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Volume 4 Number 4
Volume 4 Number 4

Volume 4 Number 4

Volume 4 Number 4
Volume 4 Number 4

Fourth Quarter 2012

Volume 4 Number 4 Fourth Quarter 2012 Annual TRENDS Issue Insights from: JCPENNEY LEGO PLAY.COM SUNGARD
Volume 4 Number 4 Fourth Quarter 2012 Annual TRENDS Issue Insights from: JCPENNEY LEGO PLAY.COM SUNGARD

Annual

TRENDS

Issue

Insights from:

JCPENNEY

LEGO

PLAY.COM

SUNGARD

LETTUCE

ENTERTAIN

YOU

Spot the difference?

Loyalty

Loyalty

Not all loyalty programs are created equal. In fact, some programs aren’t equipped to motivate loyalty at all.

Traditional loyalty programs are focussed on points collection, whereas true loyalty programs come from deepening employees’ and customers’ connections to a company or brand through a meaningful exchange of value at every interaction – online, offline, everywhere!

Effective Loyalty Marketing solutions include strategic consulting, program strategy and design, analytics, business intelligence and research, loyalty platform and operations, and a focus on member engagement and communications strategies, always and all ways.

That’s the difference.

Learn more by requesting a copy of our upcoming white paper, “What every business leader needs to know about true loyalty” at www.maritzloyaltymarketing.com

Spot the difference ? Loyalty Loyalty Not all loyalty programs are created equal. In fact, some

Maritz Loyalty Marketing is a consumer loyalty marketing agency specializing in delivering next-generation loyalty solutions for its clients across North America. Leveraging over 115 years of history, experience and expertise from the Maritz family of companies, Maritz Loyalty Marketing provides its clients with consumer loyalty solutions that consider the holistic consumer experience – at every brand touch point and through all stages of their lifecycle with a brand. For more information, visit www.maritzloyaltymarketing.com or contact Rob Daniel, VP Research & Loyalty, robdaniel@maritz.com or (905) 696-5326.

In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG FEATURES IMAGE USED BY PERMISSION,® 2012 THE LEGO
In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG FEATURES IMAGE USED BY PERMISSION,® 2012 THE LEGO

In this Issue ...

FOURTH QUARTER 2012

VOLUME 4 NUMBER 4

WWW.LOYALTY360.ORG

FEATURES

In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG FEATURES IMAGE USED BY PERMISSION,® 2012 THE LEGO

IMAGE USED BY PERMISSION,® 2012 THE LEGO GROUP

20

In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG FEATURES IMAGE USED BY PERMISSION,® 2012 THE LEGO
In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG FEATURES IMAGE USED BY PERMISSION,® 2012 THE LEGO
  • 24 26

LEGO: Building Customer Loyalty One Brick at a Time

Bernard Chung—

SAP

jcp cares:

Customer Loyalty through Cause Marketing

Heather Reid—

Pointsmith

Beyond Loyalty:

Why We Need to Get Smarter about Customer Engagement

Hunter Albright—

Beyond Analysis

28 32 Is Your Business Loyalty or is Loyalty Part of Your Business? Leveraging Facebook— Play.com’s
28 32 Is Your Business Loyalty or is Loyalty Part of Your Business? Leveraging Facebook— Play.com’s

28

32

Is Your Business Loyalty or is Loyalty Part of Your Business?

Leveraging Facebook— Play.com’s Social Success

Rob Morgan—

Interview with

CAC Group

Adam Stewart—

Play.com

LOYALTY FORUM: IN EVERY ISSUE

 

Letter from the Editor

 

6

Loyalty 360 on the Web

 

7

Your Voice

 

10

Behind the Brand

 

13

 

Kerry Hurff, Safelite AutoGlass

 

360 Insights: The New Marketing Paradigm

 

16

Mark Johnson, Loyalty 360

 

18

Q & A: Ask the Experts Loyalty Innovation

 

34

By the Numbers

 

48

Loyalty Reads

 

60

Behind the Brand

 

62

John

O’Hara, Pitney Bowes Software

 

SEGMENT YOUR AUDIENCE,

OR IT COULD GET UGLY.

SEGMENT YOUR AUDIENCE, OR IT COULD GET UGLY. a Segerdahl company Your customers aren’t one person.
SEGMENT YOUR AUDIENCE, OR IT COULD GET UGLY. a Segerdahl company Your customers aren’t one person.

a Segerdahl company

Your customers aren’t one person. They are many. And your direct marketing should treat them that way.

Find out what each demographic and psychographic group wants

to see, hear and buy.

And in turn, what your communications need

to say, show and offer.

BRANDIRECTions EMPIRICALdata

Find an Empirical Direct Marketing Solution for your business. Connect with:

Paul White, Executive Vice President, 847.419.3311

Bob Radzis, Chief Customer Officer, 847.506.8191

1351 South Wheeling Road, Wheeling, Illinois 60090

main 847.541.1080

www.sg360.com

EMPIRICAL

DIRECT

MARKETING

SOLUTIONS

In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG TECHNOLOGY, TRENDS & REWARDS 36 Minimizing Effort to
In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG TECHNOLOGY, TRENDS & REWARDS 36 Minimizing Effort to

In this Issue ...

FOURTH QUARTER 2012

VOLUME 4 NUMBER 4

WWW.LOYALTY360.ORG

TECHNOLOGY, TRENDS & REWARDS

  • 36 Minimizing Effort to Maximize Loyalty

Kana & Loyalty 360

  • 38 Shop Talk—What Motivates Shoppers Over 40 Years?

Joe Cecere, Little & Company

  • 40 Three Critical Decisions Marketers Must Make Bob Fetter, Affect Results

  • 42 The Frequent Diner Club Evolves Loyalty 360

  • 43 Taking the Leap from Plastic to Mobile Doug Dwyre, Mocapay

  • 44 Time to Get More Personal with your Audience Tariq Charara, Covario

BEST BUSINESS PRACTICES

  • 50 VoC: Drive Customer Satisfaction & Loyalty

Andrew McInnes, Allegiance, Inc.

  • 52 Is Your Loyalty Program Supporting Your Loyalty Strategy?

Judy Melanson, Chadwick Martin Bailey

  • 54 Listening to Create a Great Customer Experience

Interview with Milista Anderson, SunGard

  • 56 HON Rethinks Engagement to Create Loyalty For Life

Mike Spellecy, Maritz

  • 58 5 Ways to Tackle Big Data & Maintain Brand Loyalty

Paul Kent, SAS

In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG TECHNOLOGY, TRENDS & REWARDS 36 Minimizing Effort to
In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG TECHNOLOGY, TRENDS & REWARDS 36 Minimizing Effort to
In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG TECHNOLOGY, TRENDS & REWARDS 36 Minimizing Effort to
In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG TECHNOLOGY, TRENDS & REWARDS 36 Minimizing Effort to
In this Issue ... FOURTH QUARTER 2012 WWW.LOYALTY360.ORG TECHNOLOGY, TRENDS & REWARDS 36 Minimizing Effort to

Loyalty Management Editorial & Production Team Erin Raese - Editor in Chief Mark Johnson - Contributing Editor Caitlin Schar - Editorial Director Liz Johnson - Senior Graphic Designer Crescent Printing Company - Print Production

Loyalty 360 Team Mark Johnson - President & CEO Erin Raese - COO Caitlin Schar - VP Marketing Jillian Hensley - Manager, Marketing & Web Development Liz Johnson - Senior Graphic Designer

Contacts

Article Submissions & Advertising: Erin Raese

erinraese@loyalty360.org or 513.800.0360, ext. 210 To subscribe to Loyalty Management, visit loyaltymanagement.com.

© 2012 Loyalty 360, Inc. and/or its Affiliates. All Rights Reserved. Reproduction and distribution of this publication in any form without prior written permission is forbid- den. The information contained herein has been obtained from sources believed to be reliable. Loyalty 360 disclaims all warranties as to the accuracy, completeness or adequacy of such information. The opinions shared are those of the contributing authors and not necessarily reflective of Loyalty 360 and/ or its affiliates. Loyalty 360 shall have no liability for errors, omissions or inadequacies in the infor- mation contained herein or for interpretations thereof. The opinions expressed herein are subject to change without notice.

Recap

Recap Pg 66 ... ENGAGEMENT & EXPERIENCE EXPO
Recap Pg 66 ... ENGAGEMENT & EXPERIENCE EXPO
Pg 66 ...
Pg 66
...
Recap Pg 66 ... ENGAGEMENT & EXPERIENCE EXPO

ENGAGEMENT & EXPERIENCE EXPO

Recap Pg 66 ... ENGAGEMENT & EXPERIENCE EXPO

Loyalty Management™ • FOURTH QUARTER 2012

5

FROM THE EDITOR

 
FROM THE EDITOR WELCOME NEW LOYALTY 360 MEMBERS! Aimia Europe Direct Energy FIS Global Heartland Payment
WELCOME NEW LOYALTY 360 MEMBERS! Aimia Europe Direct Energy FIS Global Heartland Payment Systems ITA Group

WELCOME NEW LOYALTY 360 MEMBERS!

Aimia Europe Direct Energy FIS Global Heartland Payment Systems ITA Group KANA Software Ketchup Agency LOC Enterprises Microsoft ORC International The Relational Capital Group RewardsPay Ontario Lottery and Gaming

Reflect Before Leaping Forward

Loyalty 360 has just marked the 4th anniversary of our first Loyalty Expo— November 2008. At the time we didn’t know it, but organizations would be hit, in the months (and years) since, with a great deal of uncertainty. 4 years ago choices needed to be made. We were amidst a recession with a bleak outlook. It forced our organizations to change focus. Where we’d been hunting for new, we quickly became all too aware that we could lose what we already had. It was a tough time between record job loss and the real estate crash, consumers

were forced to become frugal; forced to chase a deal. Four years ago, brand loyalty dropped to an all-time low. Traditional advertising, always churning new

customers was no longer the answer to revenue gains.

Sure some organizations

found a niche and became household names—Groupon, Living Social. But the rest

saw attrition percentages increase in double digits. Noticing this trend, surprised organizations realized that to sustain their foothold in the marketplace, the first

thing they had to do was keep their existing customers.

Sure many have loyalty

programs. However, possibly for the first time, organizations began to understand

the real potential of keeping their existing customers spending and spending more. Four= years ago, we scrambled to sustain what we had.

Now, having found our greatest asset, we’re committed to being loyal to our customers! Organizations are scrambling to collect, digest, assimilate and effectively use information. In 2013 and the years that follow, successful companies will be those who perfect customer expectation matching—providing your customer, your right customer, with their perfect experience. This issue of Loyalty

Management shares with you those trends.

In this issue, learn how Play.com

successfully leveraged Facebook to drive online sales from 84% of its FB users.

Learn how jcpenney drives customer engagement through corporate social responsibility opportunities. Learn how to minimize customer effort—it will increase customer loyalty and profitability—in a new paper from Loyalty 360 and Kana.

Also within this issue, each author has shared trends they’re seeing and predictions of how they’ll affect our future. For further trending insights visit Loyalty Management online, Executive Insights: Top Trends for 2013. While you’re there, share your predictions for 2013 in our comments feed!

Last, a quick reminder: register for the 2013 Loyalty Expo by December 31, 2012 to receive early bird rates. The 6th annual Loyalty Expo is March 20 – 22, at the Renaissance Sea World in Orlando, Florida.

Enjoy the issue!

Reflect Before Leaping Forward Loyalty 360 has just marked the 4th anniversary of our first Loyalty

Erin Raese

Editor-in-Chief

Loyalty Management

erinraese@loyalty360.org

LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on
LOYALTY 360 ON THE WEB
What’s
VISIT LOYALTY360.ORG
FOR EXCLUSIVE CONTENT &
INTERACTIVE MEMBER FEATURES
on
LOYALTY 360
LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on
LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on

NEW ADDITIONS TO THE HOMEPAGE

As we continue to fill our Resources library with the latest research, news and thought leadership insights in the marketplace today, Loyatly360.org has become the daily destination for your information needs. We have redesigned the homepage to make it easier for you to find the content you want.

:: Easily access and review the day’s TOP NEWS STORIES :: Stay on top of the articles and topics that are TRENDING NOW :: Dive into current RESEARCH, white papers and case studies :: Discover new insights in the EDITORS’ PICKS :: See the latest user COMMENTS and join the discussion :: View new VIDEO content and interviews :: Follow the latest TWITTER updates

LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on
LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on
LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on

ANNOUNCING THE FEATURED COLUMNIST SERIES!

LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on

Executives guiding the latest innovations and advancements in the industry today will be sharing their insights through regular features in this new space! From Experience, Engagement and Loyalty to Mobile, Social, VoC and more, we invite you to follow your favorite thought leaders and topics as each contributor will have a unique perspective & area of expertise to share.

IN ADDITION TO THESE EXCITING NEW ADDITIONS YOU’LL ALSO FIND THE SAME GREAT FEATURES YOU RELY ON FROM LOYALTY 360:

:: Loyalty Management Online – Now featuring MONTHLY issues :: Loyalty Today Blog Aggregator :: Weekly Pulse! Polls :: Webinars & Conferences Calendar :: Find a Partner :: Job Board & Resume Bank

LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on

...

And

more!

LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on
LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on
LOYALTY 360 ON THE WEB What’s VISIT LOYALTY360.ORG FOR EXCLUSIVE CONTENT & INTERACTIVE MEMBER FEATURES on
LOYALTY 360 ON THE WEB TRENDING ON LOYALTY360.ORG & LOYALTY MANAGEMENT ONLINE LOYALTY 360 RESOURCES THE

LOYALTY 360 ON THE WEB

 
TRENDING
TRENDING
LOYALTY 360 ON THE WEB TRENDING ON LOYALTY360.ORG & LOYALTY MANAGEMENT ONLINE LOYALTY 360 RESOURCES THE
LOYALTY 360 ON THE WEB TRENDING ON LOYALTY360.ORG & LOYALTY MANAGEMENT ONLINE LOYALTY 360 RESOURCES THE

ON LOYALTY360.ORG & LOYALTY MANAGEMENT ONLINE

LOYALTY 360 RESOURCES

LOYALTY 360 ON THE WEB TRENDING ON LOYALTY360.ORG & LOYALTY MANAGEMENT ONLINE LOYALTY 360 RESOURCES THE

THE RETURN OF DIALOGUE WITH CUSTOMERS

In addition to two-way real-time communication, social networks and mobile applications are generating tremendous data on customer behavior, interests and dialogue. Innovative marketing leaders are using these tools and data to deepen their relationships with customers, rather than just target, measure and manage marketing campaigns.

Building Brand Loyalty in the Digital Age, by The Relational Capital Group

ENTERPRISE FEEDBACK MANAGEMENT (EFM)

LOYALTY 360 ON THE WEB TRENDING ON LOYALTY360.ORG & LOYALTY MANAGEMENT ONLINE LOYALTY 360 RESOURCES THE
LOYALTY 360 ON THE WEB TRENDING ON LOYALTY360.ORG & LOYALTY MANAGEMENT ONLINE LOYALTY 360 RESOURCES THE

Organizations with fiercely loyal customers, employees and business partners take the time to listen to feedback and integrate it into decision making at every level of the business. They have a process for continually listening, analyzing, and acting on feedback in order to increase customer satisfaction and loyalty, improve employee productivity, and increase bottom-line profitability.

15-Minute Guide to Increasing Customer Loyalty, by CustomerSat

DATA MANAGEMENT

When asked if companies could identify their top customers, 86% of respondents with loyalty

programs and 80% without loyalty programs both said they could. What was surprising was that out of the companies that answered yes, 10% and 16% respectively said they did not have access to the internal data to identify their top customer. Two conclusions can be drawn from this:

  • 1. While top customers are identified, some companies know they could do better with more data

  • 2. Most think they can identify their top customers without enough data to substantiate the claim

Data Management: The DNA to Loyalty Program Success by Altair Customer Intelligence & Loyalty 360

LOYALTY MANAGEMENT ONLINE

MOBILE CHANNEL

98%

of people today

have a cell phone.

55%

have a smartphone.

Companies need to leverage that opportunity. One of the pitfalls that companies fall into is not understanding the mobile channel. It’s a powerful device. It lets [the consumer] live in a world without barriers.

October: Three Pitfalls to Avoid When Building Customer Loyalty—Mike Romano, senior vice president of mobile sales and client services at SoundBite Communications

EMPLOYEE ENGAGEMENT

It is widely proven that employee engagement is directly linked to the profitability and sustainability of a business. Why is it, then, that—according to the Gallup Organization (which has done extensive research on the subject)—only 11 percent of all employees worldwide are engaged in their work? Shouldn’t engagement be a higher priority for business leaders?

December: 8 Critical Elements To Take Your Organization From Engaged To Entangled by Dr. Ray Benedetto and Molly Meyer

NEW RESEARCH

THE LOYALTY DIVIDE:

Better Connections, Better Results

—Loyalty 360 & Acxiom

A new report based on a joint survey of 110 respondents, plus qualitative interviews conducted by Loyalty 360 and Acxiom, reveals that marketers struggle to connect the customer data that would help them understand their most valuable audiences and create the relevant, consistent, personalized experiences that would engender loyalty between customers and brands.

Real loyalty is something that consumers provide a brand based on trust and is not merely a program created by the brand. Successful “loyalty marketing” occurs when the brand provides consistent, authentic engagement that is an extension of the brand itself. Brands that connect consumer data to create personal and integrated experiences nurture loyalty and consumer preference to the brand which in turn creates more value than merely capturing customer data.

