On the Sixth Day of Loyalty Marketing Nirvana: Assess the Total Cost of the Program

We all want to achieve the highest level of success possible, and with loyalty marketing initiatives requiring significant planning to complete the journey, each step is critical. Missing a step could mean failure, but hitting your stride as you develop your rewards program can help your business reach new heights.

Calculating Total Cost of Your Loyalty Program

If you’ve been following along with our series, you’ve already generated and validated your best ideas and earned the necessary consensus. To continue with the journey to loyalty marketing nirvana, we must now calculate the true cost of the program.

As noted by Shawn Turner in his article “Loyalty programs are worth the cost,” the hotel industry is one that has seen a significant ROI despite high initial investment.

So, how can you calculate the total cost of your loyalty initiatives and ensure your business booms rather than busts? Considering the size and scope of the program, upfront costs, ongoing costs, technology, marketing, and administration, even the most seasoned business veteran’s head might start spinning. However, breaking up the key costs into smaller pieces will help.

Here are the key considerations:

  • How big is the program?
  • How much are upfront costs, such as initial technology and supplies?
  • What will be the ongoing costs, such as a monthly subscription program and maintaining supplies?
  • Will your business need any new technology or training?
  • How much will you market and upsell your new incentive reward program?
  • Will you need additional staff to ensure the administration of the program is covered?

Answer each of these questions individually, and by the end you will have calculated the true cost of your program. As an added bonus, if you’ve been following our 8 Days to Loyalty Marketing Nirvana, you will have also developed a loyalty program that should reflect a great ROI. We’ll look to calculate that in our next post.

Would you like more help determining the total cost of a loyalty program? Our experts are here to help you reach new heights. Tweet us @TIBCO using the hashtag #LoyaltyLab.

On the Second Day of Loyalty Marketing Nirvana: Establish Value Drivers

Congratulations on making it to the second day of loyalty marketing nirvana. Now that your stakeholders are organized and committed to your loyalty programs, let’s talk value drivers.

Value drivers are established to ensure business objectives are met on a strategic and operational level. Each one  is also directly tied to either a technology or a business outcome.

So let’s dive right in to some examples of value drivers for loyalty marketing, shall we?

Loyalty Program Value Driver #1: Turn Customers Into Fans

Turning customers into fans is a strategic objective tied to a business outcome. It is all about delivering relevant offers through optimal channels at a precise moment in the buying cycle in order to maximize the lifetime value of your customer.

A major component of your initial business strategy will focus on actively driving the highest possible percentage of customers into your loyalty program so you can then deliver and optimize your engagement methods over time.

Loyalty Program Value Driver #2: Intelligent Contextual Engagement

Intelligent contextual engagement is a strategic objective tied to a technology outcome. Determining how to properly integrate data at rest and data in motion with powerful analytics and real-time decision engines allows you to deliver contextually rich customer engagement with ease.

To attain true visibility into customer context, the customer data that resides within your CRM system is not enough. Pulling data from all available streams (e.g. social, transactional, weather or other events) allows your technology team to present a transformational point of view to your enterprise.

Loyalty Program Value Driver #3: Omni-channel SaaS Platform

An omni-channel SaaS platform is an operational objective tied to a technology outcome. While not an absolute necessity, the numerous advantages of a SaaS platform over traditional software are making it the model of choice for an increasing number of businesses.

When you plug into an omni-channel SaaS loyalty program management platform, your investment in hardware, software, integration, and maintenance becomes negligible, and in almost every case presents an enormous cost-saving opportunity. If you want to accurately gauge the potential profitability of your loyalty program, a plug-and-play loyalty program management platform should be considered.

Loyalty Program Value Driver #4: Accelerated Value Optimization

Accelerated value optimization is an operational objective tied to a business outcome. This is all about looking for ways to evolve your loyalty program so that you can continuously do more with less. Testing and adaptive learning of more interaction scenarios in less time allows you to maximize the return on your loyalty marketing investment.

