the cycle repeats.

[BlinkingDuck]

@mkmkmk

Does anyone know what supermarkets (and many other retailers) do with all the data collected from using their club/reward cards? They claim the data is not sold, traded or used for any nefarious purpose. Why then are they selling product to card holders for 1/2 or even less than they sell to non-cardholders?

I just found out that if you register a Ralph’s card using the internet you can complete registration after skipping the page that asks for address phone number ect

I’ll bet they don’t wan that generally known to the public!

There is so much you can do with it. It really is powerful stuff. Unlike surveys, which rely on respondents participating and relying on what they SAY…this is actual, real stuff. Pure.

Just off the top of the head on could:

• Optimise the layout of the store…putting items that tend to be purchased together in the same area. This includes items you might not think go together but when a person buys something they see the related item and decide they need that as well. Likewise put common items in the back so people have to walk by items that have a larger probability of appealing to them.

• Find a good spot for a new item.

• You can segment the customers and target advertising/coupons to them including direct mail.

• You can gauge the profitability of individual customers and exclude unprofitable ‘cherry pickers’ from direct advertisement/coupons.

• Use it as an early warning system…significant groups of high purchase customers stopping or slowing down their purchases overall or in certain areas could mean there is an issue in that area and needs to be investigated.

and so on…much much possibilities

[BlinkingDuck]

@AlsoNamedBort

When I worked at Kroger’s, I learned about how they find out how much you spend on average on groceries and send you coupons based on that. Say, for example, you spend about $60 a week. They’ll start sending you “Spend $70 and save $7” coupons. So then when the coupons finally stop you’re used to getting $70 worth of groceries a week. And then the cycle repeats.

Yes…another good example. Marketers believe it is much easier to get more money out of existing customers than get new ones.

Don’t laugh…studies have also shown people shop at 2 or more grocery stores rather than just one…so they want to become that one.

[muttrox]

@mkmkmk

Why then are they selling product to card holders for 1/2 or even less than they sell to non-cardholders?

I’d like to know what store is giving a 50% or more discount.

[Tastes_of_Chocolate]

@Sigmagirl

I noticed that Giant Eagle was giving me register coupons for Kotex on a kind of semi-regular basis. :dubious: I e-mailed them and asked **“Just what is it you are keeping track of here?” **
They stopped giving me those coupons.

Dear customer:

We see you are about to have your period. Here is a coupon for Kotex. Time to stock up. While you are here, don’t forget to get more Advil and some chocolate.

Sincerely,
Your caring grocer

[chowder]

@ruadh

The vouchers I get from Tesco aren’t anywhere near that value - I’m not sure if that’s because I buy less than you, or because I live in Rip-off Ireland - but they are certainly the reason I use their loyalty card. If something’s cheaper elsewhere I’ll buy it elsewhere, but if the prices are the same I’ll buy it at Tesco to get more points to get more vouchers. If it saves me money, why not.

And while I certainly don’t want them selling my personal data, I wouldn’t mind it at all if they would use it to send more appropriate offers in my direction. After almost ten years of buying exclusively vegetarian goods (including things like their own-brand vegetarian products), I’d like it if they would figure out I’m not interested in €2 off a sirloin steak or whatever.

I possibly buy more than you and then there’s always petrol and the points I get by registering my electricity account with the Tesco club card people.

For every £ spend on power I normally get 1p but as Tesco have an incentive on at the moment this is increased to 2p for every £

[Mister_Rik]

@Exapno_Mapcase

The register prints coupons that are being pushed by the manufacturer, not the store. The owner of the coupon brand looks through the data and sees that you like the product but are buying a competitor’s brand. So when you buy that brand the machine is programmed to spit out a coupon that will tempt you to try or go back to the other brand.

