FreshDirect: A Geo-targeted Loyalty Drives New Customer Growth
169%
YoY lift in total client sales
171%
YoY lift in new customer sales for a gross ROI of $12.50x
66%
YoY lift in sales by lapsed customers for gross ROI of $12.48x
The Challenge
Fresh Direct is a popular food-delivery service in the United States that is geographically concentrated within a specific part of the country. The brand places a high focus on acquiring new customers, so the program is set up to commission on only new net orders and sales. The company wanted to expand its customer acquisition efforts and came to Gen3 in search of some “out of the box” thinking. Their geographic concentration provided advantages but presented unique challenges for growth.
The Gen3 Approach
Using its extensive publisher knowledge, Gen3 proposed that Fresh Direct partner with Augeo, a card-linking publisher with an audience of 35 million cardholders that redeem cashback points for every purchase made with a participating brand. Augeo also has geotargeting capabilities that fit well with Fresh Direct’s geographic restrictions and also accepts commissions on net new orders only.
Gen3 set up the loyalty campaign, negotiated the budget, and monitored the spending. The agency ran a three-month test that targeted both new customers and lapsed customers with a cashback reward for each purchase.
To determine the incrementality with this test and the effect of the cash back with each purchase, a control group of 5% of eligible customers was not served the cashback reward, while all others were shown the 5% cashback rate.
The Results
- 169% YoY lift in total client sales
- 171% YoY lift in new customer sales for a gross ROI of $12.50x
- 66% YoY lift in sales by lapsed customers for gross ROI of $12.48x
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