Brand loyalty is something that every company wants but few actually attain. To build a loyal customer base, you need to provide the best experiences possible, offer unique products or services, and deliver on quality and in a timely fashion. It’s a tough ask, and for those in the grocery industry, it’s even more difficult since differentiation between product selection is not as easy as it might be in other verticals. 

But when it comes to customer loyalty, there are ways to separate yourself from the pack. 

And that’s where Rachel Stephens comes in. As the Vice President of Marketing, Digital and Loyalty for Stop & Shop, a major grocery chain with more than 400 stores, she thinks about this every day. Thanks to a new online platform and through a loyalty program that customers actually want to engage in, Rachel explains that Stop & Shop is finally gaining access to some of the dark data it couldn’t access in the past. 

On this episode of Up Next in Commerce, Rachel explains why that kind of data is a true game-changer for any brand. Plus she reveals some of the consumer psychology that she looks at when building loyalty programs, and she peers into the future at how the use of A.I., machine learning and natural language processing will further advance not just Stop & Shop’s ecommerce experience, but the entire ecommerce industry.

Main Takeaways:

• Is it Actually on the Grocery List?: When building or improving loyalty programs, having an understanding of data is critical. Everyone has to take on the role of data scientist and look at the data analytically, especially as it relates to consumer behavior. Just because a customer says they want something or they intend to make a purchase, does not mean the data will always show that. Word for advice: trust the data and build a program around what is actually happening instead of what customers are saying.  
• Accessing Dark Data: For too long, grocery stores have asked only for customer phone numbers in order for them to have access to loyalty cards. But if that phone number isn’t linked to a real name or address, and is changing hands faster than an email address would, there is a huge amount of data left in the dark, which makes it impossible to build a meaningful database of customer information. To access that critical data, companies need to build programs that are truly enticing that customers want to share their data with that helps not only the brand but also the consumer.
• The Psychology of a Discount: Tune in to hear what Rachel saw in the data when reviewing their sales and discounts. Hint: higher is not always better.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

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Transcript:

Stephanie:

Welcome back to Up Next in Commerce, I'm your host Stephanie Postals, co-founder of Mission.org. Today we have Rachel Stevens on the show, vice president of marketing, digital and loyalty at Stop & Shop. Rachel, welcome.

Rachel:

Thank you very much for having me.

Stephanie:

Yeah, I'm really excited to have you on. I saw a little bit of your background before hopping on here and I got very excited when I saw that you have worked at the TJX companies, which I was hoping we could start there with your background.

Rachel:

Are you a brand fan?

Stephanie:

Oh, yes. I mean, I love TJ Maxx and when I saw that I'm like, "Ooh, this is my interview. This is the one."

Rachel:

Yeah, I was actually the assistant vice president of CRM Loyalty [inaudible] within TJX. And that really matched the TJX rewards program ... was a program that fell under my group and my responsibilities included the day to days and ensuring that our customers really wanted to participate in our program, our loyalty program so that we had clean data at the end of the day. And we were able to provide additional value in savings on top of what customers were already saving with the strong value that TJX stores provide.

Stephanie:

Very cool. How did you first get interested in the world of loyalty marketing, what lead you there?

Rachel:

I started actually in loyalty marketing at Pet Smart in their corporate headquarters in Phoenix and I think the thing that really appealed to me was marriage of data and customer communications, so understanding what customers say and what customers actually do is vital, I think, to the success of an organization because customers can say, "Yes, I have intent to purchase X,Y,Z." But when you look at the actual data, the data doesn't lie.

Rachel:

So, loyalty programs give you a vital tool for success within your organization to take a look at consumer data and then apply your marketing tactics really that are from acquisition, retention or reactivation perspective based on what that consumer is doing in a particular moment. So it's really, to me, such a great marriage of a lot of different areas within marketing and it just was something that I developed an immediate passion for. When I started there on the Pet Perks Program and then went to TJX to work on the loyalty program for TJ Maxx, Marshalls, Home Goods, [inaudible] Trading Post, and HomeSense, I feel like when I was there honed in on my skills within the loyalty space, so the position at Stop & Shop to really develop the role and develop what the new program was going to look like was incredibly appealing just because of my passion for this space and for retail.

Stephanie:

That's so much good experience to be able to bring to Stop & Shop. How have you seen consumer behaviors or loyalty programs having to change since you started?

Rachel:

Since I started in loyalty or since I started at Stop & Shop?

Stephanie:

I'd say in loyalty program, in loyalty overall. Since you started back in the pets days.

Rachel:

Yeah, I think there was a transactional nature to loyalty programs in the past. I think it was you give and get and that was usually based in points programs whereas today obviously I think more experiential programs have come about and providing more omni-channel experience, which wasn't really the case back when I first started within the loyalty space. I'd say that there's a number of people that really do a great job at this. I think Sephora's loyalty program is top notch. They do an excellent job at marrying the in-store and the online experience, really making it truly omni-channel tied in with their loyalty program.

Rachel:

I think that a lot of retailers have caught up and are doing a good job and I still think there's a lot of room to grow. And I think grocery retail was stuck in the loyalty stage of two tier pricing and I think we have a to model grocery loyalty programs more after what a lot of other retailers are doing in the loyalty space and even hotels. Airlines, I think that soft benefits and providing experiential benefits are really critical to the success of a program.

Stephanie:

Yep, yeah completely agree. Now that we're touching on grocery a bit I would love for you to explain what Stop & Shop is for anyone who doesn't know.

Rachel:

Sure, Stop & Shop is actually a grocery retailer with over 100 years in the industry. It started out as a very small grocery in the east coast and now we have over 400 stores and of course our online experience at Stop&Shop.com and the Stop & Shop app.

Stephanie:

That's great. And Stop & Shop, you guys just started moving into e-commerce, right? I think I saw that you launched a new platform just in a couple months ago, am I right?

Rachel:

We did actually, on July 28th in fact. We launched ... we had Peapod with a partner company. Peapod actually was owned by Ahold Delhaize, which is the parent company that owns Stop & Shop and we have integrated Peapod into Stop & Shop now. So, within Stop & Shop's footprint to order grocery delivery or to get pickup you actually now go to the Stop & Shop website or the Stop & Shop app versus Peapod. That integration occurred again at the end of July, and it's been going incredibly well so far.

Stephanie:

What was that transition ... what did that look like behind the scenes of not only integrating a current path that people are using but also I'm sure adding on additional functionalities that maybe weren't already there. What was the process behind the scenes or any maybe hiccups that you guys experienced when you were going through all this because it sounds like a big project.

Rachel:

Yes, yes. In fact, huge project. And all of our sister brands went through the same scope of work at the same time. We work with an internal agency who actually is responsible for all of that development work. And the agency actually had to develop the platform for all the brands. There was Giant Martin's out of Carlisle, Pennsylvania and Giant Foods in Maryland, also went through the same transition.

Rachel:

And there was obviously ... it requires a lot of work to marry the database, really marry those platforms. There was a Stop & Shop website, a Peapod website and H Brands app, so marrying those together