Hooray! You have 20 million loyalty members! But how many of them are active and what does this mean for your business?
Colloquy release a consolidated annual report of loyalty activity in USA called The Loyalty Census. Each year they analyse membership growth and factors attributing to this growth. This year's census saw a massive increase in loyalty memberships across the US (up 26.7% to 2.65 billion).
Being in the loyalty industry, I can’t help but notice how South Africa has adopted this rise in loyalty programmes with every industry wanting a piece of the loyalty pie! Unfortunately, we have no official stats for the South African market place to compare with the U.S.
However with the expansion of loyalty programmes and therefore number of members, how many of these are really active? Despite the fact that loyalty programmes are aimed at incentivising members for shopping or engaging with your brand, why is there a decline in active memberships as reported by Colloquy?
Active membership refers to the number of times a member has engaged with the programme (at least once) over a period of 12 months or otherwise stipulated by the programme. The number of members vs. active members shows a large divide.
“4.3% is the drop in loyalty programme active membership between 2010 and 2012.”
Naturally, there is huge acquisition at the initial sign up process but the drop off rate in months to come is almost equally as huge. Based on these facts, it is clear that the active numbers are not aligned and the hard work starts when needing to retain these customers after acquisition. It’s all about engagement!
“Typically, new programmes acquire members and can’t keep them engaged…..both new & existing programmes are failing to strike the chord with members.” Colloquy
With competition so rife in the loyalty industry across all sectors, how do you ensure your loyalty programme is top of mind? What’s causing your loyalty card to be shoved behind your competitors’ card? Here are just 4 suggestions for consideration:
1. Loyalty is no longer solely “owned” by the retail and airline industries. There is rapid growth in loyalty in other sectors which can be attributed to an increase in partner programmes with competing brands to offer a more compelling loyalty offering together with the expansion of innovative loyalty programmes using real time POS technology.
2. The competition is heating up. There is no limit to the amount of programmes your customers can join and it is just so easy for them to do. Companies are eliminating the barriers to complicated sign up processes and are really tallying up members with a quick & effective registration processes via in-store, online or via mobile. Also, with so many choices for programmes offering similar benefits for similar behaviour in the same sector – how do you make sure your programme is top of mind?
3. Racking up the memberships at a fast pace at the registration step is one thing…staying fully engaged & relevant is whole new ball game. Companies who get the engagement element right are streets ahead of those who focus their energy on other activities in the loyalty lifecycle.
“Talk to me about what I want and need, not what YOU decide is what I want and need.”
4. Data is the kryptonite of loyalty. There are more channels than there have ever been to collect data. Data obtained by companies is wasted if not mined properly. Use your data to be relevant and offer your members an experience tailored to their wants and needs.
True engagement focuses on customer loyalty not acquisition stats.
By Ros Siddle, Marketing & Loyalty Research Manager, Truth
Wednesday, July 31, 2013
Monday, July 1, 2013
The untapped power of social data: The new social customer & how they impact your current marketing strategy
The future (very near future) of loyalty is social and mobile…this was the headline of a conference Truth attended earlier this month, hosted by Marketing Mix.
In fact, global players in loyalty have already adopted mobile as a core offering in loyalty…Walgreens is a great example of how a brand amplified their member base through its innovative mobile app offering. Mobile platforms allow for real time points earning & redemption which is one of the key benefits a customer rates a loyalty programme by…real time rewards.
However, it goes beyond mobile…
Has it ever occurred to you that the information your customer provides to their social networks may be of some value…more valuable than the “like” or “following” to your brand?
Amanda Cromhout, CEO of Truth, highlighted this in her presentation at the conference. It’s no longer enough to look in isolation at age, gender, intention to purchase and basket size. We now need to look one layer deeper.... social data! Social data includes information such as relationship status, brand/competitor likes, interests & circle of influence.
Overlay demographic data, psychographic data, transactional data AND social data to create the bigger picture of your new customer…the social customer.
