Loyalty Systems: Fuel for Thought

Oct 19, 2009 12:00 PM, By MICHAEL GARRY


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During an uncertain economy, retailers tend to step up efforts to attract shoppers from competing stores with all manner of price cuts and other enticements. This means that retailers also have to work harder to keep their core shoppers within the fold. Increasingly, card-based loyalty systems are seen as an important way to make customers stay true to their primary stores.

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Giant Eagle, Pittsburgh, is an example of a retailer that has fashioned an effective loyalty program that is different from the conventional variety. This program, known as fuelperks!, gives loyalty card holders something that is especially coveted during difficult economic times — discounts on gasoline.

While Giant Eagle is able to offer a program like this in part because it operates convenience stores with fuel stations called GetGo, other food retailers have run similar programs by partnering with third-party convenience or fuel retailers.

Giant Eagle's fuelperks! program, run in conjunction with Excentus, Irving, Texas, cuts the price of gas at GetGo stations by 10 cents per gallon for every $50 spent at a Giant Eagle store, covering 95% of items, including gift cards. Shoppers are given up to 90 days after the month in which they earn the discount to redeem it, using their card; the savings apply to up to 30 gallons purchased during a single fill-up-up.

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The program, which was rolled out in 2006, is offered at all of the chain's 158 corporate and 63 independently owned stores, as well as its 150 GetGo outlets.

The program “drives loyalty and gets us fill-in trips we would not otherwise get,” said Linda Wakim, senior director of CRM for Giant Eagle, who spoke about the program at the LEAD Marketing Conference earlier this month in Rosemont, Ill.

“The incremental sales and margin impact is positive, so we're pleased with the results,” she said, acknowledging that “there is a launch investment that's needed.”

Wakim puts herself among the “large group of Giant Eagle shoppers who are fuelperks! crazy,” always looking for ways to get faster gas discounts such as purchasing gift cards used at other retail outlets. She generally waits until she's accumulated enough of a discount to get a free tank of gas.

Last year, Giant Eagle introduced a complementary loyalty program called foodperks!, which turns the tables by giving GetGo gasoline consumers discounts on food at Giant Eagle — 1% off a shopping trip (up to 20% of a $300 trip) for every 10 gallons of gas purchased. Introduced in the Columbus, Ohio, market, foodperks! was brought to the chain's home market in Pittsburgh in April of this year.

Working together, the fuelperks! and foodperks! programs “increase loyalty back and forth between groceries and fuel,” said Wakim. One shopper said that Giant Eagle “won me back” as a result of the savings offered through foodperks! “We've seen incremental sales because customers feel we are more competitively priced with foodperks!,” she noted.

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