Loyalty programs certainly provide good deals to regular customers in exchange for repeat business. The practice of giving loyal customers better deals is as old as doing business itself, but as business practices progress, evolve and innovate, the customer loyalty model also adapts, especially with technological advances.

Today’s loyalty programs track and record purchases and build customer profiles based on this data. These profiles help a retailer to better understand its customers and develop marketing and advertising strategies to target each customer specifically.

Stores under the Supervalu banner use LoyaltyOne’s Precima customer-centric analytics solution to develop a multi-dimensional customer segmentation. LoyaltyOne has more than 20 years in the business of leveraging data-driven insights to develop and operate effective loyalty programs and customer-centric solutions. The US grocer plans to strengthen and expand its customer-driven marketing, merchandising and operations strategy through the Precima product.

“Our shoppers will benefit most from this strategic pick as we enrich their shopping experience and focus more on the customer as we make key business decisions,” says Wesley Story, vice president, customer insight and loyalty for Supervalu Group. “Precima’s approach to building a customer segmentation strategy grounded in insights that combine behavioral analysis with market data research will result in innovative programs across all facets of our enterprise that are relevant and more personalized to our customers.”

Parent company of Market Street, United Supermarkets LLC, based on Lubbock, TX, launched its Smart Rewards Loyalty Program in June 2011. Like most loyalty programs, Smart Rewards gives customers the chance to earn points when they purchase items at Market Street stores in the Dallas/Ft. Worth area. Customers then redeem points for free products and discounts on additional products in the store.

The program is free, and Market Street guests in the Dallas/Ft. Worth area can sign up in any store location. The enrollment process takes seconds to complete and members can use their phone numbers instead of carrying a card. Upon enrollment, members automatically receive an online account.

Market Street believes in the value of its customers, as well as the value of the products it offers. Giving customers value and treating them with respect and fairness underlies the mission of the Smart Rewards Program, “Our company philosophy has always been never to have two-tiered pricing,” says Eddie Owens, director of communications and public relations. “We’re of the mindset that every guest is as valuable as the next one.” Market Street developed the program internally so they could control the way it works.

“The intent for our Smart Rewards Program was to develop a loyalty program that essentially leveled the playing field for everyone,” Owens says.

Aside from gaining the loyalty of customers, retailers have the ability to gain invaluable knowledge about customers and their shopping habits on an individual and demographic level. Market Street uses the data collected from the program to tailor marketing and how they disperse member rewards. “We look at the total member behavior, member activity and really giving offers to members based off the activity we’re trying to drive,” says Robin Cash, loyalty and marketing manager for United Supermarkets LLC.

Knowing your customers better than your competition creates an advantage when seeking loyalty from your shoppers. Market Street’s Smart Rewards Program gives the store insight into who its customers really are. “Through the program, we understand our customers more than we did before we had the program,” Cash says. “We understand their shopping habits and patterns. That’s been our primary insight so far.”

The knowledge Market Street has gained from the program goes further than present time. While knowing your customer and their habits helps immensely at the moment, the long-term benefit, relative to growth, is invaluable. “I think one of the biggest benefits of having a program like this, especially in the Metroplex (Dallas/Ft. Worth area) right now, is that it will go a long way in helping us develop new stores,” Owens says.

With a new store on the drawing board, Market Street has built up enough information from the rewards program that the company can develop strategies to better accommodate customers. “The new store will be much better focused where our guests’ needs and shopping desires are concerned,” Owens says. “If we don’t see a double-digit growth in sales year over year, that’s okay, as long as it’s incremental and our shoppers are better-pleased with their shopping experiences as a result.”