Tue, Apr 20, 2004 page11

• Far Eastern Geant to offer card

  LOYALTY PAYS Following in the steps of industry leaders Carrefour and RT-Mart, the third-largest hypermarket chain will reward customers with discounts and gifts

  • By Jackie Lin / STAFF REPORTER
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  The Taiwanese-French venture Far Eastern Geant (愛買吉安), the nation's third-biggest hypermarket chain, will introduce an interactive "loyalty card" service in June to compete head-to-head with industry leaders Carrefour Corp Taiwan and RT-Mart (大潤發), Far Eastern Geant president Charles Kruse said.

  The company hopes the loyalty-card plan will boost sales by offering discounts and free products to some customers, Kruse told the Taipei Times during an interview last week.

  With a handful of kiosks installed in each store, customers with loyalty cards will be able to scan their cards at any time in the store, even after they check out, to receive personalized shopping information, Kruse said.

  Besides recording customers' family data and individual shopping habits, such as which brand of soft drinks the cardholders buy, the cards also will offer discounts and free products on a random basis, making the shopping process more interactive and interesting, he said.

  "We know in Asia, the longer people stay in the store, the more they buy," Kruse said.

  The membership cards will be the first issued by Far Eastern Geant, spokeswoman Brenda Yen (嚴必文) said. The retailer has 13 outlets nationwide, and last year had NT$16 billion in sales with an after-tax loss of NT$1 million.

  Both Carrefour and RT-Mart have similar customer membership card services.

  Launched six years ago, Carrefour's credit cards are exclusively for use in its 32 stores and are now held by 600,000 customers, a group which has increased by about 12,000 per month.

  Cardholders can enjoy discounts of between 10 percent and 20 percent when purchasing certain products, according to public relations manager Lilian Lee (李莉莉). "The cards could help strengthen customers' loyalty and increase customer traffic, as our company frequently holds promotional events," Lee said.

  Number-two player RT-Mart (大潤發) is the only hypermarket chain that implements a membership system without levying any charge on customers, said manager Fiona Wang (王彤芳).

  The 22-outlet retailer now has 2 million members who are eligible for discounts and accumulate points for every NT$100 of purchases made.

  Cardholders' consumption accounts for 80 percent of the company's monthly revenues, Wang said. "The success of a membership system hinges on massive information integration," she said, but membership card systems are no guarantee of increased revenues.

  Rachel Lee (李依慧), a researcher at Polaris Securities Group (寶來證券), voiced reservations about Far Eastern Geant's plans.

  "This could be a selling point to attract more members," Lee said.

  "But besides highlighting the system's interactive capability and offering promotional items, what's more important is [the company's] next step, and we don't know that yet," she said.

  Far Eastern Geant and RT-Mart are discussing forming an alliance or even a merger, said Douglas Hsu (徐旭東), chairman of Far Eastern Group (遠東集團), the parent company of Far Eastern Geant, at an investor conference earlier this month.

  "If such cooperation takes shape, we dont know what they will do with [Far Eastern Geant's] card system," Lee said.
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