Story and photos by John I. Borja
As businesses continue to maintain and upgrade loyalty programs for customer satisfaction, consumers are looking more toward personalization and partnerships with their rewards.
HelloWorld, a Merkle Company that provides marketing services for companies, in a report published in December concluded that consumers appreciate a loyalty program that is relatable and appeals to their individual interests. With changing trends and advancing technologies, businesses on Guam are also updating their loyalty programs to better suit their customers.
Calvo’s Insurance Underwriters Inc. Lifestyle Club has a network of benefits for its home, auto and health insurance customers. Shopping, dining and health care are the primary outlets for these benefits and discounts. Participating companies change from time to time, but there are more than 100 offers and discounts from various companies under the Lifestyle Club.
“The relationships with our customers and our partners help the program to be successful. It is our way of saying ‘Thank you’ to our customers for placing their trust in us,” says Steven P. Perez, Lifestyle Club associate.
Because it’s connected to the insurance company, Perez says some members sign up with Calvo’s Insurance specifically for the Lifestyle Club benefits. The loyalty program increases marketing and sales opportunities for the business. It also increases exposure for those companies partnering with the program, he says.
Numerous businesses on Guam express their appreciation for customer loyalty by setting up special programs with exclusive rewards. Loyalty programs have various structures, but all have a singular goal: to maintain the company’s consumer base. Through rewards, these programs are a way of giving back to customers who keep the business afloat.
Camille Denight, regional marketing manager of IP&E Holdings, which is licensed to operate the Shell brand on Guam, Saipan and Palau, says a loyalty program is a win-win situation for everyone.
“For us, we get customers that return. Customers get more value for their dollars. It creates a better relationship and more interaction between the customer and business,” Denight says.
Shell has the Lucky 7 Gold rewards program that partners with other companies to benefit Shell customers. Customers can sign up for the program at any Shell location by filling out an application, and they can redeem points soon after.
With the Lucky 7 Gold program, a customer earns one point for each gallon purchased at Shell locations. A customer that accumulates 100 points can redeem $7 in free fuel, $7 in purchases from a connected convenience store, a $10 IT&E prepaid wireless card or 500 United Airlines MileagePlus Award miles.
“We’ve had a very positive response with our program since it started. Nearly 50% of Shell customers use our Lucky 7 program,” Denight says.
Shell’s point-based program is just one of several structures businesses use for their loyalty programs. Other structures include card stamping, exclusive products and events for members, surprise rewards and rewards for customers who frequently engage with company events and promotions.
The HelloWorld report shows that 64% of those surveyed favored a loyalty program structure where they must earn points to unlock rewards.
The popularity of points is evident in Infusion Coffee and Tea’s point-based program, which has tiered rewards based on the number of points a customer has.
“Our customers watch their points grow and usually save it as long as possible in order to get a big reward,” Archway Inc. Vice President and General Manager Mika C. Gibson says. Archway is the parent company of Infusion.
Infusion’s rewards program is the company’s way of letting its customers knows that they are appreciated for their loyalty, Gibson said. Points, earned through in-store purchases, can get a customer a free beverage, snack or gift certificate, which becomes popular during the holiday season, she says.
“We have a very generous loyalty program and our customers recognize that. Some of our customers will volunteer to do the coffee run for the office just so they can get the points,” Gibson says.
HelloWorld’s report shows the second favorable structure, a cash reward after spending a certain amount of money, gained 60% approval from those surveyed.
Subway’s MyWay rewards program has a similar structure in which customers earn eight tokens for every dollar they spend. When a customer earns 200 tokens, they automatically get a $2 cash reward. That’s $2 for every $25 a customer spends at Subway.
Macy’s Inc. uses a combination of structures for its rewards program. Star Rewards uses a tiered membership based on how much a customer spends annually. At the highest level of the program, a customer is eligible for a cash-back opportunity.
Andrea Schwartz, vice president of media relations for Macy’s Inc. North Central, Northwest, South and Southwest regions, says the company pays attention to how its customers respond to its Star Rewards programs. So far, it has been a generally positive experience, Schwartz said.
“We rolled out the first phase of our new Star Rewards loyalty program in early October 2017. Our customers are responding enthusiastically, particularly at our platinum level, which is our most valuable customer,” Schwartz says.
The Star Rewards program has three levels divided by how much a customer spends annually: Silver for customers who spend up to $499 annually; Gold for between $500 and $1,199 annually; and Platinum for $1,200 and beyond. The benefits start with a 25% discount with Star Pass coupons, and as customers upgrade their status, they earn free shipping and 5% rebate on purchases after spending at least $200.
“Of course, this continues to benefit Macy’s customers, our Macy’s colleagues and the community,” Schwartz says. “It’s important to Macy’s to make a meaningful impact — in the customers’ purchases of value and the greater community.”
The 2017 loyalty report also notes what consumers don’t like about loyalty and rewards programs, with the top concern being that it takes too long to earn a reward. The results indicate that 53% of all respondents shared that sentiment. Other concerns include too much communications, keeping personal information secure, difficulties in earning a reward and rewards that aren’t enticing.
The report concludes that 77% of consumers surveyed want a more personalized experience with loyalty programs. This includes partnering with companies that fit a customer’s lifestyle and creating rewards based on a customer’s purchase. Consumers also want to be rewarded for filling out questionnaires distributed by the company, the report states.
As trends come and go, businesses update their loyalty programs so that customers remain interested. Schwartz says Macy’s will be evolving its Star Rewards program later this year to enhance customer experience, and Denight says Shell will be adding new features to its Lucky 7 program so that its customers will continue to enjoy the program.
Guam Business Magazine compiled a list of loyalty and rewards programs residents can take advantage of this year.