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Loblaw’s New Loyalty Program: Is Grocery Primed for Paid Loyalty?

Loblaw Companies, Canada’s food and pharmacy leader, recently announced plans to launch a premium loyalty program called The PC Insiders program. Styled after Prime, Loblaw’s new loyalty program offers an assortment of benefits for $99 per year to attract more consumers to shop exclusively with its massive grocery chain.

Loblaw Companies comprises a network of corporate and independently-operated stores in communities across Canada and employs nearly 200,000 people.

Amazon’s highly successful Prime premium loyalty program, which eclipsed 100 million members in April, has not only attracted the attention of global consumers, but also other retailers.

 

Modeled After Prime

The PC Insiders program is available to the 16 million members who currently use PC Optimum, which is Loblaw’s free rewards program. PC Insiders was designed with Prime in mind (minus the streaming service).

The PC Insiders program includes free “click and collect” grocery shopping, where customers order online and pickup at one of 600 designated locations, as well as free shipping on purchases from Loblaw’s Joe Fresh apparel brand and Shoppers Drug Mart.

The program is available at $9.99 per month or $99 per year.

“It’s not 16 million customers all at once,” said PC Financial President Barry Columb, who started PC Insiders and continues to oversee the program. “But if we go out in the next six months and we put 100,000 customers into the program, we would be very, very satisfied.”

Along with free shipping and grocery pickup, PC Insiders members receive 20 per cent back in reward points when they buy baby products and Loblaw store brands like PC Organics and Black Label, as well as online purchases on Joe Fresh clothes and Shoppers luxury beauty products.

Loblaw’s PC Optimum free loyalty program launched earlier this year when the company merged its PC Plus card with Shoppers Optimum.

“It’s all about creating that loyalty loop,” Columb said, “and driving customers back into the store, where they find value and convenience.”

 

Retailers are Rethinking Loyalty

As many brands rethink their customer loyalty strategies, premium loyalty programs are becoming a viable option for retailers. Lululemon Athletica recently announced plans to expand its successful premium loyalty test. Because the results have been so successful, officials for the athleisure brand plan to expand the test into additional markets, possibly at a higher membership price point.

Back in April when online and mobile wholesale retailer Boxed launched a new premium loyalty program called Boxed Up, Helen Pan, Director of Loyalty and Customer Experience at Boxed, offered Clarus Commerce some insights about the company’s thought process.

“We definitely looked at Amazon Prime given its success over recent years,” Pan explained. “We also looked at popular loyalty programs across retail and outside of retail when shaping our program.”

Pan noted that premium loyalty programs allow for continual testing, optimization, and personalization.

“With the way that we set up Boxed Up, we have given ourselves tremendous flexibility to offer the perks our customers truly value and to evolve over time as our customers evolve,” she added.

Jeff Pearson, Senior Vice President, E-commerce & Marketing at Lids Sports Group, talked to Clarus earlier this year about the power of premium loyalty.

“Premium loyalty programs make it easy for customers,” Pearson explained. “Customers can rely on a consistent, unified commerce experience and the benefits of our premium loyalty program outweigh the initial cost of membership. I also believe once a customer selects the premium option, they are more engaged, but also have higher expectations. It’s then our responsibility to meet and exceed these expectations on a regular basis.”

 

Premium Loyalty Program Members Want to Be Heard

The great thing about a premium loyalty program like PC Insiders is it swiftly identifies your best customers because they’re the ones who are raising their hands to sign up.

They’re the ones telling their favorite brands that they are willing to pay for the exclusive benefits, access, and experiences that a traditional loyalty program just can’t offer.

Brands understand that they need to strengthen consumer relationships through trust and reciprocity. Creating a value exchange that occurs at every touch point between you and your customers is vitally important to gain brand loyalty.

To achieve this goal of true differentiation, many brands have implemented premium loyalty programs.

Officials for Loblaw Companies hope they can build stronger two-way relationships with their most loyal customers through the PC Insiders premium loyalty program, as well as brand advocates.

ebbo

ebbo helps brands achieve their customer loyalty goals with full-service, end-to-end solutions and also creates original educational content straight from the experts to help loyalty marketers stay on the cutting edge of customer engagement.

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