First-ever mall-wide rewards program launched

Discussion
Sep 03, 2015

Starwood Retail Partners, which owns several malls, has partnered with a loyalty network to launch "Oh, So Simple Rewards," described as "a first-of-its-kind rewards program that offers consumers easy to earn credit for their purchases at stores across the entire mall."

The program, developed with Spring Network, enables members to earn $10 back on every $250 they spend at their local one-stop shopping center, regardless of the payment method they choose.

Shoppers sign up for Oh, So Simple Rewards at mall kiosks or at ShoppingChicagoRidgeMall.com/Rewards. The process links an existing Visa, MasterCard or personal American Express credit or debit card to an Oh, So Simple Rewards account. Members can connect as many of their cards to the account as they wish.

Members then automatically earn credit for purchases made across the entire mall and receive real time notifications for cash back rewards. When spending reaches $250, a $10 credit is registered to the member’s rewards account. Members can use their earned cash value at whatever retailer they choose.

Oh, So Simple rewards

Source: shoppingchicagoridgemall.com

Members must provide an e-mail address and can also opt to share a phone number to receive exclusive offers. The information will be used for account notifications and marketing messages, though members can opt out of receiving some of these communications.

For retailers, using real-time spending data will enable stores "to engage high intent shoppers while they are in the mall and structure incentives by spend amount, time frame or specific location." Redemption of rewards is said to be automatically administered by the platform with no operational burden, change at the point of sale, or involvement by the retailer staff.

"This robust, efficient and easy to use platform delivers a performance-based solution to retailers that they can use with no risk," said Laurie Paquette, director of asset management.

The program debuted on September 2 at Starwood’s Chicago Ridge Mall in Chicago Ridge, IL. The Oh, So Simple Rewards program is set to roll out in three additional markets this year and all 29 Starwood properties during 2016, reaching approximately 3,000 retailer locations, more than 100 million annual consumer visits, and $15 billion in consumer spending.

What do you see as the pros and cons of Oh, So Simple Rewards for shoppers and stores? How much consumer appeal do you see in mall-based loyalty programs?

Braintrust
"First of all, I can’t believe it took so long. As to the pros, we probably don’t need to enumerate them. As to drawbacks, can you spell H-A-C-K?"
"The ultimate question will be, how does the ROI on this program compare to other traffic driving tactics that are available to the mall and its tenants?"
"Oh, so Simple Rewards is a smaller version of a nationwide coalition loyalty program with a few tweaks. The real-time rewards that consumers earn are important here. Fast-and-easy delivery is paramount to the customer experience."

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13 Comments on "First-ever mall-wide rewards program launched"

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Bob Phibbs
BrainTrust

Very smart. Customers can see how easy it is to use, it doesn’t apparently conflict with other reward cards like frequent flier cards and it is site-specific. A good tool to use when marketing a mall as a destination and it draws comparisons with online retailers who can’t match the breadth of the offering.

Camille P. Schuster, PhD.
BrainTrust

The pros are the flexibility to consumers for using rewards across a number of retailers. A pro for the mall is that the program may stimulate shoppers to visit a variety of stores at the mall. A pro for Starwood is that consumers may like the flexibility of the rewards program.

If consumers do not typically shop at other stores in the mall, this program will not be valuable. If consumers do not typically shop at a particular mall, this program will not motivate them to go there. Consumers do not typically associate particular malls with a hotel chain, so this program does not inherently build the image of Starwood hotels.

While a mall-based loyalty program may have some value for consumers if they shop a variety of stores at the mall, associating it with a hotel chain does not seem to be attractive.

Chris Petersen, PhD.
BrainTrust
Let’s be clear, this isn’t so much about designing a loyal shopper program for consumers. It is about getting consumers to turn their phones on so that malls and retailers can track location and shopping behavior! One of the biggest challenges of shopping centers is that average trips have dropped from 7.9 times per year to 3.8 trips. To keep retailers as tenants, malls must do something to help drive trips, repeat visits and loyalty. I just posted about “NEX”, which is an innovative outlet mall. NEX has implemented a complete digital platform across the mall: complete with with an integrated app, coupons and location tracking. Their results speak to the power of an integrated mall-based approach: 30 percent of mall visitors check their app before coming 60 percent of app users that visit the mall do so within 4 hours of seeing an offer. The mall can track each store that the consumer visits will shopping. The future of retail, especially malls, is all about “place” and how to leverage location. The portal is the consumer’s smartphone. The key is providing consumers with enough benefits that they will opt in, turn their phone on while shopping AND use the… Read more »
Ryan Mathews
BrainTrust

First of all, I can’t believe it took so long.

As to the pros, we probably don’t need to enumerate them. Customers get more rewards faster, have more incentive to shop the whole mall, the rewards make one mall instantly more attractive than another, etc.

As to drawbacks, can you spell H-A-C-K? The system, like all systems, will only be as strong as its weakest link and a hack of that link will compromise everyone.

As to appeal. Hey, this is aimed at customers who are already there right? What’s for them to hate?

Gene Detroyer
BrainTrust

This is a nice program for the shopper already in the mall and the stores. It probably will generate incremental sales for some retailers. If I have spent $200 already, might I go for another $50? Perhaps. If I have $200 in the bank, might I return to that mall? Probably. Will it compel me to go to the mall to shop rather than other retail alternatives? Not likely. Will the program eventually become thoughtless to the shopper? Very likely!