Well, in my case there haven’t been any competitor’s products involved. Examples of coupons I’ve gotten: Motrin (I’d purchased a large bottle months earlier. I’m single, with no family to share the bottle with, so of course it lasts me a long time. I wasn’t buying Advil or Nuprin or any other brand of ibuprofen when I got the coupon; I just hadn’t needed to buy pain relievers lately because I hadn’t finished off the existing bottle.); Hot Pockets (In this case I’d simply gotten tired of eating them, so hadn’t bought a box in a while. The only competing brand my Safeway sells is the store brand, which I’ve never purchased.)

Some other things I’ve gotten coupons for are items I just no longer buy at Safeway because I can get them in larger quantities at a better price now that I have a Costco membership. I tend to be pretty “brand loyal” anyway.

[joebuck20]

@Balthisar

Almost all of the register coupons I get are for stupid stuff I’d never dream of buying, like frozen pizza or frozen vegetables that already have some sauce of unknown origin. Why can’t I get coupons for fresh asparagus or salmon from the meat counter?

Or they’re only good if you buy three of the product.

[tofergregg]

@joebuck20

Or they’re only good if you buy three of the product.

All the stores I’ve shopped at don’t require you to buy X number in an X for $Y deal. You can simply buy one and they divide the Y/X and charge you that much.

I’ve also never actually signed up for a card–I just get it from the cashier the first time I’m in the store, and use it thereafter. If I forget the card, most of the time the cashier will swipe a card he/she has for me, to give me the discounts. Or, I just ask for another card, which is immediately used.

[Balthisar]

@Exapno_Mapcase

The register prints coupons that are being pushed by the manufacturer, not the store. The owner of the coupon brand looks through the data and sees that you like the product but are buying a competitor’s brand. So when you buy that brand the machine is programmed to spit out a coupon that will tempt you to try or go back to the other brand.
…
And that’s why you don’t see these coupons for fresh meat or produce. They aren’t branded and there is no need to pry you away from a competitor.

I should have been more specific. I always get tons and tons of coupons at Meijer. Many of them are indeed manufacturers coupons. But many of them are store coupons, and that’s an important difference legally. The fresh veggies and meat are basically “brandless.” Yeah, the name of the producer is on the fruit, and I suppose I could dig up where the meat came from, but they’re basically store commodities, like the bakery items. So when I get the store coupons, that’s the kind of stuff I want.

[Prelude_to_Fascination]

I generally dislike the cards partially because I shop at several different stores, and I don’t like the prices advertised in numbers 9 feet tall, and in .002mm print the words “with your card” are below it. Dammit, I want to know what the price is without the card. Plus I don’t like the idea of invasive marketing (yeah, I know everybody online knows all about me or can find out, since I’m online and I bank online, and even if I didn’t, my bank banks electronically, and so on). I just figure they’ll sell my information, regardless of whether they say they won’t. I get enough junk mail I don’t use.

Now, a plus for the cards: my wife does our weekly grocery shopping with one that offers discounts at the gas pump, and when we used it, the discount was actually more than the price per gallon. I literally paid 2 cents per gallon for gas (tax), and ended up filling my car for a total of 32 cents rather than $30 or so.

[CookingWithGas]

@ZipperJJ

They are customer loyalty cards. If your experience is that because you have one of these cards you are treated to special discounts when you shop at their store, you’ll be more inclined to shop at their store again.

But my grocery store (Giant) uses the cards, and virtually every customer now has a card, and so virtually everyone gets the discounts. Just like before they issued the cards. :rolleyes:

They can also use their data to see that card holders are likely to buy pizza dough and pizza sauce, but only when pizza dough is on sale.

You don’t have to ask customers to sign up, provide personal information, and use a card to do analysis of what items are purchased together.

@Eyebrows_0f_Doom

I use them because they save me a few bucks. Why would I want to pay more when I can pay less?

Like I said, I could save the same money before cards as I can now with cards. So sure, I use a card to save the money, but I preferred the days of anonymous purchases and the same savings.

@BlinkingDuck

There is so much you can do with it. It really is powerful stuff.

off the top of the head on could:

• Optimise the layout of the store…putting items that tend to be purchased together in the same area.

