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Back when I first started at Staples, the company had just within the last couple of months had changed the way the company was doing business. No longer did the company have a membership program where if a customer was a member they would receive a discounted price on merchandise. This membership program was changed to what was called “Staples Dividends” card. The last “s': in the name was actually a “$” to indicate the money you would get back from the card. And YES, you REALLY got back certificates that could be used like REAL money.
The original program was a straight 2.5% back on purchases with the exception of gift cards, computers, and postage stamps. Although these items did count toward your yearly total. When a customer reached a $1,000 purchasing threshold, the customer was raised to the “Gold Level” card. The benefit of this card added free shipping and on occasion other special perks. When a customer reached $5,000, they were raised to the “Platinum Level” card. This card increased the return to 5% and double back occasionally on copy center orders. The largest certificate I ever saw was for $1200!! This was because the customer was using the copy center a lot and certainly took advantage of that. It was this type of customer that gave inspiration and a selling point to make signing people up for the card easier.
Given these fairly good returns, it was somewhat easy to get customers to sign up for this free program. Even someone like me got up to the gold level card and would get back about $25 back a year. Not bad for what little I was buying with the company. At that time, most customers had a rewards card and some fortunately (or unfortunately had multiple cards. I remember one employee who was so stupid that every time she lost her card she would sign up for a new one. At one point I checked the system and she had accumulated 15 cards! With customers like that, sign-ups were very high.
All went well for the most part until April 2007. This is when the program changed. Not just a small change, but a radically different direction. Instead of three levels of cards, there would be only one level of cards. Instead of all products counting for the amount given back, the program was limited to ink cartridges, paper, and copy center services. Suddenly, the usage of the rewards cards dropped. Not just a little, it dropped like a boat anchor taking the boat with it. Customers stopped using the cards as they stopped seeing the benefit in them. They were angry and trying to convince them to still use the card was almost impossible. Out of the mouths of every customer was almost like a chorus of anger and it was pretty much all the same “I don’t buy ink cartridges often, nor do I buy a lot of paper, and I certainly NEVER use the copy center for anything!” With that being heard constantly, it was hard (read impossible) to get anybody to sign up for the card much less use the card they already had. A few months later, the company added ink recycling credits to this new card as well. Even with this addition, the card was still a very difficult sell to customers. I will have more to say about Staples ink recycling program in a future post and for those who think that this is another scam then you are very right. With Staples, scams breed scams. It appears in the last year, after my termination with the company, that Staples has added the concept of special sales pricing of certain products in their ads with usage of their rewards card. It seems that this is just desperation that the card still isn’t going over as well as the company had expected. No surprise to me at all given its limited value.
However, the biggest issue of selling/signing up customers to the card is a matter of timing or should I say “time of day”. This is the subject of the next post as we have fun with statistics or maybe not so much fun after all.
Next Up: A Statistical Game of Cards and Lies.
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