THE “LOYALTY DIVIDE” HAS 3 CAUSES:

S uccessful “loyalty marketing”

occurs when the brand provides consistent, authentic engagement that is an extension of the brand itself.

1:: Poor use of connections in CRM systems 2:: Improper use of Net Promoter Scores (NPS) 3:: Insufficient application of social signals that should serve to build a deeper understanding of valuable audiences.

Marketers miss the big picture of accessing and utilizing all customer-touch points to build brand intimacy across the enterprise. Poor input yields poor customer insight output. For example, 26% of marketers emphasize the costs of customer service when calculating Customer Lifetime Value, (CLV). Only 21% highly consider NPS, a loyalty metric that can predict advocates that if combined with other measures, can hone a brand’s precision about CLV and which customers are likely to recommend them.

RELIANCE ON DISCOUNTS ERODES BRAND VALUE

Marketers underestimate the impact of the indiscriminate use of discounts as a promotional tool to achieve short term results. While discounting is a popular, highly commoditized tactic that may keep consumers on the program, it doesn’t generate loyalty or long term value. “Offering loyalty” through the use of discounts trains consumers to promiscuously shop based on price, easily dumping one brand for a cheaper alternative, eroding margins and destroying brand value.

Contrast this to when brands create deep understanding of their most valuable audiences through the judicious collection and use of customer data, they prepare to reap rewards of better long term profit, improved margins, and can better defend their pricing.

CONNECT CUSTOMER DATA TO CUSTOMER EXPERIENCES

Interviews with brands including HON Office Furniture, The Container Store and others revealed the success of their loyalty programs stems from an enterprise-wide focus and commitment toward connecting customer data to drive engagement and retention, not just customer acquisition. By investing in understanding customer needs and delivering engaging experiences to different audience segments, these brands reap the benefits of delighted audiences, loyal advocates and increased profit.

There are many data points that are not generally part of loyalty

programs.

Marketers who judge a program’s success solely

based on RFM miss a very powerful signal about customers— the ability of a buyer to influence others. If understanding valuable customers matters, then blending RFM with NPS is a great way to measure them. For example, is a customer is assessed a “medium value” RFM score but has a high NPS, then the combination halo effect may elevate them as a “high value” customer who deserves special attention.

paper, THE LOYALTY DIVIDE: BETTER CONNECTIONS, BET TER RESULTS AT:

**For optimal user experience be sure your scanner app is current.

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loyalty360.org/resources/research/

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paper, THE LOYALTY DIVIDE: BETTER CONNECTIONS, BET TER RESULTS AT: **For optimal user experience be sure
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NEW RESEARCH THE LOYALTY DIVIDE: Better Connections, Better Results —Loyalty 360 & Acxiom A new report

LOYALTY FORUM: YOUR VOICE

 

WHAT DO YOU PREDICT WILL BE THE LEADING TRENDS OF

LOYALTY FORUM: YOUR VOICE WHAT DO YOU PREDICT WILL BE THE LEADING TRENDS OF A t
LOYALTY FORUM: YOUR VOICE WHAT DO YOU PREDICT WILL BE THE LEADING TRENDS OF A t
LOYALTY FORUM: YOUR VOICE WHAT DO YOU PREDICT WILL BE THE LEADING TRENDS OF A t
LOYALTY FORUM: YOUR VOICE WHAT DO YOU PREDICT WILL BE THE LEADING TRENDS OF A t

A t the beginning of 2012, we landed on three

words that would demand our attention and

guide our work in loyalty marketing during

the year. The words were Data, Social, Mobile.

Each has significance, though for reasons you might not expect. As we enter Q4 of 2012, we realize that another word could be added to the list: Human.

Sometimes we forget that our customers are “human beings”. They are complex, yet able to be moved to action by tapping into unique sets of characteristics defined through the study of behavioral psychology.

Imagine the changes to your loyalty program if you are able to effect desired changes in customer behavior through intrinsic motivation rather than the standard extrinsic rewards that we have used for two decades. The impact on customer experience, not to mention bottom line, would be significant.

Mobility will continue to transform the way companies communicate with their customers, as well as transform customer expectations on how (and when) they want to be communicated with. Channel transparency will be key. Technology will allow the integration of ‘geo- location based services’, which will create tremendous new opportunities to delight customers with real-time, relevant offers —if done correctly.

BILL HANIFIN,

Managing Director, Hanifin Loyalty / Consulting Practice Leader, Aimia

—Brandon Sailors, Director of Business Solutions, CSG International

Loyalty 360 Pulse: What will be the top trend in customer experience, engagement & loyalty for 2013?

18% 2% 3% 5% 6% 14% 34%
18%
2% 3%
5%
6%
14%
34%

18%

  • Mobile Payments (34%)

  • SMS – Mobile Marketing (14%)

  • Discounting / Coupons (6%)

  • Card-Linked Offers (5%)

  • Big Data Analytics (18%)

  • Gamification (2%)

  • Check-In / Status Rewards     (ie. FourSquare &  Shopkick) (3%)

  • Social Media Reward Platforms (18%)

FPO KANA
FPO
KANA
  • L oyalty marketers must have a razor sharp focus on program differentiation, delivering a comprehensive and engaging customer experience, and operational excellence. The

convergence of CRM, Loyalty, CEM—and the utility of the resulting data—is foundational for programs to be relevant. From this data, we have the opportunity to create our greatest brand advocates, but only when programs permeate every channel in the customer lifecycle.

Mobile technology and the ways in which mobile, digital and social media outlets work together in a seamless, fully integrated and “omnichannel” way is still nascent, but growing, opportunity for marketers. Think of this approach as a natural outgrowth of existing technology and the always-on demands of tech-savvy mobile users. Mobile commerce is forecast to reach $18 billion in revenue in the US by 2014 and $119 billion worldwide. Smartphones and tablets have crossed critical adoption rates in many Western countries and will continue mobile dominance across the globe. With smartphone adoption rates now hovering around 50 percent in the US and other developed nations, and with tablets not far behind, smart brands are beginning to tailor their loyalty campaigns accordingly, so much so that the term SoLoMo—social, local, mobile—has become part of our marketing lexicon.

According to Forrester Research, the perceived value of many loyalty programs gets weaker by the year. In 2011, 21% of survey respondents agreed with the statement that “Most loyalty programs don’t offer any real value,” up from 15% in 2008. This underscores the increasing importance for loyalty marketers to leverage the wealth of data from every channel their customers engage to create meaningful and relevant customer experiences.

MICHAEL HEMSEY, President, Kobie Marketing

2013 will be the year of the “gift”

for retail marketers. Coupons

and deals have historically

dominated the way marketers attempted to attract customers. But with a 0.1% to 1% redemption rate, the coupon and deal model is clearly broken and the impact and ROI that marketers hope to secure is not there. With a redemption rate of more than 60%, gift incentives are proven to drive customers into stores, resulting in profitable, incremental spend. More marketers are making the shift to gift marketing and we predict that 2013 will be the year when gifts explode onto the scene.

GADI MAIER, CEO, FreeMonee Network

from #innovation 2013 trends: @Loyalty360 TWEET BEYOND ANALYSIS @HunterAlbright data driven engagement; data collection & organization;
from
#innovation
2013 trends:
@Loyalty360
TWEET
BEYOND ANALYSIS
@HunterAlbright
data driven engagement;
data collection
& organization;
commercial focus
FPO KANA L oyalty marketers must have a razor sharp focus on program differentiation, delivering a

W hile mobile has been a driving force in loyalty for a few years now, I believe that 2013 is going to be *the* year of mobile

loyalty. Apple, via the Passport app introduced in the iPhone 5/iOS 6, has forced the hand of the loyalty marketers who were ‘on the fence’ in regards to mobile. Consumers are going to expect the ability to access not only their affinity program cards, but also program information and

benefits, in the palm of their hand. Brands that aren’t in the forefront of their industry in regards to mobile presence will likely start losing market share to more mobile-savvy competitors.

LINDA DICKERHOOF SPERLING,

Director of Marketing Communications, VIPdesk

ANALYTICS Uncover the pro t potential in every customer. SAS Customer Intelligence solutions help you nd

ANALYTICS

Uncover the pro t potential in every customer.

SAS ® Customer Intelligence solutions help you nd the most pro table growth opportunities and drive the best marketing actions to achieve optimal cross-business impact. Decide with con dence.

Scan the QR code* with your mobile device to see a video or visit sas.com/potential to
Scan the QR code* with your mobile device to see a video
or visit sas.com/potential to learn more.

*Requires reader app to be installed on your mobile device

ANALYTICS Uncover the pro t potential in every customer. SAS Customer Intelligence solutions help you nd

SAS and all other SAS Institute Inc. product or service names are registered trademarks or trademarks of SAS Institute Inc. in the USA and other countries. ® indicates USA registration. Other brand and product names are trademarks of their respective companies. © 2011 SAS Institute Inc. All rights reserved. S83316US.1111

 

LOYALTY FORUM: BEHIND THE BRAND

LOYALTY FORUM: BEHIND THE BRAND K E R R Y — Safelite AutoGlass® H U R

K E R R Y

— Safelite AutoGlass®

H U R F F

A s marketing director for Safelite AutoGlass®, Kerry Hurff is responsible for consumer insights, business-to-business marketing and leading the creative team. Prior to joining Safelite AutoGlass, Hurff served as director of marketing—

scientific products for Cardinal Health. In his nearly 30-year career,

he has managed consumer packaged goods marketing and brand

development for companies such as Novartis, Abbott Labs, Borden, Inc., H.J. Heinz Company and Quaker Oats. In the interview below Hurff shares personal perspectives on marketing, and provides an inside look at the leadership Behind the Brand at Safelite AutoGlass today.

WHAT ARE THE KEY AREAS OF FOCUS FOR SAFELITE AUTOGLASS® AS YOU PLAN FOR 2013?

A key area of focus in 2013 is breaking out from being a good

company to a great company. This involves improving everything that we do from optimizing our advertising message, providing extraordinary customer service, and delivering a customer experi- ence so compelling that our customers tell their friends and family. We have a number of really exciting initiatives in 2013 that will help us realize our vision of being the natural choice in vehicle glass repair and replacement.

We also consistently try to go from “belief to knowledge.” As an old mentor once told me, “the facts are your friends.” We are always learning what would truly delight the customer throughout the service process, and our research includes how to best market those differen- tiators to consumers. These insights will shape our marketing in 2013.

IS YOUR EXISTING CUSTOMER STRATEGY FOCUSED MORE HEAVILY ON ACQUISITION OR RETENTION?

Both. Because auto glass repair and replacements is a low-frequency need for most consumers (once every seven years on average), our strategy focuses heavily on generating top-of-mind awareness, that generates choice for Safelite, and then a great service experience that leads to referrals. We are also using customer relationship management tools and deploying new initiatives so that the next time a consumer has glass damage, they call us again.

WHY IS THIS THE MOST VALUABLE APPROACH AT THIS TIME?

The dual approach is valuable because we are in a low awareness, low involvement category, akin to dentists and exterminators… you really do not want to buy a new windshield. We find that people very much appreciate our service, but quickly forget about it. We need to remind them via acquisition strategies, and maintain top of mind

awareness through relationship strategies. Shoppers also visit sites like Yelp and Angie’s List to see what others have to say about service providers before making purchase decisions. Therefore, we focus very hard on making sure there are plenty of testimonials online.

DO YOU SEE THIS FOCUS CHANGING WITHIN THE NEXT COUPLE YEARS?

No—in fact, as the population ages and buyers are more prone

to voice opinions online, this strategy will only be more important.

WHAT IS ON YOUR “WISH LIST” FOR TACTICS, TOOLS OR TECHNOLOGIES YOU WOULD LIKE TO SEE INCORPORATED INTO YOUR CUSTOMER RELATIONSHIP STRATEGY?

When a consumer comes to an auto glass shop, let’s face it, they’ve had a bad day – they have damage to their car. They expect it to be fixed right and they expect the service to be quick. Those are the givens. We’ve made large investments to make sure we’re able to deliver on those two things. Now, we’re focused on making it more of a “wow” experience that can create brand advocates in a product category that’s what we consider “low engagement.”

YOU’VE WORKED WITH MANY TOP BRANDS IN THE INDUSTRY TODAY, WHAT WOULD YOU SAY IS THE BIGGEST CHALLENGE THAT MARKETERS FACE IN CREATING ENGAGEMENT AND ESTABLISHING LOYALTY WITH THEIR CUSTOMERS? HOW DO YOU ADDRESS THIS CHALLENGE WITH SAFELITE AUTOGLASS?

A big challenge is customers do not have a lot of time to engage. Customers are so busy and distracted with the increasing pressures in their lives. We address this challenge by trying to make it easy to do business with us. We offer multiple ways to contact us, try very hard to arrange a convenient time to conduct the service (we can come to your location most of the time), and try to create an experi- ence that is extraordinary.

continued on next page » Loyalty Management™ • FOURTH QUARTER 2012

13

Behind the Brand—Kerry Hurff, Safelite AutoGlass (continued)

WHAT DO YOU BELIEVE IS KEY IN CREATING THE ULTIMATE CUSTOMER EXPERIENCE?

The key to creating the ultimate customer experience comes down to the employees who deliver the service—from the CSR that takes the phone call to the technician that completes the repair or replacement. That’s why Safelite introduced a talent develop- ment program several years ago. We have an obsessive focus on having great people and providing them the resources to excel. We believe this is what will give us the com- petitive advantage and win over customers.

WHAT WAS YOUR LAST “AH-HA” CUSTOMER EXPERIENCE?

was the guest speaker at Safelite’s national

meeting. He talked to us about leadership, and it was very inspiring to all of us at the company. While he had a great impact on our people, we were also pleased to learn that we had an impact on him and included us in his latest book, It Worked for Me: In Life and Leadership.

“I take calculated risks. As a marketer, I’m

The newspaper…it was a real negative ah- ha. I’ve ordered the same paper for more than 20 years, and in a one week period, they did not deliver twice. I called their customer service line, and after being on hold for 15 minutes, was told I called too late to deliver the paper….seriously? At Safelite, we would have personally deliv- ered the paper that same day, and had our executive services team call and try and make good on the error.

WHAT IS YOUR PERSONAL MOTTO?

Nothing worthwhile is ever easy.

WHO WOULD PLAY YOU IN THE FILM OF YOUR LIFE?

Steve Carrell—he strikes me on the surface as an average kind of guy, but with an under- lying purpose and energy to get things done.

WHO IS THE MOST FAMOUS PERSON YOU HAVE EVER MET?

Several years ago, Former Secretary of State and National Security Adviser Colin Powell

always asking, ‘what if…’ and trying to think outside of the box. ”

WHAT FAMOUS PERSON WOULD YOU MOST LIKE TO MEET? WHY?

Abraham Lincoln—a self-made man. He was a wise and true leader, with no ego, who was truly successful in what he set out to do.

WHAT BOOK(S) ARE YOU CURRENTLY RECOMMENDING?

Brand Advocates: Turning Enthusiastic Custom- ers into a Powerful Marketing Force, by Rob Fuggetta, founder and CEO of Zuberance, a leading brand advocacy company that works with Safelite. The book shows marketers and business leaders how to identify brand advo- cates; energize them to spread positive word

“T he key

to creating

the ultimate customer experience comes down to the employees who deliver the service”

of mouth and drive sales; and track results from advocacy programs.

ARE YOU A RULE BREAKER OR A RULE KEEPER? WHY?

I’d say I’m somewhere in the middle – I take

calculated risks. As a marketer, I’m always asking, “what if…” and trying to think out- side of the box. However, we always test these new ideas before putting them into

play.

IF YOU COULD INVITE 4 PEOPLE TO DIN - NER (PAST OR PRESENT) WHO WOULD THEY BE AND WHY?

Abraham Lincoln—for the reasons I cited above.

Winston Churchill—another leader, with a lot of flaws that he overcame, who led England successfully through World War 2.

Mao Zedong—even though vulgar, Mao also overcame great odds, and also pushed continu- ous revolution, constantly changing his country to achieve his vision.

The Apostle Paul—a man who was going plac- es. He gave up everything for what he believed in, and suffered immensely for it.

WHO OR WHAT INSPIRES YOU?

A leader with vision

WHO (OR WHAT) HAS HAD THE GREATEST INFLUENCE ON YOUR CAREER?

Rob Crim, Global General Manager at Danone. He was the author of the “facts are your friends.”

DEFINING LIFE MOMENT?

When I met my future wife, and the first time

I kissed her.

DO YOU (OR WOULD YOU) LIKE TO VOLUN - TEER? WHAT ORGANIZATIONS OR CAUSES ARE YOU MOST PASSIONATE ABOUT?

Yes. I am active in my congregation and I

have served on the board of trustees for the Godman Guild, a settlement house in Columbus, Ohio.

KERRY, WHAT ARE YOUR INDUSTRY PRE - DICTIONS FOR TOP TRENDS IN 2013?

• Social media becomes Social business

• A really good “big data” solution is finally

found

• Companies continue to leverage mobile,

and find new solutions to vexing problems

• Tweeters become rock stars • Service becomes the new differentiator • The Cubs win the World Series!

L
L
Behind the Brand—Kerry Hurff, Safelite AutoGlass (continued) WHAT DO YOU BELIEVE IS KEY IN CREATING THE

QUICK-FIRE QUESTIONS FOR KERRY*

What is your favorite word?

