Cumberland’s Mobile Community

New England retailer pockets the benefits of virtual wallets.

By  Samantha Strong Murphey, Freelance writer

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The Cumberland Farms website looks more like the home of a hipster design agency than a chain of New England convenience stores. Instead of a humdrum history of a c-store, the “Family Story” timeline just off the Cumberland Farms home page blends modern-day graphics with oldyarn storytelling.

The narrative speaks of the American dream: “from a cow to a company.” It starts in 1939 with two Rhode Island dairy farmers and expands into “milk stores” that add products and services in creative ways as the years go on. Framingham, Mass.-based Cumberland Farms was one of the first true New England convenience stores and one of the first to offer self-serve gasoline. Being “one of the first” is a vital capillary in the company’s lifeblood.

And jumping onto the mobile-app scene is the next innovative leap for business longevity. While a number of convenience retailers have embraced apps for promotions at the fuel island and inside the store, Cumberland, operator of 600 stores in 11 states, may be the largest player in the channel to introduce a mobile cash card, a phone-friendly version of the reloadable gift cards it already offers. A simple way to cut down on credit-card interchange costs, gift-card sales for Cumberland followed typical patterns: About half of all sales were made around the holidays.

Hoping a mobile option would reach new customers and possibly drive cashcard sales throughout the year, Cumberland recently entered into a partnership with CardStar, a mobile application based in Hartford, Conn., that collates a user’s loyalty and gift cards. “It’s the very beginning—a toe in the water of the electronic wallet,” says Gwen Forman, Cumberland’s vice president of marketing. “A lot of our customers are young, and we have a lot of mobile workers. Although they aren’t necessarily affluent, they embrace mobile technology. This engages us in the electronic wallet at a decent cost to us.”

The mobile cash card is still in its infancy, but Forman says Cumberland’s innovators are already looking ahead. They’re developing their own mobileenabled website and plan to link their CardStar application to that. They plan to explore couponing and other loyalty-type functionality with the mobile card. “For example,” Forman says, “we could load values onto the card and position it as a free cup of coffee.”

Understanding the Customer

Building a mobile wallet database could very well open the blinds to a retailer’s customer base, understanding their purchasing habits. Some apps out there mine data from users’ credit and debit cards so merchants can target market more effectively, but many users are wary of such an invasion. CardStar asks for no personally identifiable information (PII). The company uses a number of other factors to create what it calls a “loyalty graph” for merchant use. It looks at which cards each user has stored in the app and classifies users into segments: the soccer mom, the traveler, etc. CardStar also uses its location tracker, which 90% of its users allow, to identify intent-driven trends from where and when users access their cards.

Users are liking the privacy protection. CardStar boasts just shy of 2 million users. And its service has been tapped 30 million times in just the past 12 months. “The average user has nine cards in the system, everything from loyalty cards to insurance cards to library cards to gym membership cards,” says Andrew Miller, CardStar founder and CEO. “It’s all about harnessing the power of aggregation. People aren’t going to go out and get 15 apps, one for each merchant they deal with. If Cumberland Farms tried to create their own app, they’d have 10 users.”

The service works like this: Users download the app and wallet dump. CardStar mines the dump data, and when it seess a critical mass of cards being loaded from one merchant, it adds the merchant to its database—with its logo and validated information—for free. Today, it has 6 million cards in its system. If a merchant is interested in taking advantage of CardStar’s platform for incentive programs, mobile couponing, store locator searches, etc., it pays a onetime fee of $100 and a second fee (paid either month-to-month or annually) based on number of users. For one to 500 users, it’s $15 per month.

“Unless you’re Best Buy or CVS, we’re talking hundreds of dollars a month, not thousands. Trivial money, really,” Miller says. “And we offer merchants all the flexibility and power to do anything with our application. There’s nothing off-limits. If someone has a good idea, we’ll do it.”

CardStar isn’t the only loyalty card application in the mobile marketplace— there’s Cardagin, Checkout, PlacePop and The Line, to name a few. But for Cumberland Farms, CardStar was the best fit. After a small-scale internal test and distribution of simple training materials to store employees, Cumberland launched its cash card using CardStar’s platform in mid-July.

The operator is also exploring Card- Star’s other features, such as banner ads, advertising and links on the CardStar application itself, targeting customers and sending offers. With CardStar’s “loyalty map,” these efforts can be instant, customized and hyperlocal.

“It’s all accessible in our contract, but how deep we’re going to get into it and how we’re going to overlay loyalty on it we don’t yet know,” Forman says. Meanwhile, Cumberland Farms is innovating in other sectors.

“We have a couple of drive-thrus, pretty advanced systems for recall and foodservice, and 150,000 fans on our Facebook page,” Forman says. “We’re not on the bleeding edge, but we’re certainly moving in that direction. The culture of change here is huge. It keeps things exciting. It keeps things busy.”  

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