Part Three: Bookstores vs. Online

In this post, the third of a multi-part series (see part one here and part two here) on how brick-and-mortars could compete better with online booksellers, I want to look at the customer loyalty program.  If you've got a tiny barcode card or two hanging from your key chain you're probably already a member of one or more of these loyalty programs.  I have six hanging from my key chain and I find some actually do encourage loyalty while others, well, not so much.

I'm part of the customer loyalty programs (also called "xxx Member", "xxx Rewards", etc.) for two major bookstore chains.  One is free and the other costs me $25/year.  The one I pay for gives me extra discounts in the store and the other one generates e-mail offers for other types of deals.  Both send me loads of e-mails but I've never found any of them compelling enough to cause me to actually go and buy something.  Since I'm not likely to pick one of these stores over the other, I'm not sure any loyalty is really being built through these programs.

So how about coming up with better, more meaningful loyalty programs?  For me, it's all about content and content accessibility.  Here are a few things that would get me excited about a bookseller's loyalty program...

First, I like the idea of access to exclusive online content.  This could be content that's e-mailed to me (the DailyLit model is an excellent one to study) or available as a PDF download from the store's website.  Next, early access would be nice.  Even a day or two can make a difference.  I was going to buy a certain recent publication anyway but the fact that it was available for my Kindle one day before it appeared in physical bookstores caused me to buy it earlier; I felt like an "insider", regardless of the fact that I wasn't going to start reading it till later in the week.

Why do loyalty programs always just have to be about one store/chain?  Why can't there be a loyalty program that includes two or more stores I shop at most frequently?  One might be a bookstore but others might be a grocery store, an electronics retailer or maybe a gas station.  Points accumulated at all these locations would be pooled together so that one month I might redeem them for a book and the next month I might use them on my gas purchase.

There are two key elements to this: customer flexibility and cross-promotions.  The airlines have always understood this with their loyalty programs, hence all the "alliances" you see across carriers, hotel chains, etc.  Why do bookstores feel they need to go it alone?  There are plenty of great opportunities to cross-promote a variety of goods and services here.

Lastly, these shouldn't be offered as one-size-fits-all programs.  Some members are probably quite happy with the benefits they currently receive.  Great.  They shouldn't have to change.  The rest of us would like to customize the program to best fit our needs.  It can be as simple as a series of checkboxes on a webpage signup screen, but customer options in a program like this could also go a long way towards the ultimate goal of encouraging more purchases.

Comments

[Walt Shiel]

However, your suggestion implies that so-called "loyalty programs" are essentially benign.

I refuse to participate in such programs, no matter what they're called, and strive to avoid stores that have them.

Why? Because such programs are nothing more than data mining programs for the stores and their suppliers. Corporate America, and our various levels of government, already have far too much personal data about us, where we go, what we do, and what we buy. Why give them a whole lot more?

Besides, loyalty programs are a one-way street. They want your loyalty in exchange for data they can sell to others. And what do you suppose would happen to your purchase history if the Feds handed that store a warrant? (I know, you're going to say you're not buying anything you'd be ashamed of...but that's the usual rationale of those sliding down the slippery slope to totalitarianism.)

No, thanks. I shop where the stores offer the same low prices to all customers and steer clear of those that offer special deals to those who are willing to give up personal data for a "good deal."