GHQ: Winning Them Over
By Suzanne Vita Palazzo
Through a special arrangement, what follows is an excerpt of a current article from Grocery Headquarters magazine, presented here for discussion.
For wellness customers, savings cards don’t cut it. These shoppers have already shown their willingness to pay a premium for healthful offerings, and discounts aren’t often a source of purchase motivation.
When building a loyalty program toward them, retailers should first understand that the wellness base requires a good dose of respect for their chosen lifestyles. They also tend to have a “unique emotional connection” to favorite brands. Since notions of well-being and social responsibility often cause these consumers to remain devoted to a particular manufacturer, it stands to reason that retailers could effectively build store loyalty by highlighting the same themes.
“There’s transactional loyalty, and discount-based loyalty programs are really driving transactional loyalty,” says Phil Rubin, president of Atlanta-based RDialogue. “But that is not nearly as valuable as customer loyalty where there is an emotional component.”
An effective way of activating this emotional component is offering a rewards-based loyalty program tied to a store card that allows wellness shoppers to receive deals and product giveaways relevant to their lifestyles. Particularly beneficial programs help shoppers achieve goals, whether dieting, exercise or something else.
One example would be in-store kiosks delivering highly-specified dietary info as well as recipes.
“Loyalty is about problem solving,” says Frank Beurskens, CEO of Buffalo-based Shop to Cook, which markets such as kiosk. “By meeting individuals specific needs, their focus on just price diminishes.”
Other suggestions for appropriate, tangible benefits in shopper rewards programs require partnerships with manufacturers and outside entities. These may include discounts to local gyms or weight-loss organizations such as Curves or Weight Watchers; or trial subscriptions to health-based magazines. Event-based marketing, such as promoting a local marathon, may open doors for additional partnerships and in-store displays.
In addition, some grocers and manufacturers find newsletters distributed online and in the store as an effective way to underscore their commitment to health and wellness. Retailers could also affiliate themselves with causes and charities held in high esteem by wellness shoppers, such as the Lance Armstrong Foundation.
“You have to have a different reward strategy for a wellness customer than you do for someone who’s just buying stuff out of the sugar aisle,” says Mr. Rubin. “There are all kinds of other things that can be offered as a reward, some of which are of direct benefit to the customer and some are just sort of aligned with wellness and the causes that are congruent to that, where the reward is really partnering with brands that are advocating things that you feel strongly about.”
On the downside, loyalty experts agree that it typically requires a bigger investment to acquire any “premium customer.” Also, making the earning-rewards threshold too high can cause feelings of resentment from a wellness customer. Finally, “too-exclusive” partnerships can alienate some customers since the level of devotion to wellness varies from customer to customer.
Going over the top with any promotion – including rewards-based ones – run the risk of being viewed as less than authentic.
“You don’t really want to shout about it or make it seem like a gimmick,” says Blaine Becker, director of marketing and communications for the Hartman Group. “If it’s perceived as genuine or that it’s really there to help the consumer do something, then it really has a great chance of being successful.”
Discussion Questions: Do you agree that a discount card strategy is not appropriate for the wellness crowd? What marketing approaches do you think are best to build loyalty with wellness shoppers?