New World launches loyalty programme, but Countdown has 20-year headstart

Foodstuffs has collaborated with one-to-one agency JustOne to launch a new loyalty programme exclusive to New World.

In the past, the company has relied on the Fly Buys reward scheme to give its customers added incentive to shop at the store, but Foodstuffs group general marketing manager Steve Bayliss says that it was time to develop something discrete. 

“Fly Buys owned the customer database, and we could only communicate with customers through its service. This meant that we didn’t know who our champion customers were.”

He explains that by establishing its own loyalty programme, New World can now identify its “champion customers” and communicate with them through various channels. 

The loyalty programme is designed to facilitate more personalised communications with consumers. And Bayliss says that as more data becomes available, it will be increasingly important for retailers to use it to send relevant and personalised communications to the target market. 

He says that New World has already started to introduce personalised email marketing campaigns, and the company’s efforts in this field have allowed the company to lift its open rates by 50 percent. But this, he says, is still well below what they are aiming for. 
And while Bayliss places emphasis on creating an independent customer database, New World will continue its partnership with Fly Buys and has also initiated a similarly collaborative deal with Airpoints New Zealand.

This collaboration means that on top of access to New World-specific promotions and special offers, customers can continue to collect either Fly Buys points or Airpoints dollars across the whole Fly Buys network using their New World Clubcard. The only difference being that the Clubcard places control of the customer data in the hands of the retailer. 

The Clubcard has already been rolled out in the South Island, and the initial promotional push has targeted Fly Buys and Airpoints cardholders.

“Those two organisations have discrete customer bases, and this will just add to our offering,” says Bayliss.

Bayliss says that the decision to first launch the loyalty scheme in the South Island was made because this is where the technical platform for the programme was first developed. He says that technical updates necessary to run the system are still being made in the North Island stores. 

He says the system has been constructed in such a way that it could potentially house multiple rewards schemes, meaning that Foodstuffs-owned Pak ‘n Save could also get its own loyalty programme in the future. 

“We have not confirmed any plans to create a loyalty programme for Pak ‘n Save at this stage,” says Bayliss. “As we go forward, we will determine whether this is a viable move.”

And while Foodstuffs develops an independent loyalty programme for the first time, its Progressive-owned competitor Countdown has already enjoyed significant success with its long-running rewards scheme.

“Given that our loyalty programme has been around for about 20 years, things are going very well,” says Progressive’s general manager of marketing Bridget Lamont.

“We have 1.8 million cardholders, making it the largest single retailer programme in New Zealand. And 60 percent of all purchases are accompanied by a swipe of the Countdown card.” 

In addition to the OneCard loyalty programme, Countdown has also introduced a sophisticated email marketing campaign through the My Specials initiative, which sends weekly emails to customers on the Countdown database. 

These emails are personalised with the customers’ names and include offers to products that they might be interested in purchasing.

As someone whose career started in the direct marketing field, Lamont says it’s essential for companies to maintain a relevant and targeted dialogue with the consumer base. 

To do this, Countdown works closely with Affinity ID, which has put various measures to process information quickly and then send out relevant information to consumers. 

“It’s all done in real time,” says Lamont.

As the data comes in, it is processed and formatted into an email and sent to the consumers on their preferred days.    

And while this provides a much more targeted means of reaching the target audience, Lamont says that this will not lead to the end of unaddressed marketing mail in the near future.

“Unaddressed mail is still really important,” she says. “ Many New Zealander still enjoy receiving their discount information in paper format, and we don’t have immediate plans to remove this.”

She says that the online efforts serve to consolidate the role that unaddressed mail continues to play.

The Countdown OneCard scheme has been so successful that Countdown now even uses its huge database to introduce its commercial partners’ new products.

In this sense, if a supplier brings a new product onto the market, then Countdown is able to enter into an agreement with the company to introduce the product to customers. Through this system, new product samples are sent to between 10,000 and 20,000 OneCard holders that fit into the target market.

Since 1994, Countdown has been able to access customer data on a more granular level. But as New World poises to launch its own nationwide loyalty programme, Countdown won’t have this point of difference for much longer.

And as Bayliss says: “Our challenge is not to match our competitor, but rather to leapfrog it with a better offer.” 

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