Dive Brief:

• Macy's on Monday announced the next phase of its Star Rewards loyalty program, which allows members to earn on each purchase regardless of how they pay. Macy's cardholders are automatically enrolled into the Star Rewards program at either silver, gold or platinum status based on their annual spending, the company said in a press release.​

• Customers without a Macy's card can enroll in the Star Rewards bronze level program in-store, online or via the mobile app. Each tier offers a range of benefits including discounts and access to exclusive events, with gold and platinum enjoying free shipping.  

• The retailer is giving away a total of 5 million points to 50 Star Rewards members, which amounts to 100,000 points per winner or $1,000 in Star Money, if they enter through the Macy’s app between Feb. 10 and Feb. 23. 

Dive Insight:

On the face of it, the latest news from Macy’s is not much different from the loyalty program announcement from two years ago. It appears that the retailer has incorporated its mobile app into the Star Rewards partnership and expanded its participation incentives. 

"With nearly 30 million members and growing, Macy’s Star Rewards program has been a huge hit," Rich Lennox, Macy’s chief customer officer, said in a company statement. "We hugged our best customers with the relaunch in October 2017 and then expanded it in 2018 to all customers. We have seen strong results and received positive customer feedback. With this next phase of the program, all customers will earn rewards on everything they buy (except gift cards, services and fees) and can redeem on anything they choose."

Lennox discussed the changes at length during the department store's recent investors day, describing them as designed to strengthen its relationship with regular customers, engage occasional shoppers more and bring on new ones. But without a clear brand strategy, that approach is overly transactional and even "antagonistic," Deb Gabor, CEO and founder of Sol Marketing and author of "Irrational Loyalty: Building a Brand that Thrives in Turbulent Times," said in a recent interview.

The loyalty program news comes as Macy’s tries to revamp its brick-and-mortar strategy. The retailer announced earlier this month that it plans to close 125 locations and will let 2,000 employees go. Meanwhile, the retailer also debuted a new, 20,000-foot store concept called "Market by Macy’s" in Texas, which will feature experiences such as book signings and cooking tutorials. 

These initiatives are part of Macy’s overall attempt to adapt to an increasingly changing retail environment by exiting underperforming malls, bringing on more freestanding off-price Backstage locations to "lifestyle shopping centers" and reportedly pulling back from its Story concept.