My Optimum. My Rewards.
86% of all Canadians participate in at least one loyalty program. In fact, the average Canadian household is active in more than nine programs! In a highly competitive retail market, companies are striving to bring their consumers value while simultaneously creating brand loyalty. Few brands do this better than Shoppers Drug Mart. In the past year, Shoppers has completely redesigned their loyalty program to fit the fast paced lives of their consumers. The new “My Optimum. My Rewards” program will provide members with personalized offers via mobile phone with the ability for them to load them onto their card via the app. Once enough points are collected, members are able to redeem them for credit on almost anything in store.
Shoppers Optimum Reward Program previously had issues with their loyalty program when customers were forced to download and print off coupons via email. In a tech savvy, fast paced generation people viewed this as too much of a hassle.
Loyalty programs surprise consumers by rewarding them for activities that had previously gone unnoticed. The joy customers experienced appealed to their emotions, thus strengthening the loyalty between the organization and customer. According to Shoppers, more than 386,000 lipsticks and 1.3 million toothbrushes were redeemed by Shoppers 10 million loyalty member’s last year using Optimum points last year.
Ultimately, these rewards are payment for both behavioral loyalty and customer personal data. As stated by Niraj Dawar, a marketing professor at Ivey School of Business, “Shoppers has managed to change the retail game in that space by targeting individual consumers with offers they can’t refuse… As it turns out, the cost of those points and rewards are small compared to the potential benefit”.
Loyalty participants are 70% more likely to recommend a store than non-members. By gaining loyalty through emotional connections with their members, Shoppers Drug Mart generates a large amount of referrals to their store. In fact, 73% of millennial consumers feel it is their responsibility to help their friends and family make smart purchase decisions. Optimum reward members spend 60% more than nonmembers, and 2/3 of all sales within Shoppers Drug Mart are with the Optimum card.
Additionally, a customer loyalty program can help Shoppers Drug Mart calculate the customer lifetime value as the organization tracks spending information on its members. From this information, Shoppers is able to track how loyal particular customers are as well as the value of the customer to Shoppers Drug Mart.
The Optimum reward program can also provide the organization with behavioral data of consumers, allowing them to track in store trends and allow the company to send personalized offers to member through the app. Furthermore, Shoppers Drug Mart is able to monitor the actions of consumers before making a purchase, allowing them to track which promotions are the most effective on particular segments of their consumer base.
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