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VOLUME 12 NUMBER 1 | FIRST & SECOND QUATER 2019

Chipotle Launches Its


First Loyalty Program

IN THIS ISSUE:

Emotional Loyalty, The Family Coppola MGM Improves


Authenticity, and Tells a Story, the Gaming
Jersey Mike’s Shares a Lifestyle Experience

PLUS: 2019 LOYALTY EXPO CONFERENCE PREVIEW


In this Issue...
Q1 & Q2 2019 | VOLUME 12 NUMBER 1 | LOYALTY360.ORG
InCommIncentives.com
Bulk Gift Cards Made Easy
FEATURES

Loyalty. Engaged.
Reward Card
10 14 Conference
Emotional Loyalty,
Authenticity, and
MGM Improves
the Gaming
Preview

36
Powering the 1234 5678 9101 1123
Jersey Mike’s Experience
Jersey Mike’s MGM Resorts
most innovative 02/25 Mark Johnson | Loyalty360 International

and engaging REWARD CARD RECIPIENT


Patrick Barney | Loyalty360

loyalty programs
in market today. 12 16
Visit us at Booth #8 for a The Family Coppola Chipotle Launches
chance to win a $100 gift card! Tells a Story, its First Loyalty
Shares a Lifestyle Program
Francis Ford Chipotle
Coppola Winery Mark Johnson | Loyalty360
Mark Johnson | Loyalty360

InCommIncentives.com

LOYALTY FORUM: IN EVERY ISSUE

5 FROM THE EDITOR 24 BEST PRACTICES Loyalty Management Editorial


Loyalty360 The Loyalty Long Game & Production Team
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Barry Kirk | Maritz Loyalty Mark Johnson - Contributing Editor
frie
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s Carly Stemmer - VP of Marketing
Refe
10 0P
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16 360 INSIGHTS Patrick Barney - Senior Editor
26 TECHNOLOGY, TRENDS & REWARDS
s

Re
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P erk

Rew
ard
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ts
Loyalty Expo 2019: Not To Be Missed Peter Mills - Staff Writer
P

Po
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Earn
ed 10
Mark Johnson | Loyalty360 The Modern Loyalty Program Powering Elizabeth Shular - Design
10
Po
ints

Po
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Brands like MVMT, FIGS & THIRDLOVE Shawn Cunningham - Design Director
20

Po
ints 18 FEATURED TECHNOLOGY Yotpo
20 ts
oin
5P
Featured Technology & Services Contacts
10
Po
ints 28 STATE OF THE INDUSTRY Article Submissions & Advertising:
19 Q&A How Do You Build Everlasting Loyalty?
Loyalty360
Brand Vision Cheetah Digital
info@loyalty360.org
513-800-0360
18 TECHNOLOGY, TRENDS & REWARDS 30 BEST PRACTICES
Technology Is Holding Loyalty Back Word-Of-Mouth Marketing
© 2019 Loyalty360, Inc. and/or its affiliates.
Powering the World's Evan Magliocca | Baesman Kasey Cover | FasTrax Solutions All Rights Reserved.

Fastest-Growing Brands 32 BEST PRACTICES


Reproduction and distribution of this publication in any
20 BEST PRACTICES form without prior written permission is forbidden. The
The most advanced solutions for customer Forget Best Practices In CX, Are Your Employees Driving Your information contained herein has been obtained from
sources believed to be reliable. Loyalty360 disclaims all
reviews, visual marketing, loyalty and referrals It’s All About Habit… Customers Away? warranties as to the accuracy, completeness, or adequacy
Claire Sporton | Confirmit Hinda Loyalty Group of such information. The opinions shared are those of
www.yotpo.com the contributing authors and not necessarily reflective
of Loyalty360 and/or its affiliates. Loyalty360 shall have
22 STATE OF THE INDUSTRY 34 BEST PRACTICES no liability for errors, omissions, or inadequacies in the

The Secret To An Effective Partnerships: The Secret Weapon To information contained herein or for interpretations thereof.
The opinions expressed herein are subject to change
Loyalty Program Building Customer Loyalty? without notice.
Laurie Meek & Antje Helfrich | Lenati Bill Finaldi | Iris Worldwide

Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 3


FROM THE EDITORS

I was around 19 years old when Chipotle first and how quick you got them. I’m 37 now, and to social issues by helping fund wishes for the
opened restaurants in Dayton, Ohio, which I’ve got three kids, so I don’t get to see Kurtis Make a Wish Foundation.
was the closest metropolitan area to my home as often as I used to. But when we do hang out,
town. I don’t quite remember my first visit, but Chippy is still one of our go-to lunch spots. We All four of these brands are doing extremely
I do remember being floored by the overall mix it up, but the burrito joint never goes out of interesting things. I think anyone looking for role
concept. I’d gotten subs made-to-order before the rotation. On occasion, one of us gets that models in the customer loyalty space should
this, but never a burrito. Quite simply, I was look in his eyes and says, “Chippy time.” pay attention to them. Now, if I could just get
amazed at how good the food was. everyone to start calling my favorite fast-casual
I’m glad to see that, after a long period of burrito spot “Chippy,” I’d feel vindicated.
After one visit, I was totally converted. I would anticipation, Chipotle has finally launched its
go as often as humanly possible with a buddy first loyalty program (pg 16), which I joined
of mine, Kurtis. In fact, we even developed immediately. The brand was always customer-
our own nickname for the restaurant: Chippy focused, and its new program deepens this
Burrito. I’d go over to his house on weekends, focus quite a bit. I can’t wait to see what
chill out for a while, check my watch, and say to developments are in store for the program.
him, “Chippy time?” He’d nod his head and we’d
head out the door. In addition to coverage of Chipotle, this issue
of Loyalty Management contains articles on
I usually got a burrito with carnitas, pinto beans, The Family Copolla (pg 12), MGM (pg 14), and
and spicy salsa. He stuck to steak and regular Jersey Mike’s (pg 10), all of which are innovating
tomato salsa (because he’s got a sensitive in customer loyalty. The Family Copolla, a
tongue). We’d line up, watch the make-station wine and lifestyle brand owned by the famous
cooks wrap our burritos, and dig in after sitting director Francis Ford Copolla, offers emotional Patrick Barney
at the stools that looked out through the big experiences to get customers engaged. MGM Managing Editor
front windows. We really could not get over is transforming the gaming experience so that Patrick Barney@loyalty360.org
how great the burritos were (they rivaled it is more social and, thus, more fun. Jersey
anything you’d get at a sit-down restaurant) Mike’s, among other things, is dedicating itself

Brain Freeze. Exclusive Brand Insight,


for Members Only
Hot Coffee.
The Future of CX.
As the association for customer loyalty, Loyalty360
speaks with top brands to address the challenges,
opportunities, and trends of a constantly evolving market. SPURN THE
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Our goal is to pass this insight along to members and
to bring companies together to build authentic loyalty
predicated on reciprocal benefit.

We invite you to join Loyalty360 for access to exclusive


insights, member-only discussion, and the opportunity
to learn from a host of brands. For more information on
Experience it all at our booth Loyalty360 membership, visit loyalty360.org or contact
Mark Johnson at markjohnson@loyalty360.org. Your loyalty program should be about more than just points and redemptions.
at the LoyaltyExpo.
With Formation’s hyper-personalization technology, you can build new behaviors, boost
513.800.0360 | loyalty360.org | @loyalty360 your bottom line, and make loyalty the center of your marketing strategy.

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formation.ai/loyalty360
Loyalty Management™ | Q2 2018 | loyalty360.org 5
LOYALTY FORUM: 360 INSIGHTS

Loyalty Expo 2019:


Not to be Missed
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AND CRM ONLY HALF OF
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loyalty+CRM with Brierley+Partners.
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Loyalty360

In this issue of Loyalty Management, we’ve got a number of We’ll also hear presentations from representatives of DSW,
excellent articles, including features on Chipotle and Jersey Kellogg’s, AARP, Caesars Entertainment, Overstock.com,
Mike’s. The issue also showcases several thought-leadership Wyndham, MGM Resorts, and more. These presentations
pieces from our valued supplier members. Suffice it to say, we’re will address several germane topics, including customer
presenting our readers with relevant, engaging content that experience, innovation, metrics, measurement, technology,
speaks to the state of customer loyalty right now. employee engagement, and social impact marketing. For these
presentations alone the Loyalty Expo will be worth the trip.
However, one of the things we cover in this issue that we’re
most excited about is the upcoming 2019 Loyalty Expo, which In addition to these presentations, though, the Loyalty Expo
is running from May 20 to May 22 at the Sheraton in Charlotte, will also unveil our new “Loyalty Landscape Report: The State Your Partner in Creating
North Carolina. I really do believe that this may turn out to be of Customer Loyalty.” This report offers a unique perspective
the best Loyalty Expo we’ve ever held. I encourage anyone with a from brand and supplier representatives on where the loyalty Lasting Customer Relationships
stake in customer loyalty to attend. industry is headed. If you want to know the pulse of the
industry, this report will be a must-read.
The Expo will feature talks from an array of thought leaders in
the loyalty space. Chris Malone, Founder and Managing Partner The weeks leading up to the Expo have been an exciting
at Fidelum Partners, will discuss his book The HUMAN Brand. time. Everyone at Loyalty360 has worked hard to make the
Jennifer Leitman, VP of Marketing at The Family Coppola, will conference outstanding. I can’t wait to see you there.
present on how to move from a transactional program to an
experiential one. Hope Tannenbaum, Senior Director of CRM, A New Look
Loyalty, & Research at Foot Locker, will talk about how her
company uses engagement to drive loyalty.
Mark Johnson,
CEO for Loyalty.
Loyalty360
Stellar Loyalty is now Cheetah Loyalty,
a product of Cheetah Digital. Connections@Baesman.com | 614-771-2300 | Baesman.com/insights

6 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org

Loyalty360_2019_QTRpg_v01.indd 1 4/3/19 2:40 PM


LOYALTY FORUM: FEATURED TECHNOLOGY LOYALTY FORUM: Q&A
What are Loyalty360 Analyst Reports?

