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September 27, 2012 - Mark Heckman Consulting

Archive for September 27, 2012

Raley’s Supermarkets Announces “Something Extra”

This week, Raley’s Supermarkets announced from their Sacramento, CA headquarters that they are now offering their shoppers a loyalty program, called appropriately enough, “Something Extra”.  This program struck me as interesting for a couple of reasons.

First, new loyalty programs in the retail grocery channel are very rare.  While digital, load to account, coupons have moved some of the most avid chains without loyalty programs to create some iteration of a customer identification process, most have opted to keep it very low key and not make it the center piece of their marketing strategy.  Quite the contrary,  Raley’s is “shouting” about Something Extra and is appears to be the headline of their value proposition.

 

The second most notable element of Something Extra is the offering to participants a customized shopping on-line pre-shop experience with a continuity element. While being driven by digital, load to account offers, Something Extra also includes a point system that enables shoppers to build and track their account on-line by purchasing various items that are linked to points within the store.  Again, point systems are not new and in and of itself, not remarkable, other than to note that Raley’s is not relying just on digitally loaded coupons to drive shopper loyalty and is making a commitment to allocating “markdown” expense to a points program.

But the really BIG news about Something Extra is hidden behind the scenes for Raley’s shoppers.  It is in fact the targeting engine that Raley’s has chosen to drive the customized content to their participants is a tool called “dunnhumby”.  For those of you familiar with the supermarket sector, you know that dunnhumby is a well established tool, first used in the UK to drive Tesco’s success and  used exclusively to this point in the U.S.  by Kroger banners to segment and target shoppers based upon their previous shopping behavior.  Suffice it to say the “dunnhumby” might be regarded as the”secret sauce” of Something Extra, given its proven ability to facilitate customer relationship communications.

As with all loyalty programs, Raley’s commitment to the program vis-a-vis the amount of content and value they direct to the program will be critical to its success.  However, adding dunnhumby to the mix, and building a intuitive and interactive website for points tracking and customized shopper communication with Raley’s tells me that they are in this for the long haul.