A Few Ideas to Score More Member Loyalty
Take a peek inside the rewards program at video-game retailer GameStop to see how incentives and personalization can drive greater member engagement.
I don’t play a lot of video games. I’m more into the quick time-waster games that I can play on my phone while I’m in line at the store. In fact, one of my current favorites is still Minesweeper, preferably in its early-1990s Microsoft Windows look and feel.
So, in short, I am likely not a target customer for GameStop’s PowerUp loyalty program. I was, however, fascinated to read about how the video-game retailer has used PowerUp to learn more about its actual target customers and engage them more directly.
Last month, Knowledge@Wharton shared GameStop’s story after Eric Oria, senior director of marketing strategy at GameStop, spoke at the second annual Customer Centricty Summit in San Francisco. GameStop launched PowerUp in 2010. Before that, its predecessor loyalty program, even with 1.9 million users, was “really just a magazine subscription” Oria said, and the company wasn’t collecting data about its customers.
Today, though, PowerUp has 40 million members worldwide; 34 million participate at the free Basic level, while 6 million are Pro members who pay $14.99 per year. The main benefit is the rewards system, as members earn points for money spent with GameStop. Pro members can earn points faster, receive additional discounts and offers, and get a subscription to Game Informer magazine. According to Oria, while Pro members make up just 15 percent of the total PowerUp membership, they account for 71 percent of the company’s sales.
Association membership, of course, is more than just a rewards program, but the insights Oria shared about GameStop’s success offer some useful ideas for improving your organization’s membership practices.
Have free members pay with their information. The reward points for PowerUp Basic members are an incentive to sign up with an email address, which GameStop then uses to track members’ purchase history and communicate with them. All else being equal, 36 million customers you know is better than 36 million customers you don’t know. It’s a simple lead-generation strategy that some associations already emulate with free membership categories, such as the Alliance for Women in Media and CompTIA. “Ultimately for us, this was about how do we gather information about you as the customer to make your life better and connect with you in a meaningful way,” Oria said.
Reward members’ loyalty. The reward-points system is a common tool in many consumer-driven businesses, but it’s less common in associations. That might be a missed opportunity, because earning rewards can drive long-term gratification and build a more lasting relationship with a member than a one-time discount. With free members, you could even let them earn points toward benefits that paid members receive.
Personalize everywhere. This is where PowerUp shows its real benefits for GameStop’s marketing and sales efforts. It uses PowerUp data to personalize emails to members, predict which new customers will be interested in specific new games, and even judge the potential market for new store locations. But it’s not just online. GameStop is currently arming its retail employees with tablets that can scan membership cards and display the member’s profile and purchase history so the employees can easily tailor their in-person interactions with customers. This ought to be a standard practice for every association, if not in tablet form, then in an association management system’s on-screen interface and, even better, integrated with the phone and email systems. Imagine how your association’s member service could improve if every employee could view a member’s profile automatically when the member called or emailed.
Understand mobile. For GameStop, the PowerUp program’s data revealed that customers wanted information via mobile but preferred to make purchases in store. So, it refocused its mobile site accordingly—to help users find game availability in stores, trade-in value for games, and their reward-points balance—and in-store spending by PowerUp members rose 8 percent in 2014 and 10 percent in 2015. Associations are notorious for their kitchen-sink approach to websites, but mobile offers an opportunity to focus on the types of resources members need most when they’re busy and on the go—short, simple, and perhaps recurring interactions that can build loyalty over time.
Underlying all of these elements to GameStop’s approach is a focus on engaging its customer base more deeply, rather than just widening it. “It’s all about the customers who are loyal for us,” Oria said. “If we find somebody who lapses, we don’t chase them; if somebody doesn’t want to buy physical games at GameStop and they go digital, we don’t chase them and try to push physical hardware down their throats. … This is all about maximizing who is loyal to you in the first place.”
It’s certainly possible to get members to progress from new to loyal, and that’s worth devoting effort to, but there may be more potential bang for your buck in working to engage your most loyal members. The trick is knowing who your most loyal members are, and borrowing methods from GameStop’s example could allow those members to reveal themselves through data.
How is your association tracking member behavior to better engage them? Could a reward-points program help you better engage members and earn their loyalty? Have you tried a free membership level or free “registered” nonmember user status? Please share your thoughts in the comments.
Editor’s Note: This post has been updated to correct the GameStop PowerUp Pro membership price. PowerUp Pro membership costs $14.99 per year, not $15 per month.
(Ethan Miller/Getty Images/Thinkstock)