You don’t need loyalty cards to know what items are purchased together.

• You can segment the customers and target advertising/coupons to them including direct mail.

• You can gauge the profitability of individual customers and exclude unprofitable ‘cherry pickers’ from direct advertisement/coupons.

True, you can, but I do not get tailored direct mail from any retailer. Not sure if any of them actually do this.

• Use it as an early warning system…significant groups of high purchase customers stopping or slowing down their purchases overall or in certain areas could mean there is an issue in that area and needs to be investigated.

Good point, I wonder if anyone actually does this. And what would they do to investigate? If Best Buy called me and said, “Say, we noticed you bought a shitload of computer components last year but just a CD this year. What’s up with that?” it would be a very short conversation.

@InvisibleWombat

I implemented a “Frequent Reader” program at my bookstore (it doesn’t use cards–just give your phone number when you come to the register).

This is a great list of services that are actually valuable to the customer, and I would love to be a customer of this bookstore.

However, every big chain (Giant, Best Buy, Borders, PETCO, Staples, Eddie Bauer) for which I have a loyalty card provides absolutely no value added to me as a customer (aside from the occasional token coupon in some cases). The exception is Giant, enough about which I ranted earlier. If these guys had the littlest bit of imagination they could really win me over. But none of them show any signs of using the data to improve the customer experience and build genuine loyalty.

[BlinkingDuck]

CookingwithGas…

Agree. I work with many F500 companies. I am constantly amazed at what they have and what they don’t do with it.

However, they could…and a few do.

[dzeiger]

@Shagnasty

One of the primary benefits to the company itself is hinted at in the term “customer loyalty card”. People don’t want to sign up for and carry around dozens of extra cards so offering them will make some people more likely to favor your stores over another.

FWIW, there’s an Android (and probablt iPhone) app that scans in loyalty cards, and then can just display them on the phone’s screen for scanning later–so you no longer have to carry any cards around, just pull up the app and select the card you wish to use.

[Gary_Robson]

@CookingWithGas

You don’t have to ask customers to sign up, provide personal information, and use a card to do analysis of what items are purchased together.

I’ve noticed that a lot of the things discussed in this thread are things that I can do from my store data without having any kind of loyalty card. That’s why my list was fairly short.

[Balthisar]

@dzeiger

FWIW, there’s an Android (and probablt iPhone) app that scans in loyalty cards, and then can just display them on the phone’s screen for scanning later–so you no longer have to carry any cards around, just pull up the app and select the card you wish to use.

CardStar on the iPhone or iPod Touch.

[not_alice]

@CookingWithGas

But my grocery store (Giant) uses the cards, and virtually every customer now has a card, and so virtually everyone gets the discounts. Just like before they issued the cards. :rolleyes:

But you don’t know how they actually set the prices in the first place. As I mentioned upthread, that is an internal process, sometimes involving negotiations with thousands of vendors.

Even if the price is exactly the same as it would have been, the store benefits from increased negotiation power, and increased ability to predict and influence demand. The vendors, knowing that to be true, also benefit, because they can set their pricing, and production accordingly.

If they can do all that, and still keep the prices the same you benefit, and each company makes more profit because there costs are lower. And in that case, share holders benefit too.

They just need broad adoption, and not-runaway costs of implementing the program for it to succeed.

You don’t have to ask customers to sign up, provide personal information, and use a card to do analysis of what items are purchased together.

True, but that is not likely all the analysis that is going on. As the checkout-time coupon examples show, if you can provide more useful coupons to the customer over the set of whole customers, then you start to accrue the benefits I listed above. In order for that to happen, you need most of your data to be tied to the customer him or herself for most accuracy.

Like I said, I could save the same money before cards as I can now with cards. So sure, I use a card to save the money, but I preferred the days of anonymous purchases and the same savings.

I agree, but they are not really “discount cards” if you think about it. Instead, by not using it, you in fact pay a penalty for not sharing your info. In a sense, you are buying your privacy with each purchase.

