Program Case Studies

Rewards Case Study: Foot Locker VIP

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As a Canadian, there are few things I like more than packing away my winter boots and pulling out my spring and summer shoes. However, while I survived the cold weather this year, my shoes did not. In my quest to find a new pair, I stumbled upon Foot Locker’s VIP Rewards Program and decided to see what sort of benefits they offer shoeless shoppers like myself.

 

How Foot Locker's VIP Program is a Slam Dunk

One of the reasons people love Foot Locker is because they always have the newest, freshest shoes around. On the surface it looks like they really understand what their customers want, and as I dug deeper it became clear that they designed a program to deliver on those desires.

Foot Locker Offers Rewards That Matter to Their Customers

Foot Locker does an excellent job of offering both experiential and transactional rewards in their VIP program. Not every customer is motivated by the same rewards, and Foot Locker expertly caters to everyone’s preferences.

You can see this through the rewards offered to Platinum VIPs. As most sneakerheads would agree, one of the most frustrating experiences of buying popular shoes is the speed at which they sell out, forcing you to pay hundreds more to buy the same shoe from resellers. The Foot Locker VIP program counteracts this issue extremely well by offering VIP members early access to select products and VIP access to certain events.

Foot Locker VIP Program Banner

However, if you’re like me and the newest wave of Jordans aren’t what you’re looking for, Foot Locker still offers rewards for the rest of us. In the first 72 hours after signing up for the program, new members receive an email with a coupon for $10 off their next purchase of $50 or more. Platinum members also receive gift cards depending on how much they spend.

Foot Locker is able to create an unstoppable duo by combining experiential and transactional rewards. On their own both act as powerful incentives for joining a loyalty program, but together they ensure that every customer is able to find the reward that is right for them.

Foot Locker Makes Their Best Customers Feel Like MVPs

If you’re someone who really loves shoes, Foot Locker’s rewards program ensures that you’ve always got the inside scoop on the hottest shoes.  As a VIP, you’re invited to exclusive launch events, get access to exclusive deals, and get information about upcoming shoe releases.

From a customer perspective, this rocks. Studies have shown that 69% of consumers who regularly participate in rewards programs say that getting special offers or treatments that aren’t available to other customers is important to their reward experience. It’s natural as a customer to want access to perks that make you feel special and important. 

VIP Exclusive Offer Icon

The majority of customers want
 exclusive offers that regular shoppers don't have access to.

From Foot Locker’s perspective, this allows them to keep customers engaged with their program and brand as a whole. It helps build a deeper, emotional connection between their brand and their customer, since the customer now feels like an MVP and have been rewarded accordingly. If you’re serious about shoes, you’re going to stick with Foot Locker because you know they’re going to make sure to hook you up with the latest and greatest that the shoe world has to offer.

Foot Locker VIP Strategy Guide
Find out what it takes to turn your customers to MVPs.
Customers who feel valued are more likely to remain loyal, and our VIP Strategy Guide gives you the tools you need to make everyone feel special.

Mobile Rewards for the Modern Customer

After joining the rewards program from my desktop, I was prompted to also checkout the Foot Locker app. Like many other Millennials, I was willing to give their mobile app a try.  The very first time I logged in to Foot Locker’s app, I was shown a progress bar representing how close I was to reaching the next reward tier. It even counted down the exact amount I still needed to spend in order to reach the next level. This graphic is incredibly easy to understand, and is an excellent motivator for me to spend more in order to earn more.

Foot Locker App Points Tracker

To my delight, the app allows me to redeem my VIP bonuses in-store - not just online! As someone who doesn’t always like to shop online, being given the option to do either allows me to explore rewards in whichever way I feel most comfortable. With one quick scan of my phone, all future purchases will now go towards my quest to join their top “Platinum” loyalty tier.

However, what really impressed me the most about the app was the minimal yet practical design. It seems that more digital experiences are relying too much on bells and whistles, when what I’m really looking for as a user is a clean, intuitive interface.

 

Where Foot Locker's VIP Program Fouls Out

While they did an excellent job with many aspects of their program, Foot Locker definitely drops the ball on a couple key elements.