What is your least favorite word?

What turns you on creatively, spiritually, or emotionally?

What turns you off?

What is your favorite (PG-13) curse word?

What sound or noise do you love?

What sound or noise do you hate?

What profession other than your own would you like to attempt?

What profession would you not like to do?

If Heaven exists, what would you like to hear God say when you arrive at the Pearly Gates?

Opportunity

No

See The Opportunity In Everything Think Why You Can , Instead Of Why Not

Negativity—I Hate To Hear Why Not.

SHOOT!

The Soothing Sound Of Flowing Water

The Siren Of The Police Car

I’d Love To Teach American History, & Coach The Women’s Jv Softball Team

Nuclear Engineer

“Well Done, Good & Faithful Servant”

*Inspired by James Lipton on “Inside the Actors Studio” we asked Kerry to share his quick-fire response to the questions originating from the French series, “Bouillon de Culture” hosted by Bernard Pivot.

Never say goodbye.

Pharmaca increased cross-shopping by 50% Virgin America's frequent yers spend 25% more than non-members U.S. Cellular enrolled over 1/3 of its members in under a year Find out how at www.loyaltylab.com

QUICK-FIRE QUESTIONS FOR KERRY* What is your favorite word? What is your least favorite word? What

continued on next page »

LOYALTY FORUM: 360 INSIGHTS

 

The New

MARKETING PARADIGM

LOYALTY FORUM: 360 INSIGHTS The New MARKETING PARADIGM MARK JOHNSON —Loyalty 360 P lanning for 2013,

MARK

JOHNSON

—Loyalty 360

P lanning for 2013, we reflect on the gains, oppor-

tunities and challenges overcome during the

course of this year. Looking back on the antici-

pated trends for 2012, I noticed that a number of them came into fruition while some of them are still looking for the internal corporate advocacy, technol- ogy adoption and process understanding needed to put them front and center in the hearts and minds of brands (CMOs and more importantly CFOs) and consumers alike. As with most projections and prog- nostications, it requires a creative and open mind, as it is usually more of a wish-list of what you want to see for the respective industry with little reverence for plausibility or feasibility. When you start to put forth myriad options it is difficult for all of them to come into fruition with any certainty. That said, I lay out my predictions for the top trends of 2013.

BIG DATA

We all are cognizant of the data rush that exists today. This crush of data will continue unabated in 2013. The challenge to create action- able insight will be brought to the forefront even more than in the past. Marketers may find that increasingly disparate internal data (structured and unstructured), in addition to a growing number of progressively more obtuse external data sets, will be more challeng- ing to identify properly, cleanse, warehouse and model. Brands need not be myopic (GIGO – garbage in / garbage out) in regard to the assortment of models (custom and canned) that will be needed. There will also be an increased need to have data processed in a “more than real time” manner. This places a great strain on already taxed marketing departments, IT staffs, technology infrastructures and communication protocols, as well as the numerous consultants that represent all of these revolutionary technologies.

In 2012 we saw a renewed focus on customer retention. The idea of loyalty continues to expand from a banal, archaic point-based approach to a realization that engaged and loyal advocates (not mass-acquired customers that you hope will move through your funnel) are becoming increasingly top of mind for today’s marketers. In order to be successful, loyalty programs, and more importantly loyalty processes, are heavily dependent on data. In the developing omni-channel environment, the ability to have insights into the manners in which a consumer touches your brand across the varied and growing channels, media and storefronts is still quite arcane to most marketers, and access to this data (usually in disparate siloed databases) is precipitously problematic.

The ability to get the consumer to raise their hand across these disparate touch points each time they engage, as well as to grant permission to track them, continues to be a challenge. Consumers frequently opt out of these messages and have come to be leery of how personal information is being used. Consumers need to be made aware of the transformational value that can be achieved for both them and the brand in this mutually beneficial information exchange. In 2013, brands that offer greater transparency, provide an easily understood data exchange process, and are able to clearly demonstrate brand value, will achieve the new marketing paradigm.

INVESTMENT IN NEW TECHNOLOGIES

Mentioned on numerous occasions, it is the most opportune time to be marketer, as well as the most challenging. There is more transfor- mational technology and access to data than ever before, yet budgets remain tight, and scrutinized more ardently than ever. As much as incremental investment in new technologies is paramount to success, the ability to use data and emerging technologies in a coordinated manner is going to be increasingly important. This is problematic for some of these new media technologies that require significantly greater resources (time, technology and human capi- tal), a leap of faith in process (we are going to listen to our custom- ers?), and a reexamination of traditional mass marketing processes. Forward-thinking CMOs have come to realize that the incremental mass-communicated messages of the past can have deleterious effects. Consumers who are not engaged properly are tuning out and opting out. The clarion call in the new marketing paradigm is for direct and reciprocal communication between brand and advocate. A focus on the ability to impact behaviors of both the brand and the consumer, in a proactive manner, is the true vision of loyalty. In concept it is quite simple and in practice it is quite difficult.

Loyalty 360 finds itself in a unique position. We see amazing emerging technology enhancements on a daily basis. We also get to hear, understand and attempt to assuage the concerns that brands have in the market; helping them transform challenges into opportunities. All brands are looking for a unique elixir of marketing savvy, technological prowess and operational efficiency that enable them to communicate more directly with their customer and influence consumer behavior, affinity and loyalty for their prod- uct, service or offering. And, in today’s economic environment, this should also come with a return on investment that not only will be better than other options, but one that will placate the CFOs in us all.

SIMPLICITY & EXECUTION

I would argue the biggest opportunities for 2013 are in simplicity and execution, a getting back to basics (blocking and tackling) on the operational and executional side of the house. It is unreasonable to expect brands to execute on ten new technology platforms in one year. The customer experiences that brands put forth need to be understood, controlled, and executed upon in intricate detail. The ability to understand the experience, interactions and supporting technologies in place to increase the “view of the customer” is going to be a strategic imperative. The need to get the operational data stores and other areas that have customer touch points under the control of one domain is needed. So, the oppor- tunity to return to an executional simplicity should be prioritized. Brands need to have measurable benchmarks in place that give them a defined marker as to which to build upon. Brands that continue to focus on the incremental gains that can be made with engaging technologies,

implemented precisely to improve the customer experiences through numerous touch points, will maxi- mize both the short and long-term value of their customer relationships and most importantly create LOYAL brand advocates.

L
L

Mark is the President & CEO of Loyalty 360. He has significant experience in selling, designing and administering prepaid, loyalty/CRM programs, as well as data-driven marketing communication programs.

“T he ability to impact behaviors of both the brand and the consumer, in a proac-
“T he ability
to impact behaviors
of both the brand
and the consumer, in a proac-
tive manner, is the true vision
of loyalty”
Loyalty 360 finds itself in a unique position. We see amazing emerging technology enhancements on a
Loyalty 360 finds itself in a unique position. We see amazing emerging technology enhancements on a

LOYALTY FORUM: Q&A

 

Q&A

Ask the Experts:

ARE DISCOUNTS & COU PONS THE BEST OPTION?

Q: For the last few years, our focus has been on discounting and coupons. We’re concerned about what this approach does to our brand message as

well as our bottom line so we’d like to explore alternatives as we plan for 2013.

Where do we start? What are our best options for the near term?

A:

Frequent discounting can have adverse effects on your brand equity, unless your brand is to be a dis-

counter. A strong brand should minimize the need for discounting, and actually allow you to command a higher price than your com- petitors. Offering a discount can be an effective strategy to induce first time buyers, but applying the same pricing to existing loyal customers may cheapen the brand at the expense of unnecessary lower margins. Additionally, using discounts and coupons to ac- quire new customers, tends to attract those with less brand affinity and greater price sensitivity – they’re always looking for the next deal. Ask companies who have used Groupon if they are happy with the long-term results. Most will say no.

Some retail categories such as mattresses and certain types of electronics have over-used price discounting to such an extent that consumers never expect to pay full price.

“Offering a discount can be an effective strategy to induce first time buyers, but applying the same pricing to existing loyal customers may cheapen the brand at the expense of unnecessary lower margins.”

All that being said, utilizing discounts and coupons to stimulate behavior has its place, but the key is effectively controlling which customers receive them. This requires segmenting your customer base and understanding current value, potential value, purchase behavior and how they interact with you. Once you have classi- fied customers into specific groups, a variety of tests should be conducted within each group to determine price sensitivity and the effect of the offer to stimulate the desired behavior. Conducting a survey within each customer segment can provide you with insight into brand perception and the potential impact your pricing strat- egy has within each group.

STEVE COLLINS — President of Analytical Solutions, Altair Customer Intelligence
STEVE
COLLINS
— President of Analytical Solutions,
Altair Customer Intelligence

A: Twenty years ago, Procter & Gamble, the inventors of brand management and one of the top coupon users,

published the results of a multi-year study on the effects of dis- counting on brand equity and loyalty. Their key takeaway: coupons erode brand equity and hurt the bottom line. P&G concluded that couponing trained consumers to be disloyal and to follow the dis- count, often straight to the competitor. So the mandate was to stop couponing.

Gift cards are proven to be 10 times more effective at driving incremental customer visits and do not ‘feel’ like a discount in the consumers’ mind.

Fast-forward to today and you will still find P&G coupons in almost every Sunday newspaper. Why? Because when it comes to pro - moting short-term consumer behavior, there are very few effective alternatives. However, the use of gift cards as incentives has been growing. Gift cards are proven to be 10 times more effective at driv- ing incremental customer visits and do not “feel” like a discount in the consumers’ mind. To a consumer, it is like extra cash to spend on full-priced items, and doesn’t erode brand equity. The challenge has been how to get these gifts in the hands of consumers at scale, in a way that makes economic sense for the marketer. If you give a gift of cash, you need to know that the consumer is going to spend enough to create a positive ROI.

Brands today have access to service providers who can offer un- derwriting technology to predict spend enabling them to deliver the right customers, irresistible gift incentives at scale. Now, mar- keters have an effective alternative to the coupon.

JIM TASCHETTA — CMO, FreeMonee
JIM
TASCHETTA
— CMO, FreeMonee

A: You’re right to be concerned. Consumers are savvy, and

many retailers have forgotten that. I once had a boss who liked to say that the words “coupon” and “crack” meant the same thing. But in trying economic times, it’s hard to resist the allure of doing whatever you can to get footsteps through your door, and dis- counts and coupons usually have a great

from you? Clearly she’s a brand fan, so how about suggesting the matching wallet and keyfob? And, wow, we just happen to have

shoes that match your new purse! Let me

show you ...

Did you just sell him a leather couch? Sug- gest coordinating throw pillows, a cozy cashmere blanket, some nice black walnut end tables, groovy lamps, and how about a

You don’t have any data? Get some. You don’t need a full-blown loyalty program. Look at what My Lowes does. It’s genius. You register pertinent things about your home--paint colors you used, product purchase warranties and manuals, po - tential remodel projects--and Lowes now has a ton of data about what matters to you. Self-reported data. It doesn’t get bet- ter than that. Plus, the consumer benefit is that she now has one repository for all that random home info. And I bet that Lowes will even send you reminders on

how to winterize your yard because they know what part of the country you live in or when to change your air filters, which they happen to sell. Ahem. (Go ahead,

Lowes marketing team, make it happen!)

Plus, once you register your home info, Lowes will be able to tell when custom- ers are buying things at competitors. Something shows up in the My Lowes ac- count, but didn’t come through Lowes’ channels? Voila.

Coming off the discount is hard. There will be whining, and sometimes not just from exter- nal customers. You can start stepping people down gradually, though. Ulta, the beauty products retailer, over the past year has taken their weekly $5 off $10 to $3.50, and they are still in business and seem to be thriving.

short-term impact--people show up, the cash register rings, comps look good. But

what are you doing to your long-term fis- cal health? Eroding margins? Training your

customers--all of them

the good ones and

... the bad ones--to wait for the deal? I used to be a regular patron of Borders (RIP), but I had learned their coupon/discount cadence. They typically rotated the same coupons in a 3-week cycle. Did I wait for

Start trading in data, not discounts. You want to continue to attract the types of customers who want to shop you because they like what you sell, regardless of whether or not there’s a deal to be had.”

the coupon email every week before head- ing over? You bet I did.

So, what to do? My suggestion is to start trading in data, not discounts. You want to continue to attract the types of customers who want to shop you because they like what you sell, regardless of whether or not there’s a deal to be had. Use the power of the data that you have to start making per- sonal recommendations based on what you already know about your customer. Did she just buy a high-end, logo-encrusted purse

nice piece of artwork to hang above it? Sell the dream! Be the partner who makes cus- tom recommendations based on shopper- indicated preferences, not the bad retailer that flings random stuff out to consum- ers because (a) you need to get it off your shelves so it’s on “special,” or (b) because you have no idea what consumers want, so you just keep sending emails with random coupons and discounts until something resonates. That’s bad retail karma, I say.

JENN MCMILLEN — VP of Loyalty & CRM, GameStop
JENN
MCMILLEN
— VP of Loyalty & CRM, GameStop

Look at what you already have to pull customers to you. If a data collection program is too hard or too expensive right now, then take a hard look at your own website. How’s your website content? If you still have the same image “above the fold” that you had a month ago, then maybe this is where you start? Drive people there to covet what you sell and, above all, pro - vide useful or fun information--customer ratings, product specs, natural go-togeth- ers, gamification. Become a trusted advisor and see where that takes you.

FEATURES

 

LEGO: Building Customer Loyalty

ONE BRICK AT A TIME

FEATURES LEGO: Building Customer Loyalty ONE BRICK AT A TIME BERNARD CHUNG —SAP T he LEGO

BERNARD

CHUNG

—SAP

T he LEGO Group, the parent organization of the company that makes the ubiquitous plastic building blocks loved by children and their parents around the world, is famous as

the largest toy manufacturer in the world. It is less well known that the privately held company also is extremely successful financially, reporting substantial revenue and net income growth each year regardless of recessions. In 2011 it recorded more than $3.3 bil- lion in revenue (converting Danish kroner to U.S. dollars) and net income of $733 million. From 2007 to 2011 the LEGO Group more than doubled revenues and quadrupled net income.

The company’s financial success is in no small way due to its so- phisticated approach to building and maintaining customer loyalty. This is not as easy as it would appear. “We have a unique situa- tion,’’ observes Conny Kalcher, vice president of Consumer Experi- ences at The LEGO Group in Slough, UK. “The people who buy the products are most often parents or grandparents, but the people who consume the products are kids. We work on consumer experi- ence with both of these groups,” Kalcher says.

In fact, The LEGO Group segments consumers into several catego- ries, based on their affinity for the LEGO brand, Kalcher says. At the top of the pyramid are the lead users – the adults and children who engage most heavily with the company, to the extent of help- ing to co-create LEGO products.

The next segment down is the one-to-one layer, consisting of people with whom the company maintains an ongoing dialog. The third layer is the connective community layer, or people who spend time on The LEGO Group online collaboration platform, where they can share files and work with staff in a secure environment, Kalcher says.

And finally, the base of the pyramid is the active household layer— people who have bought LEGO products at some point in time. All consumer types want something different from the LEGO brand, Kalcher says, so their relationships with the company are varied.

“The people who buy the products are most often parents or grandparents, but the people who consume the products are kids. We work on consumer experience with both of these groups”

—Conny Kalcher, vice president of Consumer Experiences at The LEGO Group in Slough, UK

And it is The LEGO Group’s self-proclaimed job to move as many people up the pyramid as it can, changing the consumer relation- ship from a monologue to a dialogue.

For example, not long after The LEGO Group first developed its MindStorms NXT robots, in conjunction with the Massachusetts Institute of Technology, the software that enables the toys to perform different opera- tions was hacked. Rather than condemn the people behind the system infiltration, the company decided to befriend them. “We had to make a decision about whether we would work with these people or sue them,’’ recalls Kalcher. “We decided to work with them.” The result:

These consumers co-created the second generation of Mind- Storms with The LEGO Group, she says, since they knew even better than The LEGO Group’s engineers what they wanted the robot to do.

“By working with them, we get to know the lead users on a personal level,” Kalcher says. Lead users are introduced to the company, and The LEGO Group involves them in special projects for which they have a passion, such as Web, game and com- munity development. “They can become part of the company and still be doing their day job,’’ Kalcher says. Thanks to their in- put the company’s new offerings match real-world demand.

Lead users can demonstrate the brand’s potential in a much stronger way than the company can, itself, Kalcher says. In fact, another sub-segment, known as LEGO Ambassadors, arranges LEGO events all over the world. “They are display- ing their passion for LEGO products at these big shows,” Kalcher says, as well as demon- strating to families what can be done with the products. Such shows draw 2.5 million visitors a year, according to Kalcher. In total, there are 70 LEGO Ambassadors from 24 different countries.

Other LEGO communities have also sprung up, such as the Kids’ Inner Circle and adult LEGO User Groups (LUGs). They refer to themselves as “AFOLs” (Adult Fans of LEGO), and the company has developed re- lationships with more than 50 such groups, which have 55,000 registered members with their own Web sites, blogs and discus- sion forums.