Stay tuned for Day 3 of loyalty marketing nirvana…

Do you have questions about establishing loyalty program value drivers? Tweet us @TIBCO #LoyaltyLab, and access the whitepaper and webinar, 8 Essential Steps: Championing Your Investment In Loyalty Marketing.

On the First Day of Loyalty Marketing Nirvana: Organize and Commit Stakeholders

“On the first day of loyalty marketing nirvana, my loyalty marketing mentor gave to me…”

It’s not a partridge in a pear tree. What does one do with a partridge in a pear tree, anyway? Partridges, pear trees, partridge families, Danny Bonaduce—let’s forget all of that.

The first day of loyalty marketing nirvana is all about organizing and committing stakeholders.

Why is this important?

Buy-in and support from all stakeholders is critical for building effective loyalty marketing initiatives—which is why we must first understand who needs to be part of the team.

Your loyalty program—although generally marketing driven—also needs buy-in from the key decision maker, as in the person making the final call. In addition, your technology team will ultimately be responsible for procuring, implementing, and owning the loyalty platform. Your operational team will be concerned about training, workflow, operational metrics, and implementation at either the store or point-of-purchase level.

And then you have your financial stakeholders. It’s vital to get these stakeholders involved early on because loyalty programs carry significant financial implications on the balance sheets, and the profit and loss, and there is a large amount of money involved. For even a moderate-sized business, implementing a rewards program based on purchases can lead to millions of dollars in associated costs.

Do not make the common mistake of involving your financial team at the end of the process. The financial stakes are too large, and they need to be involved early on to perform due diligence to ensure all the financials align.

At the outset, get all of your stakeholders to agree on the objectives and metrics you will use to define success. High-level questions are a good place to start. Here are a few examples:

  • Why do customers care?
  • Why does our CEO care?
  • Why do store owners care?
  • Why do managers care?

After you’ve answered the high-level questions, start identifying the variable measurements you will use to determine success, and come to an agreement on them. A good practice is to brainstorm a wide range of metrics and then pare them down to the specific metrics you will use to determine success, from both qualitative (soft measurements, such as brand trackers) and quantitative (hard measurements, such as conversion rates) delivery samples once your loyalty marketing program is off and running.

Next time, we’ll celebrate Day 2 of loyalty marketing nirvana: value drivers. Bring your party hat, because it’s going to be a real hoot!

Learn more by watching the webinar, 8 Essential Steps: Championing Your Investment In Loyalty Marketing.

The 8 Days of Loyalty Marketing Nirvana

The holiday season is upon us. It’s the time of year to give thanks and celebrate with those we hold dear.

So how does this translate to loyalty marketing?

For loyalty marketers, the customer is the person we hold dear. We know that establishing a trusting, mutually beneficial relationship with our customers is the key to year-round success—and it’s a year-round effort. But there is also a special loyalty marketing holiday that can happen at any time…the investment.

This is that moment when a business realizes that, to achieve long-term goals, their current loyalty marketing initiatives need to be expanded and improved. It sounds great on the surface, and most all of your colleagues will agree on its importance, but it’s easier said than done. It takes a cohesive effort among a team of stakeholders. But luckily, we’re here to help.

Join us as we celebrate the almighty customer. Unfortunately, there are no songs or elaborate decorations. We tried, but “build consensus on improvement” doesn’t align with “five goooooooolden riiiiiiiiiiiinnnnngs.”

The eight days of loyalty marketing nirvana will address each critical step in championing your loyalty investment. And here is a preview of what we will cover in our celebration of the almighty loyal customer.

Day 1: Organize and commit stakeholders

Who needs to sit down over a cup of eggnog and agree on a plan?

Day 2: Identify value drivers

The ways to make your loyalty investment seem like a Black Friday special.

Day 3: Ideate and validate

Get the creative juices flowing.

Day 4: Baseline existing performance

How good are your customer tidings now?

Day 5: Build consensus on improvement

Let’s agree on how we can build a stellar, year-round celebration that keeps getting better.

