It seems that every retailer has a loyalty program these days. Because of this, their universality is raising the bar. To capture customers’ attention, it’s no longer enough just to offer discounts or a points system. Instead, retailers need to craft loyalty programs that are easy to access, include uncommon or unexpected benefits and make a meaningful connection with shoppers.
Target, Staples, Foot Locker and Walmart are four examples of retailers that are innovating on loyalty with discounted delivery, personalized offers, free returns and identity-based membership programs. Here’s how these four major retailers are innovating with their loyalty programs and what fellow retailers can learn from them.
Target
In April, Target launched a new membership program, Target 360, which elevates its offerings to the level of Amazon Prime and Walmart+. The major retailer’s first paid membership program offers unlimited free same-day delivery for orders $35 and above as well as free two-day shipping. Annual membership for Target 360 is $99, while Target Circle Cardholders (formerly Target RedCard) will get a discounted cost of $49 annually. Verified teachers, too, get a discounted membership cost of $49 for the first year via the Target Circle Teacher Appreciation Program. Combined with their 20% off teacher discount, this is a great example of creating a meaningful connection with a highly influential consumer community.
Target’s move points to the increasing demand for exclusive, paid memberships that prioritize convenience and expediency. Why should brands care about Target 360? If Amazon has shown us that customers will pay more for expedited shipping and exclusive discounts, Target 360 proves that customers crave exclusive memberships — and will pay for them — at their other favorite retailers too. These benefits are the new standard, not just the hallmark of the ecommerce leader.
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Staples
In February, Staples rolled out a reimagined rewards program called Easy Rewards, which makes it, well, easier for members to accrue points and redeem them for qualifying purchases.
What’s included in the new program is a one-to-one dollars-to-points conversion on qualifying purchases, as well as a chance to earn two times bonus points when customers shop in the three categories they use most. Points can be redeemed for savings at checkout. Members also get exclusive access to members-only events and promotions.
Easy Rewards prioritizes personalization and bigger rewards. The option to receive bonus points in the three categories shoppers use the most points toward a larger trend: customers want recognition and rewards for their purchasing patterns. Staples’ Easy Rewards imbues personalization into their loyalty program, setting it apart from competitors’ one-size-fits-all programs and giving its members the recognition — and rewards — they crave.
Foot Locker
Foot Locker joined the ranks of retailers elevating their loyalty programs in June with their new program, FLX Rewards, offering members “Xtra Savings, Xtra Access, and Xtra Perks.” Members receive 100 points per dollar spent and can redeem points for savings ranging from $5 to $20 per purchase. The membership also comes with exclusive promotions and experiences, such as members-only sales and sneaker launch reservations. Other perks include free shipping with no minimums, free returns and an upgraded birthday gift.
While most loyalty programs offer similar points-to-dollars-saved promotions, FLX Rewards incorporates unique perks tailored to their customers’ biggest desires (such as sneaker launch reservations). In particular, brands should learn from the program’s “Xtra Perks,” including early access to new product launches and members-only sales, which creates a circle of exclusivity around its members.
Walmart
Walmart+ is Walmart’s paid membership program, with offerings such as free grocery delivery, free shipping with no order minimum, and discounts on gasoline. While Walmart+ is by no means new, in 2023 the retailer rolled out a membership option called Walmart+ Assist, which offers a discounted membership fee for verified customers who qualify for government assistance. The membership allows access to all Walmart+ has to offer for a whopping 50% discounted annual fee of $49.
Walmart has made itself a leader in catering to customers who qualify for government assistance by expanding access to essentials through premium offerings and exclusive discounts. Brands hoping to follow Walmart’s lead should consider tiered access to loyalty programs based on identity and demographic data. Along with income-at-risk populations, other groups that greatly benefit from exclusive access to premium offers include students, teachers and military communities.
All four loyalty programs mentioned here are pushing the envelope in creative ways. Target, Staples, Foot Locker and Walmart cater to their customers’ desire for exclusive discounts, free shipping and delivery as well as personalized experiences and offers. Brands can learn from each of these examples as they reimagine their loyalty programs and make themselves more competitive for the dollars of loyalty-minded shoppers.
Angela Modzelewski is the Head of Marketing Strategy at SheerID. With over 20 years of marketing experience, she has expertise in B2C, B2B and non-profit marketing strategies. She is one of SheerID’s original employees and has played a role in growing the company from startup to today, partnering with over 300 of the world’s biggest brands. Modzelewski is responsible for advising SheerID customers like Sleep Number, Princess Cruises and J.Crew Group on best practices for reaching niche audiences. She currently lives in Asheville, N.C. with her cat Sam and her pup Ripley.
