Borders Rewards “Failed to Deliver,” Say Analysts

January 10, 2007 · 0 comments

According to this story in today’s Ann Arbor News, stock analysts are unhappy with the performance of Borders Bookstores and they think part of the problem was the Borders Rewards program unveiled last year.
Credit Suisse analysts said, “(Borders’) results suggest that the rewards program failed to deliver the anticipated results…” Analysts for Merrill Lynch said they didn’t believe customers really understood how the program worked, which explained why the program didn’t increase customer traffic as expected. Analysts for Goldman, Sachs, & Co. said, “We believe…that the company will significantly change the details of its loyalty program in 2007.”
Borders said changes to Borders Rewards are “likely.” Their CEO will be announcing his new strategy for improving the company’s performance in March.

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