Main content begins

Lowes Foods’ First-Ever Digital Loyalty Program

May 16, 2018

In October 2016, Lowes Foods launched its first-ever digital loyalty program: Kitchen Kaboodle. This article explores how a collaboration between Lowes Foods, BrandLoyalty and IceMobile created a successful recipe for a quintessentially local grocery store.

Bruce Kerr, SVP and President, BrandLoyalty North America

 

 

In October 2016, Lowes Foods, a North Carolina-based family-owned grocer focused on local, homegrown products, enlisted the help of BrandLoyalty, a global leader in providing innovative, incentive-driven loyalty programs, and IceMobile, an award-winning developer of apps and mobile experiences, to create its first-ever digital, short-term loyalty program, Lowes Foods Kitchen Kaboodle. Driving loyalty and sales through digital stamp collecting and an enhanced mobile experience, the program ran for 18 weeks in 75 Lowes Foods stores across North Carolina, South Carolina and Virginia. Read on to find out how it worked, the results and some key takeaways for other food retailers interested in launching their own program.

 

About the Program

The Kitchen Kaboodle program centered on a simple concept. Customers collected stamps by making purchases, then exchanged those stamps for Villeroy & Boch Group Vivo-branded kitchen knives. More stamps earned more knives, with the most frequent shoppers ultimately collecting an entire set.

Lowes already utilized a traditional rewards program (Lowes Fresh Rewards) that integrated loyalty cards into the purchasing process. In order to drive participation and make taking part in Kitchen Kaboodle as seamless as possible, Fresh Rewards members were automatically enrolled, which meant that every time a customer swiped their card during purchase, the relevant number of stamps was automatically added to their collection. Rather than requiring people to visit a website after their shopping trip, the team at IceMobile developed a mobile app called MyKaboodle that allowed customers to track the progress of their collection from anywhere in real time.

The program also featured a “collect together” option, which enabled families or friends to link their cards to save up for some great rewards, which proved very popular. Each time one person gained a stamp, everyone in the group saw the update on their app, reminding them about the program and motivating them to contribute toward the group’s score too.

Customers were even given the option to collect paper stamps, but the program incentivized digital participation by offering lots of perks, including an initial bonus of five stamps at sign-up and the ability to collect as a family and to transfer stamps to other customers.

 

Setting Up for Success

Developing the program took three-plus months, including eight weeks to integrate into Lowes’ IT systems. This started with research into customer likes and dislikes as well as where and how they lived and shopped. It also included user experience mapping with the retailer and asking lots of questions about Lowes’ goals for the program.

Once the program was ready for launch, a targeted marketing campaign was initiated to spread the word. This included in-store POS materials, paper leaflets, social media content, one-to-one push messaging and other tactics that helped maximize awareness during the holiday period when the program was approaching its peak.

 

The Results

Feedback for the program was overwhelmingly positive, with participating shoppers enjoying the opportunity to extend their basket value and earn rewards with their purchases. The digital side of the program in particular was a massive success, significantly increasing the number of new customers for Lowes and driving 25 percent more sales than the legacy/paper model. Mobile-specific tactics like the one-to-one push messaging deployed were especially impactful, showing a steady correlation to customers shopping in-store and spending more when they were notified of potential bonus stamps that could help them reach the next reward.

 

What’s Next

Since agility is key to constantly improving programs for customers, the data Lowes Foods collected from the Kitchen Kaboodle program was analyzed and leveraged to enhance a second digital program, which launched in September 2017. The new campaign used the same app and tactics as the first, offering loyal customers the chance to assemble an entire collection of Vivo cookware for the Lowes Fresh Rewards loyalty card. 

 

For more information on Kitchen Kaboodle and building successful digital loyalty programs in the food retailing space, please contact BrandLoyalty at marketing@brandloyalty-int.com