Loyalty card program gets renewed push
Just in time for Christmas shopping in 2006, the city of Boston announced a first-of-its-kind customer loyalty card that was to create a symbiotic relationship between local businesses, pennywise shoppers and community-based non-profits and schools. A year and a half and countless hours of work later, the system has earned precious few donations for its beneficiaries, just passing the $8,000 mark this week.
But it's still a good idea.
In Seattle, Washington, where the card's innovator Interra is based, a similar program the company helped launch seven months ago has so far resulted in over $46,000 in donations and rebates and is growing via the public schools, which can directly benefit, proving the idea has potential.
Realizing the lag, Boston's Main Streets department - a city agency devoted to improving local business districts in coordination with a network of smaller neighborhood-based 'Main Streets' non-profits - launched a marketing effort in June, advertising on subway car cards, bus stops, on the radio and in the Boston Phoenix. But getting the cards in consumers' hands is only one piece of the puzzle. They also need compelling reasons to use them.
The idea itself is inspired, at least in the eyes of mom-and-pop shop supporters. Interra founder Jon Ramer calls it a "win-win-win proposition."
For businesses, it is a loyalty card that encourages customers to buy more in order to get a discount, thus improving the bottom line for the proprietors. At D'Benny's Sub Shop in Fields Corner for instance, cardholders can get a 5 percent rebate on any order over $20.
For consumers, it's a rebate card, or, they can choose to donate rebates to local non-profits, schools or other entities. Last week, UMass Boston agreed to help promote the cards to its 75,000 students in exchange for being listed as an option for cardholder donations.
For local non-profits, schools and other charities it's a new source of income that could become fairly substantial when and if the program takes off.
The entire program is grounded by an elegantly designed but little used website that maps local businesses around the city and their rebates, as well as providing a way for cardholders to check their accounts - at bostoncommunitychange.org.
Over 200 businesses have signed up for the card in Boston, as have over 6,200 cardholders, according to Interra, but only 15 percent - roughly 1,000 - of those who have signed up for the card have actually used it. And of the businesses, particularly those in Dorchester, many rarely see the card.
"Maybe once every two or three months, that's it," said George Papadopoulos of Upham's House of Pizza in Uphams Corner. A sampling of stores in Fields Corner and Peabody Square brought similar answers, and according to Interra, the program sees only 600 to 700 transactions a month citywide.
Still, in other parts of the city, the program has reached a slightly higher level of acceptance.
"With our regulars I'd say it gets used fairly regularly," said Jeff Morrin, manager of City Feed and Supply, an upscale but funky corner store in Jamaica Plain. City Feed is the epitome of a locally-owned, community-minded business in JP, where the mindset of supporting the local economy (and locking out chain stores) has become a reflex. "I wouldn't say that I'm seeing first-time customers with it, mostly it's the regulars that know the whole deal already."
JP, the South End and Roslindale Village have signed up around 67 businesses combined, compared to 42 in all of Dorchester, including Grove Hall.
Local main streets groups in have also been successful signing up locals for cards at Main Streets sponsored events.
"I wouldn't attribute it to anything we do, I would just attribute it to how cool people are in JP," said Randace Moore, director of JP Centre/South Main Streets. "We just have more hippies and that kind of thing."
"The districts that are the strongest now are the ones where we developed roots the earliest," said Brain Goodman, the program's manager at Boston Main Streets. "There's a natural kind of grouping and growth, it's not uniform across Boston."
Jon Ramer, director of Interra - the company that created the card's technology - attributes Seattle's success with the card program to a greater availability of resources, the involvement of a locally-based chain of eight full-size natural grocery stores, and the fact that the program stretches across all of King County. In Boston it has so far been limited to the Main Streets districts.
"Frankly, the mayor's office and the city of Boston have been very supportive, but there just isn't the resources and the political machinations there make it hard," said Ramer. "It's working great here [in Seattle], I just need some help there."
But it may not be fair to compare the two cities' programs head to head, even if some would encourage a healthy competition.
"Boston was the innovator in launching this, so a lot of the time we took developing it, it was really in its infancy," said Goodman. "It's only now getting to the point where it's a mature machine really. I think we're learning. We can look to other cities and what's working well out there."
Additionally, Interra is based in Seattle, giving that city's card program a natural edge. It involves an impressive list of partners, from a local radio station to socially responsible investment companies to the Bainbridge Graduate Institute, which offers an MBA in sustainable business. There are also salespeople who sell the system to businesses, others who promote the card to shoppers and an advertising campaign to back it all up.
Until a few months ago, Boston Main Streets had a dedicated salesperson of its own for the program - Steve Rumpler - but he was reassigned, apparently due to temporary short staffing in the agency, according to Main Streets directors around the city.
In Seattle only 115 businesses signed up so far, but there are over 3,500 active cardholders, more than three times Boston's number. Ramer emphasizes that the eight grocery stores make up a lion's share of the transactions on the card and drive membership. The stores offer 3 percent on purchases of $50 or more and 5 percent on those of $100 or more.
Much like a healthy business district, Ramer argues that a healthy card program needs an anchor, a place where compulsory, habitual purchases are made.
"Stop & Shop, Shaw's, Whole Foods, those are natural allies," he said.
Of course, that move could change the nature of the program in some eyes. Each community determines its own criteria on what defines a local business, Ramer said.
"It's a very fine line between when you're supporting local businesses and when you're not any more," said Uphams Corner Main Streets director Zachary Cohen. "You could go to Stop & Shop and make it work, but the program is ultimately meant to benefit the neighborhood."
Right now, it's up to the directors of the 19 main street non-profits around town to get more stores involved. All seem to be enthused about the card, but some say they juggle pitching the card to merchants and shoppers along with several other projects, limiting the effort they can afford to put forth.
Dan Larner of St. Mark's Area Main Streets said every business he's pitched to has adopted the program as far as he can recall, but admits that to save time he targets the likely candidates rather than blanketing the neighborhood.
"There are affinity cards out there that will market to a business and will cost them a minimum of a couple of thousand dollars to get a card," said Larner. "With this, it's free, and there are 5,000 people with the card all over the city. So it's great for businesses."
The program, it is widely accepted, holds a great deal of promise. The question now for the city and these 19 non-profits is how to tie the neighborhood loyalty that so many Bostonians seem to have built in to the action of pulling out a little blue and white card every time they shop.
"That's going to be a long term discussion," said Cohen. "Ultimately I think we're going to come out with an even stronger program than we have now It's strong right now, it's a good program, but it's going to take a more concerted effort from all the Main Streets programs and downtown."