Hannaford Piloting Loyalty Program

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Hannaford Piloting Loyalty Program

By Bridget Goldschmidt - 10/02/2017

My Hannaford Rewards, a new program offering shoppers personalized rewards and special offers on the items they buy most often, is currently being piloted at 11 Hannaford Supermarkets stores in Burlington, Vt. Under the program, customers earn 2 percent rewards on the purchase of all private-brand items, including meat, seafood, packaged produce, deli items and center store products, with rewards able to be redeemed each quarter; receive ongoing, personalized coupons for their favorite foods and brands; and, when they enroll, receive offers for free groceries.

Hannaford's private brands are Hannaford, Taste of Inspirations, Nature's Place, Healthy Accents, Cha-Ching and Home 360.

According to Hannaford President Mike Vail, the Burlington pilot is actually “the second step of a three-step process,” the first being a rollout to the grocer’s 27,000 associates in August. This process enabled Hannaford to “work the bugs out” of the program, Vail told Progressive Grocer, adding that the company was “excited by the execution” of the initiative, which proved popular with employees. In fact, their enrollment exceeded goals substantially, the company found, with the ability to earn a percentage back on items purchased a particularly welcome feature.

Burlington was chosen as the site for the customer pilot, he explained, because of its “strong [Hannaford] store presence,” and the fact that it’s “representative of [the company’s] customer base.” Additionally, the market’s relative geographic isolation and small size will allow the company to “turn on the bells and whistles,” see how the program performs and make any needed modifications before a company-wide launch, which is anticipated to occur by the first part of the first quarter of 2018, he said.

Innovative Features

The roots of My Hannaford Rewards date back to 2014, when, as part of the Hannaford 2020 project, the company looked at all aspects of its business as it contemplated the near-future of retailing. “Loyalty was a major piece for us,” noted Vail, adding that the grocer embarked on “a lot of consumer research” to come up with an offering that would resonate with its shoppers. “We don’t want to be another me-too loyalty program with two-tier pricing.”

For that reason, there’s no tiered pricing as part of My Hannaford Rewards: the banner’s everyday low prices are still available to all of its shoppers, not just those with a program account.

In creating My Hannaford Rewards, the company was inspired to design its first-ever mobile app as an “easy and highly interactive” platform. This was a requirement for launch, asserted Vail, since “the vast majority of [shoppers] are working off a smartphone.” Using the app, shoppers can sign up instantly, easily earn and track their rewards, and redeem personalized coupons and exclusive offers.

Further, after “a lot of conversation around” the issue, Hannaford made the decision to offer an all-digital program, which Vail believes is not only “clean, from a data point of view,” but also provides an opportunity for the company to “leapfrog” its competitors in preserving data and keeping participants up to speed. The all-digital design means that there are no loyalty cards or keychain fobs; shoppers can scan a bar on the mobile app or just provide a phone number. “We expect that to go smoothly,” said Vail. “We assume everyone has a phone number.”

Battling ‘Fatigue’

Although he acknowledged that, as shown by recent research from Colloquy, consumer “fatigue” with traditional loyalty programs is an issue, the key to developing a successful initiative in this space is “meeting customers where they want to be.” This involves the ability to “dial the program up or down,” depending on participants’ desire to engage with it. Vail stressed that the effort was “a complete add-on,” explaining that there’s “nothing people lose from the Hannaford experience” if they choose not to take part.

As My Hannaford Rewards gathers information on participants’ buying habits, the company will be able to provide them with targeted high-value offers. As part of this proposition, Hannaford anticipates working with suppliers on the creation of customized coupons with much higher redemption rates, representing a more “efficient spend” on manufacturers’ part. The idea, Vail observed, is to “make customers say, ‘Hannaford knows me.’”

Likening the new initiative to the curated, personalized information consumers have grown to expect from their social media feeds, he noted, “If it’s done well … customers will appreciate our program, and endorse it, and embrace it.”

Burlington-area shoppers can enroll in My Hannaford Rewards online in stores or through the app.

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