Featured
Designed to help brands and marketers navigate vendors and providers in the
Products, market that support customer loyalty, customer experience, and customer
Advancements &

Technology
Technologies
engagement strategies in any capacity. With a focus on objectivity, rigor, and

Brand Vision
transparency, the Analyst Reports help brands narrow down to core competencies,
strengths, and industry expertise. If you are a vendor or provider interested in
learning how Loyalty360’s Analyst Reports can help you reach new prospective

& Services
clients, please contact Mark Johnson at markjohnson@loyalty360.org

To view Analyst Reports please visit: loyalty360.org/resources/analyst-report

Q:
Loyalty. Engaged.

Is there a technology or process you are


CrowdTwist offers an SaaS, cloud-based platform that is intended to facilitate a HelloWorld, a Merkle Company, helps clients move from transaction-only
range of customer engagement and multichannel loyalty solutions. This platform programs to programs that engage customers in multiple ways. It does this by
designing, developing, implementing, and managing loyalty programs, digital
looking to implement in your upcoming
is designed to provide the tools necessary for designing flexible loyalty programs.
Clients may also choose to supplement an existing program by integrating promotions, and agency services. It uses purchase-based tactics, multi-channel
selected functions. Comprehensive strategic consulting and ongoing messaging, and analytics to optimize customer interactions. The company also
administrative and analytical support simplifies loyalty program management. offers strategic consulting and creative services.

The company’s loyalty-specific services include implementation services,


customer loyalty strategy?
Furthermore, the CrowdTwist platform offers functional, operational, and
aesthetic customization. Clients with existing technology infrastructures can engagement strategies, concept development, and audits of existing programs.
adapt it to their organizational needs. Clients can also determine nearly every The company also offers full suite design engagements inclusive of ideation, UX/
aspect of the program, including the basic structure, reward types, and consumer UI, and financial viability. Program management, analytics, technical support,
strategic consulting, and creative development are also provided if required.
activities that generate rewards. “From a technology standpoint, we are focusing on “We know that voice search has changed the way people
In addition, the level of client interaction is flexible. CrowdTwist-hosted and In addition to these services, the company offers a platform that includes marketing automation to make our communications use search, so last week our web group did a hackathon
client-hosted options enable for hands-on and hands-off approaches, as well as out-of-the-box API support for core loyalty features such as profile management, more personalized for our fans. While email may on Alexa skills to understand how to program for that.
strategies in between. Through a set of CSS-compatible and mobile-responsive user history tracking, and award redemption. The platform also interfaces with seem passé, our fans rely heavily on it. Marketing We started with a flu tool, a little piece of software code
widgets, the platform enables custom-made end-user interfaces. These are ideal client, vendor, and partner-provided APIs for real-time data integration. The automation extends beyond email and will be critical that you can interact with to understand whether you
company implements new APIs to support program-specific use cases as needed.
for clients with very precise branding guidelines. for us as we continue to offer compelling content for have the flu, where you should go, and what you should
Batch data transfer and processing are also supported.
distribution across our digital channels.” do about it. We turned it into an Alexa skill. So now we’re
refining that and will put that out to the market.”
Kelly Linstroth
Assistant Director, Relationship Marketing Jill Austin
Chicago Cubs Chief Marketing Officer
Engage is a loyalty and redemption technology provider that delivers targeted
engagement supported by limitless redemption options. Engage enables loyalty Vanderbilt University Medical Center
teams to execute today’s campaigns, tap new engagement capabilities, deliver
Lenati is a marketing strategy firm committed to helping the world’s leading
innovative new programs, and convert loyalty points to currency.
brands build customer loyalty, organizational focus around the customer, and
Easily integrated with current systems and requirements, Engage provides better improve revenue growth via a unique, comprehensive, and thoroughly crafted
customer knowledge, rich campaign insights, and timely feedback through its approach. It partners with B2C and B2B clients to find innovative ways to
Podium Software Solution. It has automated communication features that can improve customer engagement, loyalty, and maximize overall customer lifetime “From a development perspective, we keep up by “We’re on the forefront of autonomous cars. We’ve just
produce system-generated notifications, including password reset, order value. It helps brands emphasize mobile and digitally-oriented experiences and had a successful pilot at CES where attendants could
hiring more smart people. From the third-party
confirmation, account statement emails, and more. It is also designed to handle develop disruptive strategies. The company works across the customer
world, we have teams that start at the executive take autonomous rides to and from specific places in Las
campaign management through configuration and API requests. It can support lifecycle, from acquisition to engagement to retention, to build stronger
both earn and redemption campaigns. Podium also offers personalization and mass customer connections. level and go down to department leads that look at Vegas, and that’s creating a whole new experience for our
communication capabilities. Using segmentation and member data to personalize new technology to see if it is something that we’re passengers and ourselves and our partners. So that’s really
offers and program rules, the platform is designed to enable every interaction to be Part of Lenati’s focus is helping brands advance loyalty programs beyond the interested in and see if it fits. We’re investigating BI exciting—being able to solve complex, exciting customer
customary transaction-based interactions. Whereas many vendors in the challenges to create more value for our customers.”
one-to-one. The software also manages mass communication through users lists. tools now and trying to come up with something that
loyalty space are focused purely on program mechanics, Lenati begins with an
Engages’ easy-to-use platforms Podium and Access allow for increased approach that is grounded in all-up corporate strategy and a deep
will meet the needs of all departments.”
customization and personalization including customer-targeted content. understanding of customer behavior. This approach is informed by expertise in
Engages’ redemption technology Access, a redemption platform that facilitates behavioral economics, advanced data sciences, and customer insights. Henrique Saboia
Scott Scherer
the conversion of loyalty points to any fiat currency, covers 80% of all eCommerce
In addition, Lenati is differentiated in that its services span an area between Chief Information Officer Senior Growth Marketing Manager
transactions, enables over 50% of the most popular eCommerce sites and
participates in 100% of the top 13 online categories. The Access platform allows traditional consultancies and agencies. It has deep capabilities in advanced Jersey Mike’s Lyft
loyalty marketers to offer limitless redemption options -- by geography and analytics, research, and corporate strategy, but its design and implementation
customer preferences. The Engage advanced loyalty environment maximizes expertise in UX, mobile, digital, and store environments sets the company
loyalty programs, increases loyalty metrics and drives business outcomes. apart from its competitors.

8 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 9
FEATURES

“The highest level of loyalty is from the


customers who are those real passionate,
emotionally connected fans who support
the brand on social media...They spread
the word and culture of Jersey Mike’s.”

EMOTIONAL LOYALTY,
AUTHENTICITY, AND
What’s going on there is that I’m a loyal customer because I’ve devel- The campaign culminates in the nationwide event, Day of Giving, this
oped an emotional connection to the place. It’s the big picture sort year on Wednesday, March 27, when local Jersey Mike’s owners and op-
of loyalty, too, because a competitor can’t pull me away with some- erators will donate their resources and every single dollar that comes in
thing like a better price or faster service. to local charities.