These loyal customer communities provide real, tangible benefits to the LEGO group

in many ways, most importantly new prod- uct ideas. Consider its Cuusoo program, launched in Japan in 2008, but only opened to global beta in the fall of 2010. Cuusoo invites users to submit--and vote for--ideas for new Lego sets, according to a recent article in Fast Company magazine. When an idea crosses the 10,000-vote threshold, it gets a formal internal review and a shot at production. The first Cuusoo project hit Japanese shelves almost a year ago--a limit- ed-edition version of the Japanese deep sea submersible, the Shinkai 6500. The second, a Japanese asteroid reconnaissance space-

And it is The LEGO Group’s self-proclaimed job to move as many people up the pyramid

craft called the Hayabusa, was released in March 2012.

And while Lego actually has a long tradi- tion of listening to, and even collaborating with, its fan base on toy concepts, doing so at the ever-accelerating rate of the web de- mands tremendous agility from the world’s third largest toy maker. The first Cuusoo project--the Shinkai--took 420 days to ac- cumulate enough votes to trigger a review (only 1,000 were needed for the Japan-only project), while Minecraft, with its 20 million registered users, racked up 10,000 votes in just 48 hours.

ENABLING CONSUMER CENTRICITY

Getting to this high level of consumer in-

teraction and engagement required organi- zational change. The LEGO Group started by combining all the departments that in- teract with consumer, Kalcher says. About four years ago, all of the departments that had direct contact with consumers were

And it is The LEGO Group’s self-proclaimed job to move as many people up the pyramid

BERNARD CHUNG’S INDUSTRY PREDICTIONS

:: The past few years have been all about developing the customer experience management vision. Many people and organizations have been speaking about it and getting behind the CEM banner.

:: 2013 will be all about how to execute that vision within your organization. Organi-

zations need to DEFINE THE

KEY CUSTOMER EXPERIENCES

they want to focus on and start to identify the key components needed to

ENABLE THEIR CEM VISION.

centralized: consumer service, community, clubs, loyalty and consumer insights. “It was a bold step, but it has given us space to de- velop that area much faster,’’ Kalcher says.

To understand consumers even better – and even interact with them directly – The LEGO Group is looking into using sentiment anal- ysis tools, which enable an automated way to “listen” to what people are saying about your company on the Web and alert you to whether things are going in a positive or negative direction. The LEGO Group also introduced a consumer loyalty program to manage loyalty rewards and points redemp- tion, using SAP’s CRM software to store the information. The global program is available in all of The LEGO Group’s retail stores in 24 countries and online. “Our aim is to develop it going forward so it becomes an engage- ment program as well as a loyalty program,’’ explains Kalcher. “The more consumers en- gage with us, the more we offer them things that are meaningful to them.”

L
L

Bernard Chung is a senior director of global solution marketing at SAP. He is focused on customer loyalty and marketing solutions and is passionate about helping organizations to successfully engage with their audiences to build customer intimacy.

FEATURES

 

jcp cares :

Customer

Loyalty

through

CAUSE

MARKETING

FEATURES jcp cares : Customer Loyalty through CAUSE MARKETING HEATHER REID —Pointsmith T he concept of

HEATHER

REID

—Pointsmith

T he concept of cause marketing originated in 1976 by Bruce Burtch. Burtch orchestrated the first cause marketing campaign by

creating a symbiotic relationship between the Marriott Corporation and the March of Dimes.

The results from the campaign were an overwhelming success and exceeded all goals, generating hundreds of thousands of dollars in free publicity. It is nearly four decades later and the phrase Bruce Burtch coined about cause marketing—“Doing Well by Doing Good” —remains relevant. Now, more than ever, cause marketing has become the core value of many successful national retailers. While it is difficult to quantify cause-marketing spending, 2013 promises to be a breakout year as retailers are projected to invest a whopping 1.73 billion dollars into cause marketing campaigns or projects.

jcpenney was founded on the principle of the Golden Rule: treat others the way you’d like to be treated. In 2012, jcpenney remains true to their giving roots and launched a new cause marketing campaign called “jcp cares.” It was meticulously crafted and has all the key ingredients to create true customer affinity. jcpenney’s business mission is to become America’s favorite store and, for the reasons outlined below, jcp cares is the vehicle that will drive them to their goal.

THE KEY ELEMENTS OF JCP CARES

Let’s take a close look at the key elements of the jcp cares program and I will shed light on why these strategic and tactical elements will result in creating customer loyalty.

THEY KNOW THEIR AUDIENCE

jcp cares supports a different cause each month. In July it was the USO, in August the Boys and Girls Club of America, for September it was Teach for America, and now in October it is The Breast Cancer

Research Foundation. Obviously, jcp cares understands which genders respond to what types of causes. jcp cares offers a smart mix of causes with a slight lean toward their female customer. Women like preven- tive medicine, child welfare & social change; men favor Goodwill & The Salvation Army.

FEATURES jcp cares : Customer Loyalty through CAUSE MARKETING HEATHER REID —Pointsmith T he concept of

HEATHER REID’S INDUSTRY PREDICTIONS

:: Protecting and exploiting CUSTOMER ANALYTICS

:: Explosion of VIRAL VIDEO CONTENT that

 humanizes brands/retailers

:: CUSTOMER CENTRICITY marketing :: Rewards based IN-STORE GAMIFICATION :: MULTI-CULTURAL marketing

ROUNDING UP

With every purchase that a consumer makes at jcpenney, they can choose to round their purchase amount up to the next dollar. The addi- tional change will be donated to that month’s featured cause. Research has proven that women prefer to shop with retailers when a donation is made with each transaction.

Walters and I further discussed the tactical element of jcp cares incor- porating foursquare into their cause marketing campaign. “jcpenny is smart to use Foursquare,” explained Waters. “It gives the program another layer of connection with consumers, especially with younger shoppers that are hooked on using smartphones and tablets to keep track of friends and deals.”

STAYING LOCAL

People want to feel they are making a difference in their community.

Most national retailers are just realizing the importance of keeping donation proceeds in their community. When customers donate, all of the proceeds stay in their state.

“The programs connection with social media, including Foursquare, represents a key advancement in cause marketing as brands use mobile devices to connect with shoppers where they are and where they care,” explained Waters. “The future of business, marketing and cause are unfolding on mobile devices.”

I asked my friend and authority on cause marketing, Joe Waters the author of “Cause Marketing for Dummies” to weigh in on the impor- tance of retailers to localize their cause marketing. Joe states that “The 2010 Cone Evolution Study made it clear what consumers want, 91% said that companies should support an issue in the communities where they do business.”

CELEBRITY ENDORSEMENT

When brands partner with a celebrity their customers identify with, it can be a very powerful tool. jcp cares recently announced that coun- try music star Blake Shelton is their official ambassador.

Consumers are inundated with over 3,000 advertising messages a day, but only 30% of those messages are committed to a consumer’s memory. Here is the kicker: only 15% of all US advertisements feature a celebrity endorsement. So it goes without saying that an advertise- ment featuring a celebrity endorsement will break through the clutter.

64% of adult Internet users who follow a celebrity also follow a brand

ROUNDING UP With every purchase that a consumer makes at jcpenney, they can choose to round

91% said that companies

should support an issue in the communities where they do business

NAILING LOYALTY THROUGH CAUSE MARKETING

In a survey executed by Cone about cause marketing, an impressive 41% of people surveyed say they’ve purchased a product because the brand was affiliated with a cause. 85% of the people surveyed went on to agree with the following statement:

85% agreed; when a product or company supports a cause that I care about I have a more positive image of the product or company

Consumers expect retailers to humanize their brands. Cause marketing directly hits consumers in the heart, creating brand affinity. The strate- gies and tactics of jcp cares are excellent examples of how to model a cause marketing campaign that will create customer loyalty. L

ROUNDING UP With every purchase that a consumer makes at jcpenney, they can choose to round

LEVERAGING SOCIAL MEDIA

Social media has taken center stage as marketers’ new sweetheart. Customers follow brands and want to engage with brands from the comfort of their smart phone. jcp cares leveraged the power of social media last July. Jcpenney donated a dollar to the USO for each customer who checked in at a jcpenney location via foursquare. The result was a $50,000 donation to the USO.

Heather Reid is a representative at Pointsmith, an esteemed in-store marketing firm. Heather offers a unique, insider perspective, as she collaborates with c-suites executives from our Nation’s leading retailers.

http://www.coneinc.com/cause-grows-consumers-want-more http://www.theagitator.net/hot-research/latest-cause-marketing-research/

http://adage.com/article/cmo-strategy/marketing-celebrity-endorsements-push-product/146023/

http://www.businessinsider.com/the-power-of-celebrity-endorsements-enhanced-by-social-media-2011-3#ixzz284hJk0Ro

FEATURES GLOBAL VIEWS BEYOND LOYALTY: why we need to get SMARTER about CUSTOMER ENGAGEMENT HUNTER ALBRIGHT

FEATURES

GLOBAL

VIEWS

BEYOND LOYALTY:

why we need to get

SMARTER

about

CUSTOMER

ENGAGEMENT

FEATURES GLOBAL VIEWS BEYOND LOYALTY: why we need to get SMARTER about CUSTOMER ENGAGEMENT HUNTER ALBRIGHT

HUNTER

ALBRIGHT

—Beyond Analysis

W hat do you think of when someone says

“loyalty program”? A wallet crammed

with retailer reward cards, perhaps?

The latest developments in payment

methods and digital technology have changed today’s loyalty landscape into an ever increasingly complex environment. The key challenge businesses face is explosion of data and how to collect it. The rapid emergence of new payment methods have revolutionized the loyalty business. Long gone are the days when loyalty cards were the only way to identify and collect customer data. Now with multiple ways to identify a customer across a growing number of channels, it’s all about Big Data. This means multiple data sources—both internal and external —being brought together to put the customer at the heart of business strategy.

The good news is that we have access to all this wonderful behavior data. However, the challenge for retailers is analyzing it, making sense of it and most importantly, acting on it. Just knowing what was in someone’s shopping basket is no longer enough; you need to understand long term consumer behavior, what customers are doing before they enter or after they leave their shop, and what their interests and aspirations are.

The future is about intelligent customer engagement and the key to this is in the data, especially the behavioral data that can really help you engage with your customer and employees in ways that will improve your company’s performance.

THE EXPLOSION OF DATA—THE RAPID RISE OF DIGITAL TECHNOLOGIES AND SOCIAL MEDIA

We live in an anything, anytime, anywhere world and new technology is already transforming consumer behavior. Products and services are increasingly being researched, reserved and bought through a wide variety of channels, including PCs and tablet computers, or via smartphones while on the move. Not only that but customers are talking about their experiences and purchases on open social networks—and are far more likely to trust reviews from fellow Face- bookers and Tweeters than they are from more traditional sources.

According to a survey by The Logic Group, over a fifth (22%) of Brit- ons has visited a company’s Facebook page in the last six months. Whether they are ‘liking’ a product on Facebook or tweeting about the service they received, consumers are increasingly telling the world what they think.

Successful customer engagement via social media is a two-way conversation between the brand and the customer, and one that adds value for the consumer. Businesses may encourage customers to share their thoughts but this desire to engage can be a double- edged sword. Unwary retailers could discover that it only takes one poor customer experience through one of these channels to have a far-reaching negative impact on their sales.

So whilst grappling with the firestorm that is the social media space, it’s easy for businesses to forget that all this customer interaction— however positive or negative—generates vast amounts of data. And although the opportunities for harnessing this data is pretty much infinite, the issues are also increasingly complex, particularly as the journey from need or desire through to purchase becomes less predictable than ever before.

It’s not, therefore, simply about keeping tabs on your social media channels. The key is to capture data from these sources, inter- rogate the facts and act on that informa- tion. To rise to the challenge, retailers need to be smarter than ever to drive customer engagement.

BEHAVIORAL DATA—THE BEST KIND OF DATA

data, every company out there has at least one data source at its fingertips. The mistake many make is trying to bring all of it together, all at once. So take the time to understand what your version of Big Data needs to look like for your company and your customers, then pick one area of focus and put your energy and resources into that.

Customers are unlikely to wait around for their reward; they want instant recognition and gratification. The trick for retailers is to deliver this loyalty kick without devaluing their brand offering. We all know of retailers that offer constant discounts and vouchers. Only a fool would buy from them at full price.

The joy of social media is that it generates vast amount of wonderful, enlightening behavioral data. Why is this so fantastic? Well, because:

•  It is straight from the horse’s mouth; pure, individual-level data •  It represents a section of the wider popu- lation and can therefore feed in to broader customer segmentation analysis •  It is infinitely actionable •  It can be tracked and measured for a clear and definitive understanding of ROI, espe- cially in relation to campaigns and offers •  You’d be amazed how many well-known brands simply don’t know what to do with their customer behavior data.

Some don’t even collect it. A good first step is to make sure that you have a range of differ- ent customer feedback mechanisms (such as customer surveys, social media, live chat, web forums and blogs) feeding into testing strategies where you can track and measure real-time feedback and behavior.

And

don’t

forget

your

customer

service

centers, if you have them.

Customer calls

and

emails

are

always

a

rich

source

of

behavioral data.

 

Collecting, interpreting and acting on behavioral data can be a real differentiator in terms of loyalty. It can provide the best possible competitive advantage; a direct link to your customers and a chance to make sure that you put their needs at the heart of your decisions around product, price, place, promotion and people (yes, that old market- ing classic).

By doing this, you start to make customer engagement a two-way street. For example, you can use your behavioral data and customer communications to test ideas on the back of customer feedback and insight.

SO, WHERE TO START?

My issue with the whole Big Data debate is that it makes data analytics seem like an unattainable utopia; it’s more than a bit scary and just too damned hard. Not so.

I’ll let you in on a secret. Big Data is nothing new. It’s simply about joining the dots of all your relevant data sources. Whether it is customer, local market or communications

  • 4. This should NOT be a 3 year, all-

be too!

Big Data plan

now (and what you don’t)

and those of your customers

in it for the long haul, your customers will

  • 5. Only include actions that can be

  • 1. Be clear on your business objectives,

    • 6. Be committed to your data-if you’re

  • 3. Align 1 & 2 and then create your own

  • 2. Understand what data you have right

HERE IS MY SIX-POINT PLAN FOR GETTING STARTED:

tested and measured—so you can learn and develop proof points

singing all-dancing plan. Plan in detail for the first 12 months, then in high level for years 2 and 3

My issue with the whole Big Data debate is that it makes data analytics seem like an unattainable utopia; it’s more than a bit scary and just too damned hard. NOT SO.

TO DATA INFINITY…AND BEYOND

The future for loyalty is intelligent customer

engagement. It’s about marketing to and engaging with the individual. To achieve your consumer, you need to know what they think to understand what they do and why. To know all that, we need to listen.

In today’s challenging and competitive economic climate, we must reassess whose views matter. Our employees, partners and customers could just be the best people to tell us how to make our business succeed.

Do it right and do it consistently, and loyalty and engagement will be the happy result.

L
L

SHORT-TERM REWARDS REAP LONG- TERM GAIN

Although true customer loyalty is about long-term retention and engagement, in today’s challenging economic environ- ment retailers need to act fast to entice new customers and win back the lapsed.

Hunter Albright is the Chief Executive Officer for North America and Global Head of Consulting for Beyond Analysis. With over two decades of experience in industry and academic settings, he is a leading expert in the development and application of value driven analytics to improve business performance.

It’s not, therefore, simply about keeping tabs on your social media channels. The key is to

HUNTER ALBRIGHT’S INDUSTRY PREDICTIONS

:: DATA DRIVEN ENGAGEMENT companies will increase efforts to use behavioral data from their customers, across all channels, to create more relevant and intelligent engagement with their customers and employees.

:: DATA COLLECTION AND ORGANIZATION— companies will continue

to reassess and improve how they collect customer data across all channels and organize it so that it is more actionable.

:: COMMERCIAL FOCUS— Senior executives in organizations will required a stronger commercial focus throughout the business and improved analysis regarding the incremental value of activities based on the data that is now available across all channels.

FEATURES

FEATURES

 

IS YOUR BUSINESS LOYALTY OR IS LOYALTY PART OF YOUR BUSINESS?

FEATURES FEATURES IS YOUR BUSINESS LOYALTY OR IS LOYALTY PART OF YOUR BUSINESS? ROB MORGAN —CAC

ROB

MORGAN

—CAC Group

T he road to poor performance is paved with good intentions and bad execution. Recent data indicates that some loyalty programs may actually be counterproductive to supporting customer acquisition and retention, encouraging purchase and improving the bottom line.

CONSIDER THE FOLLOWING:

44% of consumers have had a negative experience with a loyalty program 1

36% of consumers received a reward or promotion that made them want to come back to the merchant 2

17% of U.S. respondents say that loyalty

purchase decisions 3

programs are “very influential” in their

81%

of loyalty member don’t know the program benefits or how/when they will receive rewards 4

There is no singular answer to why some loyalty programs are falling short of

desired outcomes. Certainly, the data explosion coupled with an exponential

increase in channels has made the discipline more complex. Moreover, the

rising tide of consumer expectations has buoyed the perception of rewards

from a nice bonus to an entitlement and created a new demand for highly

relevant, personalized experiences as opposed to generic commodities.

Other factors include poor technology support and failure to communicate

program benefits clearly and consistently.

TRUE STRATEGIC MAPPING OF LOYALTY INITIATIVES EXTENDS BEYOND THE MARKETING P & L. RATHER, IT IS A HOLISTIC APPROACH WHERE LOYALTY IS A COMPONENT OF THE BROADER BRAND VISION AND INVESTMENT MATRIX.

However, while there are many possible reasons for lackluster

results, our experience indicates that, among effective programs,

there is one common denominator for success—strategic integra-

tion of loyalty with overarching corporate goals.

