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LoyaltyOne Announces Dotz Program Expansion into Third Brazilian Region

CBSM – Companhia Brasileira De Servicos De Marketing (“Dotz”), operator of Brazil’s dotz loyalty program (www.dotz.com.br), in which LoyaltyOne holds a sizeable equity stake, has rolled-out its successful coalition loyalty program into the Sao Paolo State Interior.

The dotz program launch into the Sao Paolo State Interior, a region comprising 23 cities with a population of approximately 4 million, represents an important milestone in its expansion plan. With its presence in three markets with a population of 13 million – Belo Horizonte, Brasilia and now the Sao Paolo State Interior – more than 2.1 million consumers have enrolled in the program and can collect dotz (points) at a growing number of national and regional sponsors.

Program Momentum
Due to the success of the program thus far, Dotz will accelerate expansion plans and is anticipating entering multiple new regions in Brazil by the end of 2012. Through membership growth in the established regions and expansion in those new regions, total membership is anticipated to reach at least 4 million by year-end.

New Partners
Contributing factors to the acceleration plan also include the announcement of a new, national multi-year agreement with Pague Menos, one of Brazil’s largest drug store chains, and a new sponsor agreement with Paulistao, a recognized brand-name grocer in the Sao Paolo State Interior.

Founded in 1981, Pague Menos, a privately-held company, has more than 500 drug store locations and 13,000 employees across Brazil. With $1.6 billion (USD) in revenue (2011), Pague Menos is recognized as a leading drug store network in the highly competitive pharmacy retail category. Pague Menos will begin a phased roll-out of the Dotz program, in mid- 2012.

With 33 locations in the Sao Paolo region, the addition of high frequency supermarket sponsor Paulistao to the coalition provides program members in the Sao Paolo State Interior with the opportunity to earn dotz on grocery purchases.

“Joined by existing national and regional sponsors including Banco do Brasil, Ale, one of Brazil’s largest national gasoline station chains, and many other specialty retail and online retailers, the addition of these new partners in critical categories firmly positions Dotz for accelerated growth throughout Brazil, including this latest region,” said Bryan Pearson, president of LoyaltyOne. “Coupled with the program’s considerable appeal with Brazilian consumers, we remain focused on maximizing interest and engagement in the program among leading Brazilian businesses.”

“Our pragmatic approach to engaging and signing new sponsors in key categories is driving our growth strategy,” said Roberto Chade, president of Dotz. “Substantial consumer participation in our program has also resulted in steady growth in existing markets. We anticipate continued momentum as we roll out the program in the Sao Paolo State Interior and plan for further regional-outs by the end of 2012.”

The dotz program is similar to the Canadian AIR MILESĀ® Reward Program – consumers can join online or at multiple participating sponsor locations to collect points on their dotz collector cards. Consumers accumulate dotz points through everyday shopping and can be redeemed for rewards.

Brazil has the fifth-largest population in the world with more than 190 million citizens (versus approximately 34 million in Canada) and has the characteristics required to host a successful coalition loyalty program. Based on the coalition program’s national target market potential and current consumer spending habits, expectations suggest a long-term opportunity of one-to-two times the financial size of the Canadian program.

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