Day 6: Assess total cost of program

We don’t want you to break the budget.

Day 7: Calculate hard ROI

Be sure what you are about to embark on is an investment.

Day 8: Understand sensitivity and risk

What can spoil your celebration, and how can you ensure it doesn’t happen?

Subscribe to the blog feed and join us as we celebrate the 8 days of loyalty marketing nirvana. See you next time as we discuss organizing and committing stakeholders.

To learn more, download the whitepaper, 8 Essential Steps: Championing Your Investment in Loyalty Marketing.

There Are Two Kinds of Loyalty

By Jeanne Roué Taylor

There’s an enormous amount of buzz in the marketplace around loyalty. But how many of the conversations make the distinction between the two kinds: one of them that’s good for the moment and the other that’s good for the long haul? Knowing the difference has a real impact on how a brand designs, implements, and maintains its customer loyalty program.

Loyalty of Convenience

In a recent blog, Seth Godin referred to the first type as the loyalty of convenience:

“I’m going to look around, sure, but probably won’t switch. Switching is risky, it’s time consuming. Switching means a new account manager or moving my software or reprinting something. Switching means I might make a mistake or lose my miles or have to defend a new decision.”

Loyalty of convenience is only as good as the near-term incentives. It is a loyalty that requires steady, non-stop investment or it breaks and loses its accumulated value. A customer stays loyal only as long as the convenience lasts.

Enduring Loyalty

Enduring loyalty is the kind that comes from relationships, not cash rewards or convenience. In the world of enduring loyalty, customers stay engaged because they feel a connection to the brand. Seth Godin refers to this type of loyalty as, “I’m not even looking.”

A loyal customer who isn’t looking doesn’t care if there’s a lower price or competing product somewhere else. Because they’re invested in the brand, it takes more than just a pretty price to turn their head.

Learn more about what it takes to create enduring loyalty in this whitepaper on Customer Loyalty Management.

Going to Loyalty World US? Here Are 5 Las Vegas Shows with Loyal Followings for You to Attend

By Jeanne Roué Taylor

Loyalty World US is coming to Las Vegas.

And if you’re planning to attend Loyalty World US October 28th and 29th, you will no doubt want to get out and experience all the city has to offer.

But with so many options, what’s a marketer to do?

Sticking with the loyalty theme (of course), here are five Las Vegas shows with some of the largest and most loyal followings.

Cirque du Soleil

Cirque du Soleil’s “O” is made for Vegas. You’ve got your world-class acrobats, your synchronized swimmers, your divers, and your characters performing in, on, and above water to create a breathtaking experience.

It’s an aquatic blend of artistry, surrealism and theatrical romance in a timeless production. The show is inspired by the concept of infinity, which matches the line of thinking you’ll have when heading back to the office, filled with new ideas from Loyalty World US.

Le Reve

Le Reve takes its name from a 1932 Picasso painting hotel mogul Steve Wynn displays in his private collection. It’s a true journey of the subconscious mind with an intense blast of rain, fire and action at the outset.

Eighty-seven performers from 17 countries tell the story using a blend of aerial acrobatics, water ballet, synchronized swimming, comedy, and amazing feats of athleticism. You’ll see performers entering and leaving the stage through air and water. The stage even rises and falls with the water during the show, enabling an 87-foot high dive.

Blue Man Group

Visually stunning, wildly entertaining, hysterically funny – these are the words that have been used to describe Blue Man Group’s critically acclaimed show. Even though it’s difficult to explain exactly what it is you’ll be seeing, audiences of all ages agree that Blue Man Group’s show is an exciting and outrageous experience that will leave you in a euphoric state of bliss.

If you want to learn how to create a loyal following without using a single word while at Loyalty World US, Blue Man Group is the only “seminar” that can show you how.

Jersey Boys

You remember Robin Leach, right? He’s the Lifestyles of the Rich and Famous guy. Anyway, here’s what he says about Jersey Boys:

“The production, which is brilliantly staged with genius execution, rockets along at jet-smooth speed and one moment you’re laughing and the next tears well up.”