I’m thinking about my relationship with the bookstore because my The program has roots that are authentic to the brand; the company’s
conversation with Rich Hope reminded me of it. He’s CMO of Jersey

JERSEY MIKE’S
founder, Peter Cancro, sought role models in his hometown. “He often
Mike’s Subs, and he put great emphasis on cultivating that sort of big cites a couple business men, Bob Hoffman of Hoffman’s Ice Cream and
picture loyalty. I’m sure he’d agree that, unlike designing and optimiz- Jack Baker of Jack Baker’s Lobster Shanty,” Hope said. “They gave un-
ing a rewards program (which Jersey Mike’s has done successfully), conditionally to everyone in town. They gave to the school and the first
achieving that emotional connection is more an art than a science. aid club and the Fire Department, and on and on and on. They helped
There’s no established formula for it, and my guess would be that we everyone they possibly could in this community. He decided way back
won’t be arriving at one anytime soon though. What I do know, though, then that that was what he wanted to do with his business.”
is that your brand can’t achieve that bigger picture loyalty without
being authentic. To me, the coolest and most authentic part of the brand’s Month of
Giving program is that it has maintained that community-serving aspect,
Jersey Mike’s began as a sub sandwich shop that served the type of even though the company is now all over the country. Jersey Mike’s
cuisine the locals favored. This was before sub sandwiches became a customers get a real say in which local non-profit they would like their
Mark Johnson | Loyalty360 standard meal across the United States. Even now, though, with a fran-
chise of over 1,500 restaurants, the brand has stayed true to its Jersey
particular location to support. Each location then, imitates the original
sub shop and participates in the giving.That program has done a lot to
roots. Hope said, “A lot of emotional loyalty comes from people who boost loyalty for both customers and employees.
are New Jersey or Northeast transplants, because they find out, ‘Holy
I have a local bookstore that’s my go-to for a new book
smokes, I can get a Northeast style sub right here in North Dakota or
South Dakota,’ or wherever we open up new stores. That brings back Hope said, “One of our stores locally raised $10,000 for Make-A-Wish,
whenever I want to read. Frankly, I don’t even remember an emotional connection to their home.” and $10,000 equals one wish. So the store, at the end of the day, they
my first time visiting the bookstore. I remember liking the realized they raised $10,000 that day. They closed and locked the doors
atmosphere, of course, but I can’t recall what prompted me Hope referred to the various levels of loyalty he sees in his customers. that day, and the entire crew broke out crying, because they were so
He noted that the highest level of loyalty is from the customers who passionate about the fact that they worked so hard and were exhausted,
to go in in the first place. That’s no matter, though. What “are those real passionate, emotionally connected fans who support but they actually raised a full wish for a person. It was overwhelming to
became important, rather, was developing a relationship the brand on social media, for instance. They spread the word and them.”
with the bookstore over time. I can tell when an employee culture of Jersey Mike’s. They may be so loyal to the brand that if
is new. The older employees recognize me when I walk in, somebody says something bad about us on social media, they would It’s truly special to see a brand play such a role in crafting experiences
even come to our defense and say that those people are wrong.” that are meaningful to the customers, the employees, and the com-
and they almost always ask how my family is doing. munity. I think we can all agree that the grueling shift that Jersey Mike’s
The people he’s describing are the walking, talking definition of “brand team handled and the money they raised amount to something beyond
I’ve been going there for maybe a decade now (how quickly advocate.” When your customers are shooting down the haters on business and marketing.
the years pass). In that time, plenty of more convenient op- Yelp without any prompting on your end, then you know you’re doing
something right. When we at Loyalty360 ask loyalty marketers what they’re curious to
tions have become available, and I’ve tried some of them: learn more about, they often tell us that, in addition to hard topics like
online retailers, big chain stores, etc. If I’m being honest, One of the big emotional loyalty differentiators that Hope brought trends in tech, personalization, and data management, they’d like to
these places may even have better prices. But they never up is Jersey Mike’s Month of Giving program. During the month of hear more about the soft side of loyalty, the big picture stuff. From our
replace my go-to, because they don’t feel like my bookstore. March, all are invited to come into their local Jersey Mike’s restaurant conversation, I gather that Rich Hope and the team at Jersey Mike’s have
and make a donation to the location’s designated charity partner. a solid foundation when it comes to that soft side.
I’m just another customer at the newer places, unlike at my
go-to, where I feel at home, where people know my name
(cue the theme from Cheers).

10 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 11
FEATURES

The Family We learned from Leitman that,


historically, loyalty can be challenging
in the wine industry. “There’s this
become more visible in its corporate
responsibility. “We’ve done a lot
through the years,” she said. “We’re

Coppola Tells thing with wine where people just


love trying something new and telling
their friends about it,” she said.
at a point where it’s time to put some
structure around our efforts and let
our customers see that we’re purpose-

a Story, Shares
Brand-hopping is common. The Family driven. We had a summit last fall with
Coppola needed to be inventive to Francis, and he’s passionate about
become the sort of brand that was a number of issues. From education

a Lifestyle
worth regular purchases. “We need and the environment to the arts and
to give people a reason to choose us. women’s achievement.”
To remind them of our qualities and of
the lifestyle that we represent, reward The Family Coppola has been involved
Mark Johnson | Loyalty360 them for their loyalty.” with social causes, but it hasn’t always
made that known to the public—
So far, the loyalty program has that’s not a bad state of affairs, really.
seen positive results. When asked Consumers will see the authenticity,
“In vino, veritas.” about customer feedback, Leitman given that the brand was, so to speak,
indicated that thus far, feedback has getting involved before it was cool.
There’s nothing quite like savoring a glass of wine. Once my There’s always something interesting that’s about to been overwhelmingly positive. “The
college days were behind me, once I grew out of drinking happen, which is fun. So, there are more things that are feedback we’ve been getting has Speaking to our hearts, Leitman noted
Pabst Blue Ribbon, I came to appreciate uncorking a good constantly being put into The Family Coppola and into been that it’s very innovative, that that loyalty goes beyond data and
bottle and spending the evening meditating on the day’s the story that we’re telling.” it’s interesting. I also think because points. “I’m deeply interested in the
events. To my surprise, I recently learned that the director of it’s connecting all the pieces of the softer part of it,” she said.
my favorite film, Apocalypse Now, is in the wine business. But telling that story can be difficult. When your business company, it’s been an interesting
does so many different things, presenting consumers a education for people that maybe just
Six-time Academy Award winning director Francis Ford unified brand can be daunting. She says, “We’re looking for participated in one part. Now they’re
Coppola has created a wide-ranging business, which a reason to get people to choose us, to remind them of our learning all these other parts about the “It’s not about the
includes film, food, wine, resorts, spirits, and a magazine. He consistent quality and also the lifestyle that we represent, company. Even if you can’t participate algorithms. It’s not about
is turning 80 this year and has been in the wine business for because a lot of people don’t know that The Family Coppola in all those, there’s a certain cachet
is more than wine.” The Coppola Rewards program was and sense of discovery around our
the points. It’s about
nearly 40 years. Through his company The Family Coppola,
his wine is available around the world. put in place to tackle that and build loyalty for the wine and company.” Sounds like things are something deeper. It’s
other lifestyle brand offerings. going well according to plan. so hard to articulate, and
In a conversation with Loyalty360, Jennifer Leitman, The
Leitman reminded us that loyalty is “more than just swag.” Customer feedback has also provided
maybe that’s why it’s so
Family Coppola’s EVP of Marketing, discussed how these
seemingly disparate ventures are actually deeply connected. She continued, “People don’t just like t-shirts. You want the brand with useful data. Leitman hard to make that happen.
It’s all about lifestyle and authenticity. The company’s new these things that you can’t buy or you can’t have access stated that it gave her team the That’s that next-level
loyalty program shows people how The Family Coppola’s to, and that’s something we can really deliver. It can be opportunity to “learn more about your
many pieces fit together. something as simple as you engage with us enough, enough customers, what wine they’re drinking,
loyalty and devotion. It’s
interactions or enough purchases, then you get to talk with how many times they drink, the age hard to come by. That’s
Leitman described her role as a marketer as being a an award-winning winemaker and ask him or her anything.” of the customer.” She continued, “All what I think we could
company storyteller. “The marketing team helps connect of that information is critical. Those
the dots within the rest of the company,” she says. “We tell Exclusive experiences like these, Leitman suggests, are the behavioral insights are what everyone all learn more about. I
the story of The Family Coppola. We have rewards. We’ve best way to drive loyalty. Speaking with a winemaker is a seems to be most fascinated with would love to have more
wonderful idea for a reward, because it costs the company right now.”
got a magazine. There’s a food business. There’s a couple education on that.”
of restaurants. There are wineries. And there’s always virtually nothing (save the winemaker’s time, which must be
something cooking with Francis. precious), but it represents a once-in-a-lifetime opportunity As for future plans, Leitman indicated
for the consumer. that The Family Coppola will

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FEATURES

MGM
Chase added that personalization will help MGM deliver Butera also pointed out that management of MGM’s
these social experiences. “I think you are going to start to see partnerships affects the customer experience as well. “We
a set of customized offers tailored to what our customers have a whole team that works on integration and activating all
prefer. So, we can reach out with updates, personalized events of this. With these partnerships, we have different hospitality
you might be interested in. If we see certain clients go into elements we use, and we’re working together to co-develop a
certain locations, we will tailor outreach towards that. We are lot of programs and reward events and live signature events. We
going to be a lot more focused on speaking to customers in a also get access to things like players and legends and on-field

IMPROVES THE personalized way.” experiences that create these once-in-a-lifetime experiences
that bolster customer engagement. For the teams and leagues,

GAMING
The company has also made some strategic partnerships the world is changing how it consumes sports content. No longer
that Butera and Chase believe will enhance the customer do people want to just sit and watch the game. They want to be
experiences as well. “We work with broadcasters and a part of the action. So, this is really enhancing their customer
networks and we also have sports sponsorships,” Butera and fan experience as well. We work with teams and leagues
said. “All of this exists on its own, but it also drives customer together to develop programs, products, apps, and games that
acquisition and loyalty. We have partnerships with three we think will create a rewarding customer experience.”

