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Overstock.com Taps Online Community as a Supplement to Loyalty Program

Capitalizing on the power of word of mouth and new media, Overstock.com is emphasizing its loyalty program, The District O Private Lounge as a new channel for customer intelligence. Known for offering brand-name merchandise at discount prices, Overstock.com recently revitalized its Club O loyalty program by utilizing rich customer feedback. Featuring 300+ active members, the Private Lounge is designed to enable Overstock.com customers to play significant roles in keeping the online retailer fresh and its customers loyal.  In its first year, the community has helped the retailer refine its popular television advertising, reinstate some of its customers’ most-missed Web features and reinvigorate Overstock.com’s holiday shopping sales.

The District O Private Lounge, which initially kicked-off with the goal of enhancing Overstock.com’s loyalty program, has since blossomed into a primary source for customer insight that extends well beyond Club O.  Communispace, which creates online customer insight communities, recruited members for the community and now engages them in activities ranging from open discussions around the best and worst loyalty programs, to generating feedback on the retailer’s television commercials.  Energized by the community experience, members also initiate their own activities in the community, generating unexpected insights that keep Overstock.com in step with its customers’ changing needs.  
 
“Although we’ve long relied on quantitative research to understand our customers, we’ve never had a way to engage in active dialogue with them, something that’s incredibly valuable for an online business,” said Patrick Byrne, Overstock.com Chairman and CEO. “We’ve already established a meaningful connection to our customers through The District O Private Lounge, and we’re looking forward to learning more from these members.  Their distinctive voices will clearly resonate in our strategy and communications in the future, specifically within our enhanced Club O program.”
 
“Businesses are facing new challenges as consumers adjust spending and change habits to cope with the recession,” said Diane Hessan, CEO of Communispace. “Overstock.com is committed to understanding its customers’ challenges by listening and engaging with them directly.  The best way to build and sustain customer loyalty, especially now, is by making your customers active stakeholders in achieving mutual success.”

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