A hard fact of life for e-tailers is that consumers are just not prepared to jump online in droves to do their shopping. As a result the $64,000 question is: What will it take to change their habits?
CIBC and Toronto-based Advantex International Marketing Inc., a specialty marketer whose other
clients include US Airways and Wal-Mart, think they have the answer. In September 2002 they launched an e-mall that gives holders of CIBC credit cards co-branded with a loyalty program the chance to earn bonus points by shopping at CIBCeshops.com. Participating credit cards include CIBC/Aerogold, CIBC/HBC Rewards and CIBC/Shoppers Optimum.
The e-mall has more than 50 national merchants including chapters.indigo.ca, Nygard International, La Vie En Rose and Henry’s. The idea is if you make a purchase at the e-mall, you will earn more Aeroplan miles than if you bypassed the mall and went directly to the same merchant’s Web site.
But is the lure of loyalty-program points enough to make people do more of their shopping online? After all, you need 15,000 Aeroplan miles to qualify for a short-haul flight from Toronto to Montreal. Even if you earn two Aeroplan miles for every dollar spent at CIBCeshops.com, you still need to rack up a $7,500 shopping bill in order to obtain an airline ticket that costs about $350.
“”If you are interested in collecting miles, we give you a chance to accelerate that process,”” says Advantex spokesperson Lisa Levstein.
Levstein is a case in point. The first year she used her CIBC/Aerogold credit card she earned enough Aeroplan miles to qualify for a short-haul flight. How did she do it? By frequenting merchants, restaurants and hotels who were members of the Aeroplan program.
If the purchasing power of strategic shoppers can be captured by e-malls with tie-ins to loyalty programs, then maybe e-tailing will take off sooner than most people think.