LOYALTY-CARD PLAN AT BALLS HIKES SALES, BASKET SIZE

DEENA AMATO-McCOY

KANSAS CITY, Kan. -- Balls Food Stores here has had a rapid ramp-up for its customer-loyalty program, enrolling nearly 300,000 members in less than three months. Early results include increased overall sales and significantly larger basket sizes for program members.

In addition, the retailer is already thinking about how it can use the customer and sales data gathered via the program to improve its marketing efforts.

"There are several tiers to a loyalty program, and the first tier is the offering of electronic discounts and collecting customer data based on those purchases," said Barb Ramsour, director of information systems for Balls.

"Once you retrieve and analyze customer data, you can reach the next levels," she added. "These involve more targeted marketing to offer specific deals to certain customers, besides those promoted within the chain."

Balls plans to implement more targeted marketing soon, according to Charles Owen, director of database marketing for Balls. "We expect to be sending our first direct mailing within four months," he said. "A year from now, we hope to be moving to the next phase, which is combining our direct mail with more targeted marketing initiatives."

The 300,000 customers signed up for the program put the chain ahead of its goals, Owen added. The program, which is deployed in the retailer's Hen House Markets and Price Chopper Foods stores, will be rolling out in Balls' newest Hen House market June 15, he said.

The frequent-shopper setup, which kicked off in 22 of the retailer's 23 stores Jan. 14, is already generating sales and basket size increases, he added.

"Within a two-month time frame, we've seen our sales increase, and our cardholders' basket sizes are exceeding our non-cardholders baskets by more than double the size," he said. In addition, the retailer is experiencing card usage that outweighs industry standards and its original objectives.

Balls uses different advertising philosophies for its program in the Hen House and Price Chopper store formats. Why? Because while Balls owns Hen House Markets, ownership of the Price Chopper stores is shared with six other families in the area, according to Ramsour.

"We have 12 Price Chopper stores out of about 30 in the area," she explained.

"Our Hen House stores are progressing to a solely card-based program, while the Price Chopper stores are only half card-based, meaning half of the promoted items aren't linked to the card program," said Owen, adding that customers at these stores can get the discounts without the card. "We cannot have a 100% card-based program in Price Chopper stores because we don't have 100% say in the company."

Balls is using database-targeted marketing software from RMS, Darien, Conn.