Poor Explainer Page

One of the most effective parts of any incredible rewards program is an explainer page that outlines how it works. When I was first looking into Foot Locker’s VIP program, I was happy to find that they already had a dedicated page and eagerly clicked through to learn more. Unfortunately their explainer page was not very well laid out, which made it difficult to navigate and understand what was in it for me as a potential member.

Foot Locker VIP Explainer Page

One of the most frustrating factors (as well as the biggest rewards faux pax) was that the entire page was text based. This gave me an unclear idea of what the program can offer me. Customers don’t want to have to read paragraph after paragraph just to figure out what benefits they receive from joining the program. Instead, they want information in a quick, easy to digest format -- preferably images or video.

As a result, Foot Locker would stand to benefit from creating a visual explainer page. This would allow them to clearly show the value of joining their VIP program, as well as make it easier to convince existing VIP members to move up to their higher Platinum tier. With visuals, not only would their engagement rates be higher but it would also deliver a more enjoyable customer experience, making everything about their program more appealing.

Branding Rewards Program Icon Foot Locker
Don’t commit the same fouls as Foot Locker.
Get your head in the game with our guide to branding your rewards program like a pro.

Demotivating Tier System

The best VIP programs are the ones that effectively motivate customers to make more purchases in order to keep their exclusive status. This is not a strength of Foot Locker’s VIP program, as it does very little to ensure that customers stay motivated to continue to purchase more shoes. The reason? Elite status is too easy to achieve.

In order to get into the top Platinum tier, a customer needs to spend $300. While this may be fine if you’re selling low-cost items, when you’re selling a single pair of shoes for north of $300 you’re hugely limiting the effectiveness of your VIP program. If a customer is able to reach the highest tier after only one purchase, why would they keep buying more? Even if points expire after a year, that doesn’t push customers to complete more purchases.

Foot Locker VIP Tier Icon

By making it easy to reach the highest tier of rewards,
 you remove the customer's incentive to buy more.

Similarly, if elite status is something everyone can have, is it really that valuable? Sometimes the social status offered by a VIP program is the best reward, and Foot Locker is robbing themselves of the chance to offer that type of exclusive experience.

Since so many of Foot Locker’s customers come from a sports background, gamifying the experience makes a lot of sense as a solution to this problem. If you add a higher tier that offers even more benefits, you’re able to take advantage of the Local Ladder Effect that pushes people to be better than their peers. By doing so, you incentivize customers to buy more and ensure that only real shoe enthusiasts will be able to gain access to your brand’s exclusive rewards.

Foot Locker's VIP Program is Not Promoted Well

 My last vice with Foot Locker’s rewards program is their lack of promotion. Rather than serving as a major part of the company’s marketing strategy, Foot Locker VIP feels like an afterthought. While associates might mention it to customers in-store, there are no links to the VIP program on the website’s main page and the only place you’re able to find it is in a submenu on the customer account page.

Foot Locker VIP Access

By hiding (or simply failing to mention) the program, Foot Locker is limiting the number of customers that will sign up for the program simply because they don’t know it exists. If you want your rewards program to succeed, you have to maximize the ways that customers can hear about it so that they can see and understand the benefits of joining.

Foot Locker could easily address this problem by putting a link to the explainer page somewhere on their homepage. They could also remind customers that their program exists on individual product pages to highlight the benefits of making a purchase as a member. That way, no matter where the customer navigates they will always have a reminder to join the program and enjoy the benefits.

Marketing VIP Thumbs Down Icon

By not marketing your program effectively on your website,
 you’re setting yourself up for failure. 
 
 

 

At the Buzzer: How Foot Locker's Program Performs Overall

Now that I have my new pair of shoes and a lot more knowledge about Foot Locker’s VIP program, I can reflect on the entire purchase experience.

While Foot Locker has clearly done their homework as far as what their customers value in rewards, the same level of thought was not present when they were structuring the program and how customers would learn more about it.

Despite glimpses of excellence, Foot Locker’s VIP program could definitely stand to benefit from a little more thought in their design process. They’ll probably see me again as a customer, but it might not be until they’ve made some changes -- or I live through another Canadian winter.

World Class VIP Program Icon
Foot Locker may have made mistakes, but you don’t have to.
From Starbucks to Sephora, find out how to build a world-class rewards program like the pros.

 

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