EXPERIENCE leagues now: the MLB, the NBA, and the NHL. Really what
we get from them is quite a bit. One, we get a complete
integration of our marketing database. We are hearing
information about each other’s customer base, we are
Both Butera and Chase admitted, however, that challenges still
arise. “The biggest challenge for us is competition and making
sure you have a great product,” Butera said. “To do this we have
marketing to each other’s customer base, we are co- to make sure our product hits home by collecting as much data
branding to each other’s loyalty base.” as possible on our customers, so we can cater our offerings
Patrick Barney | Loyalty360 correctly.”
He continued, “We also have a lot that we do on the
customer side to create great fan experiences and great Chase added, “Through all of our touchpoints I think it is critical
customer experiences. Where you see that online is under we are creating a unique experience, one that is well thought out
the ‘Play for Fun’ tab. We do live sports wagering in states and matches the needs of our consumers. This isn’t always being
My extended family has a tradition. Each year, when we two of the company’s executives: Scott Butera, President where you can do that, but in states where we aren’t legal yet, first, but it’s important that we have elements that are unique
gather for Christmas, we play a family poker game. That’s of International Gaming, and Greg Chase, Corporate Vice we do predictive interactive games that get people to learn the or stand out. We want to create something that is world class,
really the only time I ever play poker, and I always lose all my President of Guest Strategy and Insights. The discussion sport while also earning rewards. For example, if the MLB does instead of launching a product and then figuring it out later.”
money. In short, I’m a terrible player. I’m sure I could improve focused on how the company has been working to make the a ‘Play for Fun’ game on its own and has rewards, the rewards
if I studied the probabilities more deeply, but to do that, I’d experience of betting and online gaming more social. could be a signed piece of merchandise or tickets. But if they MGM’s focus on the gaming experience strikes a chord with me.
have to invest more emotional energy in the game, which I work with us, it could also be a weekend stay in Las Vegas. I don’t pay too much attention to sports all that often. I watch a
don’t really want to do. I like to play once a year, spend some Butera said, “[Customers] are changing in the sense that There are really symbiotic, fully integrated partnerships Cincinnati Reds game on the TV when I’m at my in-laws’ house,
quality time with my family, and see if my skills are any better they want to do more than just bet on a game. They want to where we get a lot of marketing.” but that’s about the extent of my interest. So, if there’s a way to
than last year. Don’t count on it. be part of the action, they want to be interacting and viewing make the experience around sports and gaming more social,
data, they want to have social experiences where they are Another partnership benefit, Butera said, is the use of official more about interaction with friends and family, then that’s going
The point I’m making is this: playing poker with my family part of a group. Just like no one wants to sit at a blackjack data. “So, each league has its own specialized data. In the to do more to acquire a customer like me than anything else.
at our Christmas get-together is about the experience. I sit table anymore, no one wants to sit in a football game for four NHL, they have something called puck and player tracking. For those who are true fans, the opportunity offers even more
down for a couple hours, see if I can put together a good hours and call it a day. People are looking to be part of an Basketball has second spectrum, which gives you data on promise. I’ll be keeping an eye out for MGM’s improvements to
hand, try to make wise bets and folds, and chit-chat with experience. They want to be part of the action.” things like how fast the ball is traveling and how high players the gaming experience in 2019 and beyond.
my relatives. If I lost more than five or 10 bucks every year, jump. It enhances the customer experience from a viewing and
I might not enjoy the experience so much, but, since it’s low Chase seconded this idea. “Folks want to touch it, they want content perspective, but also from a betting perspective. If I
stakes, the feeling I come away with is one of community. to see it, they want to feel like they are there. We have never know someone swings faster than another player, then I might
You can’t really ask much more from a gaming experience really placed gaming tables in the sports book area, but bet on him because he might hit more home runs. So, one
than this. we recently started doing this to create a more immersive day you could be watching the game and bet on who has the
gaming experience. So now, while watching how their bet is fastest fastball or hits the fastest slapshot. That’s why we do
Since the repeal of PAPSA, one gaming brand, MGM Resorts, playing out, people can have a social experience at one of our these. They are revolutionary, and no one has really done them
has been focusing on the online sports betting experience gaming tables.” before. It’s a whole new approach and it’s very comprehensive,
in exactly this way. Loyalty360 recently sat down with and it’s meant to compliment everything we do online, as well
as everything we do with our resorts.”

14 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 15
FEATURES

Garner said, “I am the Chief Technology Officer, so I’m account- that you can enter in, oversee, or get credit for a mobile order up
able for our digital commerce group, the revenue side that does to 24 hours after placing it when you joined the rewards program.
product management, and the development of our consumer That’s all facilitated through web and mobile.”
facing technology initiative. So that’s our app, our loyalty program,
Chipotle.com, delivery. All of that is part of my organization, and I Garner also discussed the methods Chipotle has used to cor-
am also accountable for the teams that build out technology solu- roborate its view of the customer. “We look at all of the metrics

CHIPOTLE
tions, the systems that run our typical backend house functions around digital and loyalty together on a weekly basis. Our market-
like supply chain and finance, HR and data.” ing and our digital work are highly coordinated and orchestrated
to complement each other. The rewards program, as an example,
He continued, “From a strategy perspective, I think it’s really was something that all of our restaurants were ready for and
important to emphasize the things about your company that are excited for because they understood it. So, it’s really important
unique and special. We look at our consumer-facing technology for anything that’s customer-facing that you’re aware of the data,
through the same lens. We want to provide great customer experi- that you’ve got a well-coordinated plan, that it’s something you’re
ences. We want people to know and feel like they’re ordering from focused on across the organization, not in just one silo.”

LAUNCHES ITS
Chipotle because we are different. If you think about going to a
restaurant and looking at a menu, you’ll tend to look at an entrée. When asked about data regulations that might impede such
Maybe it’s chicken with onions and peppers and a chipotle sauce, efforts, Garner said, “The technology marketplace has caught up
with a side of mushrooms, etcetera. However, we want you to tell and has adapted to many of the regulations to make it easier to
us the ingredients that you want, and then we’ll create an entrée collect, store, organize, and match customer data. There’s been a
based upon that.” lot of dancers in the marketplace around that, and the landscape
and the regulatory environment haven’t changed. Chipotle has put
Garner believes that this different approach lets customers a greater focus on understanding the value of the responsibility

FIRST LOYALTY
that comes along with data. We have groups set up with specific
know that Chipotle cares about what they want. “They care
accountabilities around that. We want to be completely transpar-
about provenance and animal husbandry and the environ- ent about how we use and store customer information.”
ment,” he said. “They care about real ingredients and not
having anything added that’s unnecessary, artificial, and they On the topic of loyalty program technology, Garner said, “We
started laying the foundation for [our program] in 2016. We’re
want to be connected to a purpose that is bigger than just
unique in the industry in that we’d already built dedicated kitchens
eating out. I think those are industry-wide trends that have and lines for out-of-restaurant orders so that we could service
been influenced in part by Chipotle making that a priority and digital without any disruption to the line in the restaurant. The first

PROGRAM
doing things differently.” piece of technology that we put into place was around logistics,
bringing orders in, figuring out how to sort them, stage them, and
He continued, “The advice I would give another brand is, really reduce the delay between when somebody made those orders and
understand what you stand for and what makes you different. The when we promised that they would be available for pickup.”
challenge is ensuring that you’re communicating that effectively
to your customers. And it has to be real enough that somebody He continued, “Then we developed screen technologies that
would get it quickly and perhaps take action on it. It’s a competi- helped make it easy for people to make all these customized
tive marketplace and people are inundated with lots of informa-
tion. So, cutting through that in a way that’s real and connected
orders very quickly. Then we put it in an app, then in pick up
Mark Johnson | Loyalty360 to purpose is really important.”Garner elaborated on other things shelves. Then we integrated delivery, so that delivery drivers
customers want in addition to a sense of brand purpose. “For in- never have to stand in line or pay. Then we launched the
stance,” he said, “one of the things we learned in the test markets loyalty [program].”
was the notion that our customers don’t feel good about having
plastic loyalty cards. That came out loud and clear. Yet, custom- When asked what other companies should avoid when imple-
If there’s a brand that epitomizes the fast-casual restaurant ers want to participate in loyalty programs, however they order, menting similar programs, Garner said, “If you don’t have a
whether they’re standing in line or they’re ordering online, either
vertical, it’s Chipotle Mexican Grill. After a decade-long fallow great app, if you don’t have a great way of making orders, if you
on a website or a mobile device.” can’t remove the friction from a delivery or pickup process, but
period following its founding in 1993, Chipotle blazed onto the you’re encouraging people to join the channel through the loyalty
national scene in the early 2000s and seemed to single- He added, “One of the things that we heard from a customer was program, you’re going to disappoint them as part of their first
it’s disappointing when you go into a company and you order
handedly invent the “watch-them-make-your-food” business something, maybe it’s for the first time or maybe you come all
potential interactions with you.” However, he said, “That’s not
something [Chipotle was] willing to do.”
model. Competitors have emerged that use the same model, but the time and after you ordered, you become aware of the loyalty
Chipotle stills seems like a big deal. program. And then don’t really get to get any credit or participate Chipotle has been on the forefront of innovation since its incep-
until the next time you come.” tion 25 years ago. For this reason, we’re extremely excited to see
As the brand progressed, customers began to clamor for a loyalty program. the company launch its loyalty program. If its reimagining of the
The company listened to this clamor and began devising strategies for This information led to specific features of Chipotle’s loyalty fast-casual space is any indication, then Chipotle’s loyalty program
implementing a program that would meet customer desires. Recently, program. “We built our program to be scannable, whether you’re will be customer-focused and thrilling. We can’t wait to see what
Loyalty360 spoke with Curt Garner, Chief Technology Officer, at Chipotle standing in line or instantly applied if you’re ordering online develops from it.
Mexican Grill, to discuss these strategies, as well as his history with the through a mobile. We [also] built a feature, unique in the industry,
company and other topics.