Use the new insights derived from the combination of data listed above to market to them about what is relevant, making their entire experience with your brand far more meaningful across all touch points of their life.
This is particularly significant to the loyalty industry. The loyalty game itself is evolving. The basics of loyalty was to “swipe, collect & earn” whether it be via a loyalty card swipe, coupon collection or mobile application. We're now in a new era of share and earn….using social media platforms to reward customers for their social media behaviour & engagement relating to a brand.
MJ Khan, head of social at Quirk delved into the new persona of the social customer and how they impact our strategies as marketers. The social customer is someone who has taught us to improve online reputation management strategies and use social CRM as an opportunity to improve this.
The social customer can offer your brand more than you know:
1) One of the most powerful attributes is the power of brand advocacy. When your brand doesn’t have the time to respond to on social media, your community of social customers jumps in & responds for you
2) We tend to forget that social media is about people not technology. The premise of social media is not new to humans because connecting to others is not new. So let your customer connect with you and other customers about things that interest them…brands need to move beyond using social media as a selling tool and use it as an engagement tool
3) Engagement is not a strategy…engagement should be used as a tool
4) Yes we like to listen, yes we like to learn...but can these new social customers' input change business output? Leverage what you can learn from the social customer through your new engagement tool
Ignore your brand's social customer insights at your peril!
By Ros Siddle, Marketing & Loyalty Research Manager, Truth
MySchool comes out tops at International Loyalty Awards
The Loyalty Awards
recognize excellence, innovation and best practice in the loyalty
industry across Europe, the Middle East and for the first time this
year, Africa. The event is hosted by Loyalty Magazine and their key
sponsor Aimia.
Homegrown CSR loyalty programme, MySchool MyVillage MyPlanet has won the ‘Best Corporate Social Responsibility Initiative Linked to Loyalty’ award at the Annual Loyalty Awards held in London earlier this month.
The winning campaign ‘Doing Good Is Good Business’ made it onto a shortlist of 200 programmes from 20 different countries with more than 80 leading brand names. MySchool went up against leading global brands such as Turkey’s leading telecommunications network, Turkcell and UK’s Pets at Home company’s VIP rewards programme which is linked to CSR.
“For MySchool MyVillage MyPlanet to receive international recognition is testament to the impact the programme has had and an example of how ordinary citizens and retailers can jointly contribute significantly to society at large”, says Pieter Twine, MySchool MyVillage MyPlanet General Manager.
MySchool MyVillage My Planet is a coalition programme (multi partnership) as well as a leading CSR initiative where by members select a beneficiary (schools/charities) they would like to support. Every time a member swipes their MySchool card at participating retailers, up to 5% is donated to their beneficiary.
Winning performance:
Well deserved MySchool! It's grear to see a South African programme came out tops!
By Ros Siddle, Marketing & Loyalty Research Manager, Truth
Homegrown CSR loyalty programme, MySchool MyVillage MyPlanet has won the ‘Best Corporate Social Responsibility Initiative Linked to Loyalty’ award at the Annual Loyalty Awards held in London earlier this month.
The winning campaign ‘Doing Good Is Good Business’ made it onto a shortlist of 200 programmes from 20 different countries with more than 80 leading brand names. MySchool went up against leading global brands such as Turkey’s leading telecommunications network, Turkcell and UK’s Pets at Home company’s VIP rewards programme which is linked to CSR.
“For MySchool MyVillage MyPlanet to receive international recognition is testament to the impact the programme has had and an example of how ordinary citizens and retailers can jointly contribute significantly to society at large”, says Pieter Twine, MySchool MyVillage MyPlanet General Manager.
MySchool MyVillage My Planet is a coalition programme (multi partnership) as well as a leading CSR initiative where by members select a beneficiary (schools/charities) they would like to support. Every time a member swipes their MySchool card at participating retailers, up to 5% is donated to their beneficiary.
