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Key CCG Services

As a pay-to-join, members-only wholesale club, Sam’s Club knew it had to deliver serious value to acquire and retain members. People needed to feel justified in spending money to join the club and renew their membership every year. But after nearly 30 years in business, Sam’s Club was starting to see trouble brewing in its membership base, including an attrition rate higher than Costco, a prime competitor.

The company knew it needed to make changes, so it began an internal initiative to review the membership loyalty program. Two objectives quickly surfaced:

  • Grow and retain the overall membership base.
  • Keep members engaged in Sam’s Club by promoting benefit usage and repeat store visits.

Initiative leaders realized their targets would be easier to achieve with customer loyalty experts on their side. They reached out to CCG for support.

Our mission was to use our knowledge of best practices, skills in customer research and specialized experience in defining optimal benefits to help Sam’s Club refresh its membership loyalty program while mitigating risk.

Step 1: Set the foundation with research.

We kicked off the partnership by providing Sam’s Club with CCG’s internal retailer loyalty program benchmarking research. And we provided an extensive review of 22 other membership and loyalty programs, including competing warehouses, best-in-class retail programs and non-retail associations.

Brands in the membership and loyalty program review included:

Brands Reviewed

This information gave Sam’s Club a view into what other loyalty programs were offering, including the biggest-draw benefits that were most motivating for member enrollment and retention. And it revealed the “secret sauce” advantages above and beyond benefits that helped these programs succeed.

Throughout this process and what followed, CCG lent our experience and expertise by participating in the retailer’s loyalty initiative team meetings.

Step 2: Brainstorm ideas but watch the bottom line.

With a foundation in place, we were ready to begin the work of imagining and evaluating potential new membership benefits. Along the way, we’d also explore the possibility of adding a third membership tier to the existing Regular and Plus tiers as a way to fold in additional premium benefits for most valuable members.

In keeping with Sam’s Club objectives, we wanted to identify benefits that would motivate customers to increase trips and basket size. But we also wanted to maintain a sharp eye on margins so that any new benefits made financial sense. This was particularly important since the two most popular benefits of Plus membership — 2% cash back (up to $500 per year) and free shipping on most items with no minimum — were hard, monetary perks.

So, we keyed in on low- and no-cost benefits, including “soft” perks that don’t rely on discounting. We also sought out unique benefits that complemented the Sam’s Club distinctive voice and branding.

We made sure that key Sam’s Club personnel were part of the benefits brainstorming. For instance, we conducted a guided loyalty workshop with the Sam’s Club team to develop a raw list of potential benefits. And we interviewed more than a dozen store managers to obtain their benefit ideas.

Step 3: Narrow it down and prioritize.

From these brainstorming sessions, we pulled together a giant list of potential benefits, and then culled it down. We still had more than 70 ideas for the Sam’s Club team to consider. To make their decision process easier, we broke the list into categories based on the retailer’s brand pillars and the type of benefit, such as value/quality, convenience, experience, target-driven and immediate. Then we prioritized each benefit as first, second or third level of importance for re-energizing the membership loyalty program.

Sample Benefits for Sam's Club Loyalty Program

We also provided team leaders with industry metrics they could use in developing a financial business case to demonstrate to stakeholders the cost and revenue impacts of the benefits.

Wrap it up with wins.

CCG’s benefits recommendations ultimately informed the creation of the new Sam’s Cash loyalty platform for Plus members and the Bonus offers rewards program. With these in place, the loyalty membership program saw quick results.

  • In one year, income from membership fees increased nearly 12%
  • For the first time, Sam’s Club membership fee income surpassed Costco and BJ’s Wholesale fee income
  • Total member count reached an all-time high driven by strong renewal rates

Now, that’s what we call benefits!

Key CCG Services

Strategic Customer Initiatives

Strategic CRM consulting
Account management
Loyalty program development, refinement & management
Retention program development
CRM/loyalty program support services

Push Your Loyalty Initiatives Forward

Could your membership or loyalty program benefit from expert insights, customized research or other support? We can help. Call us at 303.986.3000 or submit this form to schedule a free consultation and see what we can do for you.