16 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 17
TECHNOLOGY, TRENDS & REWARDS

Technology
Who Are Your Customers? Loyalty Never Stops
Do you know your customers? And do you really understand Implementing or redesigning your program is just the
them? Have you discovered their motivations, when they feel beginning. Loyalty is a constant evolution, so make sure you

is holding
recognized, and what makes them buy? There’s a big difference have a long-term partner to help you test, learn, refine, and
between “Our customer buys three times per year,” and “Here’s repeat. The landscape is always changing. What customers
why our customer buys three times per year.” find rewarding is constantly in motion. Your customer isn’t
standing still, and neither should your program. Constantly

loyalty back
Loyalty starts with a deeper understanding—a comprehensive test to improve and your program will evolve naturally over
customer composition that unlocks the structure and design time for profitable growth.
of your program. Without it, you’re going in blind, and that can
be a pretty expensive guess with years of residual impact if you
get it wrong. Cultivating Better Customers
We’ve barely begun to scratch the surface of Find a partner with loyalty and customer analytics expertise The essential elements of building better customers are
the nuanced approaches that actually engage customers—
loyalty’s potential. It’s capable of so much more, that can dig up the deeper insights that you’ll need for your
program to succeed. whether that’s marketing and messaging or developing
but a focus on platforms is hindering brands’ insights to better serve them. In the end, technology doesn’t
abilities to better serve their customers. Strategic equal marketing and we need to accept that a combined
approach is the only effective way for brands to focus
design and in-depth analytics combined with an Loyalty Is a Solutions-Based on their customers and build the full spectrum of loyalty
adaptable platform and a commitment to the Commitment components to achieve success.
customer create far greater impact.
Loyalty is not just execution. Brands are trying to solve the
To avoid that high-risk riddle of what makes their customers tick. The solution is a
program strategy designed from customer insights focused
Evan Magliocca approach and to ensure on the following key components: interact with customers
Director of Marketing in key channels; ignite their interest in your brand; and hold
Baesman Insights & Marketing
a successful program, their affinity over time through great service, recognition,
gratification, and cultural alignment.
consider focusing on
People want to be loyal; it’s in our DNA. We want positive
Today, loyalty is focused largely on martech. Martech seems
to align best to our love of innovation and promises to solve all the key components reinforcement for making the right choices. As brands, our
objective is simply to give customers a reason to stay by
of our deepest problems with a simple wave of the wand. Yet
in practice, technology is a small—but important—part of the
of the whole loyalty providing that reinforcement. This is the heart of program
design and it needs to provide clear opportunities for
actual solution.
ecosystem. interest, affinity, recognition, and alignment.

For brands, problems arise when technology runs wild and is


implemented as the primary focal point of a loyalty offering. Infrastructure
Technology is merely an engine and traditional platforms are
Yes, platforms are still important, but don’t get distracted
crippled by their own inability to remain flexible and integrate
by big, traditional providers with tons of capabilities that,
easily with so many other channel-specific platforms.
unfortunately, come with legacy issues. Technology should
make your life easy, not drown you and become your
For brands searching to connect with their customers and full-time job.
build loyal bases, that inability can put investments at significant
risk. A brand risks being sucked into a fragmented approach Technology needs to be scalable, flexible, and seamless. You
that shackles it to a platform without the ability to adapt to its should barely know that it’s there and you shouldn’t spend
customer. Without a broader focus on marketing, analytics, your days complaining about it. Some partners even offer full-
strategy, and the customer, technology can quickly limit service approaches that will keep you focused on your goals
your team and prevent you from engaging in strategies that and not on the daily doldrums of operating a platform.
accomplish your goals.
Look for a team with great service and a history of associates
with brand-side experience that can help you to keep your
program growing over time.

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51%
BEST PRACTICES
of those we identified as Leaders agreed strongly that their program

Forget Best
is driving innovation, compared to only 16% of Laggards.

Practices in CX, Think


2 Innovation – and Action
Innovation always sounds like a nice idea. But it so often doesn’t
4 Build a customer-centric culture
Throughout the research we saw the importance of driving a

it’s all about


happen. CX as a driver of innovation is a huge part of being able to customer-centric culture. Our audience mentioned extensively the
prove your worth as an investment. The research we did shows that need for high employee engagement at all levels of the organization,
the ability of a CX program to drive innovation is the number two from the front-line, customer-facing employees, through to middle
driver of CX success. management across silos, and of course at Board level.

Habit… 51% of those we identified as Leaders agreed strongly that their


program is driving innovation, compared to only 16% of Laggards.
This makes sense. If programs are not resulting in innovation and
Companies that foster a great customer-centric culture tend to be
on a virtuous circle. One where executive support and employee
engagement combine to fuel the right behaviors, drive the right
action, they are – to put it bluntly - pointless. So it’s no surprise that initiatives, and link to positive business outcomes.
additional funding is not forthcoming. Be clear with your team. You
must drive change. One great habit is to become an agile listener – taking the views
Claire Sporton
of your internal teams into account. Combine proactive, solicited
SVP Customer Experience
Innovation surveys at key stages of the employee lifecycle with unsolicited,
Confirmit Don’t
3 stop at listening to customers reactive approaches such as online comment boxes and social
media sources. Every employee has a unique view of the customer
As you would expect from an audience of CX pros, the overwhelming experience – understand it and use it.
majority (87%) of respondents were actively capturing the Voice of
the Customer. Those who were not capturing Voice of the Customer
We’re awash with people talking about best 1 Ownership of Goals were capturing Voice of the Employee. 5 Continuously re-think
practices these days. It’s hardly surprising. It’s easy for CX programs, just like any other functions in a business,
This was the habit that most strongly correlated to success.
Everyone wants to be sure they’re doing the A common affliction of the CX professional is a tendency More Voices = Competitive to get stale, to stop pushing the boundaries, to get stuck with bad

right things for their Customer Experience toward focusing exclusively on CX metrics – and claiming Advantage habits. The CX equivalent of biting your fingernails. When you get
ownership over all things CX. Our number one driver of started, there is that drive to deliver results and wow the Board. But
or Customer Loyalty program. But best program success is ensuring that your stakeholders in the
Leaders Laggards as time passes, especially for successful programs, a plateau occurs
and routine sets in. And then results can plummet.
practices mean nothing if they don’t translate business own the goals rather than them being owned by the
CX team. Then defining success using the measurements
into regular habits that become part of the and terminology that will secure broad support. It may seem obvious that CX professionals need to keep their
programs innovative, but I’m often shocked at how often there is a
fabric of what we do, day after day. 72%
This means setting goals and having other teams included 59% sense that a program is in place and the job is done! Innovation is
as part of that process. This gets them engaged and helps 26% 41% critical as customer expectations and competitors’ capabilities are
to ensure that they really commit to doing what it takes to constantly evolving.
But what are those habits? What are the things that CX professionals deliver. The most successful companies are then able to 1 or 2 Voices 3 or 4 Voices
need to do in order to really make a difference in their organization? demonstrate Return on Investment that directly links these (Customer/Employee) (adding Supplier/VoCE)
And it is across the organization that CX teams need to focus on. The goals to results. If you have a bad habit of keeping your head
ability to boost NPS score is fine – good even – but it’s not what secures down and staying in your CX lane – look up, and get out into This does raise the question of whether companies are able I would strongly urge any CX team to take
the future of CX in the long term. To do that you need to demonstrate the rest of the company. That’s where success lies. to integrate the analysis of multiple voices. In our experience, some time to think about which of these habits
real business value. Show them the money! organizations that do capture feedback from both customers and
employees struggle with integration. This is particularly true with
they currently have, and which would be most
This was very much in our minds when we ran a survey of over 700 CX Goals owned by the business more mature programs where entirely different methodologies beneficial to adopt. Think of CX as part of
professionals. Instead of identifying the “Leaders” as companies who
were able to boast amazing CX metrics, we considered companies
(Not by You) have been used by the HR and CX teams. It’s a huge challenge, but business intelligence. It’s all about turning data
one that you must address to really get the insight you need to
to be CX Leaders if they were securing greater investment in their Link to the broader business
drive action.
into insight and using it to make better business
program. Nothing says “delivering value” like a boost to the budget! decisions. As your decisions get better, the
Start thinking about the wider experience ecosystem too. Suppliers, results get better. And, all things being equal,
We looked at what those Leaders were doing that had helped to put 33% partners, subsidiaries. Anyone else who touches your customer
them in that Leadership position. What was clear is that there was five 27% has an impact – bring their voices into the process too. Make sure
budgets get better too.
25%
key areas – habits, if you like – that really made a difference. you take a step-by-step process, though, to avoid creating silos.
Leaders Followers Laggards You almost certainly have enough of those already!

