Most retailers use their loyalty card programs to build good will with customers. Joe Fasula does that more than most, but he also leverages his Gold Card program to improve the morale of his employees.
Fasula, vice president and co-owner (with his mother, Joyce) of Gerrity's, a nine-store independent based in Scranton, Pa., offers his 900 full-time and part-time employees a 5% rebate per quarter on all purchases they make in his stores using the Gold Card. The maximum rebate is $120 for $2,400 in purchases — about the equivalent of a free weekly grocery order for a family of four, he said.
“The employees love it,” Fasula said. “I'll overhear them asking each other, ‘How much did you get?’”
Since launching the program in the second quarter of 2004, Fasula has seen it grow from 473 participating employees generating about $17,000 in sales to 624 participants contributing sales of nearly $26,000 (in the third quarter of 2007). The average employee spend in the most recent quarter was about $937, a 15% jump over the initial quarter. The average rebate in the most recent quarter was about $42. Fasula said the program “pays for itself” through the additional sales.
Fasula said he considered offering employees a conventional employee discount program, but held back because it would have presented employees with too much of a “temptation” to commit fraud. “It's so easy for an employee to say to friends or family, ‘I'll give you the employee discount,’” he said.
But with the loyalty card program, “we know each employee's rebate is based on their Gold Card purchases,” Fasula said. The system lets him track purchases to ensure that they reflect reasonable expenditures, and to confirm that purchases were not made during an employee's working hours.
While the rebate program has improved employee morale and even productivity, Fasula acknowledged that it has not reduced turnover. “There are too many other variables that affect turnover,” he said.