Rite Aid Launches New Feature to Upload Rewards to Loyalty Card

08/16/2012| 10:59am US/Eastern

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   By John Kell 
 

Rite Aid Corp. (>> Rite Aid Corporation) next month will launch a new feature to the drug-store chain's loyalty card that will allow +UP rewards to be automatically loaded to the Wellness+ card, an upgrade the retailer touted after a seven-month pilot in four cities.

Previously, if a customer bought a so-called +UP reward item that was featured in Rite Aid's circular while scanning the loyalty card, a dollar amount showing the reward would be printed at the bottom of the receipt. Customers would then need to bring the receipt back to the store to redeem the savings at a future visit.

But Rite Aid said the national rollout of the card-loading feature should increase redemptions of the discounts since customers won't be required to keep their receipt to use the rewards they earned.

The Wellness+ loyalty program, launched in April 2010, had 25 million active members at the end of the fiscal first quarter. Card usage by those members--defined as those who have used their card at least twice in the past 26 weeks--increased 11% from a year ago and accounted for 75% of front-end sales and 69% of prescriptions filled in the latest quarter.

The program is the core focus of Rite Aid's overall marketing and promotional efforts. Rite Aid has sought to upgrade the features of the card to increase usage and meet the needs of its customers, especially those who are most loyal to its stores.

The new feature comes as larger rival Walgreen Co. (>> Walgreen Company) is moving to launch the company's first loyalty card in September. Some observers have expressed concern about how Walgreen's debut of a loyalty program will affect the promotional environment for drug-store chains this fall, as Rite Aid and CVS Caremark Corp. (>> CVS Caremark Corporation) likely will attempt to retain customers with targeted deals.

-Write to John Kell at john.kell@dowjones.com

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