20 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 21
STATE OF THE INDUSTRY

THE SECRET TO THREE KEY STEPS TO FOSTERING EMOTIONAL LOYALTY


Fostering emotional loyalty requires brands to deeply understand their customers and predict their needs. The following three steps

AN EFFECTIVE outline how to build superior experiences that stimulate a positive emotional response.

LOYALTY PROGRAM 1. KNOW YOUR CUSTOMER


Even with innovative marketing technologies and an abundance of
consumer data, knowing one’s customer is still a struggle today.
PROVIDE MEMBER-ALIGNED VALUE.

Consumers spend their money with businesses they respect. They also
This is due to a variety of factors—legacy systems don’t talk to each have the potential to be vocal advocates, which is easy to do in today’s
We live in the age of exponential technological progress. It’s hard
other, data lives in numerous databases, laws regulate what data can world of instant status updates and social media. Word of mouth is a
to imagine that just 10 years ago the iPhone was first launched, powerful and influential tool, with comments, customer ratings, and
be collected, data is available but not useful—the list goes on and
unlimited data was non-existent, and Amazon Prime was only three influencer videos a click away at any given time in the buying journey.
on. Consolidating data systems, modernizing IT infrastructure, and
years old. Innovations like these have completely changed the way ensuring the right data is available enables brands to have a ‘single And consumers—millennials especially—are eager to promote brands
we interact with brands, with each other, and even objects—think source of truth’ about their customers. However, brands that go a that align with their personal values and beliefs.
Alexa, Apple Watch, and Smart Refrigerators. But most importantly, step further by augmenting data with the “human-touch” to create a
this progress has changed consumer behavior and expectations, personalized experience achieve astounding results. REI saw the opportunity to align with their customer’s personal values
proving to be a disruptive force in the business world. and beliefs through the ‘Opt Outside’ campaign. REI knows their
Stich Fix, a clothing subscription service, has incorporated this idea customers and employees have one thing in common—they love being
as part of their core business model. Personal stylists are key to Stitch outside. Therefore, on the largest money-making day of the year, the
Fix knowing and understanding their customers. When customers retailer closes its doors and encourages their employees and customers
express a need to create an outfit for an upcoming event, stylists to ‘Opt Outside’ instead. By showing customers that the business is
make a recommendation using mathematical algorithms and robust willing to sacrifice sales to stand behind their beliefs created respect and
customer data as a baseline to match what the customer is telling more loyal members than ever.
LAURIE MEEK ANTJE HELFRICH them about their needs for a specific occasion. This allows the stylist
Engagement Manager, Sr. Manager, Customer to go above and beyond to curate the right look, improvise when
Loyalty Lead Experience & Loyalty necessary, and connect with their customers—creating incredible 3. LEVERAGE TECHNOLOGY TO DELIVER THE
brand loyalty.
RIGHT EXPERIENCE AT THE RIGHT TIME
The role of technology in building customer loyalty is twofold: First, the
With information easily accessible via tools that are deeply engraved 2. BUILD A CUSTOMER-CENTRIC STRATEGY company needs a loyalty platform that integrates seamlessly with other
in our daily lives, customers have the power to engage with and switch core systems and tools to deliver foundational loyalty experiences, such
Understanding that customers can be swayed by complementary as earning and redeeming points. Second, brands should build digital
to competitors at any point in time, should a preferred brand fail to services and benefits is fundamental to building a customer- centric and phygital experiences to meet customers where they are at – on their
meet expectations. Today’s customers want brands to know who they strategy. Brands should start moving away from product-centric mobile devices – and use it as a touchpoint to build both transactional
and non-transactional engagement.
are, what they want, and how they want it—putting huge pressure on messaging only, to communicating with their customers in a
meaningful 1:1 manner – this could include personalized offers that
brands to deliver. And to make matters more complicated, having a contain complementary services or benefits; it could include sharing Unfortunately, proprietary loyalty systems designed to support
superior product is no longer enough to keep consumers loyal. content that is timely and relevant; or, traditional, high-transactional loyalty programs are often inflexible
it could just be a touchpoint that furthers the emotional connection and unable to adapt to new, agile requirements of a modern loyalty
with the brand. The following three pillars offer a great starting point program. Re-platforming to a modern loyalty solution that can handle
to building a customer-centric strategy: high transaction volumes, plus offers a modular engagement-oriented
architecture, is key to flexibly supporting innovation in program design.
OFFER MEMBERS UTILITARIAN BENEFITS.

Today’s consumers are incredibly busy between work, family, social The way consumers shop and engage
obligations, and hobbies. Services like Amazon Prime offer utilitarian with brands is rapidly evolving, and
benefits by providing fast, convenient, and personalized services, companies must adapt to keep
which effectively frees up time for up. As companies like Amazon
members. Likewise, Hilton has invested heavily in digital tools to continue to take market share
improve the travel experience. They addressed their customers’ pain from traditional businesses, it
points through a digital strategy and technology roadmap that gives becomes ever more critical to
travelers the option to check-in digitally from their mobile app, along develop direct-to-consumer
with the ability to select their own room—leading to a frictionless relationships. Fostering
travel experience. loyalty based on an
emotional connection
is important, as
MAKE MEMBERS FEEL SPECIAL AND RECOGNIZED.
emotionally loyal
relationships are
People like to be recognized—it confirms that they are valued by more valuable and
others. When people feel valued their satisfaction rises, and they stand the test
are motivated to continue the behavior that results in recognition. of time.
The travel industry has this one well-figured out—top fliers in airline
programs receive special treatment, from first class lounge access and
Unlike behavioral loyalty, emotional loyalty can be difficult to measure. However, brands that leverage the power of upgrades to status for life.
emotional loyalty by building personalized, value-add experiences achieve higher market share, program ROI, and
customer advocacy in the long-run.

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BEST PRACTICES
TheLoyalty
The LoyaltyLong
LongGame
Game
Barry
Barry Kirk,
Kirk, VP VP of Strategy
of Strategy for for Maritz
Maritz Loyalty
Loyalty