Winning performance:
- Since it started in 2009, the programme has donated over R 200 million to its beneficiaries
- In 2012 alone, it raised more than R36 million for over 10 000 beneficiaries
- On average, the programme gives back R3 million every month
- The programme has over 700 000 active members
- The programme signed up 136 new beneficiaries in 2012 which saw the value of funds raised increase by 23%
Well deserved MySchool! It's grear to see a South African programme came out tops!
By Ros Siddle, Marketing & Loyalty Research Manager, Truth
Tuesday, May 28, 2013
Netprophet – where great entrepreneurs in digital come together
Highlights from Netprophet Conference in May
The recent Netprohet conference proved once again that anyone can have a dream and turn it into a reality. Netprophet brings together a group of entrepreneurial leaders in digital marketing space from South Africa and around the globe. These entrepreneurs share their success stories with you detailing how their determination and innovative business ideas got them to where they are today.
Amongst the speakers this year were Mike Butcher, Editor of TechCrunch Europe; Andre DeWet GM of PriceCheck; Stuart Forrest CEO of Triggerfish Animation, Bob Skinstad ex South African Springbok rugby player and now Director & shareholder of Itec Innovate (Pty) Ltd & Justin Stanford co-founder & CEO 4Di Group to mention a few.
Erik is the Co-Founder of FONK, both Amsterdam and Cape Town based agency who specialise in multi touch devices. His presentation, “Tangible magic of the digital era”, focused on how people are losing the tangible side to things due to digital innovations such as online shopping, dating and living in general and how quickly those intangible things can disappear at the touch of a button. We are losing touch due to our intangible products/services linked to our mobile devices such as virtual friends, virtual money and virtual books etc. When we switch off our mobile device, we switch off the interconnected world we have created.
The argument: is digital enough and will it overtake the need consumers still have today to physically touch things before making a purchase? Erik says that the way forward will be the creation of symbiosis between reality (touch) and virtual/digital (intangible).
The point being that people are still willing to pay more for a “real” in-store experience vs. a virtual online one. Why do we not flitch at paying up to R12 for a newspaper hardcopy but pull up our nose when we need to pay for something online like an app? We have created a culture where online content is expected to always be free because online content has credibility issues when it comes to being authentic. Nothing is more authentic than walking into a store, choosing a garment, feeling it, smelling it and trying it on. People look for the trust they receive from using their senses to smell & touch a product and they don’t mind paying for that trust and value. Anyone can post anything on the internet and sound like they know what they are doing. So the fight for authenticity from a digital perspective continues….
This reminds me of Truth’s mantra that customer centricity is driven from combining the ‘science and soul’ of retailing. The offline world is the true ‘soul’.
Two other speakers who got me feeling rather inspired were South African entrepreneurs’ Andre De Wet & Stuart Forest.
Andre de Wet, a med school dropout turned GM of Price Check, is this year’s app of the year winner. Andre spoke of his journey and his presentation title, “It takes 15 years to become an overnight success” (previously quoted by Bono and Madonna!), touched on his devotion to learn and never getting too comfortable at any stage of your life, because that’s when you stop learning. He says that if you are feeling comfortable when you are in your 20s & 30s… “do yourself a favour & get uncomfortable…you have far too much to learn still”
Following a similar topic was Stuart Forest, CEO of Triggerfish Animation. Stuart, born in Port Elizabeth, with a passion for animation, started his journey building clay models just like popular owner & his dog, Wallace & Gromit. With little to no interest or growth opportunity in clay animation in South Africa he dedicated his time to 2D & 3D animation…. Today his 20 year vision is to displace Disney in their home market.
Triggerfish are behind two successful animation films namely Zambezia & Kumba. Animation is in another league of its own when it comes to patience & precision. In order for any animation to appear smooth, each frame needs to be displayed quickly. On average, 24 frames are needed per second. Translate that into 1 minute and an artist would need to draw over 1400 frames for 60 secs of smooth running.
Stuart’s presentation focused on lessons you were taught in playschool and how they still apply to your day to day life. Being patient, kind & honest was one and to get up and try again and again and again was another.
