As we continue to study the latest loyalty campaigns and concepts from convenience industry leaders, we are always interested to notice if and when the subscription model is being implemented to ensure “extreme loyalty”.
In our view, signing customers to a subscription programme is the single best way to secure a 100% share of your customers wallet in your category, as customers won’t generally ever shop elsewhere once they’ve signed up for a package with a favourite brand, especially when it’s a subscription service – in this case for their daily coffee fix.
Following on our first article on their “Leon Lover’s Club, we now look at the latest approach taken by this smaller UK coffee house as it also evolves to deal with the dramatic loss of customers during the Covid 19 global pandemic and fights to win every customer it can.
In a somewhat confusing message, Leons “Unlimited” coffee package is in fact limited to 75 cups a month. Admittedly 75 cups is a LOT of coffee, and of course, commercially, the reasons for the limit are understandable, however it does to be an unusual way to position the product.
At full usage, £15 for 75 cups would be incredible value – just 20p a cup and its easy to imagine commuters justifying the decision to commit to Leon, with just five or six cups of barista-brewed coffee needed at regular Leon prices to start saving money.
A second limitation is imposed on *how* customers buy their coffee, with the subscription option limited to “click and collect” customers who “smart order” and can’t be used at kiosks or even at tills.
While the awareness and adoption of the “smart order” function is not publicly available, my guess is that it’s low and at least for now, this risks adding further confusion to an already unfamiliar concept.
How It Works:
- Leon is using its gift card functionality for this product, so customers simply head to the “unlimited coffee” page and pay the £15 for the product online.
- Although it’s sold using the gift card shopping cart on their website, there is no option to have the code sent to a friend, so it does not appear to be a “gift” that can be gifted.
- They are then sent a code which can be used via Smartorder to order coffee at any “participating” Leon restaurant. There were no details on the Leon home page about Smartorder, so I assumed it was an app but found none. I eventually discovered that this is their online ordering platform on their website as they excitedly mentioned by email that “no app download is required”.
- The code is valid for 30 days and then expires along with any of the limited/unlimited allowance of 75 coffees.
- The package is not a subscription option and does not renew.
The Leon Non-Subscription Approach
We were surprised to discover that Leon’s Unlimited package is actually a non-subscription package. This again seems an unusual decision, as “unlimited” packages typically appeal to customers who’ve decided they love the product and want the simplest and quickest way to enjoy it on a regular basis. A manual renewal will increase churn rates and will result in the need for ongoing recruitment and renewal conversations which could be avoided.
In closing, having already highlighted ongoing losses for the brand before Covid emerged, it’s likely that Leon is now truly fighting to survive, however in this age of digitally savvy customers, there are a lot of simple improvements that could be made to truly delight customers and earn greater loyalty. In particular, offering customers an option to buy a recurring subscription package instead of limiting the purchases to a single month would give the brand a commercial benefit at no real cost.
We’ll be watching to see how they evolve and like other brands struggling in such difficult times, we wish them every success.
Liquid Barcodes is a leading global loyalty and digital marketing technology company specialising in the convenience store and foodservice industries. Our proprietary cloud-based technology platform allow retailers to create and manage their digital marketing campaigns with a proprietary process we call the “customer connection cycle’ to engage, promote and reward customers activities in real-time across digital and media channels.
How we do it:
We have developed the most advanced loyalty and digital marketing technology platform specifically for convenience store and foodservice retailers globally.
Retailers use our self-service dashboard to create and manage loyalty driven marketing campaigns that increase purchases with their existing customers, as well as effectively target and acquire new customers through partners or paid media channels.
One core component of live loyalty is gamification. We have gamified branding, loyalty and promotions. We believe this approach is essential in order to get customers’ attention and ultimately truly engage them with repeatable actions thereby winning their loyalty.
Check out some of our exciting/proven results here:
Chief Content Officer, Liquid Barcodes and Loyalty Podcaster
With over twenty-five years marketing experience, I specialise in loyalty marketing articles and podcasts. In addition to working with Liquid Barcodes, my clients have included Telefonica O2 Priority, Three Mobile, Electric Ireland, Allied Irish Bank and The Entertainer Group (UAE), as well as Avios – the global points currency for some of the world’s top airlines. I am also a former judge for the Loyalty Magazine Awards and proud host of the “Let’s Talk Loyalty” podcast – the industry’s first podcast for loyalty marketing professionals.