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From licks to clicks
By MICHELLE SLATALLA, New York Times
© St. Petersburg Times, published March 20, 2000
And now, green stamps are back, this time in digital form. S&H recently went online with an Internet site (greenpoints.com) to resurrect one of the most famous icons of 20th century retailing as a reward for online shopping.
The challenge for S&H will be to persuade online users that a new digital currency called greenpoints -- which you can't see or hold or lick or print out -- is as meaningful as the stack of perforated green stamps that used to accumulate in that old red Pyrex bowl on the kitchen counter.
For those of you who have not thought of S&H stamps since your mother redeemed them for a new blender, let's refresh your memory: At the peak of trading stamp popularity in the mid-1960s, most gas stations and supermarkets offered them to shoppers. S&H operated 800 free-standing redemption centers nationwide, and in the mid-1960s it printed more stamps than the Postal Service.
Each stamp had a pale green background embellished by a jaunty red "S&H" logo, a serial number and fine print that read "Value 1 2/3 mills," which meant that you could redeem it for cash.
But when I was a child, nobody I knew would have considered trading green stamps for mere money; they were worth far more than that. For my family -- sitting around the kitchen table for hours, licking that tapioca-flavored glue and filling Quick Saver Books until the pages began to warp and sag under the weight of wet stamps -- the experience provided the opportunity to ask the big questions: Were we the sort of people who would redeem our hoarded stamps for the kinds of sensible items that you could really build a postwar lifestyle around, such as a 12-cup coffee percolator or a toaster? Or would we blow everything on something frivolous, like that family down the block who redeemed their stamps for a basketball that their kids lost the next day?
Green stamps confirmed us as proud members of the first generation that succumbed to the heady lure of fancy new appliances. "That was the year," my mother said, remembering one green stamp purchase in 1969, "that we upgraded from a two-slice to a four-slice." And toast never tasted so good.
Long after the popularity of green stamps waned in the 1970s, the S&H logo still exerts a powerful, Proustian pull on nearly everyone who was old enough back then to lick.
"The most compelling thing about S&H green stamps," said Melissa Shore, an analyst at Jupiter Communications, "is that whenever I tell someone that the company is entering the online market, people immediately launch into an emotional story about their experience of growing up with S&H green stamps. They have strong brand equity and a hundred years of experience."
So it is understandable that S&H wants to repackage the old-fashioned appeal of green stamps into something the company's executives describe with straight faces as a "complete loyalty solution."
"This is a company founded in 1896," said Walter Beinecke, the executive vice president of Greenpoints.com and a great-grandson of an S&H founder, Thomas Sperry. "But we're also a 104-year-old dot-com start-up."
Computers, however, do not come loaded with a sense of taste, at least not yet. Clicking on a Web site seems a poor substitute for giddy feelings that the original stamps induced in millions of consumers.
"The question is: Can you convey, online, that emotional feeling that people remember?" Shore said. It is a question that could be asked of any old-style retailer poised to take its business to the Web. S&H has a few additional hurdles.
"Our parents remembered the Depression and the war, and collecting trading stamps was all part of the dream of affluence, which meant acquiring your Levitt home and your television and your first appliances," said David Monod, a historian and the author of Store Wars: Shopkeepers and the Culture of Mass Marketing, 1890-1939.
"It definitely had to do with the physical feeling of the stamp itself, and the fact that your whole family sat around the table doing it together."
The transition to the Web becomes more problematic because the domain name Greenstamps.com belongs to two California lawyers, Sullwold & Hughes, who think of themselves as S&H, too, and say they will not give up the name.
But Greenpoints officials said the name would have been too old-fashioned for them. "We would not want to be green stamps on the Internet anyway, because that speaks to an older way of doing things," Beinecke said.
In 1896, Beinecke said, Sperry & Hutchinson became the first independent trading stamp company to distribute stamps and books to merchants, beginning in Michigan, and by the turn of the century, trading stamps were popular.
The reason, Beinecke said, was that the S&H incentive program rewarded shoppers for timely payment (the stamps were given out in exchange for cash purchases) and loyalty to specific merchants.
But after World War I, "the novelty wore off and nobody used them," Monod said. "Trading stamps tended to be popular in inflationary times, when people were concerned about prices, but in the 1920s, prices were stable. And in the 1930s, prices were deflationary."
In the 1930s, to protect independent merchants from chain stores, states began passing fair-trade laws to prevent retailers from cutting prices.
"Retailers had to find ways to entice customers and give them price breaks," said Sandra Stringer Vance, a historian who specializes in retail history since World War II and a co-author of Wal-Mart: A History of Sam Walton's Retail Phenomenon.
The popularity of trading stamps revived, and by the middle of the century, S&H had become a powerful national company whose success was imitated by scores of local companies with names such as Gold Bond, Blue Chip and Plaid Stamps, said Jeff R. Lonto, a Minneapolis author who published The Trading Stamp Story.