He firmly believes that as important as it is to have short term goals, the real McCoy is that vision of how you are going to achieve your major life goal which may just take 20 years to achieve.
As our favourite leadership coach, Robin Sharma, reminds us: ‘ideation without execution, is nothing more than delusion.”
Overall, Netprophet proved to be an inspiring day out, realising that everyone has the opportunity to dream and come up with something great, but it’s what you do, how you learn and how much you believe in yourself is what determines the success of your “something great”.
The recent Netprohet conference proved once again that anyone can have a dream and turn it into a reality. Netprophet brings together a group of entrepreneurial leaders in digital marketing space from South Africa and around the globe. These entrepreneurs share their success stories with you detailing how their determination and innovative business ideas got them to where they are today.
Amongst the speakers this year were Mike Butcher, Editor of TechCrunch Europe; Andre DeWet GM of PriceCheck; Stuart Forrest CEO of Triggerfish Animation, Bob Skinstad ex South African Springbok rugby player and now Director & shareholder of Itec Innovate (Pty) Ltd & Justin Stanford co-founder & CEO 4Di Group to mention a few.
Erik is the Co-Founder of FONK, both Amsterdam and Cape Town based agency who specialise in multi touch devices. His presentation, “Tangible magic of the digital era”, focused on how people are losing the tangible side to things due to digital innovations such as online shopping, dating and living in general and how quickly those intangible things can disappear at the touch of a button. We are losing touch due to our intangible products/services linked to our mobile devices such as virtual friends, virtual money and virtual books etc. When we switch off our mobile device, we switch off the interconnected world we have created.
The argument: is digital enough and will it overtake the need consumers still have today to physically touch things before making a purchase? Erik says that the way forward will be the creation of symbiosis between reality (touch) and virtual/digital (intangible).
The point being that people are still willing to pay more for a “real” in-store experience vs. a virtual online one. Why do we not flitch at paying up to R12 for a newspaper hardcopy but pull up our nose when we need to pay for something online like an app? We have created a culture where online content is expected to always be free because online content has credibility issues when it comes to being authentic. Nothing is more authentic than walking into a store, choosing a garment, feeling it, smelling it and trying it on. People look for the trust they receive from using their senses to smell & touch a product and they don’t mind paying for that trust and value. Anyone can post anything on the internet and sound like they know what they are doing. So the fight for authenticity from a digital perspective continues….
This reminds me of Truth’s mantra that customer centricity is driven from combining the ‘science and soul’ of retailing. The offline world is the true ‘soul’.
Two other speakers who got me feeling rather inspired were South African entrepreneurs’ Andre De Wet & Stuart Forest.
Andre de Wet, a med school dropout turned GM of Price Check, is this year’s app of the year winner. Andre spoke of his journey and his presentation title, “It takes 15 years to become an overnight success” (previously quoted by Bono and Madonna!), touched on his devotion to learn and never getting too comfortable at any stage of your life, because that’s when you stop learning. He says that if you are feeling comfortable when you are in your 20s & 30s… “do yourself a favour & get uncomfortable…you have far too much to learn still”
Following a similar topic was Stuart Forest, CEO of Triggerfish Animation. Stuart, born in Port Elizabeth, with a passion for animation, started his journey building clay models just like popular owner & his dog, Wallace & Gromit. With little to no interest or growth opportunity in clay animation in South Africa he dedicated his time to 2D & 3D animation…. Today his 20 year vision is to displace Disney in their home market.
Triggerfish are behind two successful animation films namely Zambezia & Kumba. Animation is in another league of its own when it comes to patience & precision. In order for any animation to appear smooth, each frame needs to be displayed quickly. On average, 24 frames are needed per second. Translate that into 1 minute and an artist would need to draw over 1400 frames for 60 secs of smooth running.
Stuart’s presentation focused on lessons you were taught in playschool and how they still apply to your day to day life. Being patient, kind & honest was one and to get up and try again and again and again was another.
He firmly believes that as important as it is to have short term goals, the real McCoy is that vision of how you are going to achieve your major life goal which may just take 20 years to achieve.
