March 27, 2007

In the wake of last week’s announcement of a new strategic plan for the Borders Group, that entity has revamped its Rewards program, effective April 12.

The most significant change seems to be the end of Personal Shopping Days and Holiday Savings Rewards in favor of “Borders Bucks”:

“For every $150 spent on Qualifying Purchases at Borders, Borders Express, or Waldenbooks in a calendar year, you’ll receive $5 in Borders Bucks. Borders Bucks are issued the first week of the month following the month in which they are earned, and are valid until the end of the month issued. Plus, any amount you spend on Qualifying Purchases in a calendar year that exceeds $150 rolls over until you reach your next cumulative total of $150. There is no limit to how many Borders Bucks you can earn.”

I wonder if that modification is a concession to the smaller number of retail outlets, with close to half of the Waldenbooks outlets slated for closure. The Bucks system does seem less complicated than the Personal Shopping Days, and the promised revamp of on-line shopping might make obtaining them easier. Still, you don’t have any more of a window to use the Bucks than you did with the Personal Shopping Days, and with fewer outlets within a users range because of the closures, maybe the level of outlay on discounts and rewards will stay the same, even though the perceived level of complication in earning them is lower.

But it’s the earn-but-maybe-don’t-use nature of the program that probably keeps it free. Since you continually get a discount via the Barnes & Noble and Books-A-Million discount programs, it makes economic sense that users have to make an initial expenditure. Both probably hope that savings reaped by users will generally be equal to or less than the income of memberships purchased.