Kmart Rewards Customers with New Card

Discussion
Nov 09, 2004
George Anderson

By George Anderson


Kmart announced the introduction of a new credit card, Kmart Rewards, which gives shoppers cash discounts on goods purchased in its stores or on Kmart.com.


According to the company’s Web site, consumers who sign up for the card receive $10 back on their first purchase of $50 or more and $10 back for every $250 they spend using the Kmart Rewards card.


Kmart spokesman Stephen Pagnani told the Detroit Free Press, the retailer is offering the card because it is “a great way to reach out to your most loyal customers and hopefully encourage more repeat business.”


While the Kmart Rewards card provides incentives for customers shopping in Kmart or on its Web site, Meijer’s new card rewards the retailer’s customers every time they plunk down the plastic.


The Meijer platinum MasterCard will offer 10 percent off on the first Meijer in-store purchase charged to the card. Shoppers will then earn two points for each dollar spent at Meijer and one point for purchases made elsewhere. Cardholders will receive $10 in Meijer store credits for every 2,000 points they accumulate.


Michael Ross, director of marketing and strategy for Meijer, said the program was developed as a result of customer feedback. “The cool thing about rewards is points can be earned for purchases outside Meijer and in Meijer. You can earn these points really fast,” he said. “If you want to redeem it for gasoline or for groceries, it’s a lot more rewarding from what our customers tell us in focus groups than an airline or hotel type program.”


Moderator’s Comment: How effective are incentive credit card programs such as those being offered by Kmart and Meijer
in influencing consumers’ purchasing behavior? Is there a retailer, in your opinion, who has a particularly effective incentive card program?

George Anderson – Moderator

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