Jeweller Michael Hill released their anual results last week. Their strategy focuses on "brand, digital transformation, loyalty, retail fundamentals, and product mix.” Jo Feeney joined as CMO from McDonalds in January.
Their 18 month old loyalty program Brilliance is growing in all three markets (Canada, Australia and New Zealand).
Launched: October 2019
June 2020: 144,000 members
August 2021: 800,000 members
The majority of Brilliance members are in Canada with Australia having the second largest member base. New Zealand would seem to have about 140,000 Brilliance members.
In the investor presentation, Michael Hill note that Brilliance loyalty program members spend more often, have bigger baskets and higher margin. More data is needed to understand how meaningful these customer behaviour metrics are. They may be due to Self Selection Bias (from Ellipsis and Company).
This is the big loyalty program measurement challenge. It is a fact that the customers most likely to enroll in your program are those already most engaged with your brand, products or services.
This makes sense. They know they are going to benefit because they intend to keep buying from you, will be rewarded the most and are more likely to notice you have a program in the first place. So comparisons of sales, value or loyalty for members versus non-members do not necessarily measure program effectiveness.
Your members are more valuable than non-members, that is why they are in the program. They are not necessarily more valuable because of the program.
Self-selection bias makes program ROI measurement difficult, but it does not invalidate offering a program. Because if you do not have a good, competitive loyalty customer value proposition, customers may well self-select into your competitor’s program.
Michael Hill note that acquisition has been a priority to date. Focus now shifts to activation and retention. Expect the relative measures between members and non-members to decline.
DXC have deployed Microsoft Dynamics 365 Commerce for Michael Hill across multiple areas of the Michael Hill business. Michael Hill "began using the loyalty feature in Dynamics 365 Commerce to manage its loyalty programs and has since tied it into Adobe Campaign. In February 2020, Michael Hill went live with the loyalty program in its stores, enabling loyalty program members to take advantage of pricing benefits that have been configured in Dynamics 365".