True, you can, but I do not get tailored direct mail from any retailer. Not sure if any of them actually do this.

Then you are a rare breed indeed. It is not as personalized via snail mail as via email or other similar channels, but it is more personalized than you might be aware.

Good point, I wonder if anyone actually does this. And what would they do to investigate? If Best Buy called me and said, “Say, we noticed you bought a shitload of computer components last year but just a CD this year. What’s up with that?” it would be a very short conversation.

It is not you they call when they notice this, they notice it in the aggregate and use it internally in their marketing and purchasing plans, and they may share it in aggregate with some vendors when they explain why they are not interested in buying CDs from them in the future, but they do expect to be buying more DVDs or whatever in the future hint hint. This is very valuable information for both parties.

This is a great list of services that are actually valuable to the customer, and I would love to be a customer of this bookstore.

It is pretty common at independent bookstores these days, no, as they compete with Amazon, I thought.

However, every big chain (Giant, Best Buy, Borders, PETCO, Staples, Eddie Bauer) for which I have a loyalty card provides absolutely no value added to me as a customer (aside from the occasional token coupon in some cases).

No, you just don’t see it because they don’t have outdated, inappropriate merchandise at prices you wouldn’t pay. Eddie Bauer doesn’t suddenly start competing with Hot Topic for instance, because they know their customers well enough to know they won’t start bringing their kids in for halter tops while they buy flannel shirts. Otherwise, trying to extend the brand by attracting the whole family is a fair approach.

Anyway, the explicit benefit is you get a store you like, and continue to shop there. The benefit of the card is they get to manage their business better, which leads to a better store for you. Prices, and especially discounts, have little to do with the overall point. That is just get and keep the sheep in line

[ClevelandProud]

@Spartydog

…

Anecdote, I was shopping in a supermarket that was in a region I rarely visit. I bought an item that would give me a discount if I had an affinity card. The cashier asked me for it, I said I didn’t have one. He asked me if I wanted one, I said OK. He handed it to me with the application and said “Send it in later.” He scanned the card and gave me the discount. I threw it all out when I left the store. That’s what it is all about.

You may have gotten the card and the discount but by not registering the card you will be unable to receive updates on new discounts / savings.

I found this out with a CVS ExtraCard Card that I have not taken the time to register with CVS.

When scanning the card at the store’s kisok, you only receive two default coupons and no others.

Many more discount offers are printed out once the card is registered.

Loyalty cards are all what you make it.

[not_alice]

@Spartydog

Anecdote, I was shopping in a supermarket that was in a region I rarely visit. I bought an item that would give me a discount if I had an affinity card. The cashier asked me for it, I said I didn’t have one. He asked me if I wanted one, I said OK. He handed it to me with the application and said “Send it in later.” He scanned the card and gave me the discount. I threw it all out when I left the store. That’s what it is all about.

Well, yeah.

In essence, they paid you a bit for the data that they collected.

Which supports my point that it is the data they are after, to help them run their business more effectively (IOW more profitably). The actual interactions with customers are only a tiny part of that process, and the data is valuable throughout much more of the process than just that part of it.

Basically, the stores are “paying” for the data, on the bet that they can then run the business more profitably with the data (and without the money they paid for it) than without the data (and with the money they paid for it).

[Voluble]

Those nefarious stores also have another use loyalty cards; they can use them to give you cars. That is right, I swiped my card at the checkout register one day and was called sometime later and told I had won a Mini-Cooper.:eek:

Dr. Pepper was running a promotion and each time you bought one of their products you were automatically entered if you used your store card. Since I drink a ton of the stuff, and had even held bonds from the company in the past, it made it all the sweeter.

So remember kids, keep your contact info up to date on all of your loyalty cards or someone else will get your goodies!

Now if the grocery store would just use the damn thing to realize that I am not going to buy any ice cream unless they have my flavor everything would be perfect. As it is, if I buy something often enough they seem to stop carrying it.:smack: