Retail

How The Gap Hopes To Capture Consumers With A More Open Take On Loyalty

Loyalty rewards for shoppers are not new to the Gap, or its associated brands, Banana Republic, Athleta and Old Navy. For those who carry either the branded Gap card, or the Gap Visa (or anyone who has ever been part of a retail rewards program), the offerings are fairly familiar. Shoppers who use their Gap card get a discount (with the percent off varying between brands, channels and daily offers), accrue points and enjoy perks like free shipping, exclusive offers and events.

It’s a solid offering for customers that are already loyal to the Gap and its affiliated brands, but it is a very standard rewards offering for a middle-market retailer, so it’s not much of an incentive to draw people to the brand.

Though there is a small subset of consumers that will open up a card with any retailer that offers them 20 percent of their first purchase, most consumers are a bit more thoughtful about signing up for branded retail cards. If they use the merchant a lot, they might sign up — that’s fine and rewards the loyalty of the already loyal, but it does little to use loyalty as a lever to bring new buyers to the brand.

Which is why, about a year ago, Gap expanded its loyalty offering away from its branded card, and into a general admission product that offers consumers points regardless of how they pay.

“We have a successful Gap, Inc. credit card program where cardmembers can earn points and redeem rewards across our portfolio of brands,” said Director of Loyalty Strategy Claudia Angulo. “With BRIGHT Rewards, we’re extending these benefits to customers who love shopping with us, but might not be ready for our credit card.”

The multi-tender loyalty program allows customers to earn points for every dollar spent across its Gap, Banana Republic, Old Navy and Athleta brands. The Gap started testing the rewards program in the Dallas/Fort Worth and Atlanta areas, though after expanding the footprint of the program to the entire state of California, it recently recruited its millionth customer.

“Our goal is to give customers more reasons to love us, such as rewarding members for shopping with us, providing an easy shopping experience and personalizing messages with content that is relevant to them,”  Angulo said of the program’s coming expansion, and how the firm’s hope is to improve BRIGHT’s functions and offerings with each new iteration of the program.

The goal, a Gap spokesperson noted in an email to PYMNTS, is to make it easier than ever for consumers to shop across Gap’s many brands, because those cross-brand shoppers are more valuable. Those who travel throughout the Gap retail ecosystem, spend nearly 10 times as much as those who are more “one-and-done” shoppers.

The move to open up a loyalty program is not unique to Gap, Inc. In May, Macy’s decided to untether its Star Rewards program from its credit card and make earning points an option for any customer using any payment method. In a similar vein, Target is reportedly testing out a new set of loyalty rewards that consumers could access without signing up for its REDcard. J.Crew also announced a loyalty program for consumers, regardless of their payment methods.

Peter Caparso​, president of Checkout.com North America, said that the move makes sense in light of younger consumers’ relationships with credit — a relationship traditional store cards often don’t fit into.

“Millennials are more likely to use credit cards in order to build up their credit rating, and not for day-to-day living,” he told Retail Dive earlier this year. “Growing up during the Great Recession, has given them, definitely it seems to me, a reluctance.”

And — at least in the case of Gap’s BRIGHT program — it seems to be designed to move consumers into the care-base program.

For example, BRIGHT members earn two points for every $1 spent at participating stores. Every 500 points earned is automatically converted to a $5 reward. Cardmembers have a similar benefit, but they earn five points for every $1 spent, earning those rewards faster.

Gap, it seems, has decided that before consumers want to run with the card, they might want to walk along with BRIGHT.

——————————–

LATEST INSIGHTS:

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out the latest PYMNTS Credit Union Innovation Index

TRENDING RIGHT NOW

To Top