Scaling With City Beach: The Next Step For Loyalty Growth

So I have a lot of pleasure to bring up Kristyn Wallace, who is going to lead a quick fireside chat with City Beach and so I'm going to hand over to Kristyn. So welcome. There's the three of us today. We want to go to the next slide again so you can see your beautiful faces. I'm Kristyn, I'm the Regional Vice President of Revenue for Emarsys, some of you already know me. I manage our Australian and Singapore offices. I have here with me Mike Cheng, who is the Head of Digital for City Beach, Australia, and James Neill, who is our Customer Lifecycle Marketer at City Beach. Mike, James, thanks for being here again and thanks for joining me for our first session to break the ice. So for those of you who aren't familiar with City Beach, City Beach has been around for almost 40 years. They have 68 stores across Australia. The first one was in Brisbane. There are homegrown lifestyle fashion retailer, I think you would say you're Australia's premier homegrown fashion lifestyle retailer and you serve a global audience at the moment digitally, so you're expanding into international markets. So guys, quick round of intros, shall we? Mike, let's start with you. I'll hand the mic over to you. Hey I'm Mike, Head of Digital at City Beach. So I guess marketing was a little bit differently at City Beach, we're not like one umbrella marketing. We're kind of separate into e-comm, brand and digital. I like to see my teams more like the glue, we amplify the brand, we work with the content and get nerdy and techie about all the things that e-comm so super small team. And we've been with Emarsys for six years now so it's really helped us like utilize a very small team with essentially a platform that can do a lot of things very quick to market as well. Hey, everyone. Yeah, my name is James Neill. I'm the Customer Lifecycle Manager. So essentially my role is anything around retaining the customer. We've got such a large database. We've been around since 1985. It's really about trying to keep those customers coming in and increasing that purchase frequency along with the AOV. So I'm in Emarsys every day working with email, SMS, and also headed up and launched the loyalty program City Beach Rewards. Fantastic. Thanks, guys. So I think we're going to just do some scene sitting here. So you've grown your database to over 3 million, is it? In the last few years so significant, maybe almost 50% growth in that since we started working together. So massive achievement. You've got a wide ranging customer base, right? So you have tweens and you've got tweens parents and maybe even their grandparents at this stage after 40 years. So you've got a lot of data to work with and you need to understand those customers really well and target them in different ways. So your loyalty program was part of this ongoing evolution of understanding and communicating with your customers. Wonderful. Thank you, Joanna. So, Mike, question for you. What were some of the initial challenges that you faced when you launched the loyalty program? I think for us, it's coming off the back of Covid. It was like two years of really accelerated growth. It's just finding time to go what's next? We in that two years did international expansion, your website, loyalty was another. We've been trying to do loyalty since 2012 so when 2022 finally came was like let's do loyalty, we've been talking about this for the past eight years. How do we do this? So the challenge was, one, why are we doing this? And two, it's like finding a partner to really essentially launch loyalty for us. Plus, stores make up about 70% of the business, so it's really getting stores on board. You've got a store network where you've got teenage kids really being sent high KPI click emails, but now you're trying to go it's not just about collecting email addresses and growing this artificial database where they're just collecting; it's about actually knowing about that customer. So selling that to the store network was a big challenge for us. And for us, we really push loyalty to be a online self-service like our websites. So we really push that self-service approach for in-store, which took away that KPI they had to drive in-store for store collection. And the other one is also like online has data going back six years, in-store probably matching, you're looking at about 30% matching in-store for last two years. Like who can we partner to really launched this loyalty program? So we've been talking to Emarsys since loyalty was two pages of API, I think back in the day. And finally they're like, "Hey, we got a loyalty extension, do you guys want to try it out?" So we definitely signed up. For us it's activating really quickly as well as a huge challenge as well. And going there I think it wasn't just a digital focus, it was now a store focus, it was a finance focus, IT focus or like a core focus area too. This increased lifetime value, so rather than talking about short term metrics and start talking about RFM scoring, let's look a bit better at retention customer so essentially everyone's fighting for the same customer. How do we retain them, get them to purchase more frequently? Also for us, it's like everyone's