Loyalty360 conducted an extensive interview with two executives of BJ’s Wholesale Club: Adrian Sosa, Senior Vice President of Membership Analytics; and Stephanie Meltzer-Paul, Vice President of Membership Rewards and Co-brand.
During an informative interview, Sosa and Meltzer-Paul discussed improving customer loyalty and how new technology will help customer engagement.
Are the challenges of creating customer loyalty different in a club than creating customer loyalty in a more traditional retail environment?
Sosa: Yes. Very different. Our focus is fulfilling the needs of value, selection and quality for our Members. With grocers and mass merchants, they have a lot of margin to plow back into promotion and invest in transactional loyalty. Whereas, the club starts out with the promise of membership and delivering every day value. We don’t have those levers that can be turned as quickly or as often then a traditional mass merchant would have. We must think of creative ways we to give value back to members. An example of that is our co-brand program. Our new credit card value proposition that we re-launched and converted in November is a testament to that because it’s giving constant value to our members.
Can you talk more about the co-branded credit cards?
Meltzer-Paul: We have a co-branded program with MasterCard® and Alliance Data called the My BJ’s Perks™ MasterCard, where we offer two cobrand card options, BJ’s Perks Plus and BJ’s Perks Elite. Members can earn up to 5% back on most spend made inside the club and outside the club everywhere MasterCard is accepted. Plus we offer every day savings at BJ’s Gas®. We consider one of the card’s best features is members’ ability to redeem their Awards directly via our registers in-club in $20 increments. Awards are stored electronically in a member’s account where they can use them at their convenience, or store them for future use. It gives our members great flexibility for earning and burning of Awards.
Have you seen customer engagement rise with your core audience as you have added these new features?
Sosa: Yes. We’ve grown the credit card portfolio in the first three months by 20% since we launched the new benefits. We have also seen extra engagement by our club field teams, in terms of selling the program. Next year, we are hoping to offer the credit card at the point of sale. So imagine at the transaction, a BJ’s cashier asks a Member if they’re a BJ’s Perks credit card holder. If they say ‘no’,' we’d then offer that Member an opportunity to apply,” Sosa said. “And if the Member would like to sign up, the cashier can input their information right at the terminal to apply and receive our My BJ’s Perks MasterCard. This is an example of how we’re presenting this new program that is filled with more benefits, more value and more convenience. When our members receive their money off from the awards earned, they are reminded of the value of a BJ’s membership and it makes them come back time and time again,” said Sosa.
I understand BJ’s also offers an easy renewal program that further engages customers and builds on the store’s loyalty among shoppers?
Meltzer-Paul: Our Easy Renewal Program allows members to automatically get renewed on a credit card of their choice or on one of our co-brands. If you sign up for an easy renewal on one of our co-brands, you get a renewal discount every year up to $25 off membership. It’s another way of passing value back to our members who are showing a long term loyalty commitment to us. And at the moment, we are seeing the vast majority of co-branded members opting into that when they are signing up for the co-brand card. That is a good sign for us.
How do you create such a unique program and process?
Meltzer- Paul: The program was developed directly based on member feedback. Additional earnings for club purchases, savings on gas, and the flexibility of when and how to use their Awards were the big things we had heard. So the value proposition of our co-brand is delivering to the member exactly what they asked. However, we just launched four months ago so we are still in this infancy stage of learning and making tweaks to our marketing as a result. Likely in the next 12 months we’ll do some focus groups with members to understand what’s resonating most about the product and continue to deep-dive into the metrics.
For us, the natural evolution with our rewards program will include something in omni-channel, both from a digital perspective and expanding that in some way.
About the Author: Mark Johnson
Mark is CEO & CMO of Loyalty360. He has significant experience in selling, designing and administering prepaid, loyalty/CRM programs, as well as data-driven marketing communication programs.