Creating a Loyalty Program at Things Remembered

Steffan Pedersen

Background• Things Remembered provides personalized gifts for special

occasions• Runs catalogs, physical stores (typically malls), and online

stores• Embroidery and engraving specified by customer• Large variety of items including: jewelry, blankets, business

items, plaques, glassware, etc.

Case information• Problem: customers limit their occasions to events such as

anniversaries, graduations, and weddings.• Struggling to reach an acceptable repeat purchase rate• Goal: create a marketing program that will get customers to

buy for a wider set of occasions, and more frequently.• Solution: A loyalty program called the “Rewards Club”

The “Rewards Club”• Key Features:

o One-time $5 membership feeo Earn $10 rebate for every $100 purchased.o Weekly distribution of rewardso Reward certificates good for 90 dayso $50 limit in rebates earned in a given montho One transaction every 18 months is required to maintain

membership

• Associates were given incentives to enroll customers as members (marketing to employees, p.644). • Initial results hit their targeted levels, but they were concerned that the program enrolled more low spenders (less than $50) than high spenders ($100+).

Discussion Question 1: Define loyalty as you understand it from the text. Do you think the

Rewards Club at Things Remembered helps create loyalty?

• I see loyalty as a quality of devotion to a brand or store.

• Things Remembered wanted “loyalty” to mean that their store was the first to come to mind when a consumer wanted a personalized product, and that consumer should be satisfied enough with their experience to return more frequently.

• I think the Rewards Club does create a certain level of loyalty, but is becoming less meaningful as market-wide rewards programs are more accessible.

Discussion Question 2: Beyond earning $$ for purchases, can you think of other aspects that could

be added to their program that would enhance loyalty?

• Occasional personalized gift with purchase for Club members

• Members receive early access to certain store sales

• Flat-rate personalization for members’ outside items

• More advice-oriented newsletters for members

Discussion Question 3: The marketing program was designed to achieve two goals, namely, increasing the number of occasions, and increasing the frequency

with which consumers purchased from Things Remembered. Which goal is best achieved by the

Rewards Club?

• Although the Club may assist in achieving a mixture of their goals, I believe it really depends on the person.

• If I had to choose: The frequency is best achieved• The Club has limited incentives for customers to

come for different occasions.• Nothing about the Club entices people to shop for

non-traditional events.

Discussion Question 4: Design a marketing program to achieve the goal of increasing the number of

occasions for which consumers think of and purchase from Things Remembered.

• Share expertise in gift giving for a wider variety of occasions (ex: Father’s Day, Mother’s Day, Valentine’s Day, nontraditionals)

• A “Things Remembered credit card” for businesses could boost the sales of personalized items sold in bulk.o Have reps perform “cold calls” to potential client companies.o “Unfortunately, Things Remembered does not offer a credit card. This is a bit

surprising since this is a store that is often used by businesses to create plaques and employee gifts.” (Creditcardchaser.com)

• Focus on relationship marketing through superior customer service (Ch. 18, p. 644)

• Use emotional appealed advertisements for the various nontraditional holidays to attract new users to the product category.

• Create online communities to enhance e-loyalty, where people can share their stories, pictures, etc. (Word of Mouth)

Discussion Question 5: What explains the fact that lower spenders are more likely to enroll? Is this a

good or bad thing?

• Lower spenders are more enticed to join the Rewards Club because their purchases reflect a wider range of occasions.

• I think it’s a good thing because lower spenders will come to the store more frequently and for more occasions, which was their program goal.

• Do you guys think the Rewards Club was a good solution to their problem?

•The Rewards Club has been in place since at least 2004.

•2012 sales of $315 million. $30 million increase since 2004. (Wall Street Journal)

•The Club hasn’t seen any major changes since it’s introduction, besides additions such as a “customer service hotline”.

•This shows that the introduction of the Club must have made a positive impact on the company.

Update on Reward’s Club

Current Marketing Strategy Update

• Currently incorporating iPads in their stores to boost sales.o iPad’s are hip and target a younger crowdo View products the store can’t have in their inventory, update Facebook,

etco Keeps kids occupied while parents browse for giftso People may return more frequently for this unique customer service

Sources T. Mulhern and D. Duffy, “Building Loyalty

at Things Remembered,” Journal of Consumer Marketing 21, no. 1 (2004), pp. 62-66; and www.thingsremembered.com.

Credit Card Chaser. http://www.creditcardchaser.com/things-remembered-credit-card/

Wall Street Journal. http://blogs.wsj.com/privateequity/2012/05/25/how-memorable-will-the-things-remembered-exit-be-for-its-sellers/

Mintel Reports: Apple iPads Make Inroads At Retailers

Factiva: Plan A Personalized Wedding Hawkins and Mothersbaugh. Consumer Behavior:

Building Marketing Strategy. Page 644