Big Lots 2012 Annual Report Download - page 104

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will introduce new merchandise to our current customer base while also qualifying our stores to accept certain
government assistance programs. We believe acceptance of these programs could enable our stores to service a
growing portion of the U.S. population.
Our marketing efforts involve a mix of printed circulars, in-store marketing, television, email and online
advertising. Much of our marketing is based on information that we have learned about our customers,
principally through customer surveys and information gathered through our rewards program. Based on this
information, we believe the majority of our core customers come to our stores without a shopping list or without
a specific item or brand in mind to purchase. We believe value dominates decision making as our customers
look to us for savings. In 2012, we made investments to improve our in-store signage and merchandising
displays, with a focus on our comparative pricing to competitors. We expect to continue to develop these efforts
in 2013.
We continue to market to our Buzz Club members, by offering a free online membership and alerting them to
new merchandise and offerings in our stores. In 2009, we launched our Rewards program, which is our first
true customer loyalty program, which we use to provide benefits to our customers. After making the required
number of qualifying purchases, the Rewards member earns a coupon on their account for a future discount in
our stores. Additionally, members may receive marketing information and other targeted promotional materials.
During 2012, we began testing a new structure to our Rewards program in select markets that would replace
the current qualifying purchase system. This pilot program utilizes targeted promotions, in lieu of the current
qualifying purchase system, to attract customers to our stores and increase the average basket and frequency of
transactions. Pending further testing and review, we expect to implement some variation of this new structure
on a chain-wide basis in the second half of 2013.
From a marketing perspective in 2013, there are four primary programs designed to continue to grow sales:
x We use our printed advertising circulars and promotional pricing to create excitement surrounding
the deals that we offer.
x We use television commercials broadcast nationwide on both national and cable networks to promote
our brand and, from time to time, promote items or special discounts in our stores.
x Our signage initiatives that focus on value and extreme price savings are also designed to continue
our effort to reinforce our niche in low everyday price retailing.
x The use of our Rewards program is a key driver to furthering our focus on our core shoppers and
expanding our customer base. We believe the insights we are gaining from the pilot program of the
new Rewards structure will lead to more direct and focused promotions that positively influence the
habits of our members. At February 2, 2013, our Rewards program membership totaled 15.3 million
members.
Also, during 2013, we intend to launch a new branding campaign under the tag lines of “Here’s the Deal” and
“Big Featured Deal” as our customer research has suggested a more favorable view of “deals” compared to prior
marketing campaigns. This new tag line will be prominent in our print, television and in-store signage as well as
our Rewards materials.
From a store operations perspective, we began the company-wide rollout of our “Ready for Business” program
in 2009. The program focuses primarily on servicing our customers and creating operational efficiencies, based
on certain performance criteria and standards centered on improving the consistency of visual presentation,
merchandise recovery efforts, and overall store cleanliness. “Ready for Business” also focuses on development
of our field management team and improving our training programs, which we believe are very important to
our store growth strategy. As we have increased the number of our stores, we have been working to develop
the depth of our field management team in order to internally promote and provide opportunities to qualified
internal candidates who have a strong understanding of our business model. We believe our focus on standards
and investments in talent development have improved the performance of our new stores during their initial
months of operation.