Jersey Boys, the Tony Award-winning Best Musical of 2006, takes you behind the music of Frankie Valli and The Four Seasons. You get to ride along with the band – up the charts and across the country.

Donnie and Marie

Donny Osmond is no stranger to Vegas. His first gig was performing with his brothers at the Sahara hotel at the age of 7.

The “Donny & Marie” show features excellent audience participation, and it’s funny and exhilarating. If you remember the Osmonds from your youth, this show will take you back to a special time in your life. If not, then this is your chance to connect with two of the best performers on the strip who still have what it takes to connect with the audience.

And that’s what it’s all about, connecting with your audience. We hope to connect with you at Loyalty World US in Las Vegas later this month. Register now for a 1:1 consultation with one of our loyalty experts, and request an invite to our cocktail reception at YellowTail Japanese Restaurant in the Bellagio on 10/28!

Which Marketing Platforms Are Here to Stay?

By Jeanne Roué Taylor

The sheer number of marketing applications offered as downloads or services is exploding. Everyone wants in on the real-time marketing game, likely because as the U.S. and the world come out of an extended economic downturn, there are few places more ripe for automation leading to efficiency than how we market and sell goods. What’s more, the fast rise of smartphones, maturation of Internet selling models, and high-speed analytics create a technology opportunity for customer engagement that’s hard to ignore for most software vendors.

But like everything that arrives quickly (think: Web companies in the ‘90s), the marketing boom will eventually sort itself out—there will be platforms which brought real value to marketers and those which brought…um…just great marketing.

So who will win and who will lose?

Data-Agnostic and Integration-Ready Marketing Platforms

The winners will be the platforms that have two characteristics: They are data source-agnostic and are able to integrate with other platforms across the marketing ecosystem.

Data source-agnostic — We market in a highly contextual world, and that context flows from many sources today—likely from many more sources tomorrow. Any platform that’s coupled too tightly to specific data sources, or has at its core its own proprietary source of data, won’t be responsive to an evolving marketplace. Experience tells us that marketing is in an ongoing period of rapid change that will alter the landscape enough to render obsolete the platforms that are rigid and data source dependent.

Integration with other platforms — Just like being data source-agnostic, the platforms that will survive will integrate liberally with other platforms, exchanging data and process as necessary to get the larger job of customer engagement done. Self-contained may have been an attractive adjective in a less-connected world, but marketing times have changed and the ability to connect and share information gives marketers more options for understanding context and more ways to engage with the consumer.

The Winner Is…the Open Platform

The real goal of today’s marketer shouldn’t be real-time response to customers, as attractive as that sounds. The goal needs to be right-time marketing that allows the brand to respond to the events that are happening anywhere in the buying environment. It’s the difference between shouting and having a conversation. That means being able to communicate and engage everywhere that matters across a number of platforms: POS, mobile apps, analytics, email services, customer databases, social tools, and whatever comes next. That’s a very integration-rich requirement.

Maybe, most importantly, data-agnostic, integration-ready platforms offer a way to avoid obsolescence of prior IT investments. Everyone likes that one.

 

Do Your Customers Seek You Out?

By Jeanne Roué Taylor

How much does customer loyalty bring your business to your stores, site or app versus how often you seek out the customer? If you’re achieving meaningful customer engagement and your loyalty programs are working, the balance will be in your favor.

Being Sought

We’ve worked hard to help people accidentally find us. Search engine optimization (SEO) is as old as the search engine itself. The moment there was a way to put a brand online, there had to be a way to be found and SEO was born. But unless your product is so undifferentiated that these schemes are your lifeblood, there has to be a better way.

Seth Godin talks about this in a recent post:

There are proven strategies that generic products can use so that they’re more likely to be stumbled upon by someone searching. Name your new book with all sorts of keywords in the title, for example, so it organically ranks higher for those very keywords…

The alternative is to create a product that earns a reputation sufficient that people choose to talk about it, choose to argue about it, choose to look for it. Not something like it, but it.

