Online Points System

Hello fellow AOers,

I'm not very good in designing websites, so I need help in this issue.

Is there any online points system, free, tiral or commercial solution for the following scenario. It is much like APs, when you reach a certain number of APs you are given an extra green or red dot.

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Scenario
AO-Points, this is an ass case :D, Is a chain stores that sell electronic goods. The company is thinking of activating (ONLINE POINT SYSTEM)
Customers who bought goods offline from any store in the chain will get tickets with serial number and code with specific number of Points.
The ONLINE POINT SYSTEM will allow customers to enter those serial and codes to charge customer account with the number of points on the ticket.
When the customers reaches the number of 1000 point they will get a present from the company that will be delivered to the address they have specify using the online point system.

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Your contribution is highly appreciated.

Cheers

Hey Black Cluster this has nothing to do with website design.............. it is about a retail business model, customer loyalty bonuses and discounts. I would suggest that whoever came up with this one learnt their trade at ENRON! It is an absolute invitation to abuse and fraud.

My first question is: what does this "1000" points mean in real terms, both to the customer and to the business? If it is worthless then you just make yourself look cheapskate and annoy the customer......................if it is valuable, then you will just get ripped off :eek:

The secret with these sorts of schemes is that they generally work on two levels:

1. The discount voucher....................like 25 cents of your next purchase, or 10% off your next bill if you spend more than 20 bucks in the store? Sometimes these are tied into a particular brand or product category, sometimes they are a global discount. They inevitably have a relatively short expiry date................two weeks, four weeks?

2. The customer loyalty card. This is like an account, but is matched to a purchase and payment when the transaction takes place. These accumulate, and are generally valid for at least 12 months. The customer has to identify themselves to open the account, and has to use the same ID each time they make a qualifying purchase, so as to add points to their account.

I will await your response, and will gladly explain the issues involved. I have 6+ years with Price Waterhouse and 9+ years in the retail sector, mostly in electricals/electronics, including rebate and voucher schemes.

:)

BC...why would you want a points system? I realize that people get hooked into these meaningless promotional tools ( like those useless ' gift cards ' which cost the same as cash but have a fraction of the flexibility of cash...or...forum point systems that make people fawn and dwell and fight over useless gifs that have no real value )...

if you're offering a product and you want customer satisfaction and repeat business...sell quality products at reasonable prices...

don't waste your time with gimmicks that only show what little value you place on customer intelligence.

Eg ;)

Hey, EG~ the customer care thing is fine for small businesses..............they know who their customers are?

Larger outfits do not, so it is a different issue? :)

Hey Hey,

I think it's a great idea.... I know tons of people that love things like Club Z (HBC Rewards) Points and Sears Points..

You'd need two "programs, functions, scripts" whatever you want to call them:

1: A program with the algorithm to generate how many points for each purchase... 1 point per dollar, 1 point per penny, etc... It would need access to the central SQL Database that you're using and to fit in with the PoS system that you are using... If it's custom that'd be simple enough... prepackaged would be a bit more difficult... On every sale it would calculate how many points are due and insert into the database in a "serial" table... the Serial (Perhaps a hash of the hash of the date/time or something like that... or just a random number)... This serial would be printed on the receipt...

The customer would then go to the points website... this would be the second program..

2. This would be a web page that would allow registration and logins... There would be a User Table and it could have a Points Total.... One of the pages on this portion would accept the serial number... query the database and pull the amount of points associated with it... and add those points to the users total..

Then you could manually or have a program to poll the points value in the database and decide who was getting gifts that month..

Of course if you went with X number of predefined points and didn't associate it with the amount spent (like iCoke or PepsiPoints) then you could populate the points database with X number of values. print the serials before hand and the cashiers could hand them out.. or even hand out scratch cards with the values printed on them...

Peace,
HT

Hi HT,

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I think it's a great idea.... I know tons of people that love things like Club Z (HBC Rewards) Points and Sears Points..

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Sure they do...because they've being duped by gimmicks...fed the consumer line...like fish to a shiny lure...and reeled in like the gullible sheep they are.

There's no free lunch...these gimmicks are paid for and promoted by higher prices...either way you pay...

I'd rather have the discounted price on the shelf...than have to pay for the flyers, the T.V. spot ADs, printing, promotion, mailings, etc...because the majority of consumers are gullible and fall for these gimmicks.