As our favourite leadership coach, Robin Sharma, reminds us: ‘ideation without execution, is nothing more than delusion.”
Overall, Netprophet proved to be an inspiring day out, realising that everyone has the opportunity to dream and come up with something great, but it’s what you do, how you learn and how much you believe in yourself is what determines the success of your “something great”.
By Ros Siddle, Marketing & Research Manager, Truth
Turning likes into loyalty...... the ultimate prize of social engagement
“Is the short term tangible ROI more valuable than the insight we gain from long term engagement with your customers and the business potential thereof?”
I posed this question in a blog earlier this year (read here) and it seems this topic is still up for debate.
Ted Rubin, Chief Social Marketing Officer at Collective Bias suggests in his book Return on Relationship that “Social Media drives engagement, engagement drives loyalty, and loyalty correlates directly to increased sales. Return on Relationship™ = ROI”.
If this equation deems true…I’d like to unpack how marketers can begin to understand how to use this metric to determine ROI from social media.
We know that there is no real correlation between vanity metrics and revenue impact. What I mean here is that the more likes, follows & shares do not necessarily lead to an increase in income.
In a recent webinar, hosted by loyalty 360, there were 4 main questions marketers were dabbling with in attempt to answer “How to measure ROI from social media”
1. Quite obviously: What’s the ROI of SM?
Marketers are saying that is it difficult to justify increasing spend on social media arguing whether or not you can directly compare ROI attained from TV commercials & billboards etc. to the cost of your social media activities.
“Social media is so popular and effective as a marketing tool because it focuses on the customer experience instead of just throwing an advertisement at them and hoping the impression will stick.” by Ted Rubin.
The realization is, the lifespan of each of these channels are dramatically different and if you cannot justify spend per campaign (output) especially in social media, how does one begin to measure the return?
2. Do marketers care enough about data?
Data is not yet seen as an important tool to help increase effectiveness of marketing campaigns and social media campaigns……how come?
Currently, there seems to be not enough time dedicated to training. There are little to no resources, no skills, no staff & no ability (or desire by marketers) to get to the heart of data and how to attribute it across the company. The scale & complexity of data has changed dramatically – what used to be done by marketing teams on excel is no longer possible, it’s far too complex and leads to incorrect insights.
Businesses have evolved so much so that not only does your financial department or IT department use data…but your marketers HAVE to use data too.
Advice given from the panel on the webinar suggest that marketers need to start from the beginning by defining their social media strategy to create & include insights derived from data.
Webinar host, Wes Brooks says, “No business has a data problem; they have a filter problem. Your analytics model has to look at the whole interconnected digital ecosystem for predictive data.”
It is essential for dialogues on data to start internally - data is needed from internal business partners and everyone needs to fine comb the data that is relevant to their department, but which aids to the bigger picture.
Lauren Swanson @swantonsoup Marketers who embrace #data will get to leave the kids table and sit with the adults in the C-Suite. #SMTlive
Social Intelligence @SDLsocial The future of marketing/sales is going to be data driven. You can use data to narrow down exact steps in the customer journey. #SMTlive
That’s why companies such as ourselves at Truth work strategically with data insights experts like P:cubed. The end client value proposition in the B2B market places is meaningless if data cannot be demystified.
3. Job titles & description are no longer clean cut.
The scale of a digital role is tremendous and the expectations are too high. There is major challenge to find one person to cover all aspects on this so called Social Media/Digital Strategist role. The expectation is that this job should cover roles that in their own capacity are so widespread such as digital & social media strategist, marketing manager, content & CRM management to mention a few.
Another change worth mentioning in organisations today is the CMO, CFO and CIO relationship….they’re big mates now. The CMO role has changed by becoming increasingly responsible for tech investments & actions driven by data insights. There should also be a single line that connects your social media manager and his/her team to your CMO.
Josh Milenthal @JM_allgrownup The most common misconception is that "social" is just something someone can do on the side. It's a full time gig.
