Loyalty Lab Blog

by Mark H. Goldstein | CEO

Today I went to SocialMedia Business School. Cool school too; located on Pier 38 overlooking the Bay. I sat in a class with 100 other developers listening to what it takes to have a successful Facebook app. Produced by SocialMedia, the leading ad network on Facebook and a kick-butt startup…

Rule 1. In designing the app…MOST important thing to figure out up-front….”Why should every person want to tell everybody they know?”

Rule 2. 50% of your development team’s energy needs to go into analytics, constantly in real-time tweaking the app, tuning the invites, the data model, text, images, links based on the latest second’s data you have on your customers at your fingertips.

Rule 3. While the initial download is great, re-engagement is critical because it’s not about the downloads—it’s about the number of daily active users of your application. Why should someone reengage with my app? Can’t be one-time flash in the pan and ‘cute’, otherwise you fade fast.

Rule 4. The ‘pictures from last weekend’ is the killer content, in part why Monday and Tuesday are highest traffic days—it’s what everyone wants to see!

Rule 5. On Facebook, everyone is trying to ‘outsmart’ the other…the proving ‘I’m smarter than you’ is what it’s all about. Beat your friends at a game, outguess them in a quiz, rank your smartest buddies, find the hottest new thang……

Rule 6. Finally, despite Facebook’s clamp on spamming friends and some folks claiming ‘Facebook Fatigue’, developers I quote said ‘it’s still possible to be successful as a Facebook app developer’ but the ‘get a million users fast Gold Rush’ is a thing of the past.

by Joshua Tretakoff | VP, Account Management

AOL, in their efforts to build relevance for their brand, today announced a service that is near and dear to the founders of Loyalty Lab’s hearts: they have created a consumer service to allow you to “clip” coupons to your grocery store loyalty card. Now, this is different than those signs you see in the store that advertise lower prices when you use your loyalty card. No, this is manufacturers offering specific coupons to specific customers; the loyalty card is just the redemption mechanism.

What’s truly interesting about this is the integration with the POS: their only current retail partner is Kroger’s, who have a substantial presence with Ralph’s, King Soopers, etc., and Krogers has integrated this “Shortcuts” functionality via an API. In essence, the cashier scans the cards, and the POS makes a real-time API call to the AOL service, determines if there are any applicable coupons “clipped” to the card, and adjusts the price of the customer’s total.

Loyalty Lab has been proud to offer this functionality for some time now, but we take it a step further. For instance, the AOL service requires “about a dozen” employees to run; our system lets you do it with less than 1/2 a FT resource. Plus, with Loyalty Lab, you can segment and target specific groups of customers, rather than all. With our strict adherence to PCI, the privacy concerns that are raised about the AOL service are alleviated. The list goes on, but we’re certainly glad to see AOL join the party!

by Joshua Tretakoff | VP, Account Management

Internet Retailer has an interesting article on the rebirth of EddieBauer.com, after a complete overhaul. Being a complete loyalty provider for dozens of top retailers and e-tailers, we work with almost every type of e-commerce site there is, from Fry Interactive-powered, like Eddie Bauer, to GSI to MarketLive…the list goes on.

One interesting excerpt here is how EddieBauer.com took advantage of the redesign to address some of the most frustrating feedback they received from loyalty customers: real-time inventory availability. What’s more interesting is how they are doing it: RSS feeds. Usually used to syndicate blogs (like ours), or podcasts, Eddie Bauer is  using RSS for feedingup to date information on the in-stock availability of items:

“Now Eddie Bauer is using a real-time data feed and Really Simple Syndication to update its web site and mix and match program with continuous product availability. RSS feeds are formats used to publish frequently updated web site content. “Before, the entire inventory updates were fed manually into the system,” says design engineer Peter Sylwester. “Now it’s a continuous feed. If an item is out of stock, it won’t appear as an option when the customer is mixing and matching.” 

Smart use of new web standards to ensure customer satisfaction.

by Mark H. Goldstein | CEO

www.cellfire.com just raised an additional $12M in venture financing. I think this puts something like over $25M into the firm and that officially makes it a big venture bet.