Generally, loyalty programs emerge in response to competitive pres-

sure and with the specific and narrow intent of addressing an imme-

diate need e.g., growing/preserving the customer base and/or

bumping up the bottom line by driving increased spending.

Consequently, loyalty programs tend to be become siloed as a

marketing tool rather than a strategic platform to advance overall

business and brand goals

True strategic mapping of loyalty initiatives extends beyond the

marketing P & L. Rather, it is a holistic approach where loyalty is a

component of the broader brand vision and investment matrix. As

such, the business case for a loyalty programs closely considers the

implications of proposed designs on operations, human resources,

and technology resources and metrics and makes it easier to secure

support from key stakeholders and management.

The following sections provide insights and best practices for elevating

loyalty planning from a marketing process to a management imperative.

STEP 1: ASSESS

The first step on a strategic mapping path is a situation analysis that

examines the competitive environment, the current business situa-

tion, and existing capabilities. Some areas to explore in this part of

the process include:

•  Company’s long-term vision/values and how a loyalty program

fits within that vision

•  Business objectives and primary means of profit generation

•  Current positioning and level of brand recognition

•  Potential of loyalty program to improve competitive differentiation

•  Possible impact of market conditions on a loyalty programs

•  Channel sales strategy, operations and differences in business

model, target customers, etc. across lines of business

•  Impact on technology/HR etc.

•  Process for capturing data and scope of existing data assets

•  Potential reputational risks

By contextualizing loyalty in the big business picture, this analysis

serves as a compass for defining a loyalty scheme direction that will

be sustainable, channel-agnostic, executable and complementary

to overall brand values and positioning.

continued on next page » Loyalty Management™ • FOURTH QUARTER 2012

29

Is Your Business Loyalty or Is Loyalty Part of Your Business? (continued)

It can also mitigate the tendency to default to quick fix “me too” STEP 3: MODEL
It can also mitigate the tendency to default to quick fix “me too”
STEP 3: MODEL
approaches that don’t move the needle, or worse, disengage
The target customer profile that emerges from the mining process
consumers and have a negative impact on business. For example,
enables marketers to pinpoint gaps between the current and desired
retailer XYZ is facing inventory selection challenges as well as other
state and isolate opportunities to garner the maximum return on
investment pressures including a technology upgrade that will
investment. This gap analysis is also an effective tool to reinforce
enable a loyalty program to go mobile. Without filtering the loyalty
confidence and consensus among senior leadership that a proposed
request through a strategic mapping lens, a company may push
loyalty plan will be an appropriate catalyst for growth.
forward the mobile play to drive sales but risk alienating customers
by lacking the inventory to meet the demand generated.
When choosing between various plan designs (e.g., currency based
programs, tiered programs, experiential, etc.), in a strategic mapping
STEP 2: MINE
scenario, the scope of review will extend beyond customary loyalty
benchmarks such as the investment and return rate projections,
With a solid business foundation in place, marketers are well-situ-
financial liability, breakage and customer growth potential to calcu-
ated to conduct a data deep dive to enhance understanding of
lating the potential implications of a loyalty program on customer
customer dynamics and define the specific structural elements for
service delivery, and other operational activities. This is a clear
an effective program. This portion of the groundwork should focus
demonstration of how strategic mapping diverges from a traditional
on examining key customer performance metrics, demographic and
loyalty planning approach. Whereas, with the latter, there is a laser-
lifestyle drivers of customer base relative to overall market, behav-
like focus on financial outcomes, strategic mapping aims to under-
ioral segmentation, competitive set for key segments, attitudinal
stand the macro impact of every corporate initiative on the brand.
drivers, and the hierarchy of customer needs, i.e, tangible (transac-
Thus, in a strategic mapping mindset, a loyalty program design that
tional) vs. intangible (emotional).
cannot be supported adequately by existing employees or risks
diverting resources from other non-loyalty related customer support
activities may not move forward (despite financial upside) as bad
service is fundamentally counterintuitive to customer centricity, the
underlying bedrock of loyalty. In fact, a recent survey found that
72% of respondents identified customer service as the top priority
ROB MORGAN’S
INDUSTRY PREDICTIONS
in their decision to remain loyal to a brand.
STEP 4: MEASURE
:: With personalized experiences continuing
to grow in priority, expect to see large
programs with an overarching value proposi-
tion splinter into a number of smaller, more
targeted offerings (e.g., sub clubs/tiers)
that give members greater control over earn
and reward option and new loyalty currency
Commonly, the definition of loyalty program success is grounded in
customer acceptance and financial results—Average monthly/quar-
terly visits, spend levels, breakage or payoff, investment vs. return,
transactional penetration. By comparison, a strategic mapping
approach will likely involve operational and HR metrics that are
statistically related to customer satisfaction/loyalty. For example,
on the HR side, a loyalty program may include employee training as
in the form of INDIVIDUALIZED CONTENT
well as specific benchmarks/expectations for performance tied to
to increase relevancy and participation.
loyalty scoring. A linkage analysis (e.g., linking satisfaction scores
with operational measures such as hold time, turnaround time, and
:: The loyalty conversation will become
more intimate and anticipatory. As marketers
become even more sophisticated in using
transaction data and modeling techniques
to understand their customers, the loyalty
process will seem less formal and more
organic and genuine with companies deliver-
number of transfers) could also be a valuable tool to establish
customer-centric operational metrics for the purposes of goal
setting.
In summary, today’s consumers have the luxury to be more fickle
than ever. They also don’t think of loyalty in break-evens and KPIs.
Winning and keeping long-term mind and wallet share this environ-
ment is not about quick gimmicks but rather a long-term game plan
ing CUSTOMIZED EXPERIENCES that make
to deliver consistently satisfying and positive experiences both in
customers feel that brands really “get them.”
and outside formal loyalty program. In other words, a brand must
:: Senior marketing executives who are
concerned about lack of financial account-
ability in channels such as social media are
likely to challenge loyalty marketers to justify
the capital expense with the programs they
have today. Responding to these new c-suite
demonstrate loyalty to get it in return. Strategic mapping embeds
loyalty as an organizational priority across all aspects of the enter-
prise and empowers brands to elevate generic, transactional “earn-
and-burn” loyalty programs to an emotional connection with the
customer that will yield substantive brand and business dividends.
L
demands will likely require GREATER INVEST-
Rob Morgan is the Chief Marketing Officer and practice leader for loyalty at CAC
MENT IN ANALYTICS AND MEASUREMENT, as our
Group. Throughout his nearly three decade career, Rob has spearheaded business and
research shows that this is generally not
an area of priority for loyalty programs.
loyalty strategy development for clients across virtually every sector including AIR
MILES Rewards, Sears, Exxon, Delta, Bank of America, P&G, GM and Nissan.
Is Your Business Loyalty or Is Loyalty Part of Your Business? (continued) It can also mitigate
  • 30 Loyalty Management™ • LOYALTY360.ORG

    • 1 ACI Worldwide Study, March 15, 2011

    • 2 Ibid.

    • 3 Colloquy, The Rules of Engagement: Loyalty in the U.S. and Canada,” December 2011

    • 4 ACI Worldwide Study, March 15, 2011

    • 5 ClickFox Loyalty Report, April 2012

Insurance Financial Services Communications Public Sector Utilities Don’t waste your money. I’m a sure thing. Will
Insurance
Financial Services
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Public Sector
Utilities
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your money.
I’m a sure thing.
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FEATURES INSIDE SCOOP LEVERAGING FACEBOOK— PLAY.COM’S SOCIAL SUCCESS L o y a l t y 3

FEATURES

INSIDE

SCOOP

LEVERAGING FACEBOOK— PLAY.COM’S SOCIAL SUCCESS

FEATURES INSIDE SCOOP LEVERAGING FACEBOOK— PLAY.COM’S SOCIAL SUCCESS L o y a l t y 3

L o y a l t y

3 6 0

I n t e r v i e w

with ADAM

STEWART

Play.com

FEATURES INSIDE SCOOP LEVERAGING FACEBOOK— PLAY.COM’S SOCIAL SUCCESS L o y a l t y 3
FEATURES INSIDE SCOOP LEVERAGING FACEBOOK— PLAY.COM’S SOCIAL SUCCESS L o y a l t y 3

Play.com, The online entertainment retailer owned by

Japanese digital firm Rakuten, has found

social success using Facebook to engage

fans and earn referrals from top advocates.

In fact, in 2011 Play.com was able to attri-

bute £2m worth of sales to Facebook, and

“PRIMARILY WE SEEK TO ENGAGE OUR FANS WITH EXCLUSIVE CONTENT AND TOPICAL POSTS RELATED TO OUR PRODUCT CATEGORIES.”

direct sales through the social network

have increased 80% in the past year.

Finding that growth on this social channel

has influenced direct sales they now look to

expand their platform on Facebook and

have plans to launch a loyalty program for

customers who promote the brand.

Demonstrating the value in social media for

online retailers, Play.com customers who

made their first purchase via a Facebook

referral were found to spend 30% more

than an average customer with the online

FEATURES INSIDE SCOOP LEVERAGING FACEBOOK— PLAY.COM’S SOCIAL SUCCESS L o y a l t y 3
FEATURES INSIDE SCOOP LEVERAGING FACEBOOK— PLAY.COM’S SOCIAL SUCCESS L o y a l t y 3

retailer over the course of the year. By

rewarding fans, Play.com can capitalize on

the viral aspect of a social presence and

turn the friends of fans into fans (and

customers).

In the Q&A that follows with Play.com’s

Marketing Director, Adam Stewart, glean

insights into how Play.com is leveraging

Facebook to engage fans and get tips on

how marketers new to the space can test

this social channel too.

WHEN DID RAKUTEN’S PLAY.COM FIRST

START USING FACEBOOK?

November 2007.

WHAT CONSIDERATIONS DID YOU WORK

THOUGH PRIOR TO LAUNCHING THE

FACEBOOK INITIATIVE?

We wanted to develop an additional channel

through which we could engage with our

customers and provide them with added

value in the form of exclusive content, offers

and competitions.

FACEBOOK CAN BE USED IN MANY WAYS,

FROM A CUSTOMER FEEDBACK TOOL AS

A CUSTOMER REFERRAL PLATFORM, OR

AS A TRAFFIC DRIVER TO A PRODUCT

SPECIFIC SALES TOOL. HOW IS

RAKUTEN’S PLAY.COM LEVERAGING

FACEBOOK?

As a retailer, our ultimate objective is to drive

new customer acquisition and sales from the

channel. In order to do this, we leverage Face-

book in a variety of ways. Primarily we seek to

engage our fans with exclusive content and

topical posts related to our product catego-

ries. We utilise campaign applications (utiliz-

ing the Engage Sciences platform) to capture

additional insights into our fans’ interests

which can be used to better target them with

Marketing activity in the future, and ulti-

mately drive additional sales.

TO WHAT DO YOU ATTRIBUTE YOUR

SUCCESS WITH FACEBOOK?

Typically our fans initially come to our

Facebook page because they are interested in

an individual competition—for example

because they want to win tickets to a film

premiere. However, they stay with us and

continue to spend time on our page because of

the way in which we engage our fans with new

and exclusive content—whether it be further

competitions, channel specific product offers

or sneak peeks into future releases. Now we

are looking the take the next step into social

loyalty with the foundations that have been

built by the Engage Sciences platform.

A BIG CONCERN WITH CMOS & MARKET-

ERS ABOUT UTILIZING FACEBOOK AS A

CHANNEL, IS UNKNOWN TIME/RESOURCE

COMMITMENT. HOW DID YOU APPROACH

THIS CHALLENGE?

We tested our way into it. Initially we

utilized an agency to run our Facebook

activity, however when it became clear that

this was going to be a key driver of growth

and data intelligence for the business, we

brought the management of the channel

in-house. In addition, we leverage technol-

ogy, working with our partner Engage

Sciences to automate a lot of the heavy lift-

ing associated with campaign creation and

management which has been the catalyst

to our success ..

ANY ADVICE FOR THE NOVICE

MARKETER?

Test and learn is just as important on Face-

book as with any other channel. Vary your

posting strategy (eg. frequency, content),

try different campaigns, and quickly

develop an idea of what works and what

doesn’t. And always make sure your social

activity and strategy is aligned with your

business objectives! Simple start is recruit

fans, engage fans, turn into customers.

L
L
A BIG CONCERN WITH CMOS & MARKET- ERS ABOUT UTILIZING FACEBOOK AS A CHANNEL, IS UNKNOWN

ADAM STEWART’S INDUSTRY PREDICTIONS

:: SOCIAL MEDIA INTEGRATION— more integration of social media tools to provide customers with a deeper level of personalization and new generation engagement.

:: LOYALTY SCHEMES — loyalty schemes are commonly used in high street stores and becoming more prolific online. We expect to see more use of a common loyalty scheme across offline/online stores and more so on social media platforms. This will provide a fuller holistic customer profile, and drive specific customer behaviors—transactional and non-transactional behaviors around an eco-system eg. SuperPoints incentive to shop cross merchant or cross device (transactional) and Super- Point incentive to “like” a facebook page (non-transactional).

:: ANALYTICS— there is a growing need for predictive and adaptive analytics to anticipate and service customer needs and wants.

:: PERSONALIZED, MULTI-PLATFORM MARKETING COMMUNICATIONS—

many businesses are still just talking about this. In order to stay ahead of the curve, retailers must provide personalized and connected marketing messages across each channel and each device used by their consumers.