Nice to be found. Essential to be sought. 

Godin didn’t say it in his classic brevity, but in the new age of customer engagement, the brand itself is also the product. The brand’s interaction with its customers is an essential part of the experience that surrounds the product and creates a compelling relationship, not just a transactional one.

As the technology of social, mobile and Big Data rewrite the rules of customer engagement, the first change needs be our mindset. We should seek to be sought by wrapping our customers in a compelling experience that brings them back time after time.

Why Customer Experience Management and Why Right Now?

By Jeanne Roué Taylor

You run a successful business, your customers are primarily repeat offenders, and your marketing department is giving you everything you ask for. Why would you care about doing more around customer engagement and, more importantly, why would you do it right now? These are great questions that customer loyalty marketers should be asking themselves. After all, who has the money to invest in the latest fads without solid reasons?

Skepticism is a good thing, but you’d have to agree that if there were compelling reasons, you should act—and soon. Here are the reasons others are implementing loyalty platforms and why you should, too.

The Connected World

First and foremost, we live in a recently-connected world that’s growing more so every day. Customers walking through the door are very likely to be carrying a computer in their pocket, and are interacting with your brand whenever and wherever they choose. Are you there and available to engage? Does your presence outside of the store look more like a billboard or do you ask your customers to raise their hand for your loyalty programs?

If you’ve invested in customer loyalty programs that include mobile loyalty, your answer to these questions is the difference between a shopper walking through the door and a connected, loyal customer. A loyal customer is now one that you recognize and immediately pick up the in-person part of the relationship. While that shopper may have been in before and may come back, the loyal customer shares information with you at a level that betters your products and provides the strategy for how and when to engage.

That strategy becomes reality through the use of a loyalty platform that can tie together data, understanding, and action across any connected channel.

No Brand Is an Island

Secondly, while you’re thinking about your next move, you’re not alone. Many brands realize that the connected world and loyalty are two parts of the same solution for engaging customers effectively. At this point, the value of taking a platform approach to customer experience management isn’t in doubt. The only question is this: Which brands will capitalize on the connected world now, and which will wait, possibly until their customers have gone in the direction of a better experience with another brand?

 

4 Secrets of Killer Loyalty Programs

By Jeanne Roué Taylor

Few things hold more promise right now than Big Data, mobility, social platforms, and cloud computing. Their impact on brand loyalty and customer engagement management is enormous.

The reasons aren’t that hard to figure out and look like this:

  • Big Data brings a rich tapestry of information together at the perfect moments for customer engagement. Both brand and consumer are sharing information at a remarkable rate.
  • Mobility finds the customer where they are in a moment, whether they’re in the store or thinking about a purchase somewhere else. Mobility gives a brand a constant presence.
  • Social platforms have become the way we share our thoughts and passions, and a way for brands to define themselves.
  • Cloud has quickly become the model for seeking and capturing data and for providing technology capabilities that can evolve remarkably quickly.

Take any one of these four trends and you have significant marketplace disruption that creates opportunities for some brands and risk for others. When you have all four, you have significantly more serious opportunities and challenges.

The Four Secrets

Bringing together these trends is, as they say, the whole enchilada. Here are the four secrets to making that happen.

  1. Think loyalty platform: Implement customer engagement management through a loyalty platform. Trying to tie together so much information across so many technology elements is far too difficult and slow.
  2. Sign up for SaaS: Forget about monolithic on-premise marketing applications. By the time those behemoths are created and tested, the market has already moved. Software as a Service is the only practical solution for staying in front of so much change.
  3. Connect to everything: Unless your choices allow you to connect to any and all data, you’re limited to what a loyalty application vendor decides is important. Only you know your personal needs and opportunities.
  4. Think real time, respond at the right time: The technology trends above are all about contextual information that offers brands the chance to know in a moment, but respond at the best moment.

You can’t take away any one of these secrets any more than you can take away the four technology trends that define today’s customer engagement management. Are you ready to be on the right side of disruption?