The first wave of marketing will roll out over the next few months. Marketing and ongoing program support-including direct mail, e-mail and point-of-sale materials, as well as technology, database maintenance, fulfillment and analytics-will be handled by Alliance Data Systems, a database marketing company.
"We've always had a very strong relationship with SOHO [small office/home office] and SMB customers," said Mark Anderson, director of customer loyalty at CompUSA. "We feel this program takes that understanding of their needs to a whole new level."
CompUSA Network for Business rewards members for purchases with points that can be redeemed for items such as notebook computers, iPods and CompUSA gift cards. There is a one-time fee of $19.99 for membership. Members will also be invited to private shopping events and have access to member-only sales and "hot" product introductions.
The small-business market has become increasingly attractive to marketers. Last year, there were about 24.7 million small businesses-defined as companies with fewer than 500 employees-in the U.S., according to the U.S. Small Business Administration. Of that number, 17.6 million were sole proprietorships. CompUSA defines small businesses as those with 50 employees or fewer.
"All combined, SOHO technology buying is estimated at more than $70 billion annually," said Nicole Fleiner, associate director of Alliance Data Systems' Loyalty & Marketing Services.
Getting a better view
The loyalty program is designed to give CompUSA a better view of its customers and help with retention efforts.
"The challenge we've had until now is we've not known enough about our customers," Anderson said. "We're hoping to gain a much better understanding of who our customers are."
Fleiner said CompUSA will gather basic information-name, address, phone and e-mail-at sign-up. "As membership continues, we'll gather more information, such as purchases and survey data," she said.
CompUSA's marketing efforts to promote the program include direct mail to 300,000 of its best business customers, e-mail and Sunday newspaper circulars. Stores will have promotional materials touting the loyalty program as well. "Every store will be outfitted to the max," Anderson said.
Store associates will be trained in the details of the program and will also be enrolled in it with the opportunity to accrue points in the same way as business customers. "We want to make sure they are kept up to speed with what's going on in the program," Anderson said. "It gives them a vested interest."
Competitors' free programs
Direct competitors Office Depot, Office Max and Staples already have loyalty programs in place, all of which are free. Office Depot has Office Depot Advantage, which grants rewards credits to members in the form of dollars off based on a total number of qualified purchases within one quarter. Similarly, OfficeMax's MaxPerks for Business members can earn up to 2% back on a minimum of $300 in qualifying merchandise per quarter. Staples Rewards gives members 2% back for spending $200 or more per quarter.
CompUSA's program is less restrictive than its competitors' programs, Anderson said. "Our members can amass points for three years," he said. "There's no minimum spend per quarter." In addition, CompUSA does not exclude any products, such as computers, from eligibility.
CompUSA plans to kick marketing up a notch next year. "We'll be looking at radio spots and broadening to TV in 2006 as well," Anderson said.