Life Pharmacy needed a quick and cheap sales boost in the run up to Xmas, but ended up discovering a high return formula for stimulating both incremental purchase visits in the short term and additional loyalty and value in the long term.
Internally, it was know as the “use it or lose it” offer.
The marketing team targeted members of the Living Card loyalty programme who were close to earning a $25 reward voucher and topped up their points to get them there early. After learning about their Xmas bonus via personalised DM or email, all the members had to do was turn up in store to claim their voucher before the bonus points expired two weeks later.
And turn up they did, with 38.9% of targeted members claiming their early Xmas surprise and 27.5% of them also redeeming it with an average purchase of nearly 3 times the voucher value.
Overall the campaign delivered a 182% ROA and contributed to turning December 2010 into Life Pharmacy’s biggest ever month of voucher redemptions and sales via the Living Card programme.
But the unexpected surprise was the long term loyalty and value effect the campaign had on members, especially the hard to motivate lower value members. 10 months later responders to this campaign proved to have greater retention, better purchase frequency and recency, and were more likely to have moved up to a higher value segment. Comparing the sales of responders to non-responders and a control group revealed that the ROI had actually increased over time to an amazing 245%, proving that the surprise and delight factor in this campaign had a lasting effect on the members who benefited.