Saturday, May 2, 2009

Good one for Myer?

The Myer One program has risen in less than five years to the position of one of Australia's better loyalty offerings. Importantly, Myer appears to "get" loyalty programs. Myer chief Bernie Brookes made a few marketers sit up and take notice when he recently revealed that the department store now spends more money on Myer One than it does on its entire above-the-line marketing. Now, you have to take into account the millions spent on those reward gift cards, but when one considers Myer's massive triumvirate of TV, press and catalogues, that's still saying something.

And for me, the true sign of success of a loyalty program is when it pervades the entire organisation and occupies a position in the middle of the organisation - as opposed to being viewed as a discretionary marketing activity. The Tesco Clubcard is the much-cited international example of this. But Myer One is heading in the Tesco directionin my view. For it is clear that the profound power of the data that Myer collects upon every swipe of the card (and the resulting gift cards) is being used by management to gain insight into all parts of its business - from store selection, to product ranging, to price points across different stores and so on. Additionally, Myer is going to great lengths to speak (generally) in a relevant, timely and appropriate manner to its members.

The recent tiering introduced by Myer (the first attempt in 2004 was a bit of a mess) is a step in that direction, with its best and better customers plonked into Gold and Silver categories. Myer takes this a step further by encouraging each store manager to develop a dialogue and close relationship with that store's best customers. Even chief Bernie gets into the one-on-one action, stating he's had Myer's five best customers nationwide around for dinner.

To Myer's credit it appears to have found sufficient resources to unearth the jewels in the database that Myer One has provided. In this respect, it provides a salutary lesson to its fellow major retailers in Australia. It is the power of the data above all else that will generate a return on loyalty investment. Myer seems to get that point best of all.