4. Focus on content…..not just selling.
As mentioned above, there is no real correlation between vanity metrics and revenue impact. The notion of accumulating as many likes/followers/fans will soon no longer be a metric to gauge popularity of a brand or show how truly engaged they are with their fans.
The true metric will be how engaged and loyal their fans are. Good content builds trust, builds credibility. Content is read to acquire knowledge and shared to spread that knowledge. Technology has broken down the barriers between brands and customers making it much easier to speak AND listen to your customers and vice versa. It allows for ‘on demand response’ to the needs of your customers.
Become more creative with your content and move passed the pre-populated Facebook post or tweet. Use your data wisely and fuel content based on the insight you have about your customers. It gives your customers the chance to feel more for your brand once you’ve taken the time to engage with them about what’s relevant to them.
Josh Milenthal @JM_allgrownup Look at it like this. When marketing in person, do you preach a message or hold a conversation? Conversations increase trust/sales #SMTlive
Challenge yourself and think beyond the audience…..how do I change them into advocates? The advocates are what create the reality of the brand. People are watching & listening to these advocates so pay attention to who they are.
Ros Siddle, Marketing & Loyalty Research Manager, Truth
I posed this question in a blog earlier this year (read here) and it seems this topic is still up for debate.
Ted Rubin, Chief Social Marketing Officer at Collective Bias suggests in his book Return on Relationship that “Social Media drives engagement, engagement drives loyalty, and loyalty correlates directly to increased sales. Return on Relationship™ = ROI”.
If this equation deems true…I’d like to unpack how marketers can begin to understand how to use this metric to determine ROI from social media.
We know that there is no real correlation between vanity metrics and revenue impact. What I mean here is that the more likes, follows & shares do not necessarily lead to an increase in income.
In a recent webinar, hosted by loyalty 360, there were 4 main questions marketers were dabbling with in attempt to answer “How to measure ROI from social media”
1. Quite obviously: What’s the ROI of SM?
Marketers are saying that is it difficult to justify increasing spend on social media arguing whether or not you can directly compare ROI attained from TV commercials & billboards etc. to the cost of your social media activities.
“Social media is so popular and effective as a marketing tool because it focuses on the customer experience instead of just throwing an advertisement at them and hoping the impression will stick.” by Ted Rubin.
The realization is, the lifespan of each of these channels are dramatically different and if you cannot justify spend per campaign (output) especially in social media, how does one begin to measure the return?
2. Do marketers care enough about data?
Data is not yet seen as an important tool to help increase effectiveness of marketing campaigns and social media campaigns……how come?
Currently, there seems to be not enough time dedicated to training. There are little to no resources, no skills, no staff & no ability (or desire by marketers) to get to the heart of data and how to attribute it across the company. The scale & complexity of data has changed dramatically – what used to be done by marketing teams on excel is no longer possible, it’s far too complex and leads to incorrect insights.
Businesses have evolved so much so that not only does your financial department or IT department use data…but your marketers HAVE to use data too.
Advice given from the panel on the webinar suggest that marketers need to start from the beginning by defining their social media strategy to create & include insights derived from data.
Webinar host, Wes Brooks says, “No business has a data problem; they have a filter problem. Your analytics model has to look at the whole interconnected digital ecosystem for predictive data.”
It is essential for dialogues on data to start internally - data is needed from internal business partners and everyone needs to fine comb the data that is relevant to their department, but which aids to the bigger picture.
Lauren Swanson @swantonsoup Marketers who embrace #data will get to leave the kids table and sit with the adults in the C-Suite. #SMTlive
Social Intelligence @SDLsocial The future of marketing/sales is going to be data driven. You can use data to narrow down exact steps in the customer journey. #SMTlive
That’s why companies such as ourselves at Truth work strategically with data insights experts like P:cubed. The end client value proposition in the B2B market places is meaningless if data cannot be demystified.