But the climate changed drastically during the oil embargo in 1973-74. "At that time, 40,000 gas stations were giving out green stamps, but a number of them went out of business or consolidated," Beinecke said.
The trading stamp craze quickly faded. Although S&H never stopped the program -- even today about 400 independent businesses, including gas stations and travel agents, give out stamps and the company still operates a central customer service center in Atlanta -- green stamps disappeared from the public consciousness.
Beinecke's family sold the company in 1981, but last year he led a group of investors who bought S&H in the hope of re-inventing the incentive program in a digital economy.
"Rather than licking and sticking stamps as a family," said Rod Parker, president of Greenpoints.com, "today's family will go to the Web site and see how many points they have and what they can get, and think, "Wow, this can be rewarding.' It's today's culture. It's fast, it's simple and you never have to leave the house."
But how do you persuade people to abandon the physical sensation of holding and licking a stamp? This is the same question that E-Stamp Corp. confronted after beginning to sell digital stamps online last year.
"We found that in the consumer market, people were tied to the physical stamp," said Nicole Eagan, E-Stamp's senior vice president for sales and marketing, "and we actually bridge the electronic and physical worlds, because you can buy the stamps in the e-commerce world but then you can still print them out." You can print it on Avery labels and peel it off and stick it on the envelope, or you can print it right on the envelope, or you can print it on a document to show through a window envelope."
Postage, of course, is very palpable: You need it to mail the bills. But the points and coupons behind Greenpoints.com and a number of other online incentive programs that arrived on the Internet months ago -- like MyPoints.com, ClickRewards.com and FreeRide.com -- are less tangible.
Greenpoints.com also will offer shoppers offline opportunities to earn points, Parker said. One merchant, the Foodtown supermarket chain, started the program in 10 stores in New York. Shoppers keep track of their points with a card that looks like a credit card, Parker said, and will be able to redeem both offline and online greenpoints for rewards.
To be successful, the programs have to offer rewards that today's jaded shoppers think are worth earning. Airline mileage? Yes. The opportunity to donate your accumulated points to charity? Maybe. Toasters? No.
Many of the 300 rewards that you could earn when Greenpoints.com began this month (the list keeps growing, and the company plans to offer more than 1,000 rewards online by the end of March) were easy-to-earn items -- such as a movie theater ticket (2,400 points) or five $1 gift certificates for Wendy's fast food (2,400 points). But so what if you can accumulate enough points to redeem those items very quickly? You earn 20 greenpoints for each dollar spent. Does that really feel like a reward to today's shoppers?
"We are wild consumers these days, but we're desensitized to it because we buy so much," Monod said. "The things that excite people today are terribly, terribly expensive, like travel, which most people consider a luxury, or a new stereo system."
If you manage to accumulate more than 100,000 greenpoints, you could get redeem them for a 13-inch Panasonic color television (141,600), a travel certificate for a round-trip domestic flight on Continental Airlines (149,000) or a ski vacation in Canada (249,000).
But at the introductory rate of 20 points per dollar, you would have to spend $12,450 to get the ski vacation. Knowing that, would you be willing to sign up, provide personal information and use the Greenpoints.com home page as a shopping trip starting point so the company can keep track of your purchases?
I did. I visited www.greenpoints.com -- and was momentarily catapulted into the lost world of a particular spring morning in 1969, the year that 80 percent of American households were collecting trading stamps and a trip to the redemption center in the next town meant that my mother first had to wrestle my little brother into "good clothes."
Signing up -- giving my e-mail address -- earned me 3,000 points. I got an additional 1,000 points for providing personal information like name, sex and number of people in my household, and 500 more by answering a survey question.
With that many points in the bank, I surveyed some of the possible purchases, many of which were not on any shopper's wish list: for example, potpourri to "add soft fragrance to any room" (3,600 points). I decided to hold on to my points. Instead, I scanned the list of 61 partner merchants (the number of merchants has increased to 88), which included well-known retailers such as OfficeMax.com, Borders.com and LandsEnd.com.
I had been planning to buy children's bathing suits and when I clicked on LandsEnd.com, a second browser window appeared on the screen to take me there. I bought eight bathing suits for $170, and when I closed the second browser window I found myself back at Greenpoints.com, which according to my calculations now owed me 3,400 greenpoints.
Even after my points are credited my 7,900 total will not be enough to get anything I want. Neither the Dr. Talking Clock (7,200 points) nor the rugged 50-foot garden hose (7,200) nor anything else in that range appealed to me.
I would not mind earning a free airline ticket, and I might not even lose interest before I bought the necessary 372 bathing suits -- or their equivalents. Now, if Greenpoints.com wanted to send me the equivalent value in actual stamps, I would stay up all night, licking their backs and laboriously pasting them into books.
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