Designing a Customer Loyalty Programme for a Fast Growing Hyper Market in India (A) *

Abstract

Fast Growing Hyper Market (FGHM), a hypermarket format retailer in India, grew from one to seven hypermarket stores in a span of last two years, achieving a healthy market share of 20% in 2014. The company planned to expand aggressively, throughout India, in the fast growing modern retail format market. FGHM had systematically collected customer transaction data for about 1.8 million shoppers from their hypermarket stores. Sophia Miller, the Vice President of FGHM, had a meeting with the regional marketing heads to review the company’s progress and the prepare plans for the future. The company planned to launch new stores (increasing their breadth coverage) and grow customer base in the existing outlets (increasing the depth of coverage & hence loyalty). For the latter, the management team was seriously thinking about starting a “customer loyalty & reward program” with personalized and targeted cross-sell/up-sell campaigns (e-mail/SMS) for their new & existing customer base. The management team wanted to initiate this program in May 2014 for their stores and based on the success & popularity of the program plan for a nationwide rollout.