3. Job titles & description are no longer clean cut.
The scale of a digital role is tremendous and the expectations are too high. There is major challenge to find one person to cover all aspects on this so called Social Media/Digital Strategist role. The expectation is that this job should cover roles that in their own capacity are so widespread such as digital & social media strategist, marketing manager, content & CRM management to mention a few.
Another change worth mentioning in organisations today is the CMO, CFO and CIO relationship….they’re big mates now. The CMO role has changed by becoming increasingly responsible for tech investments & actions driven by data insights. There should also be a single line that connects your social media manager and his/her team to your CMO.
Josh Milenthal @JM_allgrownup The most common misconception is that "social" is just something someone can do on the side. It's a full time gig.
4. Focus on content…..not just selling.
As mentioned above, there is no real correlation between vanity metrics and revenue impact. The notion of accumulating as many likes/followers/fans will soon no longer be a metric to gauge popularity of a brand or show how truly engaged they are with their fans.
The true metric will be how engaged and loyal their fans are. Good content builds trust, builds credibility. Content is read to acquire knowledge and shared to spread that knowledge. Technology has broken down the barriers between brands and customers making it much easier to speak AND listen to your customers and vice versa. It allows for ‘on demand response’ to the needs of your customers.
Become more creative with your content and move passed the pre-populated Facebook post or tweet. Use your data wisely and fuel content based on the insight you have about your customers. It gives your customers the chance to feel more for your brand once you’ve taken the time to engage with them about what’s relevant to them.
Josh Milenthal @JM_allgrownup Look at it like this. When marketing in person, do you preach a message or hold a conversation? Conversations increase trust/sales #SMTlive
Challenge yourself and think beyond the audience…..how do I change them into advocates? The advocates are what create the reality of the brand. People are watching & listening to these advocates so pay attention to who they are.
Ros Siddle, Marketing & Loyalty Research Manager, Truth
Friday, May 10, 2013
Is this the end of value segmentation as we know it?
It strikes me that at times we, as marketers look to focus our budgets and efforts to retain our most valuable customers. We also strive to increase engagement and spend from the group of customers showing the most potential to increase their future spend with our business. But are we missing a trick by not focusing on the least likely group to increase their potential value to the business?
What about those who don’t spend much with you, but adore your brand? In a standard RFM model (Recency, Frequency and Monetary), they are likely to be missed out, and not given the same attention as those who are spending more with you. So should we be engaging with them? I believe there are segments of customers with whom their value isn’t measurable on a purely financial basis.
I believe there is a space for CRM analytics and attitudinal research to be combined, to further understand your brands potential reach. This is where the power of research comes in, and the much publicised Net Promoter Score (NPS) could help to establish the segments of customers whom adore or dislike your brand.
There is much talk of the pros and cons of using customer affinity measures such as the Net Promoter score – developed by Fred Reichheld author of the book ‘The Loyalty Effect’ and ‘The Ultimate Question’. The idea being you ask a simple question – “on a scale of 0-10 how likely are you to recommend a {brand/product} to a friend or relative?” The responses are then measured by splitting the customer base into 3 groups: Detractors, Passives and Promoters.
For some industries identifying those most likely to promote your brand, even if they have only purchased once, can be very fruitful in driving word of mouth influencer campaigns. Creating a memorably brand experience for this group can drive considerable word of mouth impact, and potentially drive new customers. That’s free acquisition, that can’t be gained anywhere else and can drive incredible value to your business in the long term.
On the flip side, those who fall into the low value/detractor category, a group least likely to spend with you, and most likely to talk negatively about your brand are equally worth considering a campaign to. With the aim to reduce the negative impact of bad publicity by making peace with those unsatisfied with your brand/product or service. It could save you lots in the future in rebuilding a brand or spending on PR.
Karen De Lorenzo, Loyalty & Engagement Consultant, Truth
What about those who don’t spend much with you, but adore your brand? In a standard RFM model (Recency, Frequency and Monetary), they are likely to be missed out, and not given the same attention as those who are spending more with you. So should we be engaging with them? I believe there are segments of customers with whom their value isn’t measurable on a purely financial basis.
