Bed Bath & Beyond Inc. recently announced its revamped loyalty program as the retail chain flounders, ousting its CEO and struggling to turn sales around. The merchant’s former Beyond+ membership, which offered free shipping with no minimum purchase and an automatic 20% off all eligible items without requiring the retailer’s ubiquitous coupon codes, is morphing into Welcome Rewards+. While the new iteration has some differences, the membership fee is unchanged, and it includes some of the same perks.
Here’s a look at how many top online retailers give consumers similar rewards or paid perk programs and how Bed Bath & Beyond’s offering stacks up against other household names like Amazon Prime and Walmart+.
What is Bed Bath & Beyond’s Welcome Rewards program?
The main selling point for the new Welcome Rewards tiers is that Bed Bath & Beyond, No. 30 in the 2022 Digital Commerce 360 Top 1000, now will allow shoppers to earn and redeem points by purchasing across its brands, including Buybuy Baby and Harmon.
The move came in response to shoppers’ demands, company executives say. More than 80% of the retailers’ customers desired a loyalty program that would let them rack up rewards across all of Bed Bath & Beyond’s banners, according to Rafeh Masood, executive vice president and chief customer officer.
Amazon, Walmart and Bed Bath & Beyond square off with paid membership programs
Amazon.com Inc., No. 1 in the Top 1000, has arguably the most well-known and deeply entrenched paid membership program in the retail industry. As of Q3 2021, Prime members spent about double on Amazon purchases annually vs. non-members, according to market research firm Consumer Intelligence Research Partners LLC, or CIRP.
“[Prime members] also have really high renewal rates — above 95% — and are more likely to pay for membership annually instead of monthly,” says Mike Levin, CIRP partner and co-founder. “So it seems that long-term members are just extremely loyal to Amazon. Amazon benefits because it locks these members into Prime spending patterns.”
Between consumers increasingly expecting free and speedy delivery and the spending patterns of paying members, other retailers unsurprisingly followed Amazon’s lead, mirroring the Prime membership model to compete with the web giant. Late in 2016, Bed Bath & Beyond’s original Beyond+ program went into beta testing. Walmart Inc., No. 2, launched Walmart+ in September 2020 with similar free shipping promises and other discounts.
Early in 2022, annual fees for the popular Prime program increased from $119 to $139. That’s significantly higher than the $98 price tag for Walmart+ and nearly five times the $29 a year shoppers pay for a Bed Bath & Beyond membership. But plenty of consumers are willing to pay that hefty fee for the convenience it brings.