The Modernization Of Lord & Taylor: Its First Loyalty, Mobile Moves
Written by Evan SchumanSeptember 16th, 2009
Lord & Taylor, the nation's oldest department store (dating back to 1826), is trialing a loyalty program, based not on a customer's dollar spend but on how frequently a store is visited. Although the motto that "every customer counts" is always true in retail, it's fair to say that that's especially true with Lord & Taylor's customers, whose average daily purchases hit $75.
When it comes to mobile investments, E-Commerce Director Dan Shelffo said "we're poking around" and that his group has made some "site modifications so that we can start to dabble" in mobile communications. But the spreadsheets do not look attractive. "I have to protect the billion-dollar brand. When I look at the dollars that I am going to invest, I look at the return. I know what my ROI is," Shelffo said. "When I look at mobile, I see a lot of investment."
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9 Comments | Read The Modernization Of Lord & Taylor: Its First Loyalty, Mobile Moves
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September 17th, 2009 at 10:00 am
The PCIKnowledgeBase’s research suggests the same thing: card data’s kept in a lot of places that it shouldn’t be. That’s the sort of thing that can make both E2E Encryption and Tokenization ineffective as enterprise-wide solutions if their implementation is only focused on the payment stream, not ancillary uses of the card data. We’ve found that encryption, for example, is differentially employed when the data are used for CRM and other apps.
I’m also interested in the role of “Data Mining” as a driver of card data retention. I think it would be really interesting to see how much of the “other uses” of card data is being driven by data mining and “new” CRM and other applications vs legacy apps that are, as Avivah said, just too expensive to re-engineer.
thx, Dave T
September 17th, 2009 at 10:05 am
This program is not innovative. Its tied to a credit card and younger buyers don’t want (or need) credit cards–they want multi-tender program. GE keeps pushing the same old story and every year the L&T customer gets a year older.
September 17th, 2009 at 10:11 am
Editor’s Note: I have no idea who Garbageman is, but it’s clear he knows a bit about this. We hadn’t mentioned GE in the story for space reasons, but they are indeed involved in this Lord & Taylor program.
September 17th, 2009 at 2:18 pm
Interesting of L&T (and GE presumably) to telegraph not only their launch date and pilot but also the stated objective being solely focused around retention.
Loyalty marketing, done right, should be about much more than retention, particularly for a department store like L&T. At $75 per transaction, they should be focused on ways to drive incremental store visits and build the basket. Part of achieving this is through integrating loyalty into the broader CRM efforts, especially those mentioned above.
September 17th, 2009 at 2:29 pm
Garbagemen is so right. GE Money pushes the same old tired Private Label loyalty program, and LT signed to it on because it costs nothing – GE does all the loyalty heavy lifting. They tell their retail clients that a non-Private label program will hurt the private label card (not true, if structured properly). And yet the LT Private Label card generates about a third of business – what about the other customers? Sounds LT is ignoring them. Taking the easy way out with this program.
September 18th, 2009 at 10:14 am
Hey, garbageman (and others),
What would be an example of a well-executed retail loyalty program not tied to credit cards? I’d like to know more.
September 18th, 2009 at 11:10 am
Back to the ‘based on visits’ part.Customers are not stupid and they certainly know that you are just trying to get them into the store. Though the data shows that the customer is indeed coming into the store more than once a month, they likely don’t realize it. And they likely don’t like that L&T knows it and is using it in a self serving way. I’ll bet some are going to be a bit miffed by this. In my opinion is not NOT customer focused, it’s all about L&T.
September 18th, 2009 at 3:50 pm
Lord & Taylor ought to teach their management staff how to treat and keep their current customers…didn’t we all learn in retailing 101 that it’s cheaper to keep a customer than develop a new one? The last time my wife visited L&T (last weekend, as a matter of fact) she was treated so badly by the management staff over a simple coupon issue that she cut up her L&T charge card in front of them…their response? “WHO CARES?” (a direct quote from their “manager on duty”).
March 11th, 2010 at 11:00 am
Well, indeed, who care? Not only does GE really want out of the credit business (esp. retail credit which is dying a very slow death over the next 30 years), but at the end of the day, it’s about topline sales.
Credit sales roll up into topline, but with a historical 46% use (if even close to this now) of credit, nearly every retailer that can figure out how to is going to tender-neutral, or is there now.
You could say at least L&T is trying something, but now that they don’t have MAY behind them, and Federated (Macy’s Inc) sold them off, they’re on their own.
And obviously – many store associates don’t care about the credit card because if they can get you to buy something, you’ve bought it, regardless of how you pay for it…and you’ve added to the bottom line.