Loyalty
Loyalty is hard.Any
is hard. Any company
company that
that sets
sets outout to earn
to earn customer
customer What’sthe
What’s thecatch?
catch?
loyalty
loyalty quickly
quickly learns
learns that
that it can
it can be be
an an elusive
elusive goal,
goal, both
both in the
in the
Once
Once you’ve
you’ve committed
committed to atoserious
a serious customer
customer retention
retention strategy,
strategy,
achieving
achieving ofand
of it it and even
even more
more so so in the
in the keeping
keeping of it.
of it.
keep
keep in mind
in mind that
that doing
doing loyalty
loyalty well
well is not
is not a given.
a given. Many
Many programs
programs
Ironically,
Ironically, thethe reason
reason forfor
thisthis is simple.
is simple. Loyalty
Loyalty is not
is not something
something dodo a great
a great jobjob at enrolling
at enrolling members,
members, butbut struggle
struggle withwith maintaining
maintaining
that expresses itself in a single purchase, or
that expresses itself in a single purchase, or one campaign one campaign sustained member engagement. Many others
sustained member engagement. Many others fall into the trap fall into the trap
of of
response
response or or a Facebook
a Facebook like.
like. Loyalty
Loyalty is built
is built through
through hundreds
hundreds of of managing the program as a cost of doing business, rather than as aas a
managing the program as a cost of doing business, rather than
moments
moments that
that taketake place
place overover months
months or or even
even years
years of interacting
of interacting keykey profit
profit driver.
driver. They
They endend
up up making
making budget-based
budget-based decisions
decisions that
that
with
with a customer.
a customer. And And while
while somesome brands
brands cancan
earnearn loyalty
loyalty faster
faster alienate the very customers they meant
alienate the very customers they meant to engage. to engage.
than
than others,
others, many
many marketers
marketers areare challenged
challenged in finding
in finding thethe
Insights
Insights from
from thethe 2018
2018 Maritz
Maritz Loyalty
Loyalty Landscape
Landscape study
study illuminate
illuminate
discipline
discipline andand patience
patience to see
to see a loyalty
a loyalty strategy
strategy through
through to its
to its
conclusion. They simply have become too wired to measure thethe challenges:
challenges:
conclusion. They simply have become too wired to measure
success
success based
based onon short-term
short-term spikes
spikes in sales
in sales targets
targets only.
only. 1 out
1 out of of every
every 5 consumers 60%
5 consumers 60% of of Millennials
Millennials
cancan recall
recall a loyalty
a loyalty program
program that who
that who quit
quit a loyalty
a loyalty program
program
So,So, taking
taking onon
thethe challenge
challenge of building
of building loyalty
loyalty is aisserious
a serious they
they never
never engaged
engaged with
with again diddid
again so so as soon
as soon as 90
as 90 days
days
commitment. If you after enrollment.
after enrollment. after enrollment.
after enrollment.
commitment. If you dodo decide
decide you’re
you’re up up
forfor it, consider
it, consider these
these
benefits
benefits that
that could
could come
come your
your way:
way:
More
More than
than half
half Almost
Almost 40%40% of of consumers
consumers
• •Loyal
Loyal customers
customers willwill deliver
deliver youyou more
more incremental
incremental profit
profit of consumers
of consumers who
who quit
quit a a citecite “rewards
“rewards were
were tootoo hard
hard to to
than casual customers.
than casual customers. program,
program, disengaged
disengaged within
within earn”
earn” as their
as their primary
primary reason
reason
• •They’ll
They’ll
be be significantly
significantly more
more resistant
resistant to offers
to offers from
from thethe first
first sixsix months.
months. forfor quitting
quitting a program.
a program.
your
your competitors.
competitors.
So,So, if you’re
if you’re charged
charged withwith leading
leading thethe loyalty
loyalty strategy
strategy forfor your
your
• •They’ll
They’ll
be be more
more willing
willing to try
to try additional
additional products
products andand services.
services. company, it’s important to know both the upside and
company, it’s important to know both the upside and the challenge the challenge
of the
of the tasktask before
before you.
you. It will
It will also
also help
help to follow
to follow a few
a few simple
simple
• •They’ll
They’ll
be be a source
a source of referrals
of referrals to help
to help acquire
acquire newnew customers
customers
who look just like them. best practices:
best practices:
who look just like them.
And here’s Think
• •Think of of your
your customers
customers as as human
human beings
beings first.
first. TheThe more
more
And here’s oneone more
more consideration:
consideration: if you
if you don’t
don’t have
have a loyalty
a loyalty
program
program yet,yet,
youryour best
best customers
customers areare almost
almost certainly
certainly already
already youyou focus
focus onon
howhow to build
to build a relationship
a relationship with
with them
them — not
— not justjust
wondering,
wondering, “Why
“Why not?”
not?” sellsell
moremore to them
to them — the— the more
more successful
successful your
your loyalty
loyalty strategy
strategy
willwill
be.be.
So So don’t
don’t justjust focus
focus onon points
points andand financial
financial benefits
benefits — put
— put
ReturnononLoyalty
Return Loyalty real thought into your creative, your program branding
real thought into your creative, your program branding and your and your
ongoing engagement
ongoing engagement strategy. strategy.
If you’d
If you’d rather
rather go go
by by
thethe numbers
numbers in justifying
in justifying a loyalty
a loyalty strategy,
strategy,
• •UseUse your
your customer
customer data.
data. There
There is likely
is likely a treasure
a treasure trove
trove of of
decades
decades of insights
of insights from
from high-performing
high-performing loyalty
loyalty programs
programs have
have
insights
insights in your
in your existing
existing data,
data, andand
moremore to be
to be gleaned
gleaned as your
as your
reinforced
reinforced industry
industry research
research that
that concludes:
concludes:
program
program matures.
matures. Continually
Continually challenge
challenge yourself
yourself to learn
to learn from
from
It costs
It costs 5 to
5 to 1010 times
times more
more to acquire
to acquire a a andand
useuse that
that data
data to drive
to drive a better
a better customer
customer experience.
experience.
new customer than to keep an existing one.
new customer than to keep an existing one. • •BeBe creative
creative with
with “rewards.”
“rewards.” Different
Different customer
customer segments
segments
Reducing
Reducing customer
customer attrition
attrition by by
justjust
5%5%
cancan will have different reward preferences, but all customers willwill
will have different reward preferences, but all customers
increase
increase your
your profits
profits by by
25%25%
. . appreciate
appreciate choice,
choice, variety
variety andand a surprise
a surprise every
every now now
andand then.
then.

Those
Those stats
stats shouldn’t
shouldn’t be be
thatthat surprising.
surprising. Think
Think about
about your your best
best
customer segments, consumers who have been
customer segments, consumers who have been with you for years with you for years Finally,
Finally, invest
invest in learning
in learning all all
youyou
cancan about
about what
what makes
makes a great
a great
and spend predictably at high levels. If you lost just
and spend predictably at high levels. If you lost just one of those one of those loyalty strategy work well, including finding a loyalty
loyalty strategy work well, including finding a loyalty partner partner
customers
customers tomorrow,
tomorrow, howhow
manymany moderately-valuable
moderately-valuable customers
customers whowhocancan provide
provide youyou with
with insights
insights from
from their
their experience
experience working
working
would
youyou need to find to replacejustjust that one? Five? Ten? And how onon other programs. That
willwill
paypay major dividendsforfor your

The Loyalty Long Game


would need to find to replace that one? Five? Ten? And how other programs. That major dividends your
long
long would
would it take
it take to nurture
to nurture anyany
oneone of those
of those new
new acquisitions
acquisitions into
into program
program andand become
become a critical
a critical factor
factor in your
in your company’s
company’s loyalty
loyalty
a reliable
a reliable high-value
high-value customer?
customer? WhenWhen youyou think
think ofinit those
of it in those very
very marketing
marketing success.
success.
simple
simple terms,
terms, thethe financial
financial argument
argument forfor a strong
a strong retention
retention
strategy becomes
strategy becomes obvious. obvious.

Barry Kirk
VP of Strategy for Maritz Loyalty

ForFor more
more information
information visit
visit maritz.com
maritz.com

24 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 25
TECHNOLOGY, TRENDS & REWARDS

Introducing Three New Approaches to Loyalty Higher Customer Acquisition Costs Raise Loyalty
The Modern Loyalty Program Understanding engagement at every level is essential for personalizing
Stakes for D2C Brands

