SimonDelivers’ Simple Loyalty Program

Jun 21, 2004

By John Hennessy

Golden Valley, Minn.-based online retailer,, has found a simple way to engender loyalty; free groceries.

The objective of their currently running “8th week free” program, according to SimonDelivers director of marketing David Gandrud, is to get customers into the habit of shopping at on a more regular basis. Shoppers who spend at least $80 a week for 7 weeks – over a designated nine-week period – receive $80 in free groceries in the 8th week.

Gandrud comments in internetRetailer that SimonDelivers doesn’t compete against grocery stores, they compete against their customers’ own behavior. The 8th week free program is specifically architected to make that change in their customers’ shopping routines and to also help maintain a consistent shopper base for during topsy-turvy summer months.

The program, originally designed only for select, infrequent shoppers is being expanded to all shoppers during two, nine-week windows this summer.

Moderator’s Comment: How should marketers prioritize new customer acquisition vs. best customer retention in programs
such as this?

At first blush I thought David Gandrud might be sitting on a ticking time bomb. Giving free groceries to infrequent shoppers but nothing to’s
best customers seemed fraught with peril. So I called him to find out how he was avoiding the slings and arrows.

David admitted that they had not done enough to reward their best shoppers. Most programs they had run were directed toward shopper acquisition and, consequently,
some existing customers have communicated feeling a bit alienated.

As stated, the original 8th week free program targeted only certain infrequent shoppers. Shoppers from that group who participated were compared against
similar shoppers who did not participate. David wouldn’t elaborate on performance but made it clear that the results warranted expansion of the program to all shoppers.

So, what began as free groceries to select shoppers is serving a broad audience of shoppers and producing results.

David feels this implementation of the program gives his best shoppers a benefit beyond service, convenience and quality (plug for
nicely embedded in his reply

John Hennessy – Moderator

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