White Castle

May 1, 2012

For more than 10 years, I have been an avid consumer of White Castle coffee. I drink at least one large coffee every day. It’s amazing coffee, and it’s much less expensive than the other options at $3+ a cup. Not to mention, it’s difficult to remember the Italian word for large – venti, grande – who knows – who cares. Even at half the price of Starbucks, you can imagine I’ve spent a great deal of money at WC over the years.

Other than the lower price, another positive is that the employees at “my” WC know me. They address me by my name. If they see my car pull into the lot, they will start brewing a fresh pot of coffee because I can detect coffee that’s been sitting around for more than 30 minutes. When they hear a voice come over the drive-thru speaker and ask, “May I have one large, fresh coffee please?” they know it’s my voice. They know I don’t just want a large, fresh coffee. I want it double-cupped. I want four creamers, napkins, and a stir stick in a small bag. That personal treatment is my only reward. And that special customer experience is okay with me until I have to go to another WC location. They don’t know me. I get treated like any other customer. If only WC had a way to reward me for my loyalty regardless of what location I spend my money.

I found a loyalty reward program that would make perfect sense for WC. I went to FroYo for the first time a few weeks ago. They had what I’ll call a ‘smart-phone punch system’. In order to take part in the program, I needed an application on my iPhone called punchd. I didn’t have it, but no worries – the store had a QR code for me to scan with my smart phone right at the register. Once I scanned the QR code (using a code scanning application), I was directed to the punchd app for a quick download.  When I checked out, I used my punchd app to get punched, by scanning another QR code provided by the cashier. Now, when I look at my punchd app, under the FroYo category, I have one punch from my first visit. After 10 punches, I get one FroYo free. Sweet!

For the consumer, participation is simple because of a fast and free registration process. Gone are the days when a consumer must carry a paper punch card in their wallet.

Implementing the program is very little work on the part of the retailer. Surprisingly, there are very few retailers who are listed as using the punchd app in my area, which probably means many of them are missing out. Punchd is a great opportunity to reward repeat customers with nearly a no cost set-up and a low cost reward. Not only is the app free, but the marketing materials are also free on the punchd website. Maybe the most valuable component of this whole program for small/medium size retailers is the analytics. Yes, this ingenious, yet simple program offers free analytics. Online, punchd provides retailers with a dashboard that gives them critical program performance information, such as: the number of new program enrollees, total members, eligible punches, graphs, and statistics. At face value it sounds like a good deal…and hopefully it is for single/limited location retailers who are usually looking for ways to drive traffic and generate incremental revenues.

Perhaps this is an opportunity for many small retailers, or those with only a few locations, to eliminate the old fashion paper punch cards, add an exciting technology component, and drive measurable repeat purchases.

It wasn’t long ago that Buckle, one of the leading retailers of popular brand-name and private label casual wear, had their own punch card called the Primo Card. Buckle is currently 400+ stores strong in the U.S., catering mostly to young adults. With the Primo Card, Buckle would punch your card for every $10 spent until you filled the card with 30 punches. Once filled, you would earn $10 off your next purchase. In the past couple of years, Buckle has changed from the punch card system to a co-branded credit card offering ‘B-rewards’. Same rules – receive $10 off your next purchase when you spend $300 on the Buckle credit card. Many youngsters who yearn to wear Buckle’s fashionable clothing are not old enough to get a credit card. Here’s an opportunity for punchd.

This new application has shown such promise, leading Google to acquire punchd for over $10 million.

Punchd’s tagline is “A Loyalty Program to Rule Them All.” Although they may not be appropriate for “All” retailers, they may provide value to many small and medium sized businesses with a limited number of locations.