How GameStop deploys elements of Enterprise Loyalty


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Last Thursday, March 24, GameStop reported growth that its executives attributed in large part to its new PowerUp Rewards program.

In the earnings call (and my thanks to for access to the transcript), CEO Paul Raines noted: “We rolled out PowerUp Rewards nationally during October [2010] after a four-market test, and the results have been well ahead of our expectations. We now have well over 8 million members across the United States in just a few months.” That figure is up from the 6 million reported when we published “Power to the Program,” by GameStop’s Jenn McMillen and Mike Hogan, in COLLOQUY Volume 18, Issue 5. Said Raines, “Members shop us with 3x the frequency of non-members and the average member has bought from us 3.9x since joining the program.”

I like quite a bit about this program, including how it not only enables GameStop to track customer purchase behavior at their locations and website, but also encourages members to record wish lists and previous purchases–even those from competitors. This data arms marketing with information for targeted messaging, and arms front-line employees with information to engage customers in-store. “The program allows us to communicate personally with millions of gaming consumers and their feedback has been extremely positive,” Raines confirmed.

But there’s an additional element of the data usage not covered in “Power to the Program” that Paul Raines noted in the earnings call. “We are using the PowerUp Rewards program as the core of all new title-launch marketing, pre-owned awareness and promotion, and even in the real estate area to facilitate store consolidation.” That latter point aligns very cleanly with COLLOQUY’s concept of Enterprise Loyalty–using data to inform corporate-level decision-making that improves operations and makes the brand more responsive and valuable to best customers in aspects beyond the formal loyalty program.

Said Raines: “In terms of new stores, we continue to make progress in understanding where our customers shop based on the PowerUp data file. We have announced that we will not add any incremental square footage in the United States during 2011, as well as opportunistic growth internationally. As a product of our merger with Electronics Boutique and lease expiration opportunities, we can consolidate customer traffic from multiple stores into one based on our customer database. We can also clearly identify voids and tertiary markets where consumers are traveling long distances to shop a GameStop location.” This, he noted, allowes the retailer to “leverage the customer data asset from PowerUp Rewards to consolidate store locations and manage our portfolio with far greater precision than before.”

That’s a good play in the Enterprise Loyalty game. How about such good plays that you’ve observed in the marketplace?–I invite your observations about other organizational use of data to improve operations and better serve the customer.

Republished with author's permission from original post.

Bill Brohaugh
As managing editor, Bill Brohaugh is responsible for the day-to-day management and editorial for the COLLOQUY magazine and, the most comprehensive loyalty marketing web site in the world. In addition to writing many of the feature articles, Bill develops the editorial calendar, hires and manages outside writers and researchers and oversees print and online production. He also contributes to COLLOQUY's weekly email Market Alert and the COLLOQUYTalk series of white papers.


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