to Launch Olympic Loyalty Program

Share this content: -- an e-commerce site specializing in DVDs, video games, music and other products -- is dipping its toe in the loyalty marketing pool when it kicks off its first such program Aug. 22.

Although hopes are high, the company isn't totally sold on points programs.

The basic structure of the Olympic-themed program is simple: from Aug. 22 to Oct. 13, customers can earn one point for every dollar spent at the site. Customers who earn 300 points can redeem them for video game manufacturer Eidos' "Sydney 2000: The Official Video Game of the Olympic Games," valued at $30. A hat is the prize for 200 points while 100 points earns the $10 version of the video game. The site is hoping to capitalize on the Olympic buzz as the games run during the later half of September.

The campaign is a test. Utilizing a more involved program will depend on the result.

"The only way to do a loyalty program is to start short term and look at numbers in detail," said Susan Daniher, vice president of marketing at, Los Angeles. "Otherwise, you get locked into something and your customers turn on you because you have to readjust your program."

Daniher researched the loyalty arena and discovered "people aren't making money anywhere. Companies aren't making money off of their loyalty programs. People are holding out for the long term. There is a projected period where you cross over."

It is for this reason that chose not to partner with any of the online loyalty companies to construct its program. The site's staff built the back end for the program. is an advocate of e-mail marketing. It sends out a message twice each month to its database of 1.5 million people. The next batch will include information about the loyalty program.

"It's just a reminder," she said. "We include our sweepstakes and promotions. Our customers are also fanatics. They want to find out what's coming out on DVD. We tend to see good conversion rates after we send them out. We'll see upwards to a 40 percent increase in traffic."

The first phase of the site's Olympic marketing efforts kicked off July 15. The "Win a Trip to Sydney 2000" sweepstakes, which ends Aug. 15, provides a way for the site to beef up its e-mail database. The site has been gathering 2,000 e-mail addresses each day, and it has been running 20 million banner ad impressions on America Online to promote the sweepstakes.

"These are good, de-duped e-mail addresses," she said. "The days we're featured on AOL it goes above 3,000."

Eidos sponsored the loyalty and sweepstakes campaigns. The site will look to other partners to get involved with future promotions.

"If we do it long term, we'll ultimately look for long-term partners to be the prize provider," Daniher said. "[The advantage for a partner is] they'll be exposed to a highly qualified customer. It's a means of acquisition for another company and a means of loyalty for ours."

To support its Olympic effort, the site will be running print ads in eight publications, including Sports Illustrated, Entertainment Weekly and US Weekly as well as video game publications. The ads begin Sept. 5 and run throughout the month.

Consumers who make purchases during the campaign will receive an inbox direct mail piece that explains the program.

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