Retailers are continually endeavoring to understand the evolutionary metrics of their customers. The most difficult demographic and shopping profile analytics occur in the on-line space, as that arena does not have the historical data available compared to long standing, traditional brick and mortar sales and acts as a continuous moving target.
Most web merchants, and multi-channel merchants, rely heavily on Internet affiliate programs to drive traffic and sales to their sites. In this case, the debate has always been – quantity vs. quality. The old sales rule of 80-20 seems to be closer to 90-10 relative to affiliate driven traffic – with big box merchants standing on both sides of the equation.
At this point in time our branded BSP Rewards Malls are almost 100% web based (with a few test exceptions). We have researched the space extensively and it seems that we have built the largest on-line mall encompassing nearly 700 merchants, over 100 gift card merchants, over 7000 local restaurants, a catalog of over 200,000 discounted merchandise items and a soon to be launched discount coupon program that will include hundreds of thousands of in-store merchant locations.
Standard affiliates programs drive traffic and sales but we designed our model to concentrate on the high affinity (quality) programs that drive the most traffic/sales - affinity loyalty.
Our name, BSP is an acronym for Branded Service Provider. We are the engine, data base maintenance, communication, viral marketing, customer service, etc. – private branded platform for a variety of for profit and non-profit organizations. Accordingly, there is a degree of affinity that ranges from low to high depending upon the client and their organization type and their relationship with their customers and members.
We have built many private branded malls and our clients have stated a wide variety of reasons to have us do so. The reasons vary and are multiple ranging from loyalty, continuity and value added benefit to enhanced traffic, sales, awareness, continuous communication, speed to market, low cost of set up/administration and in some cases – revenue share. They particularly like the fact that our program is MERCHANT FUNDED (by the nearly 700 participating merchants) and they as a client, reap the benefits on an extremely low to even a no cost basis.
So now let’s get back to the loyalty aspect of today’s blog (as I seem to have delved deeper into the reasons rather than just the results).
Our clients have a customer and/or member base that have a varying degree of affinity and loyalty to them. We build branded programs for these clients and the clients then market the program as their own (which it is) - to their database. Accordingly, the client is in reality, our affiliate therefore brings of much higher quality to the table than if we targeted to a non-related quantity of non-interested affiliates that we could acquire through affiliate programs.
Accordingly, we are becoming a high sales producer for our participating merchants as we encompass a higher affinity, more motivated, shopper. We combine a super mall with the added incentive of giving our shoppers cash value points from every single participating merchants which of course produces- a large number of motivated shoppers. Especially when that shopper can accumulate the points from all as a “common currency” and spend them back everywhere for virtually everything they can imagine.
Our clients and merchant partners are seeing have seen industry statistics whereby the highest traffic and sales come from loyalty program members, and especially if those shoppers receive added value in the form of desired rebates.
According to the September 2007 issue of Internet Retailer Magazine, merchants benefit to a greater degree when sales are generated from loyalty sites (like the BSP Branded Malls are) as they offer something that the retailers can’t offer themselves – affinity relationships, and in our case, common currency rebates. The research proves that customers visit their loyalty sites more regularly than they do a particular merchant site and having a presence on those affinity sites is a valuable traffic driver to those merchants.
The bottom line is that loyalty sites encompass a higher-grade customer, who visits their affinity mall more often, and has a particular desire to help their organization, therefore drives a higher degree of traffic and sales to participating merchants. The results are enhanced further when the customer is automatically given a cash value added incentive with their purchase.
Hence, BSP has developed a program that sells merchant gift cards, drives sales to merchant web sites, and is advancing inroads into brick and mortar locations – therefore having the ability to add revenue for all 3 of the merchant divisions. …How sweet it is.
Staying ahead of the curve regarding content, merchants, enhanced incentives and increased member benefits is the interesting part of the game……..again that is another story for another time.