on a sugar hit, sales are bad let's do a promotion, really trying to decrease rely on price and promotions so building some kind of loyalty or reason, identifying different customers that form better get them back in the fold. One thing that's definitely beneficial for us is really looking at the customer experience through better data. So loyalty means better customer signals, whether it's online, in-store, purchase view, etc.. And the last ones like engagement started for us was a big one as well. So it's not just going to be a loyalty program. How do we get brand ambassadors? Everyone wants to be the Maccas, how do we get that kind of experience? That's a lot to think about Mike. James, let's talk a little bit about the planning and the execution. Can you talk about maybe some specifics of the solutions that you have implemented so far and how that's integrated into your customer lifecycle and your overall framework? Yeah, definitely. So to keep it short, because I have a short amount of time, I'll run through it really quick. So the idea is to keep it as simple as possible because we want to catch a wide net of these customers that we know we could increase our frequency. Went out a high frequency shop so people come in maybe once, twice a year, generally, probably during summer when they need to get new thongs or togs. And it's really just trying to help them to go again and shop again. So really simple, it's ten points per dollar every time you shop, when you add a thousand points, you get $10 voucher, which you can redeem on your next purchase. From there, it was online and in-store. As Mike said, online is very simple to set up. We have complete control of it. We set up where they could see their vouchers, where they could see their points, how they could redeem and go through the whole process of making a purchase and then actually getting to the checkout and getting their points and getting their voucher. In-store was definitely a bit of a learning curve there as well because we weren't in complete control, it was on the 15 to 17 year old casuals as well that we had to try and help push along. So we had to really make this customer focused and customer driven. So in-store and online, you sign up, you provide an email address, mobile number, some added bits of data that we'd like to get and then in-store you can walk up to the post, talk to the staff member, they can search you or you can scan your mobile wallet where they'll be able to identify you, how frequently you shop, how many times you've shopped this year, as well as add points, sorry, add vouchers to the redemption or to the sale, which would then taly off the points. Yeah. So it's really kind of adding to that in-store experience as well by allowing your representative to have more information about the customer while they're dealing with the customer. Right? So from a results point of view, which is obviously the good stuff that we all want to hear, aside from what we can see up on the screen above me, what are some of the key results from implementing phase one loyalty for City Beach? Probably one of my favorite ones was we wanted to get like a 20% increase. We set the benchmark of about a 20% increase in getting existing customers across onto the loyalty program. Well, just we're 11 months so we hit one year in November, we're at 40% of our total database. Looking at it now it's almost half of our active opted in database so the majority of our active database which we send promotions to regularly, are part of the loyalty program. That was really cool to see. We're seeing a 10% increase on overall conversion rate on automations that are for loyalty programs so that's really strong for us. So we've got I think it's an added seven automations on top of our standard life cycle automations, which is an extra touch point that 1-to-1 experience that the customer can have. We haven't yet jumped in to our attention and reactivation and gone loyalty to non-loyalty just yet but what we've seen at the moment is the 'use your points, your voucher is about to expire' that's really driven customers to come back and purchase again. If you're interested in having that conversation about life cycle plus loyalty, we have friends from Adore Beauty in the audience who would probably be very willing to talk to you about that one. All right. Earlier this year, we touched on it. You touched on it. When you're talking about your channel mix, we did launch the mobile wallet offering. So what that allows brands to do is give something to someone to keep on their phone that may not be an app, that's easy to use, pull out and store and can contain digital vouchers, coupons, tickets, loyalty cards, etc.. So you've started communicating in a very omnichannel way. How is that mobile wallet solution fitting into your channel mix, your omnichannel mix? And in that mix, what overall channels are helping you the most to boost those loyalty conversions? Yeah. Great question. So yeah, we run mobile wallet is definitely one of the tools we use to help drive loyalty. On top of that, we have AI segments, automations, we've got that in-store and online data coming in which we can feed the correct information through. Mobile wallet to us at