A BIG CONCERN WITH CMOS & MARKET- ERS ABOUT UTILIZING FACEBOOK AS A CHANNEL, IS UNKNOWN
A BIG CONCERN WITH CMOS & MARKET- ERS ABOUT UTILIZING FACEBOOK AS A CHANNEL, IS UNKNOWN
A BIG CONCERN WITH CMOS & MARKET- ERS ABOUT UTILIZING FACEBOOK AS A CHANNEL, IS UNKNOWN
A BIG CONCERN WITH CMOS & MARKET- ERS ABOUT UTILIZING FACEBOOK AS A CHANNEL, IS UNKNOWN
A BIG CONCERN WITH CMOS & MARKET- ERS ABOUT UTILIZING FACEBOOK AS A CHANNEL, IS UNKNOWN
A BIG CONCERN WITH CMOS & MARKET- ERS ABOUT UTILIZING FACEBOOK AS A CHANNEL, IS UNKNOWN
A BIG CONCERN WITH CMOS & MARKET- ERS ABOUT UTILIZING FACEBOOK AS A CHANNEL, IS UNKNOWN
A BIG CONCERN WITH CMOS & MARKET- ERS ABOUT UTILIZING FACEBOOK AS A CHANNEL, IS UNKNOWN
A BIG CONCERN WITH CMOS & MARKET- ERS ABOUT UTILIZING FACEBOOK AS A CHANNEL, IS UNKNOWN
TECHNOLOGY, TRENDS & REWARDS Products, Advancements, & Technologies FIVESTARS—LOYALTY SOLUTION REWARD ME The FiveStars co-founders began
TECHNOLOGY, TRENDS & REWARDS
Products, Advancements, & Technologies
FIVESTARS—LOYALTY SOLUTION
REWARD ME
The FiveStars co-founders began as top business consultants at McKinsey,
where they were first exposed to the power of customer loyalty programs.
They quickly realized why almost every Fortune 500 willingly spends
MILLIONS of dollars on their in house programs
...
because
a well-executed
loyalty program is extremely profitable! With this in mind, FiveStars created
a network of customized loyalty programs with tools that are simple enough
for busy merchants to use, yet powerful enough to outclass anything even
a Fortune 500 has to offer. FiveStars is an incredibly robust loyalty and
CRM solution.
RewardMe is a customer loyalty platform for the restaurant and retail
industries that captures customer data at the point of sale and empowers
businesses to use the data to influence customer behavior. Businesses that
use RewardMe have experienced a measurable 2% increase in bottom line
revenue due to gamification techniques and personalized marketing
messages made possible by the unique, patent-pending technology
RewardMe has created.
How RewardMe is different
1.
All customers can join the rewards program: all customers with a mobile
The FiveStars network builds a customized loyalty program that is
optimized for your business. You maintain full control. Sign up all of your
customers right from your POS in seconds and FiveStars does the heavy
lifting. They: collect the data, provide clear analytics and give you cutting
edge tools to stay in touch with your customers via narrowly targeted
emails and text messages, along with social media integration. For the first
time, truly understand and engage your customers all in one easy to use
platform. The FiveStars’ network comes with hundreds of thousands of
users that are eager to discover and visit your store! Their goal is to generate
and maintain buzz around your business to keep your customers coming
back again and again ...
number can join RewardMe. This means that there are no apps to download
or smartphone requirements.
2.
Capture dollar value and SKU data: RewardMe captures how much
money a customer spent, what the customer bought, and when the
customer shopped from EVERY customer—even customers that pay cash.
3.
Reward customers based on dollars spent: A business is not limited to
rewarding a customer based on visits. This means that a customer that
buys a group meal for an entire office receives more points than a customer
that just buys a soda.
4.
Custom branded for businesses: the RewardMe tablet is custom branded
to fit the business. When a customer joins the rewards program, they don’t
join RewardMe; instead, the customer believes they join the Business’s
Rewards Program.
Further opportunities with RewardMe include:
LOC ENTERPRISES—LOC CARD
LOC Card allows any merchant to have a Loyalty Program
• Personalize marketing messages: send a customer that loves burgers one
message and a customer that loves salads a completely different message.
Marketing messages are more effective when personalized to fit the
customer’s preferences.
It is a known fact that consumers love reward /loyalty programs, but it is
also a well-known fact consumers are more than frustrated with sheer
number of programs they are forced to manage, to the point they are now
declining participation. The frustration comes with the cumbersome
enrollment process and sharing their personal information. The frustration
manifests itself in the bombardment of email and text messages, and the
simple fact that there is yet another card to carry and manage. The LOC™
card solution is the fastest and easiest method for a merchant to overcome
those barriers and grow their loyalty member base.
• Bring back lost customers: auto-send a text or email to a customer that
has not returned in the past 30 days.
• Segment and filter customers to better understand them: view customers
that have spent over $500, segment weekday vs weekend customers, and
even categorize customers based on food preferences.
• RewardMe currently serves businesses from the largest multi-national
franchises to small, single-store local businesses.
The LOC card allows consumers to use a single, “universal” card to enroll
and track reward/loyalty points in multiple merchant programs. A simple
swipe of the LOC card enrolls a new customer into any program, eliminating
all the hassles of enrolling in reward programs for the customer. Quick,
easy and simple, the LOC card is the merchant’s answer to the consumer’s
demands for a simple universal loyalty card. Consumers can then visit a
personalized web page on the LOC site to view their program balances and
set their communication preferences. The LOC Card offers a whole host of
additional benefits to both the merchant and consumer. The merchant
maintains their own “currency” with-in their loyalty system.
Merchant integration is easy, requiring minimal IT effort. The LOC card is
working with numerous POS providers to provide simple integration, or
merchants can contact LOC directly to integrate. The merchant maintains
all their data with complete control of their program.
The LOC card allows consumers
to use a single, “universal” card
to enroll and track reward/loyalty
points in multiple merchant
programs.
TECHNOLOGY, TRENDS & REWARDS Products, Advancements, & Technologies FIVESTARS—LOYALTY SOLUTION REWARD ME The FiveStars co-founders began
RQ becomes part of your sales workflow by combining the tracking and reporting capabilities of Salesforce
RQ becomes part of your sales workflow by combining the tracking and
reporting capabilities of Salesforce with The Relational Capital Group’s
Relational Quotient insight to create an easy-to-use, yet powerful cloud-
based CRM relationship advancement tool. With RQ, your team receives a
powerful relationship advancement tool to develop action plans for
transforming their relationships with every Contact. And your management
team can access these plans to validate that effective strategies are being
produced, for the right relationships. You can transform the way you do
business by developing the insights and strategies needed to:
So why is the right balance between business results and relationships so
difficult? Until now, businesses couldn’t measure the strength of their
customer relationships, much less track this information across their
Creating a strategy for consumer engagement is simple… just ask the
consumer what they want—then the only challenge is collecting the
information, acting on it and repeating the process over and over, while
maintaining consistency.
Companies today have customer data coming to them from all directions
—interactions in the store, phone calls, website, chat, social media and
survey feedback. The big question is, how are organizations listening to all
of this data and acting on it in a meaningful timeframe?
Help others. Every time a talktUp member spends $20 or more at any
talktUp business, talktUp will donate a meal to someone in need through
Food Lifeline on their behalf. Members buy something they want. Someone
gets something they need. Everybody wins!
The ResponseTek Listening Platform™ connects
thousands of employees with millions of
customers daily. By involving the customer at all
touch-points across the customer lifecycle,
organizations are able to continuously improve
through operational programs and strategic
services.
Since 1999, the ResponseTek Listening Platform™ has been implemented
by global leaders in the telecom, insurance, financial services, tourism and
retail sectors in need of an enterprise voice of the customer system. With
its unified view of the customer across multiple touch-points, a single
system is delivered that integrates channels, lines of business and countries.
When dining at restaurants and bars or shopping at retailers, customers
using talktUp gain access to cashback dividends, monthly jackpots, and
shared philanthropic giving. Unlike daily deal companies that distribute one-
time discounts and coupons, talktUp promotes steady, long-term customer
loyalty with a variety of incentives for both consumers and businesses.
ResponseTek, a market leading customer experience management (CEM)
software vendor, has a software solution to automatically manage, analyze
and report on customer feedback.
Help yourself. With talktUp, every time someone acts on a member’s
recommendation the member gets paid for it (and their friend spends their
money more wisely). Not only do they get the satisfaction of knowing their
friends are benefiting from their recommendations, but talktUp pays them
on their own purchases too!
Feedback is integrated from all customer touch-points with individualized
and aggregate reporting. The right information is automatically distributed
in real-time to the right people, eliminating silos of customer data and
creating visibility into the overall customer experience. The Buzz Tracker
report, a key product release in the past year, automatically translates
customer’s text-based comments from all channels into business metrics,
allowing for immediate interpretation of satisfaction and loyalty drivers.
organization within their daily CRM processes. RQ for Salesforce (RQ),
The Relational Capital Group’s client relationship advancement application,
provides deep, actionable insights and plans that lead to improved customer
retention, penetration and growth—transforming the way you do business.
RQ is the first Salesforce application that allows you to identify, measure
and assess the most important relationships impacting your sales and
business performance.
These two solutions are the cornerstones of NCR’s c-tailing solutions,
which allows retailers to provide consumers a ubiquitous experience based
on where and how they want to interact. Until recently, NCR AMS and NCR
EPM were aligned to the needs of the grocery segment—NCR AMS is
currently implemented in seven of the top 25 grocery retailers and
wholesalers. 1 In 2011, NCR expanded their portfolio to include general
merchandise and will soon complete development efforts to extend to
convenience stores.
You don’t have to be a rocket scientist to know that a personal recommendation
is the best advertisement in the world. We all love to shop, dine out and tell
our friends about the great places we discover, so talktUp figured out a way
for customers, merchants and the whole community to get rewarded for
doing something nice that comes naturally. They made it so simple it’s
almost embarrassing. Invite loyal customers to share their good experiences
with their friends, then reward them and donate to charity when their
recommendations are acted upon. Pretty easy!
NCR EPM can be implemented as a stand-alone solution or in conjunction
with NCR Advanced Marketing Solution (AMS) to add real-time consumer
preferences and create personalized offers. NCR AMS is an enterprise
offer management solution that coordinates offer execution, facilitates
unlimited customer loyalty programs, electronic opt-in (coupon to card)
and connects the retailer’s touchpoints so that the customer is able to
redeem, view and manage their profile with the retailer anywhere they
interact—online, at a traditional point of sale or self-service touchpoint.
NCR Enterprise Preference Manager (EPM) solves all of those challenges
—NCR EPM is an omni-channel solution that captures the voice of
consumer, extending a retailer’s view beyond historical Customer
Relationship Management (CRM) data. Integrated with customer-facing
touchpoints, NCR EPM learns the consumer’s behavior (e.g. language
preference, dexterity, receipt printing) and asks questions to gather any
detail the retailer needs (e.g. favorite departments/ brands and
communication preferences.)
talktUp is free for consumers. They simply download the mobile app or
sign up at www.talktup.com and enjoy the following benefits for doing
something they already do!
It’s good business. talktUp members’ voices make a difference. Businesses
that they “talk up” get more customers—keeping good businesses in
business—and the world a better place. talktUp creates community and
focuses on the good in all of us. Good experiences, good advice and
recommendations with a good outcome—for everyone.
RQ FOR SALESFORCE
sales team’s relationship status
1 Supermarket News’ 2012 Top 75 Retailers and Wholesalers.
•  Competitor-proof yourself and your team
•  Collaborate better with customers to tailor solutions
•  Challenge them in ways they will appreciate
To get started today, go to RQforSalesforce.com/Get-App or info@RQforSalesforce.com.
•  Minimize forecast risk through better transparency into your 
•  Create “horizontal and vertical relationships” within key accounts
RESPONSETEK
LISTENING PLATFORM™
TALKTUP —
CONNECT :: REFER :: REWARD
NCR CONVERGED RETAILING
(C-TAILING™) SOLUTIONS
Customer experience information is gathered through advanced listening
posts following an interaction with the company, including call center and
retail store channels, using SMS, email, web and IVR survey collection.
We all know that strong customer and target business relationships are the
most reliable and profitable source of growth. But often the drive for short-term
revenues causes client relationships to become lost in the process.

TECHNOLOGY, TRENDS & REWARDS

 

MINIMIZING EFFORT to MAXIMIZE LOYALTY

—Loyalty 360 & KANA

I n the digital age information flows quickly and with

few barriers. Consumers, your customers, have

questions, challenges and concerns; they have high

standards and limited patience. The world is their

marketplace, and customers today have many options for purchasing products and obtaining services. The informa- tion provided on websites, social networks and through traditional media empowers your customer; they have a voice. At the push of a button, a person expects answers, solutions and resolutions. Knowledge is power and consumers are now better able to evaluate and choose the companies that will best serve their needs—they have power.

The important question is: how easy do you make it for your

customers, prospects and partners to work with your organiza-

tion? The effort required to work with your brand is a critical

measure and will determine, in part, your successes and fail-

ures. Consider the customer experience as they seek to find

information, phone numbers, email addresses. How about the

process for doing business and transacting? Companies serve

customers best by providing to them simple paths and low

barriers. This is not only about order taking, but also a neces-

sary consideration for providing instructions, support, return

policies and other important details. Most companies have this

information readily available—somewhere.

The trick is to make this information easily accessible to the

customer, through the channel with which the customer is the

most comfortable; matching need with the customers’ expec-

tations. It seems like a simple enough step, but the reality is

that most companies have major hurdles for customers to

jump in effort to obtain servicing and support information.

Part of the solution is to organize information and make it

ridiculously easy to search, find and present.

3636 36

Loyalty Management™ • LOYALTY360.ORG

Loyalty Management™

Loyalty

Management™ LOYALTY360.ORG

LOYALTY360.ORG

This is a critical issue today because consumers are accustomed to

immediate information and are provided with a wide variety of

similar options, customers will choose the product or service from

the company offering the best overall experience. Web customer

service is a powerful tool and it can help companies to save money

over more expensive service channels. Done right, web customer

service allows customers to easily handle their own needs

at their own convenience.

unstructured data from a wide variety of sources in order to

provide world-class customer self-service that sets them apart

from their competitors and contributes significantly to sales,

revenue and profitability.

This paper will examine those elements critical to measuring

customer effort, the potential use of this information, examples of

some enterprises successfully deploying customer self-service

and the brand impact of customer self-service.

L
L

DONE RIGHT, WEB CUSTOMER SERVICE ALLOWS CUSTOMERS TO EASILY HANDLE THEIR OWN NEEDS AT THEIR OWN CONVENIENCE.

Analysts from Gartner and Forrester pointed out in a 2010 Harvard

Business Review article that reducing the effort that customers

need to make in servicing themselves makes it much more likely

that they will do business with the company again, plus it’s more

likely that they will also speak positively about their experience on

increasingly important social networks, positively influencing

other prospects.

According to Forrester, 66% percent of customers say that valuing

their time is the most important thing that a company can do to

provide good services. Forty-five percent of adults shopping online

will abandon their online purchase if they can’t find a quick answer

to their question.

Companies cannot rely on anecdotal evidence or what company execu-

tives think “should” be adequate customer self-service capabilities.

Enterprises need to collect, measure and analyze structured and

KANA—By unifying and adapting customer journeys across the contact center, Web

site and social community, KANA’s solutions have reduced handling time, increased

resolution rates and improved NPS at more than 600 enterprises globally.

Loyalty 360—A trusted source for cutting-edge research, best practices, and

networking opportunities. Loyalty 360 gives members the expert insights and

guidance needed to better understand loyalty and develop programs that effectively

engage and build strong relationships with their customers and employees.

paper, MINIMIZING EFFORT TO MAXI -

Download a full copy of the white

MIZE LOYALTY at: www.loyalty360.

**For optimal user experience be sure your

org/resources/research/kana-

THE FULL WHITE PAPER NOW.

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This is a critical issue today because consumers are accustomed to immediate information and are provided
This is a critical issue today because consumers are accustomed to immediate information and are provided
This is a critical issue today because consumers are accustomed to immediate information and are provided
This is a critical issue today because consumers are accustomed to immediate information and are provided

TECHNOLOGY, TRENDS & REWARDS

SHOP TALK

WHAT MOTIVATES SHOPPERS OVER 40 YEARS? NEW STUDY SHARES INSIGHTS WITH RETAILERS

TECHNOLOGY, TRENDS & REWARDS SHOP TALK WHAT MOTIVATES SHOPPERS OVER 40 YEARS? NEW STUDY SHARES INSIGHTS

JOE

CECERE

—Little & Company

  • D o the same shopping motivations still matter in 2012 that inspired shoppers in 1972 when Watergate was news, flares were HOT,

ABBA was IN and The Brady Bunch was on, and an average house

cost under $8,000?

With “Shop Talk: Building Brand Loyalty by Understanding Today’s Shopping Behaviors and Realities,” Little & Company

revisited the landmark work of Dr. Edward Tauber’s “Why Do People Shop?” study in its 40th anniversary year. The

commissioned study four decades later would revisit Tauber’s conclusions and also help us to better understand our retail

clients’ target audience and help them to identify opportunities to

improve brand loyalty.

We wanted to see if shopper’s motivations—the shopping experi-

ence and the shopping outcomes that Tauber looked at were still

relevant —and to gauge if we could affirm, and add to those views

with new insights based on the current marketplace.

• Are shoppers still driven by the same personal and social factors?

• If so, what are the implications for retailers who are trying to find

or maintain a competitive position?

Our study confirmed the basics of Tauber’s work: People shop for a

variety of personal and social reasons. However, where Tauber’s

work surveyed men and women, Shop Talk focused on women—

since 80% of them do all of the shopping today—and looked at the

impact of a number of trending retail realities. For example, the life-

changing impact of technology on brick-and-mortar stores, and the

fact that Millennials—with their discriminating tastes—are the

largest emerging demographic, and a new, key influencer group

raised and trained on mobile phones, websites and more recently in

social networks.

Surprisingly a lot of the motivations from 40 years ago haven’t

changed dramatically. But the expectations of how those motiva-

tions are met have changed dramatically. We thought that maybe

after 40 years Tauber’s conclusions would be outdated but no, they

provide a fundamental baseline that is still valid. We merely added

a coda to the work in looking at the impact of today’s retail realities

and added a new perspective for retailers to drive brand loyalty and

improve business.

TECHNOLOGY, TRENDS & REWARDS SHOP TALK WHAT MOTIVATES SHOPPERS OVER 40 YEARS? NEW STUDY SHARES INSIGHTS

JOE CECERE’S INDUSTRY PREDICTIONS

:: DEEPER CONNECTIONS: Retailers will develop a deeper and more meaningful connection with consumers, inviting them to take an even greater part in the conversation. Social media will play an even bigger critical role. Brands can no longer simply push information and hope it sticks. Because without an opportunity to answer back, it won’t.

:: Brands will strive for even GREATER

AUTHENTICITY IN 2013: Especially those that appeal to Millennials who are emerging as a powerful consumer demographic and as a sophisticated shopper with well-defined shopping habits. That means, brands have to be to true to themselves by being authentic and maintaining a consistent voice.

WE IDENTIFIED SIX BEHAVIORAL

PERSONAS THAT REFLECT TAUBER’S

RESEARCH & INCORPORATE HOW

SHOPPERS INTERACT TODAY:

Inspiration Seekers – creativity is a thoughtful part of the experience

Shopping Socialites – because sharing the outing is half the fun

Treasure Hunters – the adventures of a shoppers high

Brand Worshippers – a following for brand affinity

Pampered Guests – it’s the consideration that counts

Self-Expressionists – individuality is a trend all to itself

A shopper generally may fall into one of these categories, but

most will relate to several of the personas. Combined, these

personas capture the many facets of shoppers and are meant

to highlight their multidimensional nature rather than confine

them to a singular definition.

BEST PRACTICES

There

are

a

number of retailers that have been successful

in connecting with shoppers in light of today’s retail realties.

Below are a few examples:

PERSONA: INSPIRATION SEEKER

J. Crew: Offering Digital Touchpoints to Target Millennials

J.Crew offers several ways for millennials to get inspired. These

digital natives have access to the inspirations of J.Crew’s own

designers through Tumblr, which features regular posts from

different members of their creative team—including behind-

the-scenes content from scouting trips. In addition to their blog,

the retailer also sends out weekly emails from their Creative and

Fashion Directors and Head Women’s Stylist.

Surprisingly a lot of the motivations from 40 years ago haven’t changed dramatically. But the expectations
Surprisingly a lot of
the motivations from
40 years ago haven’t
changed dramatically.
But the expectations
of how those motiva-
tions are met have
changed dramatically.

PERSONA: SHOPPING SOCIALITES

Whole Foods: Taking Shopper Loyalty to a More Rewarding Level

Whole Foods Market Wellness Club is a loyalty program that

is sure to appeal to Shopping Socialites. The Club features:

health-minded courses developed by medical doctors, inspira-

tional and informative skill-building classes, supper clubs and

special events, coaching and support, and a growing network of

community businesses that promote health and well being. Not

only have they created a group for shoppers to belong, they’ve

also invited highly social events that revolve around the in-store

PERSONA: CONNECTING WITH BRAND WORSHIPPERS

Lululemon: Utilizing Health-Minded Employees to Educate Shoppers

Lululemon offers an inclusive, intimate shopping experience

made possible by employees who advocate healthy living. The

retailer also offers an ambassador program to unique individu-

als living in its store communities who embody the lululemon

lifestyle and culture. On top of that, its online presence promotes

community pages, a lively blog, and a detailed calendar of events

that continues the healthy brand experience.

environment.

