John Lewis and Waitrose test new joint loyalty scheme – success will lie in what they do with the data insight

| September 19, 2018 | By

In a rollercoaster month that’s seen John Lewis and Waitrose unveil a major rebrand and then announce a 99 percent profit dive, plans are now afoot to combine their loyalty schemes. If the brands can think mobile-first and harness the right data insight, there’s a massive opportunity to boost both customer experience and sales, says Yoyo CEO Michael Rolph.

John Lewis and Waitrose test new joint loyalty scheme - success will lie in what they do with the data insight

It was announced last week that John Lewis and Waitrose have plans to combine their loyalty schemes, as the sister companies look to bring both brands closer together.

According to Charlie Mayfield, chairman of parent company John Lewis Partnership (JLP), an initial 600,000 customers will receive a combined loyalty card that will work across both brands. If the new loyalty offering proves a success, the card will then be rolled out to their wider customer bases.

This announcement comes during a bit of a rollercoaster month for JLP. The beginning of September saw a major rebrand announced for both Waitrose and John Lewis – the first in 18 years – with the words “and partners” added to both names to empathise the brands being brought closer together.

But this was quickly followed by the news that JLP profits for the six months to 28 July fell by a humongous 99% to £1.2 million compared to last year, with the John Lewis side of the business taking much of the hit, and blame placed squarely on “a challenging time” in the retail market.

These starkly contrasting events give validation to JLP’s plans to focus more on customer experience and combine both John Lewis’ and Waitrose’s loyalty offerings:

One – if the brands are serious about promoting their partnership, it’s a no brainer that customers should see their loyalty benefits seamlessly integrated.

And two – in this “challenging time” that is the retail market, it opens up an opportunity to delve into the behaviours of these two distinct customer bases, identify invaluable data trends and develop hyper-personalised experiences and retention strategies that could measurably help boost footfall and sales across both brands.

Earlier this month, Charlie Mayfield told Marketing Week:

“Department stores that innovate, change their proposition, move with the times, offer people what they want, will thrive. We are determined to be in that camp.”

Combining both loyalty schemes, is one part of Mayfield’s plan to place John Lewis firmly in this “camp”.

It could potentially deliver:

  • A seamless payment and loyalty experience across both stores
  • Combined loyalty points, rewards and offers instantly viewable in one place
  • A merged John Lewis / Waitrose marketplace so customers could choose their own loyalty rewards
  • A John Lewis Partnership brand further bolstered through its own customer loyalty experience

But to achieve this, John Lewis Partnership needs to adopt a mobile-first strategy…

This should be a no brainer for John Lewis and Waitrose if the aim of their new combined loyalty strategy is to bring the brands closer together and redefine their customer experience.

At the moment, John Lewis’ current loyalty scheme members can only choose to receive rewards and vouchers, as well as create and share “wish lists” by tying a plastic loyalty card to the John Lewis app. But if the plastic card is still the dominant method of loyalty delivery – they are not redefining anything.

A full end-to-end digital offering would introduce a combined and seamless payments and loyalty strategy for Waitrose and John Lewis, bringing both the brands and the customer experience even closer together.

What’s more, in a time when the high street is desperately trying to compete with the ease and speed of online shopping, a mobile-led experience is the only way to deliver other simple but convenient loyalty perks like order-ahead and queue-jumping functionality. It’s also by far the best tool to meaningfully engage with customers.

…And customer data insight will be the measure of success

More importantly, there is also a huge customer data insight opportunity here for JLP – and it’s something that both Waitrose and John Lewis have been doing online since 2013.

By pooling each other’s data into targeted CRM technology, one brand has been able to target customers based on how they interacted with the other. For instance, a customer who buys a fridge from John Lewis online is now likely to find themselves seeing ads about food from Waitrose.

Now think of the awesome marketing potential if Waitrose and John Lewis analysed and segmented the data from their massive in-store customer bases – creating customer preference-based campaigns from spending behaviour born out of the newly-combined loyalty programme.

The opportunities around personalised loyalty expereinces, hyper-targeted campaigns, data-led incentivisation, and intelligent acquisition strategies are endless. Based on individual purchasing preferences, a customer could be incentivised enough to step out of a Waitrose shop and straight into a John Lewis store (or visa versa).

And with two such high-value brands, large, affluent user bases, and granular data, JLP could create the perfect foundation for valuable third party partnerships – think airline tie-ins, health insurers and more.

Conclusion

John Lewis Partnership’s decision to connect the loyalty experience up for their customers could be seen as a move in the right direction as it looks to drive more footfall and sales.

But in retail today, digital, data and personalised experiences need to be at the top of the priority list (Amazon is winning precisely because of this). Unless you utilise these three areas you are fundamentally NOT redefining the customer experience.

And as Einstein said, the definition of madness is doing the same thing over and over again and expecting a different result!