the moment, it's allowing customers come in so they can scan a QR code so the staff doesn't have to type in an email address at our POS. So that's just to try and speed up the process. Definitely the goal is to help push with promotions, drive that second purchase because at the moment we don't have an app. So it's a really good way for us or a good entry into doing notifications, app notifications and then having that AI segmentation on top of that helps us drive better automation so we can see when they're about to churn, when they're new, when they've dropped off completely and that that's helping us a lot. Yeah. I think mobile wallet for us is super low touch. It's another ID kind of a component of matching someone in-store. We make sure we're part of a larger program. We also have the unique identifier on our emails as well, whether it's transactional behavior or mail, another ID point as well, does this add that, I mean super excited about what I can do from personalization level around promos, but I think we're talking about it before. it's like a segue into app. Same is loyalty. You don't want to just have an app for the sake of having an app. There's a reason for an app. When the loyalty program says mobile wallet, it's a segway into us you know having the app as well. Yeah and it's also when we talk about the economy and what's happening and people tightening up on budgets, not every brand has the money to go and build an app right now, right? So it's a cost effective solution that still gives people the in-your-hand kind of access to the website, to a store that you want to drive with an app. It's not a acquisition game it's literally a retention conversion. I mean, doing a loyalty program or an app, if you want to convert that customer, look at make them purchase more, make them engage more. So treat it like a conversion or retention platform. Yeah. So you're increasing average number of purchases in a year, you're increasing your average order value, all those wonderful metrics that we like to see. Okay to sum up our session, I have one final question I'd like to ask each of you. It's more for the marketers in the room, it's kind of a unfiltered question. If you could go back in time to the beginning of your loyalty program and the journey of implementation, is there anything you would do differently or any advice that you would give to anyone in the audience who's about to do it? Don't do it in 90 days and don't launch it during peak. So we scoped it out for ages, but the actual implementation was 90 days. I think James and I spent two months going online, in-store shopping and testing. I think I remember an implementation consulting. We did it. That was one. It would've given us more time to really build some kind of comms strategy with stores because they're going to be pushing out, you want them to adopt that product online, as I said before, it's like very self-service. So you want that in-store team to be on board and really adopt the loyalty program. The other thing is like place more emphasis into… We took a very tactical approach for us, like points based, then go I want everything in one go; one point tiers, free sample like everything start off simple. Your points approach will give you data about that customer and their purchase behavior and then use that to segway into something like a team base program. We spend version 1.5 fixing a lot of bugs as well. So key want to be don't just surface loyalty based on email. Look into your checkout on your website as well as service points. There's a lot of customers going to be reminded to use points, using email as a channel to tell them about to use their points or they've gained perks. It's a very small channel because of diminishing returns of open deliver, open click website. But if you start building into actual website through your checkout saying, £Hey, you've got points." "You know, you can get points", you get a lot of conversions through that as well. And I guess the other one's like reporting. You launch loyalty program, you don't really talk about reporting. You're like, oh, it's an inherited debt. I should talk to finance about that one. So make sure you got your tracking down part. You're probably going to find your social team being the best for loyalty because they're going to gain points for like gifting, etc.. Talk to finance, talk to loss prevention about how do we monitor dodgy behavior around people using points. The other one is you would really introduce now a new metric; this is long term metric with lifetime value, target over 6 months, 12 months, and then you've got your point usage and your daily, weekly transactional buyer loyalty. So when people ask you how did loyalty you go last week, you really have to take a longer view because you want your senior suite to really look at loyalty as a long term play like a 0.2% increase in purchase frequency, or 0.3% in AOV. It's such a huge metric magnifier as opposed to like up 10% in sales. Yeah. So that's sort of the art and science mixing, right? So loyalty is a concept, it's an art, right? So you take those metrics and you have to look at them in that long term view of keeping your customer loyal and keeping them with your business.