The purpose of a rewards program is to change your customers’ behavior, getting them to visit more often and/or make more purchases.
The methods for changing these behaviors are broken into two elements: the core program and the layers and promotions.
The core program is the foundation of your rewards program and its “published” piece. It consists of what customers see promoted in your store, what they talk about, and what they compare with your competitors’ loyalty programs.
There are six building blocks of a core program, and they can be implemented on their own or in combination:
- Earned Points. This is the program element that most people think of regarding rewards. People can earn points for making purchases or taking other specified action, and accrued points may be traded in for various rewards. Your earned points program can also include vendor-funded bonus points, whereby people earn rewards for purchasing items in a vendor-funded promotion.
- Fuel Discounts. This is another common element in convenience store loyalty programs, and it often offers discounts per gallon of fuel. It’s important to note that these discounts don’t have to be uniform. For example, you could always offer three cents off per gallon or you could offer 10 cents off per gallon during the first month of membership.
- Club Programs. Many people associate punch cards with club programs, but it’s also very easy to implement a digital “buy x items, get something free” promotion. Running a club program digitally instead of with punch cards allows you to track you customers’ behavior, communicate reminders about their standings, and motivate them to visit.
- Member Pricing. Offering popular items, such as coffee or soda, at a lower price for members than for non-members can be especially effective for generating program sign-ups. People naturally want to save on the items that they purchase regularly.
- C-Stores generally use sweepstakes promotions to rewards members with automatic entries. Beyond that, they can allow members to buy products or redeem points to earn extra entries, incentivizing them to make more purchases.
- Creating different levels of membership adds complexity to a rewards program, but it can be very useful for motivating your competitive customers to act. You can offer advancement to new tiers via purchases and/or visits, vary your rewards by level, and even implement demotion if activity tapers. Keep in mind that your tiers – and how customers can navigate them – should be easily understood. Otherwise, you invite questions from confused customers.
Once you have your core program in place, you can begin planning your layers and promotions. Learn more about your core program by downloading the ebook, “Essential Building Blocks of Convenience Store Reward Programs.”