Loyalty Lab Blog

by Michael Greenberg | CMO

Maybe I’m late to this party, but on my trip to LA two weeks ago to see a client, I checked into LAX arriving and leaving, to two different foursquare entries, and both mayorships had been hijacked by a travel-oriented website. Its an obvious tactic that Foursquare will need to address quickly, but shows how fast the market can exploit an opportunity.

In many ways, this is an inflection point, where guerilla marketers are looking for loopholes to exploit. As mobile quickly becomes a channel for customer interaction, with a dizzying array of new applications, services, and devices, its inevitable that the masses are right behind. The huge upswing we’ve seen in mobile marketing enhancement requests are pushing us to add features and functionality plus new partners to extend the customer relationship to the mobile device. Given the potential, it makes perfect sense.

by Joshua Tretakoff | EVP, Services

According to TechCrunch, Amazon is attempting to make a revolutionary counterattack to Steve Jobs. If you haven’t followed, Amazon introduced the most successful e-reader to date, the Kindle.  It’s been so successful, it’s been compared to do for books what the iPod did for music. Naturally, there’s a certain CEO in Cupertino who decided he wanted that segment, so he introduced his answer, the iPad, complete with iBooks.

Now here’s where it gets interesting. Does Amazon simply lay down and surrender their leadership position to Apple? Not according to TechCrunch: they have decided to fight back by giving away a Kindle to every one of their current Amazon Prime subscribers.  Amazon Prime allows loyal Amazon customers to pay $80 a year for the privilege of getting all of their purchases shipped 2-day air, free of charge. That’s a profitable and loyal customer base; if you have paid for Prime, why would you ever shop anywhere else? Now, reward that loyalty with a Kindle, and you have an enormous customer base who can only buy content through you; if even a portion of those loyal customers buy a few books, you dominate the space, and the iPad plays catch up.

Will it work? Will they do it? Stay tuned, but one thing’s for sure: Loyalty will tell the tale.

By Michael Greenberg | COO

Ever since the WSJ article on the end of email, its been a cage match between email service providers and social media/emerging technology. Hyperbole aside, this is just part of the natural evolution of technology. Ideas that were cutting edge become mainstream and eventually become background noise.

What makes this time so different from years past is the sheer number of channels for interaction. Its tempting to try and take on all of them, but unless you have a large team or superhuman skills, you won’t be able to put enough time and energy into each channel to get a good return.

So the key here is to pick your battles, find the channels that make sense, and put in the resources to make them work. We love what Express is doing on Twitter – focus, cadence, good content, personality, and fits naturally with the rest of their marketing and brand voice. We also love what Pink does on Facebook – it also has focus, cadence, good content, personality, relevance, and stays exactly on brand.

Brands can learn a lot from these examples. Success in the new (mostly) social channels comes from resourcing and focus more than anything else. Just check out Chris Brogan, who has become the foremost social marketing guru through sheer force of will…51,000+ tweets, over 100K followers. And he seems to have conversations with every single one.

by Joshua Tretakoff | EVP, Services

A lot of clients we’ve worked with focus on rewarding customer shopping behavior. Some are starting to go outside that, broadening the appeal of their programs to award customers for reviews and social networking. H-E-B, a San Antonio-based market chain, decided to increase the appeal of its program by focusing on some issues that are important to its customer: reducing traffic and waste.

Starting tomorrow, Houston residents who sign up with H-E-B for the Commuter Challenge will be able to earn $5 off every $50 in groceries when they earn points by “taking cars off the road.” They’ve teamed up with a third-party company, NuRide, to track the points earnings, and will be encouraging all shoppers to earn jointly towards the goal of “conserving” 15 million miles.

A revision to a loyalty strategy that involves tangible earnings, core customer values, and a joint participation goal? Sounds like a winner to me.

by David Rosen | SVP Strategy & Channel Development

Thank you to Mark Silva of Real Branding for posting this graphic from SXSW today.  It’s a great visual of Zappo’s culture = brand = customer loyalty presentation by their CEO Tony Hsieh.   Here is a link to the original

By Mark H. Goldstein | Chairman

I’d always liked these guys and we were going to build a program with competitor Backcountry 2 years back until they back-treaded a bit…..but take a close look at Moosejaw…this is a powerful programs…simple benefits, but what i like most….look how easy they allow you to use points OR $$$ to buy…this is the new world order and what consumers expect and demand..other than 50% off everyday

by Joshua Tretakoff | EVP, Services

Nine West has just launched their Loyalty Lab-powered program, Nine Loves, and you can sign up today.  Valid in any of the hundreds of Nine West stores, on NineWest.com, you earn 10 points for every dollar you spend on the shoes you love today. Plus, you get birthday gifts, possibilities for free shoes, and more!

We’re not usually ones to talk about our great clients here, but this one is irresistible. While we know the program is going to a big hit with the great Nine West customers, we look forward to seeing the new customers who join as a result!

by Joshua Tretakoff | EVP, Services

One of the latest trends with many retail loyalty programs is a shift of emphasis from a hard, points-based accumulation program, to one that emphasizes more exclusive access or “surprise & delight.” While Best Buy is certainly one of the most prevalent points programs out there, they have definitely stepped up the access benefits. For instance, they are now offering $100 off the purchase of an iPhone, exclusively for Premier Silver Reward Zone members.

When you think of how hot this phone is, and that unlike almost every other phone, there are no discounts allowed by Apple, this is a pretty serious perk for loyal customers. Other retailers should follow suite, with special discounts on specific hot products, or the ability to get to the front of the line (think Wii Fit). Augmenting or replacing your points based program with these exclusives is what keeps those customers coming back for more and more.

by Joshua Tretakoff | EVP, Services

Advertising Age Magazine has a good article today on the retailers who are thriving in the down economy. The common thread through most of their case studies is the presence and prevalence of a strong loyalty program. Salient clips from the article:

•  “[Kroger] offered gas discounts and free groceries in exchange for points earned through its loyalty-card program…data from its loyalty-card program are being used to send unique coupon offerings to specific households. “We understand and appreciate that no two customers are alike,” said David Dillon, Kroger’s chairman-CEO. “Some may live in the same city, some in the same neighborhood and even on the same street, but we know that they don’t have the same shopping habits. This level of personalization is a direct link to our customers [that] no other U.S. grocery retailer can replicate.”
• CVS: “Rob Price, the chain’s senior VP-marketing and advertising, pointed out that not all of the retailer’s programs are captured in measured-media data. Its massive ExtraCare loyalty program, for example, is not tracked. That program, which counts more than 50 million cardholders, has spawned more targeted marketing efforts, with promotional offers at the register, coupons, e-mail and direct mail.”

There’s also an anecdote about how certain companies who are definitely hurting the most, like Pottery Barn, are rolling out a loyalty program to try to turn the tide. Overall, yet more good reason for retailers to embrace loyalty.

by David Rosen | Senior Vice President

I read today a story about Calgary-based WestJet (The “Southwest Airlines of Canada”). 

For many travelers in North America this past week, long lines and crowded planes have been the least of their worries.  The news was filled with reports of people stuck in Seattle and struggling to be rebooked after cancellations in much of the East and Midwest.

Meanwhile, in Canada — in the spirit of the holidays — WestJet went out of its way to provide nearly 5000 stranded customers with free meals, hotel rooms and alternate travel options (including charting aircraft from other airlines).

What WestJet understands is that airline loyalty really has little to do with points or perks.  What truely endears loyalty to a carrier (or any business for that matter) is that unique connection with their customers at times when the effort is most appreciated.