The Paytronix Convenient Connections Summer Series is a five-part blog that explores successful loyalty campaigns that convenience stores can use to drive user engagement, win back customers, successfully segment customer groups, and ultimately drive incremental revenue. Look for the Summer Series throughout the months of August and September.
Humans are motivated by a lot of things, but few incentives work as well as that of free food.
Right after the food incentive come money-savers: think 10 cents off a gallon or double points per purchase. So it’s easy to understand the logic behind visit challenges, in which customers earn a small reward for coming in for an extra visit.
The obstacle that convenience stores have always faced with visit challenges lies in the segmentation. Visit challenges are exceptionally successful for customers that fall into what Paytronix calls the “bronze” category: those who come in frequently – maybe two to four times monthly – but not regularly enough to choose that brand over another. These customers are less brand loyal and respond well to a small incentive; but while managing five visits in a month is easily achievable for four-visits-a-month bronze customers, it’s a bit of a stretch for those who typically visit just twice.
Historically, brands managed this challenge by segmenting even further, offering the twice-per-month customers rewards for visiting a third time, thrice-per-month customers a fourth-visit challenge, and so on. These campaigns were more successful, but some customers still did not respond.
Today, Paytronix offers a modern solution: 1:1 visit challenges.
1:1 visit challenges rely on algorithms to target customers based on their unique behavior. Using these algorithms, the brand is able to look at each customer’s visit and purchase history, then determine the appropriate visit threshold for that specific customer. Programs like these could even be used to determine which incentives and rewards are most successful on a per-customer basis.
Most Paytronix clients that use the Data Insights product have moved their visit challenges to the 1:1 model, and to great success: those brands have seen up to four times the lift in visits they had seen when using a traditional single-segment visit challenge.
Customers who receive targeted, relevant offers are more motivated, and the brands that run 1:1 visit challenge campaigns see less cannibalization, are able to offer promotions more frequently, and ultimately see more visits.