Sears Holdings CEO Edward Lampert owes much to his company’s bright spot: Its Shop Your Way loyalty program, which accounts for a staggering 70% of sales. As Sears seeks to transform itself and restore profitability, its loyalty program stands as the key.
“At the core of this transformation is a change in perspective,” Lampert said during the Feb. 26 fourth-quarter earnings conference call, according to Seeking Alpha. “We are shifting from being product-centric to member-centric, from transacting with customers to building relationships with our members, from focusing on driving our customers to our store network, to building Integrated Retail capabilities that leverage the store network to create solutions that allow us to better serve our members.”
Lampert said the company’s member-centric Integrated Retail model is built on the foundation provided by two separate and distinct platforms: Shop Your Way and Integrated Retail, the technology platform that connects members to the Sears integrated ecosystem of retail channels and member touch points.
“As we continue in our transformation, we are focused on the future and are placing a disproportionate amount of our attention and resources on our best members, our best stores, and our best categories,” Lampert added. “We have a very substantial member base with more than 70% of sales being derived from Shop Your Way members. We are applying our resources toward better understanding the wants and needs of our best members, so that we can apply these 
learnings toward increasing engagement and strengthening our relationships with all of our existing members. We believe that by building these relationships, there is significant opportunity for growth through member retention.”
Lampert explained that Sears has made “significant progress” in its ability to personalize interactions with loyalty program members as the percent of total interactions that were personalized more than doubled from 2013 to 2014.
“Over 25% of our total interactions with members are now personalized, which allows us to increase the relevance of these interactions, driving higher retention and engagement, which we believe over time will yield increased visit frequency and a higher share of our members’ wallet. Our primary focus is on growth by retaining existing members. We provide products and services across many categories that our members may choose not to purchase from us today, but by nurturing these relationships with personalized and relevant interactions, we believe there is substantial opportunity for growth within our existing member base.”