Sneakerheads love to be the first on their block to own the latest Nike Air Force or Adidas Harden shoe. And retailer Hibbett Sports Inc. is leveraging that footwear fanaticism to drive downloads and repeat usage of its first mobile app.
The app, introduced in May, offers shoppers the only way to enter drawings for the right to purchase limited-edition shoes. In the past, consumers filled out entry slips in stores and placed them in bowls to enter a raffle for the opportunity to buy a new pair of kicks. No longer can they enter that way; nor are their entry forms on Hibbett.com, the retailer’s e-commerce site.
Bill Quinn, vice president of digital commerce. Hibbett Sports Inc.
The raffle strategy also has an important omnichannel component: Consumers selected through the raffle can only buy the shoes in one of Hibbett’s more than 1,000 physical stores. When signing up for a drawing, the customer indicates three Hibbett stores he’d like to buy from. Each store then chooses among the app users who selected that store.
Experience has taught Bill Quinn, Hibbett’s vice president of digital commerce, that a retailer has to offer something via the mobile app that shoppers can’t get on the website for the app to be successful.
“There has to be a reason for you to download the app. It can’t just be a replica of or a subset of your website,” Quinn says. “The app has to have something that’s different, and a key component for us is this omnichannel component, the raffle.”
Quinn says “a substantial number” of consumers have downloaded the Hibbett app since its introduction in May, though he would not say how many.
The raffle strategy not only encourages consumers to download the app, but also to repeatedly use it, as shoppers not selected for one shoe are likely to enter a raffle for another pair they like.
That’s important, because customer acquisition campaigns often do a good job of attracting new customers but fail to keep them coming back, says Scott Robinson, senior director of loyalty design and strategy at Bond Brand Loyalty Inc., which specializes in designing, building and operating retail loyalty programs. “Exclusive access to scarce or limited-quantity items, or benefits only a certain group will have access to, are familiar and clever mechanisms for continuing to engage consumers,” Robinson says.
Besides building the mobile app, Hibbett also had to build an internal web portal that would allow stores to make sure that the inventory consumers see is accurate and to view raffle winners, Quinn says. Each store can print out the names of winners so they are prepared to serve them when they come into the store to buy the sneakers.
The mobile app, which was developed for Hibbett Sports by mobile technology company Prolific Interactive for both iOS and Android devices, is the latest in a series of steps Hibbett has taken to acquire and engage new customers, both online and offline. That includes upgrading its loyalty program in spring 2016 and launching its first e-commerce site in July 2017.
The retailer also began this fall allowing online shoppers to both buy online for in-store pickup and to reserve items on Hibbett.com that they can try on in stores. Quinn says the reserve-an-item option caters to a shopper who may not be ready to purchase. Many want to try an item on before buying, which is especially important for footwear, which represents half of Hibbett’s sales. It’s also important when buying shoes or apparel for growing children, he says.
E-commerce represented 8% of Hibbett’s revenue in the second quarter of its current fiscal year, which ended Aug. 4. The retailer reported $211 million in sales for the quarter, which suggests online sales totaled about $17 million.
60% of sales come from members of the Hibbett Rewards loyalty program, compared with 46% two years, the retailer reported. However, Quinn says the percentage of online sales from loyalty program participants is somewhat lower because the retailer’s digital marketing is largely focused on acquiring new customers who are not likely to have signed up yet for the rewards-points program.
The big change Hibbett made in its rewards program was to introduce two membership tiers. The lower MVP tier provides 1 loyalty point for every dollar of purchase. But those who spend $250 move into the VIP tier, where they get 1.5 points per dollar spent, plus free shipping of online orders. Consumers get a $10 credit for every 200 points they accumulate, a reward equal to 5% of their spend, compared with about 2.5% for Hibbett’s previous program, Quinn says.
Hibbett reported in August it had attracted more than 860,000 new members to its loyalty program in 2018. Now, there are more than 9 million members of the loyalty program, including customers who had signed up for the earlier program.
“Adding a tier to the program definitely helps because it rewards your best customers,” Quinn says. “We also see that people who are on the borderline, close to that cutoff, will participate more because they want the benefits of being in the higher tier.”
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