A conversation with Stadium - the importance of surprises and the end of the customer club
Sweden’s largest sports chain knows what’s waiting around the corner. This is about a new generation of customers who are completely uninterested in traditional customer clubs. They’re not driven by chasing bonus vouchers and instead have high expectations of the customer experience, which must provide a seamless transition between digital and physical contact interfaces. They’re unafraid of change and expect things to constantly evolve. However, this doesn’t mean we can forget that group of customers which has the strongest buying power and which may have other needs and expectations.
Customer loyalty and expectations of different customer groups
Hanna Gåverud is Head of CRM at Stadium. We had a chat with her about how Stadium is working with customer loyalty, why micropizza can both improve or worsen a customer experience, and how Stadium is doing things differently in order to meet the expectations of different customer groups.
How do you work with customer loyalty?
- A couple of years ago, we realised that we needed to develop our loyalty programme and abandon the traditional customer club where members would chase bonuses and get a discount coupon each month. People’s expectations govern what we do and are increasing all the time as society evolves. In order not to fall behind, we realised that we need to strive continuously for change and step up the customer experience. For this reason, we decided to shake up our Stadium Member loyalty programme and question absolutely everything about it. We conducted an extensive feasibility study, which led us to fundamentally rework Stadium Member from the ground up.
What are the biggest differences from how it used to be?
- One basic insight into our new strategy relates to surprises. The idea has its origins in increased expectations, and I usually cite this example to make it clear: Imagine booking a couple of tickets to a sporting event that include any pizza in the arena restaurant at half time. ‘Nice!’ you think, as you picture the tasty pizza and a drink that’s waiting for you when the referee blows the halftime whistle. When you then go to collect your pizza and find that it’s a soggy micropizza on a paper plate, you’re disappointed. But if it was something you’d known nothing about, you’d still be happy with it, because you had no expectations. This is how we think all the time.
Stadium has also chosen to invest in its truly loyal customers. One step the company has taken in this direction is to depart from the concept of a monthly bonus and small vouchers. The smallest bonus a customer can now get is SEK 500, which requires them to earn 10,000 points in a year. At that point they’ve reached level three in the visible element of the loyalty programme, which has four levels with clear amount thresholds. The invisible rewards increase with the levels. Meanwhile, Stadium wants to give something to all members of the loyalty programme.”
- We’re working extensively with our partners, as this gives the feeling of exclusivity and gives us fantastic opportunities to surprise. The level of the surprises is relative to the level in Stadium Member. Those who reach the highest levels can, for example, get exclusive tickets to sporting events or free seats at the Vasaloppet race.
To make membership as simple as possible, Stadium has recently launched an app. Here customers can see their membership level and bonus. They also get an overview of their Stadium account – a payment solution that Stadium offers its members through a partnership with Walley. The service enables all purchases during the month to be added up on one invoice. Eventually, it will be possible to pay using the app as well.
-We currently have a cardless membership scheme and are making a constant effort to improve the shopping experience in the app. The next step is to also offer a payment solution. Here, it’s important to point out that we see it as crucial that the customer always remains in our world. This is what Walley does in that it creates the invoice so that it looks like it comes from us, despite Walley being the ones taking care of the credit side of things. And we want customers to shop via their Stadium account, which is why we give them 20% extra points when they do.
Stadium also uses an invoicing service from Walley, which allows customers to pay for their purchase in instalments.
- We sell a lot of expensive equipment such as bikes, skis, and golf clubs. We want people to be able to afford an active life, which is fundamental in our brand. This is why everyone, even those who aren’t Stadium members, can pay for their purchases in instalments. This is where Walley is valuable to us, because they don’t take over when the customer comes to pay.
What challenges do you see ahead for customer loyalty?
- My job is to be on the customer’s side. It’s not possible to look at a loyalty programme as a pure sales channel. I believe that the path to success is about investing, taking a long-term approach, and constantly striving to improve what we offer our customers. It boils down to a balance between value for us and value for our customers. An important dimension is also the brand and incorporating this into the loyalty programme. One example of how we’re working with this is how we’re enabling people to earn points by taking part in our races and activities.
Hanna’s three tips for strong customer loyalty:
- Hygiene factors such as the shopping experience in the form of attractive products, delivery, simplicity, and living up to expectations will always need to be number one. If these don’t work, or if you don’t have attractive products, a loyalty programme is pointless.
- This comes down to having the courage to invest in your customers and loyalty programme on a long-term basis. If there’s somewhere you shouldn’t seek to make savings, its on your most valuable customers.
- Think outside the box, be brave, and try new things.