W. Frank Dell II
BrainTrust

Frequent shopper programs have fallen into pure customer discounts, which does not build loyalty, only reinforces that prices are too high. This mall concept has been tried before by a group of retailers in a city. The problem was they had different customer bases. In theory a mall has the same target customer across many retailers. The real problem is getting customers to visit a mall today. More malls are to be changed into something else than are being built today. Many consumers just see malls an expensive shop. Not sure $10 on $250 purchased will change that image.

Naomi K. Shapiro
Guest
Naomi K. Shapiro
2 years 18 days ago

Chris Petersen touched most of the bases (while providing some great statistics) about the power of an integrated mall-based approach. I do think such a reward program will lead to more customer visits to more of the mall members, more time spent in the mall and maybe more spending to receive the bonus amount. It’s a kind of “bundling” of mall services, and that may make the contents and price more attractive than a one-by-one (or none) approach.

Ralph Jacobson
BrainTrust

This is about getting people to the malls, right? Not a bad thing…for the malls. There are some other programs that cross merchants/retailers/utilities, etc., that have been talked about here on RetailWire, however, there has to be a reason for the shopper to keep coming back and I’m not certain the offer is compelling enough.

Martin Mehalchin
BrainTrust

The biggest pro about this from the consumer’s point of view is how seamless the program sounds. Just shop and then see a credit on your card account. The question is whether the seamless design might actually lessen the loyalty impact. Will consumers become so accustomed to the program that they barely notice the credit and don’t modify their behavior as a result?

The other aspect that would be interesting to explore here are the back-end arrangements and economics. It would be interesting to know if Starwood is subsidizing the rewards at all, or if the costs are just proportionally shared by those retailers who ring up the sales. Also, who is paying Spring’s admin fees, Starwood or the retailers? The ultimate question will be how does the ROI on this program compare to other traffic driving tactics that are available to the mall and its tenants? Kudos to Starwood for organizing a diverse group of tenants to all participate in the program; I’m sure that was a non-trivial undertaking.

Jenne Barbour
Guest
Jenne Barbour
2 years 18 days ago

Having worked with another mall group owner to address shopper loyalty in its centers several years ago, I certainly admire Starwood’s work to collect, track and reward multiple forms of payment via Spring [the tech years have been kind to retailers and retail-adjacent businesses in this regard], but I find it too short-sighted for today’s consumer’s expectations.

Never mind my mother, who keeps her phone turned off, in her purse, and would be caught dead before she connected her credit and debit cards to a 3rd party program—not the retailer. And yet, she shops at the mall frequently, and should be their target. Her daughter visits the mall (and is far more likely to connect and track), but inevitably defaults to those brown boxes on my porch that arrive.

The other limiter I see is the householding of cards for a membership. Again, it doesn’t provide the potential for individualizing the experience, and fences in the opportunity to connect one:one with shoppers.

So, bravo for getting it to market in Chicago Ridge, but get ready for the lessons learned from this one.

Michael Greenberg
Guest
Michael Greenberg
2 years 18 days ago

This is much more common in Asia, where many malls have mom and pop shops with minimal technology. Those are typically coupon programs and moderately effective.

One of the big challenges of retailer-specific programs is the spending threshold needed to achieve rewards. A cross-retailer program in a mall can achieve those spending levels to make it “worth it” from the customers’ point of view.

So the longer-term challenge will be to translate the promise of stuff (benefits, rewards, etc.) in exchange for consolidation of wallet share at the mall (aka more trips). If Starwood has committed a couple of years of operating budget to go through the inevitable trial and error, they really may be on to something. My guess is Westfield will respond strongly if it shows any level of success.

Bryan Pearson
BrainTrust

Oh, so Simple Rewards is a smaller version of a nationwide coalition loyalty program with a few tweaks. As CEO of LoyaltyOne, which operates Canada’s nationwide coalition program AIRMILES, I can tell you what I think is the appeal of this type of program to consumers.

The real-time rewards that consumers earn are important here. Fast-and-easy delivery is paramount to the customer experience, and the value of instant gratification when making a purchase is not to be discounted. Also to be noted, the ability to earn credits for purchases and redeem those points from a broad variety of merchants in the mall makes the program accessible and appealing to a larger consumer base.

There is a definite benefit to consumers as long as program partners use the data they collect wisely. If used well to target relevant offers to consumers, the value proposition should reinforce itself, leading to increased adoption by consumers who are receptive to those offers. That said, if used poorly, consumers may feel spammed by offers from irrelevant retailers and choose to abandon the program.

Kai Clarke
BrainTrust

Another reward program which promises much, but really doesn’t do anything unique with the data which is collected. The true issue with these programs is how does participation offer the retailer an advantage? The secondary question is how to get, and use the actual data to improve sales. This program doesn’t offer any answers to these 2 key questions, but seems to fall into the same abyss as most loyalty programs. This really doesn’t offer any more appeal to consumers than a simple credit card loyalty program….

wpDiscuz
Braintrust
"First of all, I can’t believe it took so long. As to the pros, we probably don’t need to enumerate them. As to drawbacks, can you spell H-A-C-K?"
"The ultimate question will be, how does the ROI on this program compare to other traffic driving tactics that are available to the mall and its tenants?"
"Oh, so Simple Rewards is a smaller version of a nationwide coalition loyalty program with a few tweaks. The real-time rewards that consumers earn are important here. Fast-and-easy delivery is paramount to the customer experience."

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