I believe there is a space for CRM analytics and attitudinal research to be combined, to further understand your brands potential reach. This is where the power of research comes in, and the much publicised Net Promoter Score (NPS) could help to establish the segments of customers whom adore or dislike your brand.
There is much talk of the pros and cons of using customer affinity measures such as the Net Promoter score – developed by Fred Reichheld author of the book ‘The Loyalty Effect’ and ‘The Ultimate Question’. The idea being you ask a simple question – “on a scale of 0-10 how likely are you to recommend a {brand/product} to a friend or relative?” The responses are then measured by splitting the customer base into 3 groups: Detractors, Passives and Promoters.
For some industries identifying those most likely to promote your brand, even if they have only purchased once, can be very fruitful in driving word of mouth influencer campaigns. Creating a memorably brand experience for this group can drive considerable word of mouth impact, and potentially drive new customers. That’s free acquisition, that can’t be gained anywhere else and can drive incredible value to your business in the long term.
On the flip side, those who fall into the low value/detractor category, a group least likely to spend with you, and most likely to talk negatively about your brand are equally worth considering a campaign to. With the aim to reduce the negative impact of bad publicity by making peace with those unsatisfied with your brand/product or service. It could save you lots in the future in rebuilding a brand or spending on PR.
Karen De Lorenzo, Loyalty & Engagement Consultant, Truth
Tuesday, April 30, 2013
Does your culture eat, sleep, drink customer?
Culture shapes the norms within an organisation and drives the way things get done both behaviourally and systematically.
Many organisations forget this when trying to implement a new strategy into the business. This is particularly relevant when implementing a new loyalty strategy to drive a new loyalty programme for the business. There is no single mould for implementing a loyalty strategy and there are many factors to consider prior to developing & implementing it into your business. The phrase “culture eats strategy for breakfast” often used to describe how no matter how successful or bullet proof you think your strategy is, if it is not in line with the culture embedded in your business……then you are wasting your time. A strategy has to include culture as a core element.
We know that a loyalty strategy impacts the entire business. It should not only belong to your marketing or clients service department but it should be “owned” and adopted by the entire business from your board of directors to your frontline employees. Your aim should be to adopt a strategy that is both employee & customer centric too. Here are 3 “Cs” to consider on how to bring about a strategy to suit your company culture:
1. Communication:
Have a communication plan
- communicate change & communicate it in a timely fashion internally before externally
- communicate in stages & do so regularly
- communicate in such a manner, always taking the current culture/environment into consideration
- Provide insights/background into the strategy to all employees
- Allow for feedback
2. Collaboration:
- Once you have delivered your communication plan allow time for people to not only provide feedback but allow for discussion groups, understand how the new strategy impacts them as individuals and as a company as a whole
- Allow your staff to spread their concern openly to get full consensus
- Provide workshops to all departments within the business enabling them to understand how their roles may change and how their role contributes to the success of the business as a whole. This is critical for landing a customer centric strategy
3. Commitment
- The customer centricity strategy needs commitment and buy-in from all parties. It will play an integral part of the company culture and daily operations. Across entire business from top management to front office
- E.g. cashier has main interaction with your customer – let her be your sales person!
- The person heading up the strategy should guide the execution of all the loyalty activities at all levels. Marketing, finance, suppliers, call centre agents to mention a few will all need to be led into the new strategy.
“People are loyal to culture, not strategies” says Joe Tye, CEO & Head Coach of Values Coach Inc. People are loyal to the culture they are accustomed to, not a strategy and this can easily cause resilience to any change within an organisation. When you fully understand your company’s culture and know how to execute any change, bearing in mind the complexities that may come along with such a change, you will be able to lead any new loyalty & customer centricity strategy and create competitive differentiation……nothing is more powerful than this.
To implement a customer centric strategy is simply a pipedream if your frontline & back office processes are not designed to be customer focused and if the culture does not eat, sleep, drink customer.
Ros Siddle, Marketing & Loyalty Research Manager, Truth
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