Loyalty Dogs Blog

by David Rosen | SVP Strategy and Channel Development

I’ve been following two trends that make me very excited to be a Loyalty marketer. Developing high-value, enduring relationships with loyal customers/guests/shoppers/members isn’t new. But what were starting to see on forefront of smart marketing is simply awesome.

Trend One – Farm Cash for Fans.

I used to work at a company called MyPoints. It’s an amazing marketing engine that could change the behavior of hundreds of thousands of members by offering points in exchange for purchases, registrations, surveys, etc. Problem was, points are expensive. Basically it costs about ten dollars to reward a member with a ten dollar Starbucks card. And we mailed a lot of Starbucks (and Target, and Red Lobster and Macy’s and Amazon, etc. ) cards.

Last week players of Zynga’s amazingly popular game Farmville were offered Farm Cash for fanning Bing. Twenty Four hours later, 400,000 virtual farmers had taken the bait and signed on. In a flash, Bing surpassed Google in the hyper-followed ranking of “how many fans do you have on Facebook” stat.

And guess how much Farm Cash costs Zynga? A lot less than a $10 Starbucks card I’d guess.

Trend Two – Check In and Earn Points.

I’ve been watching for this one for some time. The very cool fro-yo shop Tasti D-Lite is now offering loyalty points when its members check in on Foursquare. Cool on so many levels: drives engagement, posts to Facebook – and more interestingly begins the process of geo-based permissioning for offers.

I strongly believe that location is the next frontier for right offer at the right time to the right person. However, geo-based targeting really does bump up against the marketing creepy factor. Loyalty programs bridge that gap by establishing a fundamental permission level for members and rewarding that additional permission with some type of gift or reward.

More to come on this one and we’ll make sure that we’re driving what happens next.

by Joshua Tretakoff | EVP, Services

Imagine you are a retailer. You want to know not just the purchases that your customers make, but when they visit your stores and don’t make a purchase.  Hard to do, right? What if you could make a benefit of  your loyalty program tied to just that?

That’s just what a maker of GPS software, Navizon, has done.  Instead of just charging their customers for their software, they actually are paying customers to install their application on their iPhone, so they can use their loyal customers to map cell towers and WiFi access points.  Now, the customer has an ongoing incentive to use the software, and the company gets rich, real-time geographical and behavioral data, all with the user’s permission.

Being able to make your customers more loyal, and your loyal customers your most valuable ones, is the name of the game. Knowing when your customer comes in and doesn’t buy, especially your most loyal ones, is often more valuable: where are they going after they leave you?

by Joshua Tretakoff | EVP, Services

Do you know Frank Eliason? You should. He’s also known as Comcast Frank, or, more importantly, ComcastCares on Twitter. Frank singlehandedly put a face on the customer service for Comcast, realizing that the biggest reason why customers defected was that there was a perception of indifference or unresponsiveness. Instead of sitting on a phone tree waiting for a rep, just message @ComcastCares; Frank responds quickly and efficiently. Event better, Frank monitors Twitter for mentions of Comcast,  and offers proactively to intercede on the customer’s frustrated behalf. In short, he completely changed the perception of Comcast from an indifferent behemoth to a proactive advocate.

Frank also writes his own blog. This week, he writes about his experience with a loyalty program on a flight.  Read his trials and tribulations for yourselves: what is supposed to be a program that rewards you for loyalty only succeeded in putting him through so many bureaucratic hoops that it is almost worse than being treated anonymously.

What struck me was the complete lack of addressing the customer by name in the communications the airline used. Instead, they constantly used the Loyalty Number or Error Code; it felt almost Brazil-like. And, as Frank points out, the only warmth in the communication at all came from their ad in the e-mail to have you get a discount at Hertz. First and foremost in a loyalty program, remember its not about the points: it’s about the way to help make a customer into your best customer. Every message, interaction, communication, and customer experience needs to be viewed through the customer lens. No amount of points will make a customer forget being treated as just another number if you truly want their business.

by Joshua Tretakoff | EVP, Services 

One thing loyalty programs try to do best is identify customers; many times, that can be the sole purpose of them. Why? To ensure that the company can better understand each person as an individual, and reward them for their ongoing patronage. In the quest to get better usage by customers, companies employ technology to make it easier for customers: key fobs, using your phone number, even simply waving your cellphone at a pad…all in the name of better identifying customers.

