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Sam's Club keen on personalization and technology to grow membership, sales

Bentonville, Ark. - The executive team members of Sam's Club said during their presentation at Walmart's 17th annual analyst meeting today that they are working to attract new customers through several initiatives that emphasize personalized marketing tactics, shopping convenience and enhanced offerings throughout all product categories.

Sam's has increasingly invested in technology and marketing designed to tap into "customer insights," explained Brian Cornell, president and ceo.

"We understand what drives [our customers'] purchases and demands," he said. "And we understand how to serve them each and every time they come...What our member wants has become a rally cry...At Sam's we are all focused on delivering what our member wants each and every time they shop."

Cindy Davis, Sam's Club's evp, membership, marketing & e-commerce, said at the crux of growing the business is "building member relationships."

The company has several efforts underway to accomplish that. Sam's is growing its existing membership by offering added incentives to its "Plus Members" with early shopping hours, 2% cash-back when members use their Sam's Club Discovery credit card, and "evalues," which are personalized savings sent directly to members based on their specific shopping habits and preferences.

David noted the last incentive is credited with helping Sam';s increase its membership by 45% from fiscal 2009 to 2010, and 30% from fiscal 2010 to 2011.

Sam's is also "enhancing target communication" with its members, "engaging them in categories most relevant to them that they have yet to discover at Sam's," David explained.

Attracting new members to Sam's is another push for the company. The warehouse club has recently created new "traffic-driving events" for potential customers, such as open houses and the Taste of Sam's, offering "a way [for them] to try out Sam's without eroding our core membership offering."

Turning to technology, Sam's last month launched its Smartphone mobile app for iPhone and Android varieties, and this week for Blackberry users.

"It simplifies shopping and is personalized so each shopper can get the information they are interested in," Davis continued.

As one-third of Sam's membership comprises households earning annual incomes of more than $100,000 and another third earning between $60,000 and $100,000, the warehouse club said it is responding to its memberships' demands for higher quality and better brands across all merchandise categories, said Linda Hefner, evp and chief merchandising officer.

Examples of the enhanced assortment include: the addition of 100 new fresh items, including high quality meats and "artisan" breads baked on site, in food and consumables; and improved and expanded offerings in pharmacy and health-and-wellness.

Hefner offered more specifics within each of Sam's four main merchandise divisions.

In "Everyday Needs," which includes paper products and cleaning supplies, "we are offering [our members'] favorite brands at the lowest prices," she said.

The "WOW" category, which spans food and beverages as well as health-and-beauty products, "quality is most important here to our members, so we are prioritizing those drivers."

In "Treasure hunt," where Sam's offers the "excitement" products like electronics, home, seasonal, apparel, and jewelry, Sam's is enhancing what members said they wanted here - "aspirational brands, leading innovation, and increasingly more service in jewelry and electronics," she went on.

And in the "Simple Solutions" segment, which includes tires, for example, "we're making it easier for our customers with the best brands and superior installation and service."

 

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