I use Cellfire and while it’s not there yet (the only offers made to me are for movie rentals and 1-800-Flowers.com so it totally lacks content), it strikes me as the one with greatest potential to break out. SMS messaging by marketers is waning…as users are opting out and governments are opting into setting restrictions. The name of the game here isn’t intrusive messaging, it’s politely having the right offers at the right time. Cellfire has a nice UI and works well, although slowly, on my Blackberry Pearl phone.

If I were Valassis, I’d buy these guys, for example.

The mobile messaging landscape in the US is becoming more clear.

We saw the free-411 directory assistance services start to give up on message targeting and simply focus on getting broadcast messages to users (new movie releases and everyday products used by everyday people). It’s now beginning to work and generate revenue.

Malls are experimenting with mobile with some initial success. If I were a mall, I’d have a service to prompt my younger customers to text-in and get targeted offers sent to them while they are strolling the mall….sure beats paper coupons! Westfield and Simon expect to double-down on these investments this year.

Of course, the Koreans and Euros are well ahead of us, thanks to a more mature and speedier mobile platform. It’s going to be an interesting next few years in mobile marketing…

By Joshua Tretakoff | VP, Account Management

There seems to be a new wave of emphasis on “green” loyalty programs: programs that have a component that favors the “eco-friendly.” For instance, see this study from Razor’s Edge Business Intelligence that cites the rising popularity of such programs.

You have to wonder: these are the same programs that inundate your home with direct mailings, provide you three kinds of plastic cards to use as your identifier, and other not-so-friendly tactics. If they want to truly be eco-friendly, why not go with the resources that don’t impact the ecosphere? Direct marketing mailings? Replace with e-mail and stress the importance of capturing it in all channels. Identifier cards? Every identifier card suffers the same illusion: that the consumer will willingly displace another card in their wallet to carry yours, even though there is already an alternative identifier available (phone number, e-mail address, etc.)

If these programs are so popular, then the client who first uses these tactics and educates their members as to why they do will surely be the winner.

by Mark H. Goldstein | CEO

SaaS advocate Phil Wainewright has come out with his predictions for SaaS in ’08. I have one of my own, or at least a strong suggestion: Retail & CPG must move to the hosted data model. Why? It’s happening in every other industry. Hosted shared services like address verification services and the sharing of profiles with marketing partners (vendors, adjacent mall stores, synergistic service providers) all promote a useful intermingling of data services that can advance all participating data partners….

by Joshua Tretakoff | VP, Client Services

We get a lot of folks who are asking about the ability to use Loyalty Lab’s amazing targeting and dynamic content to populate transactional emails. You know, those emails you get from a system when you’ve placed your order, with the order details? The theory goes that, since these are about specific orders, they will be much more influential than traditional email marketing. Good theory, but DIRECT Magazine sounds a cautionary alert for those who might take it too far.

by Mark H. Goldstein | CEO

Wow, lots of opinions circling about on this topic. I thought this post was a great ‘luddite-esque’ view of things, but one which I can a hard time refuting. Something tells me that the winners in Facebook advertising are going to be the smaller firms that dig in and solve the hard problems. Facebook is not a marketing firm and their DNA is not direct marketing, advertising or targeting. Their culture is that of a next-gen web portal rich in compelling features. My bet is Facebook fails at their own advertising plan, and instead uses that wacko $15 billion valuation to buy smart marketing companies that will figure it out for them—the way Yahoo bought Overture back in the day.

by Matt Howland | CTO
Over on All Things Distributed, Werner Vogels has provided some insight into the inter-workings of Amazon’s service offerings (S3, SQS, etc.). The Dynamo paper really is a terrific read to get a feeling for some of the trade offs in designing scalable, “always on”, highly fault tolerant key-value stores.

By Ed Martin | VP, Engineering
Marc Andreesen, Netscape founder and current Ning CEO, has an interesting blog post explaining the types of platforms available on the Internet.

The first type of platform, which he calls “Level 1″, is the Web based API. This is the type of API Loyalty Lab provides. The post gives a concise, clear and mostly non-technical explanation of what Web API’s are and how they can be used.

The other two platform “levels” are far more advanced, and he gives a good job of explaining and giving examples of types of sites currently available on the Internet. It’s an interesting read that shows the future of where Internet applications are headed.