Before news of Loblaw’s purchase of Shoppers Drug Mart broke, strategy sat down with the grocery chain’s SVP marketing, Uwe Stueckmann, to learn more about its new loyalty program, PC Plus, launched in May.
It is more than just a card (although that is available for folks as well). The program was launched with an app, which had nifty components like shareable shopping lists and meal planners. PC Plus can also be synched to PC’s existing financial cards, all of which help give the consumer customized bonuses and offers based on past purchase history, on top of the traditional point-gathering aspect.
The app, created by Toronto-based SAP, has been in development for the past 12 months and is currently only available at the 44 Loblaws-banner stores in Ontario, though Stueckmann says they plan to roll it out nationally by the end of 2013.
And though it’s still early days, he adds PC Plus has had positive results with higher-than-expected pick-up from consumers.
Strategy caught up with him to chat about what the digital loyalty program means for shopper marketers, trends he’s keeping track of and what’s next for the world of retail marketing.
Have you seen a lot of pick-up from the shopping list aid and the meal-time planning component of the app?
One of the things we get really good feedback from is the ability to share across multiple people in a household. So if you have multiple people registered for PC Plus membership, you can share a shopping list.
For future iterations, are there plans to roll out location-based deals?
In a very, very limited way. We don’t believe that interrupting people while they’re shopping is a good thing to do, so we’ve really designed this program to solve problems, help save money and time and answer the “what’s for dinner?” question. Interrupting people as they walk down the aisle with proactive suggestions is not something we would look to. Frankly it’s not something we would want.
There’s a long road map of future enhancements, I can’t get into too much detail, but it is our retail shopping application that allows customers to engage with us while at home, on the go and in the store.
How does this program play into your overall shopper marketing mix?
If you think about traditional shopper marketing programs, [they] are all about creating promotional displays in the store that interrupt the customer to sell incremental product. They end up running the risk of creating [a] cluttered retail experience. [PC Plus] is, for the first time, an opportunity to allow our vendor partners to present meaningful offers to the right consumers, at the right time in a digital way, and really that doesn’t happen in shopper marketing elsewhere.
[In traditional programs] you might be able to select all people who drink Pepsi, and push them a Coca-Cola offer, which is not something we would do. In our program, it’s centered around the customer. We would never try to sell a customer something she doesn’t want. It’s very much delivering our customer products we know she buys already or we really believe she would like based on people like her buying similar things.
How does it work with vendors?
Our vendors can create offers in our systems, so they can say, “I’d like to make an offer on product A with 1,000 points,” and then our system figures out who the right customers are [based on] an algorithm we’ve built.
Have you had a lot of pick-up from the vendor side with new programs?
[There has been] a tremendous amount of interest from our vendor community, and we’re only in 44 of our 1,000 stores, so it is early days. But they do seem very excited in how we structured this, [as] a tool to help drive incremental volume.
How does it work in conjunction with in-store marketing efforts?
Certainly during the launch, there’s a lot of in-store signage displaying how the program works. And we also have an at-shelf program to incent specific products, but it’s incremental to the guts of the program that is very much based on personalization.
Retailers are just starting to dip their toes into personalized offers – are there any other major shopper marketing trends you’ve noticed taking shape?
I think you’ve got this ongoing balance between CPG organizations having the desire to run a beautiful and full program across all retailers, and retailers wanting programs that are unique to us. That always creates a healthy amount of tension around shopper marketing in general. We certainly believe that less is more. Less visual clutter [and] fewer programs running in the store is better than having too many shopper marketing programs running.
To take those programs, which are by definition one size fits all, digitizing them and making them available to the right customer at the right point, is the next frontier of shopper marketing. So for a brand, in the store, it has to be the same display, same price point across the network, whereas, if I bring it into the digital realm, I can change up the investment [and] messaging based on the customer I’m targeting. And it allows for far more flexibility, allowing all brands to participate in shopper marketing and not just have it be the domain of a few.
How many shopper marketing programs does a Loblaws or Superstore run at any given point?
We’re definitely striving to run a single program across our network at any given point. We launched [this approach] last year with an opportunity for our vendors to collaborate with us on our big seasonal promotions and go to market under one umbrella promotion that our control brand led to have one uniform message, which creates a far better customer experience than the one-off disjointed programs.
Are you seeing that trend spread across multiple retailers?
Most of the retailers are trying to maintain control over the retail environment, because only the retailer has visibility to all the programs that’ll be running. And it can become quite cluttered.
Is there something in particular that sparked that desire for a more consistent look and feel?
We’ve done quite a bit of research around that. It’s certainly very high on the list of things that customers want and expect.
It’s a journey to get the right structures in place and build the right programs to replace the activity that was done by the disparate programs. [The first umbrella program was] our “Healthy Eating” campaign that launched in the spring of last year. It was the first time we created a campaign that was anchored in President’s Choice, but it was supported by national brand activity.
What do you see for shopper marketing going forward?
I think shopper marketing is very much going into the digital world. So that’s why we made the investment in PC Plus and built it the way we have. A lot of our partners made significant investments to build out their own digital capabilities and social capabilities and I do think that finding intelligent ways to collaborate with our vendors around that is going to be the next frontier.
Check out strategy‘s past Q&A’s with Metro’s Nancy Modrcin, WSL’s Wendy Liebmann and Canadian Tire’s Allan MacDonald.