Eg ;)

EDIT: as long as there are suckers to fall for these things, thinking they're getting something for free :rolleyes: , the companies will keep producing them...and everyone pays higher prices for consumer stupidity.

If people didn't fall for this..then..companies would have to resort to the old methods of getting customer support...more competitive sales and lower prices. ;)

Well, speaking as a professional with many years experience of retail financial systems and control, and marketing, particularly in the electronics sector, I will point out the following:

1. A discount voucher for a few cents, that expires in a few days and probably isn't for something you want, will not be cashed in. BUT the offer was there?

As the amount of redemption is either very small, restricted to product lines, or requires quite a large expenditure. This makes their transferability very marginal. The net result is that no more than 15% or so are actually redeemed. Strange though it may seem, people are actually too lazy or disinterested.

2. A customer loyalty scheme that credits a customer concurrently with a payment transaction is the best option, as it can be controlled and will only credit a specific customer. It is not like a banknote that anyone can spend, more like a credit card or bank account. Sure there will be people who will use the loyalty award for presents and so on but these are surprisingly few.

3. If you sell in store, but allow the points to be claimed as a separate activity online, there is nothing to stop these vouchers becoming "currency" which in itself is illegal in many places. Does anyone remember what happened to green shield stamps? :rolleyes:

This will greatly increase the redemption percentage, which is not what you want, if you know ANYTHING about retail

4. If you give out vouchers that people don't want they will politely decline.............your staff members will just pocket them and pass them on; once again increasing your redemption rate.

5. And when someone figures out the algorithms and starts flooding the market with bogus, but apparently valid vouchers (anyone here know what "carding" is?)...................... I would not give my competitors the potential of getting some script kiddie to write a bit of crap that would potentially destroy my business.

6. The secure way is to have a loyalty card and credit the account with each purchase/payment. This is the simplest and by far the cheapest solution. Sure, I could secure other approaches, but that would be far more complex than doing it properly, in the first place.

That way you know what your potential outstanding liabilities are, and would have good actuarial data to be able to account for them to the satisfaction of your external auditors.

:)

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Originally posted here by Egaladeist
Hi HT,


Sure they do...because they've being duped by gimmicks...fed the consumer line...like fish to a shiny lure...and reeled in like the gullible sheep they are.

There's no free lunch...these gimmicks are paid for and promoted by higher prices...either way you pay...

I'd rather have the discounted price on the shelf...than have to pay for the flyers, the T.V. spot ADs, printing, promotion, mailings, etc...because the majority of consumers are gullible and fall for these gimmicks.

Eg ;)

EDIT: as long as there are suckers to fall for these things, thinking they're getting something for free :rolleyes: , the companies will keep producing them...and everyone pays higher prices for consumer stupidity.

If people didn't fall for this..then..companies would have to resort to the old methods of getting customer support...more competitive sales and lower prices. ;)

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Have you been in a walmart or zellers lately??? When I can buy a coffee pot for under 20 bucks... I consider prices to be fairly decent... So the end of the day if I can purchace every kitchen appliance at under 100 bucks per appliance (which I can do by quite a bit) I feel as though I've done fairly well.. since similar quality appliances in "specialty stores" would be 5 - 10 times more... so I'm getting a lower price and getting points out of it.. It's called customer loyalty... Why do more people go to shoppers than the rexall/guardian/pharma plus family.... half the time rexall brand stores are cheaper... but Shoppers offers optimum points... people like that... You can call them stupid because you're the one person that doesn't take advantage of it but I disagree... If they cut out optimum or hbc rewards or sears points... they wouldn't be lowering their prices because in the end their prices are competetive a good chunk of the time...Look at petro points when they came out.. Gas was the exact same price but now you got points for it... suddenly everyone was going to PetroCan... sure it's only little stuff like windsheild washer, etc... but that's a few bucks here and there that people don't have to spend... that adds up... and that's what the masses care about..

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This will greatly increase the redemption percentage, which is not what you want, if you know ANYTHING about retail

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nihil: You seem to have worked in every market in existance... I often wonder about that... but anyways... there's nothing wrong with a high redemption percentage if you plan for it... That's why most places that do this give "bonus points" if their sales people forget to mention it... and regularly give big "extra point" days... they expect you to redeem them.... because you're given them something cheap in exchange for them continuing to frequent your store...

Anyways... I don't think you guys are being fair to this... he's looking for what he needs to implement this.. you're taking it off topic and attacking the system.. a system that has worked for years and years for many corporations.

