Case Study: Kudler Fine Foods Reward Points Program

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Running Heading: KUDLER FINE FOODS REWARD POINTS PROGRAM Kudler Fine Foods Reward Points Program Christopher Fortuna University of Phoenix May 1, 2009 Kudler Fine Foods Reward Points Program Kudler Fine Foods has a unique marketing opportunity to assist and reward its current shoppers and invite new shoppers at the same time. By investing in a Loyalty or Rewards card system, Kudler can establish a key card system that will allow a consumer to present the key tag typically at the Point of Sale (POS) or a serial number for online purchases as a method of identification and earn an allotment of points that can be used in future purchases or services from partnerships made with other external companies.…show more content…
The system can work on a three tier level at first launch. I will provide you an example and for this I will call the levels Beginner, Advanced Shopper and Super Shopper. The Beginner will gain 1 point for every dollar spent in the store. When the customer reaches $1500 spent in the store, we can promote them to the Advanced Shopper level where they can earn 1.5 points for every dollar spent. And finally, once they reach $3,000 we can promote them to the Super Shopper level where they will earn 2 points for every dollar spent in the store. To maximize the effectiveness of the program and keep it from becoming a “passing phase” for marketing, we can offer “Double Points” sales. Keeping the idea of having the customer try new things or end close out sales, Kudler can keep the full price on merchandise, place the double points rack in the back of the store surrounded by other items that are either new or are slow movers and offer deals for the customers. Bargain shoppers will pay full price to gain extra…show more content…
Beal (2004), said that “Convincing senior management of the value of a loyalty program requires organizations to get their data in order. Customer loyalty programs collect massive amounts of data but many companies aren't using it. Customer loyalty data provides insight into both share of wallet -- or customer penetration -- and lost customers.” This is where you must take the data collected and be able to separate the sales that are repetitive and the sales that are impulse buys. While we all love impulse buys, this is only a margin of the metric used to understand what and why your customers will come back. Larry Goldman (2008) explains that, “Your definition of a loyal customer will determine how you measure the success of your loyalty program. There is no one metric to measure your program, but most companies will typically use a combination of metrics and more, including average order size or matrices of frequency and product breadth. Ensuring that marketing has access to the various customer metrics to evaluate their loyalty initiatives, including Internet discussions that reverse-engineers loyalty drivers, is the job of customer intelligence. By providing a complete selection, marketing can show their ROI metrics based on the most relevant indicators, which will change every time.” After

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