What is Anaconda?
Anaconda is a low-cost adventure retailer that specialises in offering a diverse range of outdoor and sporting products. It offers gear for camping and hiking, 4WD, fishing, water sports, cycling and snow gear, at affordable prices. Their low-cost products are highlighted in their advertising, promotions and website. Founded in November 2004, the one-stop adventure retailer has 84 stores across Australia.
Anaconda has a loyalty program known as the Anaconda Adventure Club which gives club members early sales alerts on their favourite products, club exclusive discounts, invitation to exclusive Club nights, special offers, VIP email & SMS offers and exclusive entry into competitions.
Loyalty programs need to stand out from the crowd
As loyalty consultants, we repeatedly see that members enthusiastically enrol in loyalty programs based on the compelling value it provides. A member will join a program because of the promise of value. And the member will continue to engage with the program if they perceive they are accessing value. Anaconda offers $10 credit to customers who join their loyalty program. Despite this attractive incentive to join the program, their remaining rewards and benefits are neither compelling, valuable nor differentiating. Their rewards are mostly driven by discounts and special offers which members can receive in other stores.
The exclusive Club nights are held several times throughout the year, offering members even lower prices, to see in-store demonstrations, and to meet like-minded Australian adventurers. However, the website and emails do not communicate the appeal of Club nights as there are no photographs or videos promoting the event. The Anaconda website highlights they offer in-store demonstrations, but it’s not clear what they will be demonstrating. It could be how to set up a tent, the features of a new fishing rod or the latest eskies for Summer. These types of demo Club Nights could attract key consumers willing to learn, engage and spend at Anaconda. Unfortunately, it seems these Club Nights are like any other regular retail day, just offering an additional discount.
Anaconda’s lowest price guarantee reduction
Anaconda differentiates itself from other adventure retailers by offering the lowest prices. Anaconda has a 10% lowest price guarantee reduction. If members find the same stocked item, then Anaconda will beat it by 10%. To claim their money, members must go to the store and show evidence such as advertising material or other official documents from the other retail store. This takes time and effort for the average person to demonstrate offers from other retailers. Members would perceive more value if this friction was removed.
Instead, Anaconda could offer a lower price guarantee credit. This is an automatic credit given to members in the event they purchase a product which later reduces in price. This credit is offered during a confined period after the product was on discount. For example, if the price reduces within two weeks of purchase, the member will receive the difference as credit. The member can access the credit on their next transaction, thus encouraging members to repeat purchasing with the brand. Credit is an ideal benefit as it removes the hassle and friction of members going into the store to save money.
Best price guarantee companies constantly study the competition and adjust prices to remain the low-cost leader. In the instance that a customer finds a better price from a competitor, Anaconda will honour and beat it by 10%. By offering a lower price guarantee credit, it will give customers confidence they’re buying the cheapest price available, and it will reduce comparison shopping by members, representing a form of loyalty. A good example of how this could be done is Super Cheap Auto. They are also a retailer focused on price; however, the value they offer is not only on price, but on giving their program members moments of surprise and delight.
Super Cheap Auto Club Plus
Super Cheap Auto is an Australian automotive parts and accessories retailer, positioning themselves as a low-cost leader similar to Anaconda. Their loyalty program, The Super Cheap Auto Club Plus effectively employs the lowest price guarantee strategy. Under this program, it offers members the ‘Get Credit Back’ promise, if an item you purchase goes on sale, they automatically credit the member the difference.
To join the program, members must pay $5 but will receive an automated $10 credit into their online account once it is activated. This program design not only fosters a lock-in effect for members who have paid (sun cost bias) but also provides instant gratification whilst familiarising members with using credits. It instils confidence in them that they will consistently access the cheapest promotional discount.
My Final Thoughts…
Anaconda can enhance their loyalty program by focusing on two strategies – club nights and the low-price guaranteed credit. As the low-cost leader, they do not need to offer a plethora of rewards and benefits; instead, the focus should centre on their value proposition rooted in competitive pricing. By highlighting the significance of club nights, Anaconda can provide an enticing and valuable incentives for members eager to explore products and gain insights before making a purchase. To achieve this, enhancing communication is paramount, incorporating engaging photos/ videos of the events and potentially recording member interviews to capture their reasons for enjoying club nights. The low-price guaranteed reduction credit eliminates any friction for members seeking to validate price differences, providing a moment of surprise and delights that fosters a positive emotional connection with the brand and cultivates brand loyalty.