Peace
HT

HT~

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nihil: You seem to have worked in every market in existance

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Weeeeeeeeeeellllllllllllllllll at 56 that is rather more plausible than coming from a 24 year old? :D

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he's looking for what he needs to implement this.. you're taking it off topic and attacking the system.. a system that has worked for years and years for many corporations.

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If someone asks for advice or an opinion they will get it, based on my experience. Even if that means telling them that I disagree with the concept as a whole.

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a system that has worked for years and years for many corporations.

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And just how would you know that?

:cool:

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Originally posted here by nihil
HT~


Weeeeeeeeeeellllllllllllllllll at 56 that is rather more plausible than coming from a 24 year old? :D

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Sounds like someone that flip flops and never really settles on a career meaningthey can't really be an expert or gve expert advice on anything... Someone that never found something they were good at and kept moving on in hopes that they someday would :D

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If someone asks for advice or an opinion they will get it, based on my experience. Even if that means telling them that I disagree with the concept as a whole.

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They want help setting it up and configuring it and suggestions on software to use... not bashing the concept.

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And just how would you know that?

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I need only look at Sears, Zellers/HBC, Shoppers, Petro-Canada, Video Stores, Coffee Shops... All of them do it... they are all still in business... so that's how I know.... You may have had a few years of first hand experience (doesn't mean you learned anything or that it was even good experience)... but I can see plenty of real life examples that are concrete.

Hi HT,

It has worked for years and years because most corporations used to be the snake oil salesmen in the old west ;)

They offer these because they know most consumers will lap it up.

Just because it's a popular gimmick to get people to come to your store and is a highly successful gimmick that does not mean it's in the consumers best interest...it's in the corporations best interest.

The reason why you can buy cheaper at Walmart, etc...is because they sell inferior quality goods...I used to be a quality control inspector...and everything is quality inspected and separated...top of the line merchandise went here...minor hardly noticable flaws ( scratches, extra flash on the edges, etc...) went there...minor, but noticeable flaws went over there...and major flaws were recycled...places like the Bargain Shop display disclaimers next to some merchandise because it's recycled or bottom drawer merchandise ( I'm sure you've seen those ' would be this " IF " ...)...

scratch and dent stuff went to places like Walmart, Sears, Zellers, etc...they sell cheaper because they sell b and c line merchandise....if you think you're getting the same quality of meat at the Price Choppers deli as you do at M&M meat Markets...ahem...you're not ;)

You get what you pay for.

As for Petro-Canada that was their way of buying into the market...thay had to offer something to get people to go there...I remember when it first started...I remember before the first station was bought...they had to practically beg people to use their stations...that's why they started giving stuff away and offering incentives. 35 years ago I got all my tee-shirts from Midas Muffler, they used to give them away for free as a means to advertise.

Eg ;)

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Originally posted here by Egaladeist
Hi HT,

It has worked for years and years because most corporations used to be the snake oil salesmen in the old west ;)

They offer these because they know most consumers will lap it up.

Just because it's a popular gimmick to get people to come to your store and is a highly successful gimmick that does not mean it's in the consumers best interest...it's in the corporations best interest.

The reason why you can buy cheaper at Walmart, etc...is because they sell inferior quality goods...I used to be a quality control inspector...and everything is quality inspected and separated...top of the line merchandise went here...minor hardly noticable flaws ( scratches, extra flash on the edges, etc...) went there...minor, but noticeable flaws went over there...and major flaws were recycled...places like the Bargain Shop display disclaimers next to some merchandise because it's recycled or bottom drawer merchandise ( I'm sure you've seen those ' would be this " IF " ...)...

scratch and dent stuff went to places like Walmart, Sears, Zellers, etc...they sell cheaper because they sell b and c line merchandise....if you think you're getting the same quality of meat at the Price Choppers deli as you do at M&M meat Markets...ahem...you're not ;)

You get what you pay for.

As for Petro-Canada that was their way of buying into the market...thay had to offer something to get people to go there...I remember when it first started...I remember before the first station was bought...they had to practically beg people to use their stations...that's why they started giving stuff away and offering incentives. 35 years ago I got all my tee-shirts from Midas Muffler, they used to give them away for free as a means to advertise.