The takeaway? To enhance a brand’s potential in today’s chal-

PERSONA: TREASURE HUNTERS

T.J. Maxx: Navigating a Competitive Strategy for Savvy Shoppers

T.J.Maxx launched the “Maxxinista” campaign, which empha-

sizes the savvy competition associated with finding insatiable

lenging retail environment, brands must align with shoppers’

values and motivations. Leveraging these behavior personas

ensures a brand’s relevancy and ability to drive long-term affinity

and loyalty.

L
L

deals. The entire store concept is based on “designer goods for

less.” What’s more, some stores offer The Runway—an exclu-

sive department overflowing with Italian, contemporary and

couture fashions at outrageously low prices. The real adrenaline

A multiple award-winning Creative Director and also the President of

Little & Company, Joe drives Little’s design-thinking to strategically help

“score” is felt when the original price is tagged with the sale price.

It’s a huntress’s haven.

continued on next page »

marketers better understand their culture and their customers, leading to

better sales, deeper engagement with the brand, repeat customers, and a

strong sense of inner and external loyalty.

TECHNOLOGY, TRENDS & REWARDS THREE CRITICAL DECISIONS MARKETERS MUST MAKE TO SEIZE 2013 AND BEYOND BOB
TECHNOLOGY, TRENDS & REWARDS
THREE CRITICAL
DECISIONS MARKETERS
MUST MAKE TO SEIZE
2013 AND BEYOND
BOB
FETTER
—Affect Results
A
s another blazingly fast year comes to a close,
we must look forward to 2013 and the deci-
sions that will shape programs through 2014.
As loyalty marketers think about their programs in
2013, smart mobile devices must drive their think-
ing around loyalty program design and especially
implementation. The critical decisions include:
So, as loyalty marketers and major brands alike come back to pick
apart strategic and budget decisions they have been kicking around
1:: HOW DO I INCORPORATE SOCIAL INTO LOYALTY?
all year,there are several absolutely critical decisions that could
Sure, brands have been dabbling with using Twitter and Facebook,
impact their loyalty efforts, either positively or negatively, for years
and with skepticism have experimented with Pinterest, Instagram
afterward. These are the kinds of decisions upon which careers are
and Foursquare. But now, as behaviors have shifted so dramatically,
made or broken. A confluence of factors will push these decisions
it’s time for marketers to get serious about investing in, maintaining
to the forefront over the next 12 months.
and developing social loyalty programs that also capture new
converts to the brand. However, none of these networks should be
Dealing with the Mobile Monster
thought of as the one place to implement loyalty. They all can be
supplemental however. Sponsored Stories on Facebook can find
Among the factors forcing loyalty marketers’ hands are first the
new converts through viral adoption and the social graph. A loyalty
inevitability of mobile and smart devices. It’s no longer if mobile will
program that rewards Pinning can draw new converts with alle-
be the dominate channel both in and out of store for consumer inter-
giance to Pinterest. Reviews and check-ins can be rewarded on Yelp
action with a brand, but simply when. According to a recent post,
and Foursquare. All of these efforts are designed to dip the brand
“the rate of iOS and Android device adoption has surpassed that of
net in the torrent of fish constantly swimming in these streams, and
any consumer technology in history. Compared to recent technolo-
drive them towards the brand’s loyalty program.
gies, smart device adoption is 10X faster than that of the 80s PC
2:: WHAT TECHNOLOGIES DO I USE TO DEVELOP MY LOYALTY
revolution, 2X faster than that of the 90s Internet boom and 3X
APPLICATIONS (APPS)?
faster than that of recent social network adoption.” 1
The smart device has given consumers an incredibly rich display
This has also caused a second factor to emerge, and that is the
with tremendous compute power right at their fingertips. Throwing
explosive growth of tablets, and in particular small form tablets.
poorly designed apps out there are doomed to failure. However, a
2013 just might be the year that e-readers 2 and forked Android
key choice must be made between native apps and mobile web
tablets go the way of Blackberries. The capabilities and user experi-
apps. A native app is one that has been developed for a specific
ence of both larger screen smart phones and tablets are simply
device (iOS or Android) and must be downloaded and installed on
overwhelming other devices.
that device. A mobile web app is one that is written to run in a
And, as computing becomes more wearable (see CNN’s story 3 about
browser on the device, so no download and installation is necessary.
Google Glasses) a whole new class of mobile devices will emerge.
A good description of the fundamental differences between the two
Finally, new forms of payments continue to explode, from Square to
can be found on Six Revisions. 4 From a decision-making perspective,
Google Wallet to the recently announced ‘Merchant Customer
one critical difference is that native apps, because they run on the
Exchange’, backed by Walmart and Target among others.
device, can integrate with the device’s features, like its phone,
40
Loyalty Management™ • LOYALTY360.ORG
accelerometer, specific location, etc., giving payment, receive information (tickets, the developer the ability to create really
accelerometer, specific location, etc., giving
payment, receive information (tickets,
the developer the ability to create really
e-receipts, etc.) in an incredibly simple
engaging applications. However, a mobile
manner. And, the entire cash register indus-
web app, as it runs in the browser and is
try will also undergo a massive transforma-
written around standard languages like
tion as they shift from fixed-location devices
HTML5, CSS3 and Javascript, can be writ-
to the very portable smart devices them-
ten once, and run on any device that
selves from which they will accept
supports the key browsers. And beautiful
payments!
eye-catching apps can be built quickly on
All of this means that loyalty marketers
these technologies to run on sharp,
must take into consideration that 5th P,
HD-quality screens. A native app must be
payments into their overall product and
written, tested and deployed for every oper-
loyalty strategies.
Will
I
adopt a single
ating system on its target devices.
wallet strategy or try and integrate with all
3:: WHAT IS MY STRATEGY FOR
of them? How can I enhance the customer
PAYMENTS?
experience through these devices in addi-
With the rush to smart devices comes the
tion to payment processing? The very
concept of what a receipt is
should change to a compelling
“ 2013 will be an amazing
transformational year in the
manner in which consumers
engage with brands”
rich media, relationship enhanc-
Bob Fetter is a Managing Partner at Affect Results,
ing experience.
a new kind of company focused on developing
In sum, 2013 will be an amazing
data-driven marketing programs and strategies
transformational
year
in
the
that truly affect results. Bob has over 25 years
manner in
which consumers
of data-driven marketing strategy work with over
engage with brands, both in and
200 clients across a wide variety of industries.
out of store.
Loyalty marketers
rush to turn that device into a wallet. Key
must begin mapping out the key decisions
players include Google’s Wallet, Apple’s
that they must make to absorb and take
Passport, IRIS (from the major wireless car-
advantage of these transformations.
L
riers), eBay and PayPal have announced
their own wallet, and most recently Walmart,
Target and other major retailers have
announced the Merchant Customer Ex-
change as reported on by GigaOm, 5 which
will at some point unveil their own wallet, to
run on virtually any smart device. In addi-
tion, both PayPal and Square have rolled out
a credit card swipe device for merchants to
plug into their smart devices to accept credit
cards, something the New York Times 6
BOB FETTER’S
INDUSTRY PREDICTIONS
covered recently. All of these initiatives are
including hooks for integrating loyalty
:: It’s no longer IF MOBILE WILL BE THE DOMINATE
programs into a single point, the wallet, and
providing some loyalty program design
CHANNEL both in and out of store for consumer
interaction with a brand, but simply WHEN.
capabilities for brands that deploy them.
:: EXPLOSIVE GROWTH OF TABLETS, and in particular
The value to the consumer is too compelling
to ignore, a new, digital wallet that allows
her to pay for anything, track all loyalty
programs, redeem points, etc., from within a
small form tablets. 2013 just might be the year that
e-readers and forked Android tablets go the way of
Blackberries.
single app.
The
wallet-based
programs
from
Google
and
Apple
will
be
built
on
Near
Field
Communications (NFC),
which
is
widely
:: NEW FORMS OF PAYMENTS continue to explode,
from Square to Google Wallet to the recently
announced “Merchant Customer Exchange”, backed
by Walmart and Target among others.
adopted outside
of
the US,
and
allows a
consumer to simply tap their
device on
another
NFC-enabled
device
to
make
a
1 “iOS and Android Adoption Explodes Internationally.” Peter Farago. The Flurry Blog: http://blog.flurry.com/bid/88867. August 27, 2012
  • 2 “Stick a Google Shaped Fork in Barnes & Noble.” Bob Fetter. Pluris Marketing: http://plurismarketing.blogspot.com/2012/07/stick-google-shaped-fork-in-barnes-noble.html. July 18, 2012

  • 3 “Google glasses are $1,500 – and you can’t have them.” David Goldman. CNN: http://money.cnn.com/2012/06/27/technology/google-glasses/index.htm. June 27, 2012

  • 4 “Native App vs. Mobile Web App: A quick comparison.” JT Mudge. Six Revisions: http://sixrevisions.com/mobile/native-app-vs-mobile-web-app-comparison/ July 11, 2012

  • 5 “Target, Walmart and Co.: Why leave mobile payments to others?” Ryan Kim. GigaOM: http://gigaom.com/2012/08/15/target-walmart-and-co-why-leave-mobile-payments-to-others/ Aug 15, 2012

  • 6 “PayPal Here Is More Than Just a Square Imitator.” David Pogue. New York Times: http://pogue.blogs.nytimes.com/2012/07/19/paypal-here-is-more-than-a-square-imitator/ July 19, 2012

TECHNOLOGY, TRENDS & REWARDS

 

THE

FREQUENT

DINER

CLUB

EVOLVES

—Loyalty 360

TECHNOLOGY, TRENDS & REWARDS THE FREQUENT DINER CLUB EVOLVES —Loyalty 360 L ettuce Entertain You has
TECHNOLOGY, TRENDS & REWARDS THE FREQUENT DINER CLUB EVOLVES —Loyalty 360 L ettuce Entertain You has
TECHNOLOGY, TRENDS & REWARDS THE FREQUENT DINER CLUB EVOLVES —Loyalty 360 L ettuce Entertain You has
  • L ettuce Entertain You has lowered the threshold for its loyalty rewards in order to improve communica-

tions with customers and drive more busi- ness into its 80-plus restaurants, most of

which are located in the Chicago metro- politan area.

“We let them know that they have earned rewards via e-mail. This way we can communicate with them and tell them something that they are personally interested in, rather than just sending them a marketing message.”

—Mike Lynch, director of loyalty marketing and market research, Lettuce Entertain You

Chicago-area members of the restaurant

chain’s Lettuce Entertain You Frequent Diner

Club had received loyalty rewards once they

had earned 360 points, resulting in a $25

credit. Now the threshold is 140 points for a

$10 credit, in line with Lettuce Entertain You

restaurants in other cities.

“It’s a way for our frequent diners to earn

rewards that much more quickly and to

communicate with them in a relevant way

that much more often,” said Mike Lynch,

Lettuce Entertain You’s director of loyalty

marketing and market research. “We let

them know that they have earned rewards

via e-mail. This way we can communicate

with them and tell them something that

they are personally interested in, rather than

just sending them a marketing message.”

A company can judge relevant e-mail

communications by tracking the percentage

opened by customers—the higher the

percentage of opened e-mails, the more

relevant the message, according to Lynch.

The higher the percentage of relevant,

opened e-mails, the more likely the diner is to

revisit one of the restaurant group’s locations.

In addition, Lettuce Entertain You recently

launched its’ mobile app: Lettuce Eats. The

app provides convenience to its frequent

diners allowing them to always have their

account with them, redeem rewards and

receive special personalized offers. Plus

individual restaurants are utilizing mobile to

provide gift cards, mobile coupons and

mobile comp cards. Read more on mobile best

practices in the inset on the next page.

Frequent diners provide an additional value

in that they are a good representative

sample of Lettuce Entertain You customers,

so their dining preferences, demographics

and other information provide valuable

marketing information for restaurant group

executives, Lynch said.

However, the loyalty threshold still had to

be high enough for customers to perceive

value in it, Lynch added. “It can’t come out

as a discount for every meal; it has to come

out as a reward for loyalty. But you can’t set

the threshold so high that guests can’t visu-

alize reaching it relatively quickly.”

The loyalty program itself had started

several years ago. Diners were
several
years
ago.
Diners
were

rewarded with coupons when they

achieved point thresholds. With more

than 50 restaurants in the Chicago

area, diners could quickly build up

rewards.

It was too expensive and too cumber-

some to mail out stacks of coupons,

so the threshold was set at $25, Lynch

explained. With far fewer restaurants

in other cities, the $10 threshold was

much easier to handle.

Lettuce Entertain You charges $25 for

Diners Club membership, which

includes a $10 credit that can be used

on the next purchase. Blue level

Lettuce Entertain You Diners Club

members earn 1 point for each dollar

spent, silver members earn 1.25

points per dollar, and gold members

earn 1.50 points per dollar. Members

achieve silver level status after spend-

ing $1,000 in a calendar year, and gold

member status for spending more

than $2,500. The status stays in

effect for the remainder of the calen-

dar year and for the following calen-

dar year.

The company changed to an elec-

tronic rewards system about three

years ago, with credits going directly

on loyalty cards instead of mailing

coupons, laying the groundwork for

the lowering of the threshold. But

there were other marketing programs

that took precedence, according to

Lynch.

For example, Lettuce Entertain You

has recently enabled frequent diners

to register their credit cards, so that

loyalty points are automatically cred-

ited when the registered card is used

for a meal or related purchase. The

restaurant group has also started a

co-marketing program with some

Chicago area sports teams.

L
L
TAKING THE LEAP From Plastic to Mobile DOUG DWYRE —Mocapay A successful customer loyalty program is
TAKING THE LEAP From Plastic to Mobile
DOUG
DWYRE
—Mocapay
A successful customer loyalty program is a two-way street. The program owner
rewards customers for desired behavior, in exchange for higher sales and repeat
customer visits.
Ultimately, loyalty is one of the strongest tools to influence and track customer
spending. Communications seems to be the challenge with loyalty programs; did you
know that “85% of those surveyed said that they haven’t heard a single word from a
loyalty program since the day they signed up”? 1 Communicating with customers is a
critical element of any loyalty program and traditional programs; however, traditionally
for plastic and punch card programs the control has been placed in the hands of the
customer leaving the program owner at the mercy of the customers’ whim.
Mobile is the best method to establish a two-way communications channel with your
customers and influence their spending behavior. In recent years, consumers have been
trained to use their mobile handsets for more than just texting and talking. The
proliferation of mobile applications, and specifically mobile banking, has increased
consumer awareness, adoption, and confidence in using their handset to transact with
businesses. In addition, consumers are trained to react to their handset, in fact “90% of
text messages are read within three minutes of being delivered.” 2
Strong loyalty programs should make use of a variety of mobile tools in order to make
the program simple and easy to use as well as convenient to the customer.
Some tools that should be considered include:
• SMS text marketing (outbound and
• Single-use & perishable awards/coupons
text-in)
• Multiple registration options: mobile, text
• In-app messaging
in, web, & POS (no registration cards)
• Geo positioning
• Real time and geo targeted triggers for
• Click-on awards
offers and messaging
• Mobile-enabled earn and
redemption tools
Another reason mobile is perfectly suited for a loyalty program is because consumers
react to immediate gratification, mobile satisfies this need. In fact, you are bound to see
improved results when using mobile to open up a new channel for your loyalty program.
When sending out promotions or coupons, consider the fact that “Mobile coupons
receive 10X higher redemption rates than print coupons.” 3
L
Doug is a seasoned executive with 24 years of experience in the financial services industry
delivering innovative payment solutions to issuers, merchants and consumers around the world.
1
ACI Worldwide Study, Wakefield Research December 2010
2
“Conversational Advertising”, mobileSQUARED comissioned by SinglePoint, June 2010, http://mashable.com/2010/08/19/mobile-advertising-trends/
3
www.gomobilebook.com
DOUG DWYRE’S INDUSTRY PREDICTIONS
I believe that 2013 WILL BE THE YEAR OF THE
RETAILER FOR MOBILE. Financial Institutions, media
and travel & entertainment are in full stride when
it comes to reaching their respective customers
via the mobile handset, retailers have yet to do so.
We are seeing the beginning of this trend in 2012 with
high adoption rates and significant transaction volume.

TECHNOLOGY, TRENDS & REWARDS

 

TIME TO GET

more personal

WITH YOUR AUDIENCE

TECHNOLOGY, TRENDS & REWARDS TIME TO GET more personal WITH YOUR AUDIENCE TARIQ CHARARA —Covario Subject:

TARIQ

CHARARA

—Covario

Subject: Today only—the best deals Body: None Search: blackberry; blackberry deals; best deals

Subject: Weekly newsletter Body: find the best prices on blackberry phones Search: blackberry

1. newsletter@smartphone.chararas.com - to investigate what effect the keyword as part of the

What was a little odd, however, was that an extremely generic query for a single term contained

2. deals@blackberry.chararas.com - to test the impact of having the brand name in the domain.

TO HELP ILLUSTRATE THE POINT, I’LL OUTLINE A BRIEF EXPERIMENT:

Gmail results in SERP. These searches demonstrate that the body content of the email has no

TEST #2: For the second email I sent from newsletter@smartphone.chararas.com I chose to

newsletter Results: With the exception of “newsletter” none of the search terms populated

Here’s a list of emails I’ve sent myself using the first address and the results for each search:

omit the branded keyword from the subject line and move it to the actual body of the email.

