Successful loyalty programs give consumers an incentive to spend more
Chico’s FAS Inc. made major changes to its loyalty program in June 2022 for the first time since the 1990s.
“The previous programs had significant limitations of what we would be able to do in the future,” senior vice president of marketing Leana Less says.
After 30 years, the loyalty programs from Chico’s competitors had significantly advanced, with better personalization capabilities. Chico’s needed to update its program to stay competitive, Less says.
The new loyalty program gave Chico’s the capability to better target consumers. Now, the retailer has access to “really phenomenal micro segmentation” of consumers, Less says, calling this feature “critically important.”
Under the previous system, a promotion would go out to the entire rewards member base. Now, Chico’s can target promotions to get the most value; for example, by giving a specific discount to members who are at the top of one tier to migrate them to the next level, Less says.
Chico’s debuted the new loyalty program in June 2022, with the goal of having 65% of its customer base join in the first year, Less says. Within nine months, 80% of Chico’s customers were members of the program, she says. The quick adoption was a combination of already-loyal consumers jumping from the previous program, and new members drawn in by potential savings.
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