Extending Loyalty Programs with BI Functionalities

Abstract

Effective customer loyalty programs are essential for every company. Small and medium sized brick-and-mortar stores, such as bakeries, butcher and flower shops, often share a common overarching loyalty program, organized by a third-party provider. Furthermore, these small shops have limited resources and often cannot afford complex BI tools. Out of these reasons we investigated how traditional brick-and-mortar stores can benefit from an expansion of service functionalities of a loyalty card provider. To answer this question, we cooperated with a cross-industry customer loyalty program in a polycentric region. The loyalty program was transformed from simple card-based solution to a mobile app for customers and a web-application for shop owners. The new solution offers additional BI services for performing data analytics and strengthening the position of brick-and-mortar stores. Participating shops can work together in order to increase sales and align marketing campaigns. Therefore, shopping data from 12 years, 55 shops, and 19,000 customers was analyzed.