In the future, Google will probably omit displaying email results for overly generic matches,

TEST #3: Using the second email address, deals@blackberry.chararas.com, which actually

phones; blackberry prices; find the best prices on blackberry phones—Exact body content;

Results: As expected, all these queries resulted in the email messages showing up in my

Subject: Today only—the best deals Body: None Search: blackberry; blackberry deals; best deals Subject: Weekly newsletter
Subject: Today only—the best deals Body: None Search: blackberry; blackberry deals; best deals Subject: Weekly newsletter

impact on the results, whereas the mailbox prefix (e.g. newsletter@…) does.

Figure 2—Brand in subdomain with search term “blackberry” populates

Figure 3—With Generic query search “today” populates results.

contains the brand in the subdomain, I sent the following email:

within the subject of the email still returned a result. (Fig. 3).

as those will surely provide no added value to the user.

I set up two email addresses as follows:

Phones” populates Gmail results.

domain may have in the results.

personal results (Fig. 2).

Gmail results.

instances,whether the results (Fig. 1). line showed up in domain or subject the keywords in the
instances,whether
the results (Fig. 1).
line showed up in
domain or subject
the keywords in the
email that contained
branded term, my test
term or the non-
targeting a branded
Figure 1—Keyword in domain or subject line with search term “BlackBerry
Result: In both
Phones; smartphones
Search: Black Berry
Body: None
on BlackBerry phones”
Subject: “Best deals
TEST #1:
Subject: Today only—the best deals Body: None Search: blackberry; blackberry deals; best deals Subject: Weekly newsletter
Subject: Today only—the best deals Body: None Search: blackberry; blackberry deals; best deals Subject: Weekly newsletter

G oogle released a field trial in August of this year for

one of its newest features: displaying Gmail messages

within personal search results. As with many of

Google’s recently added features, the net is buzzing

with negative sentiment and resistance to yet another seemingly

invasive skewing of search results.

From an SEO and overall marketing perspective, however, the

new feature is actually a positive one.

Almost a year after Google launched its SSL (Secure Sockets

Layer) search for signed in users, SEO practitioners are still left

bruised and licking their wounds. As a result of Google SSL

search, Covario’s SEO clients are reporting that on average

between 26 and 36 percent of their Web traffic stems from

withheld keywords. Those numbers are bound to increase quite

a bit when the latest version of Firefox (with its 20 percent adop-

tion rate) rolls out with built-in default Google SSL search.

So, if we surrender to the fact that personalized search will even-

tually become the norm in terms of search engine results, this

new Google feature provides companies with an opportunity to

tie their email marketing and SEO/SEM efforts together quite

nicely. It also incentivizes businesses to align their email commu-

nications with what really matters to its customers or followers.

By optimizing and tailoring email campaigns around relevant

keywords, companies increase their odds of staying visible to

their customer base.

  • 44 Loyalty Management™ • LOYALTY360.ORG

THE FOLLOWING TEMPLATE COULD SERVE AS A BEST PRACTICE WHEN CREATING MASS EMAIL COMMUNICATIONS.

From: mailbox@brand.com To: john.smith@gmail.com Subject: Best Laptop & Notebook Deals Today Message:

From: mailbox@brand.com To: john.smith@gmail.com Subject: Best Laptop & Notebook Deals Today Message: Today only, we’re offering
From: mailbox@brand.com To: john.smith@gmail.com Subject: Best Laptop & Notebook Deals Today Message: Today only, we’re offering
From: mailbox@brand.com To: john.smith@gmail.com Subject: Best Laptop & Notebook Deals Today Message: Today only, we’re offering

Today only, we’re offering our best ever deals on new laptops and notebooks. Visit us here for more information.

Share this email with your friends!

From: mailbox@brand.com To: john.smith@gmail.com Subject: Best Laptop & Notebook Deals Today Message: Today only, we’re offering

Having a keyword, brand (or sub-brand) in the

  • mailbox, subdomain or domain will get you in personalized results.

  • Subject should contain relevant, high volume keywords that your business is targeting Body content should be relevant and supportive to the subject—include links back to the relevant

  • pages on your site and the ability for your current
    customers to share the communication—thereby

extending your audience.

It’s really too early to say how Google’s new feature will impact the

world of SEO and email marketing since the algorithm determining

what results are displayed seems fairly simple so far. As it currently

stands, one key take-away is that email marketers should consult

with their SEO counterparts to make sure each email-blast they send

out contains a focused keyword target within the subject line of the

email since the body content does not seem to have an impact on

displayed results. The content of the email should naturally support

the target keyword and offer users relevant information and links.

  • I n marketing there are two expressions we’ve heard at one point or another:

“Data is King” and “Content is King.”

Tweaking this a bit, I’m willing to offer up

a new expression: “Data-driven Content is King.”

Apart from consulting with the SEO counterparts, marketers should

try to gather as much data on their customers (existing and poten-

tial) from any and all data sources before putting together their email

marketing content calendar. In marketing there are two expressions

we’ve heard at one point or another: “Data is King” and “Content is

King.” Tweaking this a bit, I’m willing to offer up a new expression:

“Data-driven Content is King.”

What I mean by this is that far too many companies collect, analyze,

and silo off data from any given source—without contemplating how

this data can be used to drive traffic for another channel. It’s all about

targeting and re-targeting. We’re seeing this more often now where

companies are using pages that have been browsed on a site or even

search queries that brought you to a page to retarget display ads on

sites you consequently visit by tagging users via a pixel or cookie.

The underlying reason why such campaigns are effective is because

they are so targeted and tailored to the individual user and his/her

previous behavior or interaction with a site. The key is to know your

customers—existing and potential.

What does this have to do with Google’s new feature you may ask?

Check out the following scenario. Like many people these days, I tend

to be a pretty price-sensitive traveler. I don’t care too much what air-

line I travel with as long as it gets me to my destination safely at the

lowest cost possible. Google’s new feature experiments quite a bit

with displaying flight data from itineraries found in Gmail, as well as

flight information from various airlines. I get emails all the time from

the various airlines I’ve used in the past, but none of them seem to be

using my previous behavior/purchases to induce a future sale. I travel

to Miami at least twice a year—most often these trips coincide with

Christmas, Thanksgiving or some other holiday (i.e. I’m pretty predict-

able). Yet there are no offers catering to that particular trend (Fig. 4):

THE FOLLOWING TEMPLATE COULD SERVE AS A BEST PRACTICE WHEN CREATING MASS EMAIL COMMUNICATIONS. From: mailbox@brand.com
THE FOLLOWING TEMPLATE COULD SERVE AS A BEST PRACTICE WHEN CREATING MASS EMAIL COMMUNICATIONS. From: mailbox@brand.com

Figure 4: The offers and tag-lines are too generic. I’ve never been to Hawaii, and I

have never browsed for a flight to Hawaii—so why am I being sent this email?

Wouldn’t it make sense for airlines to be sending me emails for of-

fers on upcoming trips to Miami? I took the liberty of sending myself

an email on Delta’s behalf—with the subject line “Looking for Cheap

Flights to Miami–Fly Delta & Save.” Notice, this subject line has also

been optimized for SEO (Fig. 5): KEYWORD LOCAL MONTHLY SEARCHES [ cheap flights to miami] [
been optimized for SEO (Fig. 5):
KEYWORD
LOCAL MONTHLY
SEARCHES
[ cheap flights to miami]
[ cheap tickets to miami]
[ cheap flight to miami]
[ cheap flights to miami florida]
[ cheap flights to miami]
6,600
1,300
590
390
110
THE FOLLOWING TEMPLATE COULD SERVE AS A BEST PRACTICE WHEN CREATING MASS EMAIL COMMUNICATIONS. From: mailbox@brand.com

Figure 5: Subject line keywords, for better SEO results.

continued on next page »

Time to Get More Personal with Your Audience (continued)

So if Delta’s original email (which was pretty well targeted to me)

Data has shown that although email user numbers, as well as email

slipped through the cracks and I had ignored it that day, once I did start

my research for flights to Miami (using the most likely of search que-

ries), the results would look like this:

open rates, have steadily increased over the past, click-throughs have

actually dropped. Judy Loschen, vice president of digital analytics at

Epsilon, attributes this to the fact that “There are just a lot more emails

Time to Get More Personal with Your Audience (continued) So if Delta’s original email (which was
Time to Get More Personal with Your Audience (continued) So if Delta’s original email (which was

The email that previously slipped by me is now being served up again

through a Google search. Ironically, Google’s internal flights feature

shows Delta in an unflattering light with respect to pricing. With this

email being served up under my personal results now, I’m much more

likely to investigate the offer and give Delta a fair shot rather than just

clicking on the cheaper United flight from Google’s list right off the bat.

As a Sr. International SEO Strategist at Covario, Tariq combines his extensive

knowledge of the EMEA and APAC digital landscape with his marketing and

technology skills to provide overarching SEO strategies for Covario’s top

international clients around the globe.

going out and consumers are less likely to click through if the

email is not relevant and targeted.”

With Google’s new feature, marketers have another shot at

getting users to interact with an email—provided it was rele-

vant in the first place. So if nothing else remember to use your

data to mold content that will stick.

L
L
Time to Get More Personal with Your Audience (continued) So if Delta’s original email (which was

TARIQ CHARARA’S INDUSTRY PREDICTIONS

With Google constantly expanding its reach and audience with its products, the inevitable

future is that PERSONALIZED SEARCH WILL

BECOME MORE AND MORE PREVALENT. This

means that everyone’s search experience will be uniquely tailored to their browsing history, their social circles and previous interactions with products and brands—especially inter- actions that occur on one of Google’s plat- forms. Google’s goal is to deliver truly relevant content for each user, and it will be the marketers’ job to ensure the brand creates as many relevant touch points with its audience as possible.

Dare to be different!

Time to Get More Personal with Your Audience (continued) So if Delta’s original email (which was

You don’t have to settle for a “me too” program. Discover loyalty strategies that stand out. At Fair lane Group, it’s all about results!

Time to Get More Personal with Your Audience (continued) So if Delta’s original email (which was

Engaging People for Better Results

Loyalty • Incentives • Recognition www.fair lainegroup.com

For more info, please contact blue sh@fair lanegroup.com

905-669-9194

BY THE NUMBERS

 

Recent Industry Research

60% of mobile phone users unsubscribe 65% because the messages 40% of diners now aren’t relevant
60%
of mobile
phone
users unsubscribe
65%
because the messages
40%
of diners now
aren’t relevant (Vibes
say that they
of US smart-
Mobile Consumer
not only want, but expect
phone owners
Report) 5
your business to provide
are open to
them information and
75%
of organizations
receiving email
deals via downloadable
don’t have the
promotions on
apps 4
required capabilities to
their device on
analyze highly unstructured
at least a weekly
data 7
basis (Strong
Mail Survey—
DATA
Aug. 2012) 5
MOBILE
63%
69%
of organiza-
tions believe
of mobile
that using
phone users
information
unsubscribe
(Big Data
from mobile
33%
vote LinkedIn as your most
analytics)
marketing
influential social media
will give them
updates due
a competitive
to too many
edge 7
messages
LOYALTY 360
(Vibes Mobile
37%
Consumer
Report) 5
say we’re still
PULSE
mass blasting
– yes, really!
RESULTS
35%
those of you that redeem
only will New
Movers change brands,
87%
points for aspiration items
they’re
of customers said
2 to 3 times
they would become
of you hoard your points for
more likely to purchase/
even more loyal to
43%
acquire or upgrade their
companies and
big ticket items
products and services 2
brands that
handle product
recalls honorably
and responsibly 3
CUSTOMER SERVICE
CONSUMER
86%
BEHAVIOR
of consumers
More than 3/4 of [Telecom] Service providers
will stop doing
indicate that improved customer experience
business with
management provides an opportunity to attract
you after a bad
new business;
customer
experience 6
2/3 agreeing that it could improve their brand

image and nearly 6-in-10 confident that it will

provide competitive differentiation (Study from

Alcatel-Lucent and Heavy Reading) 1

  • 1 Britt, Phillip. “Telecom Providers Plan to Increase Customer Experience Management Spending.” Loyalty 360 – Resources.

  • 2 Epsilon. “New Mover Report 2012: Epsilon Finds Brand Loyalty Tested When Consumers Move” Loyalty 360 – Resources.

18 September 2012. Web. 27 September 2012. Web.

  • 3 The Relational Capital Group. “Building Brand Loyalty In The Digital Age.” Loyalty 360 – Resources.

2 October 2012. Web.

  • 4 “Why Restaurants Need to Integrate Loyalty with Mobile.” Loyalty 360 – Resources.

FuzeBuy - Jedlo, Nicole.

28 August 2012. Web.

  • 5 MarketingCharts. “Message Overload Causes Mobile Users to Unsubscribe From Updates” 12 September 2012. Web.

  • 6 “Attention retailers: mystery shoppers are so yesterday” The Queensland Times. 22 October 2012. Web.

Empathica – Baird, Andrew.

  • 7 “Survey Shows Organizational Challenges with Big Data.”

Britt, Phillip.

Loyalty 360 – Resources.

22 October 2012. Web.

CUSTOMERS COME AND GO. FANS RETURN AGAIN AND AGAIN. For three decades, Affi nion Loyalty Group
CUSTOMERS COME
AND GO. FANS RETURN
AGAIN AND AGAIN.
For three decades, Affi nion Loyalty Group has been a pioneer
in the loyalty and enhancement industries. We help our clients
retain and motivate consumers while delivering tangible results
and incremental revenue. We continually develop ground-breaking
products found in almost every wallet in America.
CUSTOMERS COME AND GO. FANS RETURN AGAIN AND AGAIN. For three decades, Affi nion Loyalty Group
www.affi nionloyalty.com 1-800-622-4863
www.affi nionloyalty.com
1-800-622-4863

BEST BUSINESS PRACTICES

 

VoC Best Practices to

DRIVE CUSTOMER SATISFACTION & LOYALTY

BEST BUSINESS PRACTICES VoC Best Practices to DRIVE CUSTOMER SATISFACTION & LOYALTY ANDREW MCINNES —Allegiance, Inc.

ANDREW

MCINNES

—Allegiance, Inc.

  • M ost executives have always known—or at least been told—that customer loyalty is

the best path to long-term profit-

able growth. Today that knowledge is impossible to ignore with increased competition across industries, more power in custom- ers’ hands, and fewer dollars flowing through the economy.

Enlightened leaders have responded by

investing in better customer intelligence,

recognizing that only a deep understanding

of customers can sustainably fuel loyalty-

building customer experiences.

Interestingly, this increased investment

hasn’t gone to traditional market research.

It’s gone to faster, more frequent, and more

focused intelligence that guides real busi-

ness decisions related to loyalty. As an

example, let’s take a look at health informa-

tion and dietary supplement provider

Healthy Directions.

EFFORTS AT HEALTHY DIRECTIONS

Facing a tough economy and rising customer

acquisition costs, Healthy Directions’ execu-

tive team doubled down on customer loyalty.

They appointed Julie Kaplan to the position

of Executive Director of Customer Experi-

ence, and they put her on a mission “to bring

the customer’s voice to the forefront of the

business and identify factors leading to prod-

uct loyalty and repeat purchases.”

Like most firms, Healthy Directions already

had customer data. It just wasn’t adding value. As Kaplan explained,

“Tracking revenue gained by direct mail marketing campaigns wasn’t tell-

ing us what we needed to know. And though we had some feedback to

work with (from periodic market research surveys), we weren’t doing

anything with it.”

“We needed a formal voice of the customer (VoC) process that would

gather feedback and other data, analyze relationships and trends, and

help us figure out actions to strategically influence a customer’s deci-

sion to buy our products,” Kaplan said.

REAL TIME CUSTOMER INTELLIGENCE

Rather than spend more money on old-school research services, Kaplan

and the Healthy Directions team decided to invest in a customer intelli-

gence software platform to handle multiple VoC activities and deliver

results in real time.

The team went from getting feedback about its products a few times a

year to getting feedback every week. Weekly surveys cover tactical

product considerations, such as clarity of instructions, as well as aspects

of customer loyalty like likelihood to repurchase products and recom-

mend products to friends.

With real-time analytics built into Healthy Directions’ customer intelli-

gence platform, Kaplan and her team quickly and flexibly analyze their

new up-to-date data to find insights that they can apply in time to drive

real results for the business.

In one instance, Kaplan said, “We scoured the feedback, ran the analysis,

and the big AHA! was that customers repurchased if they noticed a

(health) difference by taking the product or if they thought the product

was helping them to prevent health problems in the future.”

ACTING ON INSIGHTS TO INCREASE RETENTION

The Healthy Directions team then dug deeper to find out exactly how to

capitalize on the opportunity to increase retention and revenue. For exam-

ple, they analyzed open-ended customer comments with the platform’s

integrated text analytics engine to understand exactly how customers

perceived health benefits associated with dietary supplements.

In the end, this process led to products that better meet customer needs, better

communicate customer value, and better drive repurchase behavior—in other

words, better outcomes for both customers and Healthy Directions.

ELEMENTS FOR PROGRAM SUCCESS

Thousands of companies are beginning to experience similar benefits

by embracing timely, relevant insights across their organizations.

Industry leaders from JetBlue to SAP now use next-generation

customer intelligence software to improve customers’ experiences