Customer loyalty is leveraged in various ways by many different brands. At Rack Room Shoes, customer loyalty is used in a variety of ways to strengthen consumer relationships and to build brand loyalty.
Aimia is Rack Room Shoes’ loyalty platform provider for the latter’s Rack Room Shoes Rewards loyalty program.
Paul Voss, CRM Director, Rack Room Shoes, talked to Loyalty360 about how customer loyalty is used to impact the overall customer experience.
How has Rack Room used loyalty to learn more about its customers and their behaviors?
Voss: We have used it a few ways. First, we have used it to understand who are our repeat customers, where do they live, what do they buy and when do they shop. It has also allowed us to ensure we are sharing with customers all the products we have and give them relevant offers.
For example, 68 percent of our customers have children, but there is a majority that has never bought children’s shoes from us. This allows us to provide better offers to make sure we are their store of choice when they need to buy their kid’s new shoes.
How has Rack Room used loyalty to build long-term customers?
Voss: Loyalty has allowed us to build a 360-degree view of customers, and continue to give them new offers and benefits. For example, rewards customers who contact us get preferred access to our customer service. We have also been able to use loyalty to drive all communication to customers, and make sure we are sharing with them the best offers on whatever channel they interact with us on.
How does Rack Room ensure its loyalty program is bringing incremental revenue?
Voss: We are doing very targeted campaigns to customers based on their purchase history, whether it is to drive a second purchase, a third purchase, or even a surprise and delight offer. We are continuing to look at small segments of customers and determine how we can help increase Rack Room Shoes wallet share.
Through your customer loyalty initiatives/programs, what have you learned that helps inform your future customer interactions?
Voss: You cannot over communicate the benefits and value of the program. During times of heavy promotion, it is important to share with customers all the value they receive from being a rewards member. Also, it is important to understand how much of our overall revenue is driven by a small group of customers. It is important to understand that and make sure you are providing customers with a best in class experience.
Do you think customers are changing from an expectation/service perspective, and how has customer loyalty helped Rack Room gain a better understanding of its customers?
Voss: Yes, in some ways customers are changing. There is an increased expectation of speed, while our customer doesn’t have a lot of free time. It is interesting when you look at what expectations are though. We moved to shipping in bags recently and were concerned about customer experience. What we found was, even when packaging was rated low, it didn’t impact their overall experience. In all cases, though, when the delivery took longer than expected, it had a profound impact on the overall experience.