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01/19/2021

Taking Loyalty Beyond Fuel Points & Discounts

ALEXANDRIA, Va.  — As more and more retailers in the convenience store industry align themselves with a loyalty program, the need for points of distinction becomes more critical. Experienced players in the loyalty game are taking their programs beyond fuel points and discounts with the understanding that loyalty programs alone do not build loyalty.

“Build it and they will come is not the right strategy here,” Brad Van Otterloo, CEO of Koupon, said during his moderation of a retailer panel during the recent NACS Crack the Code Experience.

With the idea being that a successful loyalty program always needs “new blood,” c-store retailers like Yesway consider it to be “a funnel that is endless,” according to panelist Derek Gaskins, Yesway’s senior vice president of merchandising and procurement.

“It’s a delicate balance. One of the biggest flaws is treating new people coming in better than long-term members,” he said, noting that Yesway is careful to never assign new members a greater value than what its long-term members already have.

The continuous funnel concept starts at the store with team members, Gaskins explained. “They have to be advocates, not just of the brand and giving friendly service, but advocates of the loyalty program.”

Like Yesway, Casey’s General Stores Inc. is also “constantly thinking about filling that funnel and engaging our members” through its loyalty program, said fellow panelist Art Sebastian, Casey’s vice president of digital customer experience. The c-store chain continuously measures enrollment, active members, and participation rates. And to really engage its store team members and get them to be loyalty program advocates, it puts out incentives and contests for its employees.

Casey’s also highlights the value proposition of its Casey’s Rewards program by trying to bring it to life in more than a functional way, but rather in a way that is relatable — namely, through Casey’s “voice,” which is friendly and contemporary, Sebastian said.

The key strategy for any loyalty program is to treat it as something that needs continuous improvement, shared Ben Hoffmeyer, vice president of marketing and foodservice for Kwik Chek Food Stores Inc., which is in the process of rebranding to Texas Born or TXB.

To change with the needs of customers, understanding your loyalty data is the most valuable piece, he advised. “For us, it’s continuous improvement. [The program] is very different from a year ago; it’s simpler, easier, with more attributes, and we’re just continuously building on that,” he said.

Points of Differentiation

The panel agreed that club points and fuel points have become table stakes in the loyalty game — they are no longer a differentiator, which does not diminish their value, but means more is needed to make a c-store loyalty program stand out.

For TXB, program flexibility is key. Members can use their points for fuel discounts or as cash in the store, with the points never expiring.

Moreover, gamification is driving a lot of traffic. This summer, the retailer did a “100 Days of Summer” scratch-and-win app contest, whereby winning digital coupons could be redeemed in 24 hours. The program generated $150,000 in sales, according to Hoffmeyer. “It’s something fun, different. We really try to make it fun and engaging,” he said.  

Flexibility is a big part of Casey’s Rewards program as well. Members can spend their points for fuel discounts, convert them into Casey’s Cash as store currency, or use them as cash to donate to the local school of their choice. “This third choice, donations to schools, is really our greater purpose and is helping to make our customers and community better,” said Sebastian. “It goes beyond saving money and is a key point of difference.”

The notion of anticipation is another differentiator in Casey’s Rewards program. During key holidays and points of time throughout the year, the chain builds up anticipation for daily offers (such as free items) that will be revealed to keep the member base engaged.

At Yesway, mass customization — which Gaskins admits sounds like an oxymoron — is one of the ways the chain differentiates. It basically “personalizes its currency” in the form of smiles. “Our smiles can be redeemed for cents or dollars off gallons, or for signature food items of Yesway-branded products, or vendor programs,” he said.

Yesway also aims to be on “the cutting edge of AI [artificial intelligence] and using machine learning and automated campaign management,” Gaskins added.

Van Otterloo summarized that there is no one size fits all with loyalty. “It’s truly allowing people to interact with you and your brand/location as they want to,” he said.

Cultivating Loyalty Outside of a Loyalty Program

The panel acknowledged that not everyone will join your loyalty program and that’s OK. C-store retailers can still encourage and maintain loyalty outside of a loyalty program.

For instance, Casey’s is continuously dreaming up creative ways to engage all its customers and build a relationship through its fans and followers on social media channels, according to Sebastian. Last year, it ran a sweepstakes for followers to win free pizza for a year. It also held a Midwest Mystery Pizza event, whereby it engaged its fan base to rename a pizza.

Yesway partners with suppliers to extend beyond its loyalty program, exciting customers through chances to win unique experiences with sports stars and other celebrities.

Hoffmeyer shared that TXB is conducting customer surveys through social media to discover how and where it can improve. It is also using loyalty data and third-party data to make sure it is merchandising correctly and building the right customer segments. “This is a big focus for us in 2021 — understanding our customer persona across the board; how to track and measure that,” he relayed.  

The NACS Crack the Code Experience was a five-week digital event that brought together convenience store industry retailers and suppliers virtually in lieu of an in-person NACS Show this year. It ran from early November to early December.