Now comes a new approach being discussed: what about using a license plate as a loyalty card? Seems crazy, but for large loyalty programs, at destination retailers, it may make financial sense. Imagine not having to carry anything into your favorite store, but still getting credit for your purchases. Convenience, taken to the extreme.

by Michael Greenberg | COO

If you go back and read The Loyalty Effect there’s a lot of reference to the referral value of customers as one of the 4 incremental sources of value from customer loyalty. Referral value has been very tough to measure in the 13 years since the book was published…until now. Social media provides an excellent view of the influence of a customer, plus new value from content contribution.

Connecting relevant social media to your customer data is increasingly possible and provides many benefits. We’ll be covering this topic from many directions over the coming months. Learn much more from our white paper, available for download here.

by Mickey Neuberger | VP Loyalty Strategy

One of the best marketing examples I’ve seen for driving that next visit.

After my meal at CPK the server handed everyone in my party a secret envelope thank you card BUT DON’T OPEN IT. On your next visit to CPK, a manager will open it for you and you win the prize inside for being a loyal customer … EVERY CARD IS A WINNER. And some envelopes contain $50k prize.  Mine contained a 20% off discount (yeah I opened it).

As if the great Sicilian pizza and BBQ chicken salad weren’t enough.

by David Rosen | Senior Vice President

Today the Marketing Executives Networking Group released their latest study of current marketing trends.  Canvassing over 2000 senior-level marketing professionals across mutliple industries, revealed the following priorities for the new year:

• Customer Satisfaction
• Customer Retention
• ROI
• Brand Loyalty
• Segmentation

In the words of the study’s authors, “all of which indicate a return to the basics of marketing.”

At Loyalty Lab we’re redoubling our efforts in 2009 to be the most effective, productive and profitable tool for top marketers to manage their best customers, increase retention and promote the highest levels of brand loyalty.

by Joshua Tretakoff | VP, Account Management

Interesting discussion in RetailWire today: seems that a couple of French professors concluded a study of loyalty programs, and determined that traditional “one size fits all” programs don’t really have a long term effect, but personalized programs that address customer’s individual needs have a dramatic one.

Their advice?

Not unsurprisingly, the professors argued that retailers should focus on providing customers with more “individualized rewards, based on what they value.” As such, the scholars identified five different purchase motivations in surveying shoppers in France from 2005 to 2007:

1. An economic motivation: the main goal is to save money;
2. A hedonistic motivation: the aim is to feel pleasure;
3. A routine-loyal/risk-avoiding motivation: the goal is to reduce the risk of being disappointed by a purchase by remaining loyal to a favorite brand or store;
4. A relational motivation: buyers seek to establish a relationship with a store or its staff and be recognized as a privileged client;
5. A functional motivation: the aim is to decrease the time and effort devoted to making purchases.

One of the reasons we founded Loyalty Lab was for just this: the ability to create highly individualized, targeted segments within your program, on the fly, and be able to set up different programs that “speak” to the customer. Nice to see this strategy now has scientific backing.

by David Rosen | Senior Vice President

Greetings from Las Vegas.

In what is an annual pilgrimage to Shop.org’s annual summit, some observations…

Attendance is up. One marketing conference later this month was actually cancelled due to lack of attendee registration. Not at all the case with the ecommerce crowd. General feeling – confirmed by attendees, analysts and the show organizers – is that ecommerce remains the shiny button at many multi-channel retailers where physical stores are suffering from consistent negative sales comps.

No real show theme. Last year you could have compressed the entire show into one big session titled “If you don’t figure out facebook today, you’re gonna get fired.” This year was back to blocking and tackling: better search, more analytics, email delivery. The doomsayers of economic woe were hard to find.

Customers matter. They really do get it. It makes no sense to reacquire your customer base daily through Google. We no longer have to explain the logic of investing in cultivating and retaining your customers. Loyalty is rewarded. Shop.org is a tough group to crack. The companies that win with these members are the companies that invest year after year in the organization.

If you want to learn about the state of the U.S. economy, spend some time chatting with a Las Vegas cab driver. They’re smart, articulate and have keen senses of observation. If Americans are cutting back, Las Vegas feels it.

Will the DMA show be this vibrant? I’ll let you know next month.

By Mark H. Goldstein | CEO

The Wall Street Journal today offered advice regarding storing customer data. Their point of view – which I concur with – is if you don’t use your customer and credit card data, don’t bother taking the risks in storing it. My view is – if you store this data, mine it. Ensure custom messaging, offers and insights flow from each megabyte of data you store. Data is like sand in a sandbox. If you have kids and they use the sandbox, it’s great. If you don’t have kids, and there are cats in the neighborhood, don’t keep sand in the sandbox. It ends up being quite a negative experience.