Eg ;)

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Man oh man... Everyone on this site is an expert in something... I disagree with walmart selling inferior quality products... and that comment would lead me to believe that you had never been in a sears... I disagree as well about the quality of meat at Price Choppers vs M&M's... M&M's is preprepared frozen crap... Price Choppers is fresh meat... I can see the quality of the cuts... I know if I'm getting a cut piece of meat or not... M&M's uses the left overs if anything... that's why it's prepackaged, preprepared stuff...

The bottom line is free gimmicks work.. Hell THe Jinx gives free stickers to people... And once they work.. they aren't gimmicks... If giving people a point for every dollar they spend and translating 100 points into a penny... and they can buy stuff with it... who cares if its minute.. it's better than nothing...

Either you and Nihil are both rich beyond belief... and believe in the best of the best name brands everywhere or you don't have a clue how about people operate day to day and what the average person is like..

Peace,
HT

Hi HT,

I didn't say I was an expert...all I said was that I've worked in the capacity as a quality control inspector...and explained what my job was...my job was to inspect merchandise before it was put on a truck...so it could be determined it's destination.

And you're wrong if you think Sears is top of the line...it's not...it falls in the same category as the Brick, Temperman's, and stores like it...slightly better than Walmart, K-Mart, and Zellers but not much.

You could be right about the meat issue...I didn't do QC for a food products company...so...I could be mistaken there...but the process is the same.

And yes, gimmicks do work...I already said that...but consumers are not benefitting from these gimmicks...the cost is passed down...not swallowed by the company.

That 100 points you get, someone else is paying for, that's the fact of it...there's no free lunch in the big bad corporate world.

Consumers are fed the crap that they're getting something for free...they're not...we pay for these promotions and advertising gimmicks...and that raises the prices not lowers them.

What bugs me about gimmicks is that they prey upon the ignorance of consumers.

It's just a newer version of P.T.Barnum's Welcome to the Egress!

"Barnum's American Museum was so popular that people would spend the entire day there. This cut into profits, as the museum would be too full to squeeze another person in. In classic Barnum style, old P.T. put up signs that said "This Way to the Egress." Many customers followed the signs, not realizing that Egress was a fancy word for "Exit." They kept on looking for this strange new attraction, the "Egress". Many patrons followed the signs right out the door! Once they had exited the building, the door would lock behind them, and if they wanted to get back in, they had to pay another admission charge!

Modern museums make sure that the last thing you see before you exit is the gift shop. "

http://www.ptbarnum.org/egress.html
PT Barnum, The Shakespeare of Advertising

Eg ;)

Hypothetically...let's say I own a gas station...and I want people to buy my coffee...so...I decide, instead of selling my coffee for 80 cents a cup...I'll go out and have 1000 cards made up...buy 9 cups your 10th is free ( cost me $40 )...I'll spend $1000 on advertising the cards...and another $400 in misc. costs associated with these cards...and I'll charge $1.10 per cup to off-set these costs...

give me my coffee for 80 cents...I can live without the gimmicks. ;)

Hmmm, I think that we are digressing from the original question? it was about the implementation of a customer loyalty scheme.

Just check around the online/mail order vendors................. a lot of them have such schemes, but they are all account based and for a very good reason.

People do not naturally group together to share these things (due to inherent mistrust and a lack of communication) so the "burn rate" for the scheme is minimised, which is what the vendor wants.

Sure, have the customer set up an account online...............you have to do that for online purchasing anyway. My argument was that it is trivial to modify the EPOS system to capture transaction data against that account. Certainly no more difficult than to issue vouchers instore. Getting the customer to login and record their "points" makes for additional back office applications, when all you would need to do is parse the daily transactions instore and apply the loyalty points to your customer loyalty database. At the very least it saves printing the voucher? And there is no need to issue any cards.................. just a unique account number ;)

Customers who are "loyal" are probably also lazy? I would not deal with a company that messed about like that :cool: I do not expect to have to submit interest demands to my bank or no claims bonus demands to my insurers, so why should I have to do it for an electronics retailer? The whole idea seems as ill conceived as mail-in rebates

Then there are the accounting implications?........................ if you have all these "anonymous vouchers" flying around, you have created a potential liability that must be provided for as a deduction in your profit and loss account. This is very much an unknown quantity as these things are obviously transferrable between individuals.

With an account and transaction based system, you have far greater control and accountability. Whilst fraud is still possible, it is much more easily prevented and detected if the loyalty bonus is uniquely and irrevocably linked to the original transaction.