Retailers shift their ad spending from TV, radio and print ads to digital ads.
Fans of the Los Angeles Dodgers have a new web site, ThinkBlue.Dodgers.com, where they can shop at hundreds of online retailers and earn loyalty points that can be cashed in for premiums like game tickets or visits with players. 74% of Dodgers fans say they`re willing to change shopping habits to earn such points, says Sports Licensing Systems, the company behind the loyalty program.
When baseball fans are passionate about their team, a lot of that enthusiasm can spill over into shopping that earns loyalty points that can be cashed in for tickets, equipment used in games, or visits with players. At least that’s the formula behind ThinkBlue.Dodgers.com, the new loyalty program site that directs fans of the Los Angeles Dodgers to shop at Macys.com, Amazon.com, Safeway.com and hundreds of other online and brick-and-mortar retailers.
“In a survey we conducted in L.A., we found that 74% of Dodgers fans were willing to change their shopping habits to get Dodgers points,” says Scott Todaro, vice president of marketing for Sports Licensing Systems, which launched the Dodgers’ Think Blue Rewards program last month in association with e-retailer aggregator Mall Networks Inc. “For participating retailers, this can result in a lift in spending of about 15%.”
In its first week after launching in mid-March, the Think Blue Rewards program garnered 1,000 registered users, including one who linked from the program to spend $1,800 at HomeDepot.com and earn points toward Dodgers-related premiums, Todaro says.
Sports Licensing Systems and Mall Networks are startup companies founded last year and backed by venture capital firm IDG Ventures Boston, which has invested $5 million in SLS and $2 million in Mall Networks.
Working with MLB Advanced Media, which operates MLB.com and provides e-commerce services to the individual web sites of Major League Baseball teams, Sports Licensing Systems and Mall Networks expect to roll out their services to all MLB teams over the next few years. “By the end of 2007, we expect to have 12 teams,” Todaro says.
Next up is the Arizona Diamondbacks, whose loyalty program will go live on the team’s opening day, April 11.
Each team’s rewards program will be promoted on the team’s main web site as well as in their stadiums and at participating retail stores. The Think Blue program, for example, is promoted and linked from the Dodgers home page at LosAngeles.Dodgers.MLB.com.
Dodgers fans register on the rewards site with their e-mail address and a password, and pay an annual fee based on the level of rewards they want. Fees start at $19.95 for 500 starting points, two stadium ticket vouchers and the ability to earn one point for every $1 spent on eligible purchases. The most expensive option is $175 a year for three points per $1 spent, plus additional perks including parking passes for two games and the option to purchase season tickets before the general public.
Fans can register any credit card on the Think Blue site to earn points at any participating merchant; they can also use a Think Blue Rewards card for cash payments at stores and stadium concessions.
Because the Dodgers were the first team to hook up with Sports Licensing and Mall Networks, it took several months to launch Think Blue Rewards with full connections to merchants, but subsequent rollouts will take only about three months, says Todaro, who is a former executive of e-commerce technology provider ATG Inc. Sports Licensing uses web-based loyalty program software from Epsilon in addition to its own proprietary software, and works with Golden Retriever Systems to process loyalty points with credit card processors.
Sports Licensing also extends the loyalty programs to include store retailers as well as concession stands at baseball stadiums. It usually has spots for only about 85 brick-and-mortar retailers to avoid having two directly competing merchants in a team’s geographic area, Todaro says.
The programs cost nothing for the participating sports teams, who share in the revenue Sports Licensing and Mall Networks earn from retailers, Todaro says. Participating retailers pay a set-up fee of about $5,000, plus a commission on sales ranging from about 1% to 2%. Retailers have the option to pre-pay their commissions-in other words, pay for the points granted to their customers-to realize lower commission rates and a waive of the set-up fee, Todaro says.
Sports Licensing and Mall Networks have also extended their services to the National Association of Stock Car Auto Racing Inc.’s NASCAR RacePoints rewards program, and have their sights set on additional sports arenas, including hockey and basketball, Todaro says.