Nescafe's Cup of Rewards is a new player in the Aussie loyalty space, and represents a brave play in a loyalty market which has been almost devoid of product-specific programs.
Loyalty watchers are quite familiar with some of the big global players in this space, with My Coke Rewards weighing in as possibly the biggest, with 14 million members in the US. Programs in the FMCG sector (read CPG in the US) have been quietly garnering a corner of the loyalty territory traditionally claimed by retailers. Not that this has been a smooth pathway, as LoyaltyOne's Sol Zia recently neatly summarised.
However, it's not surprising that Australia has to date provided a barren landscape for FMCG programs. Although older Australians may recall exchanging Robur or Lan Choo tea labels for teapots in years past, the simple lack of scale has hindered the economics of such initiatives here.
So will the Nestle program work? The program is simple to join, and the website has a contemporary, friendly feel. A head start of 50 "beans" (plus a further 25 if I refer a friend) means that rewards are instantly within my reach. There's been a deliberate attempt to have the lowest possible bar on rewards, but I think it comes at a cost. Low-level rewards such as $30 off a $130+ Red Balloon experience, or a free game of bowling for every paid one, can come for nothing with existing member benefit programs. The balance of the reward catalogue seems a little sparse at present and surprisingly there appears to be no current link to social media but I expect these aspects will come in time.
The giveback is by necessity generous, given the narrowness of the category. With a 150 gram jar costing $8.50 earning me 150 beans, a $20 Repco voucher or iTunes benefit for 1,900 beans implies a very healthy giveback of just under 20%. Beans remain "fresh" for 24 months.
It's early days for Cup of Rewards. With the increasing appetite of Australian shoppers for private label products, programs like this have potential to provide additional brand stickiness. More than a few bean counters will be watching!