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Target and Whole Foods testing loyalty programs

Retailer News News Releases February 25, 2015

From RetailWire.com

a foreground image of a Whole Foods Market rewards card with someone receiving food at the deli in the background

Target is joining Whole Foods Market in testing a points-based loyalty program.

Target's REDperks mobile loyalty program rewards shoppers when purchases reach certain levels.

At its REDperks beta site, interested users are encouraged to:

  • Load Up: Request an invite to the Redperks app;
  • Rack Up: 10 points for every dollar spent at Target;
  • Save Up: Get five percent off an entire trip at 5,000 points ($500 worth of spending);
  • Live It Up: Other rewards and bonus perks along the way.

The REDperks beta will initially be available on iOS by invitation only in select markets. REDcard holders still gain a five percent discount in addition to any REDPerks benefits.

"We believe this loyalty program is a good addition to Target's offering as it can help reach less frequent guests who are not interested in opening a REDcard account or who are unbanked," Sean Naughton, an analyst at Piper Jaffray, told StreetInsider.com last week.

Some reports compared REDperks to Whole Foods' ongoing test of its Market Rewards affinity program at 12 stores in Princeton, NJ and the Philadelphia region. Available through a card or mobile app, points earned in the program can be exchanged for discounts or "experiential" rewards, such as free cooking classes. The type of rewards are based on individual preferences. The program hasn't been rolled out to any more stores.

"Our customers have wanted an affinity program for some time," spokesman Michael Silverman told USA Today last year. "With such strong existing customer demand for a program like this, we believe it will enhance existing customer loyalty and drive new customers to shop Whole Foods Market stores."

Toys "R" Us, Best Buy, REI as well as many department stores and drug stores chains all use points-driven loyalty programs. Kmart and Sears share a points-based "Shop Your Way" program, but Walmart and Target haven't used them. Some grocers such as Safeway offer discounts for gasoline tied to purchase levels but points-based programs are not pervasive at supermarkets.

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