Powering Brands like


your loyalty program and ensuring long-term customer relationships. Tying loyalty programs to transactions from repeat customers is
crucial as the competition for new direct online sales becomes more
Who are your best customers? Are they simply the ones who purchase intense. But there are many more important touchpoints that need to be
often, or generate the most revenue? Is there value to a customer who checked off along the customer journey toward lasting brand loyalty to
follows you on social media? How about one who refers your company achieve greater ROI.
to friends? Or always leaves a review, or posts photos and videos of
themselves with your product? The latest developments in customer loyalty programs track the trends
MVMT FIGS THIRDLOVE Asking these questions of Yotpo’s brand customers expands the
impacting the wider retail landscape. Even as retail institutions from Sears
to Saks shutter, digital-natives turn to pop-up shops and niche-oriented
definition of brand engagement beyond the purchase. At the heart of outlets. These new physical showrooms are designed to entertain and
these factors is a fundamental trust in a brand’s value based on past inspire. Bottom line is that these stores emphasize product clarity, visual
The demand for true marketing personalization is completely upending the strategies, experience. And that value can be added to (or, conversely subtracted dynamics and interactivity that play well in social media feeds, and provide
from) according to these three ways that brands might approach enhanced convenience.
scope, and meaning of loyalty and rewards programs. cultivating shopper loyalty:
Those tactics by established retailers have followed the lead taken by
innovative rivals like Amazon, on the larger end of the spectrum, and
Transactional: niche direct-to-consumer (D2C) brands like Warby Parker, Glossier and
The traditional rewards concept, starting with deals and (Walmart-owned) Bonobos. The ability of successful eCommerce upstarts
There was a time when running a loyalty program was simple: A Prime Misstep to transfer their brands into physical extensions, whether temporary or
any business from a hotel chain to a wellness center could offer discounts, and this approach is for you if:
While repeat purchases remain the obvious end goal for all permanent locations, shows that direct engagement is now one of the
a reward, in the form of a discount on a product or service, to • You generally have high LTV most important factors in building a committed customer base.
a return shopper who completes a pre-specified number of brands, in this age of on-demand and uber-availability, brands can
no longer settle for the typical loyalty program because Amazon • You want to focus on lowering the barrier to entry for new customers
transactions. However, when it comes to satisfying the demand for greater convenience
Prime has upped the ante. Today, over 100 million shoppers are • You need to show why your product is better than your competitors’
and scale as they seek to expand from online and offline, D2C companies
subscribed to Prime, and that number is expected to double within • You are a lifestyle brand like MVMT or full suite brand like
But it’s not that simple any more. risk diminishing one of their most valuable loyalty assets: the emotional
the decade, according to Citigroup. Lauren James connection with customers based on the development of a distinct
business persona.
According to a Yotpo survey, For most brands with relatively limited product offerings, simply
Functional:
providing a bargain as a reward to customers who sign up for
71% of consumers want discounts in membership in a loyalty program becomes reductive in the long Built on engendering a consumer’s habit and satisfying convenience, Who Owns This Relationship?
exchange for loyalty, and also demonstrate term. Focusing solely on transactions fails to capitalize on other this is the first pillar in a foundation of personalized service and this An enterprise can’t have loyalty without a clear brand identity. But in order
aspects of the experience that makes engagements with a brand approach is for you if: to grow and adapt to an ever-evolving shopper landscape, it often helps
a substantial willingness to accept higher
more meaningful for customers and potentially more viable for the • You sell products that people buy frequently to harness the halo effect offered by a recognized brand partner. Whether
prices: 39.4% say consumers are willing business. sharing resources or simply opening new avenues for bringing distinct
• You sell a variety of products and want to make sure they audiences together, finding complements can be a win for all sides.
to spend more on a product for brands they all get visibility
love--even if presented with a lower Winning a head-to-head against Amazon Prime requires
• You need an alternative to offering discounts But the wins are rarely of equal size. The same is true when it comes to
rethinking the nature of how customer relationships form
cost alternative. and are maintained. • You’re wary about reducing prices (e.g. premium or luxury brands) bearing the burdens when the alliance concludes. Therefore, it pays to be
aware of potential negative implications to retail alliances and to enter into
• Your pricing model doesn’t leave room for promotions
them with a clear idea of what you expect to gain and what you expect
(e.g. subscription boxes)
to pay.
How many purchases does it take to Personalization at the Core • You are a premium brand like Thirdlove or niche brand like FIGS
For an established retail brand, the decision of crafting “stores within
be brand loyal? Just as every customer has individual expectations and demands,
Emotional: a store” has become another popular way of quickly establishing new
companies have to take into account that the days of loyalty
Most shoppers consider themselves to be loyal customer connections. Generally, opening up space to an upstart can
programs where “one size fits all” and “set it and forget it” are A deep connection based on the brand’s identification fitting provide an instant brand refresh and inspire new shoppers to walk through
after purchasing five times from the same brand. over. Personalization greatly depends on developing a deeper consumers’ intrinsic set of lifestyle values and aspirational choices; the doors or click on a site. For the eCommerce D2C player, the retailer’s
understanding of customers. price doesn’t enter into it. Even convenience can be thrown out the offer of shared space and mainstream validation can rapidly accelerate
37% window when the bond between consumer and company is strong. its growth.
33% If a shopper is coming directly through the website or app, This approach is for you if:
it’s safe to say they’ve made up their minds to buy something. There are rewards on both sides that can be quite favorable toward
Being able to pick up from where they left off last and offer quick • Your goal is to remain top of mind for customers building and maintaining customer relationships.
17.65% recommendations will likely satisfy that consumer. • You’re a wholesaler or sell products made by other brands
But loyalty, unlike the space in a store, is difficult to share. Having a
12.35% • You need to educate customers on your brand story
well-thoughtout analytics program in place to capture the levels of
But let’s say a customer arrives after looking at several • You leverage inter-purchase engagement to drive repeat purchases engagement, the sources of discovery, and to track whether visitors to the
videos on Instagram or YouTube offering style tips. This person
• You are a retailer like Best Choice Products or best friend brand like retail collaboration were converted into repeat shopper activity will help
might be in research mode and not prepared to make a final you determine if your brand became the beneficiary of a shared space or if
Thrive Causemetics
More than Three Four Two
purchase. In that case, showing this individual careful guidance you’re actually giving up the reins of your relationship with your customer.
five purchases purchases purchases purchases will hold her attention. Now when this consumer returns, it’s
reasonable to expect a sale.

26 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 27
STATE OF THE INDUSTRY

1. Acts of Service 4. Words of Affirmation


To quote Janet Jackson, “What have you done for me lately?” Remember, people are joining your loyalty program and reading
That’s the question your customers who are fluent in this your messages, not bots. Make them feel special and introduce
love language will always be asking. Even the smallest acts of exclusivity easily by using words like “yours” and “you.”
service can make all the difference in helping them feel your Then step up your game by emphasizing how much they have saved,

HOW DO
brand’s love. That can include something as simple as offering how smart they are to be shopping with you, how many perks and
free shipping and free returns during critical times like the
benefits are just for them, how important they are to you, and so on.
end of the year or “just because.” You could also spontane-
ously dazzle and delight your customers by utilizing all
available channels (email, social, in-store, etc.) to emphasize

YOU BUILD
extra services loyalty members can take advantage of, such as
personal styling/shopping, tailoring, expedited online ordering,
in-store pick-up, free home delivery, etc. 5. Quality Time
BONUS: If email marketing is a piece of your loyalty program (which it
Few resources are more valuable than time, so make sure
should be), weave those service elements into the main message of the
your customers know you appreciate theirs (and don’t waste

EVERLASTING
email, in addition to including them as regular fixtures in the header or
footer, like the Neiman Marcus example below. it). Proper functionality is an easy win in this category.
If you feature a product in-app or via email/social/etc., ensure
the click takes them to that specific product, and not a broad
category page. The concept of quality time can extend to other
channels and offers as well. Be timely with rewards and deliver

LOYALTY?
quickly when customers complete a challenge or reach a new
tier of loyalty. There’s nothing worse than waiting to find out
if you’ve actually received those points you worked so hard
to earn. Respect your loyalty members time, and it might just
inspire them to spend even more of it with you.

Learn Your Customers’ 2. Gifts Ultimately, your goal is to discover your


customers’ love language by listening to them.
Whether that’s via the analysis of loyalty

Love Language Who doesn’t love presents? You can show


your loyalty members extra love with a
surprise just for them. Whether that’s offering
a free product with purchase or an exclusive
metrics or a customer survey, what’s most
important is that you deliver on those prefer-
ences with personalized experiences for each
discount, what matters most is that it’s a gift and every one of your most valuable custom-
given explicitly in appreciation of their loyalty. ers (i.e. all of them). Establish those emotional
Extend discounts (wisely) and invite them connections by getting to know your customers
to in-store appreciation events. By enabling
even better and speaking to them in the love
your local store managers to create and host
functions for customers, you’ll also build a language they understand. You’ll both reap the
rewards of a love that is built to last.
The Five Love Languages of Loyalty local relationship with an actual human being, BONUS: If you’re using email or other
Would you rather go on a date with someone who is channels to promote an event, be sure
potentially creating even more opportunities
simply tolerating you, or a person who really wants to be for customers to spend money through sales
to have them show the email or other
there? The latter is the obvious choice (and the former You may have already heard of or read the similarly titled book, communication so you can tie atten-
rep upsell efforts vs. online. dance to your promotional efforts like
but have you considered how these love languages could be
being the stuff of first-date nightmares). After all, some- the Williams Sonoma example here.
applied to your loyalty program? For those unfamiliar with the
one who is interested in developing and maintaining a

3. Physical Touch
lingo, here’s the gist: We all prefer to receive love differently.
relationship is tuned in and actively engaged. The same For some, it’s through acts of service or words of affirmation.
goes for businesses trying to capture (and keep) the af- And for others, it’s via quality time, physical touch, or gifts.
fections (and loyalty) of their customers.
These basic human preferences could be the secret to tapping
This one might seem a little difficult because you can’t literally reach
All too often, however, brands claim they want to build ongoing into your customers' desires. Many marketing programs don’t
out and touch all your customers. For a multi-channel retailer, your
relationships with their customers, but they aren’t very deliberate take these unique, particular mindsets into account when challenge is to “touch” them via all engagement opportunities across
about it. They tend to treat all customers the same, regardless of mapping out their loyalty strategy. But ignoring these needs all possible channels. That means checking in (enough, but not too
how they respond (or don’t). The challenge for marketers and the could have a lasting, negative impact on your relationship. much) via SMS, email, and in person (a la the old school, brick-and-
loyalty programs they’re building: Find unique, personalized ways mortar) to create a full cross-channel experience. Consistent touch-
to capture the attention of your customers and create emotional So, how can your loyalty program speak to your customers in points and reminders lets them know you’re thinking about them.
connections that will stand the test of time. the language they, well, love?

28 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 29
BEST PRACTICES

Word-of-Mouth
According to a Nielsen
According to a survey entitled “What Makes Customers Loyal?” report, 92% of consumers
94% of consumers cited consistently good customer service
as the top reason for their brand loyalty. One of the biggest believe suggestions from
determining factors of a customer’s experience will be the friends and family more
interaction he or she has with your sales associates. It seems
redundant, but how friendly and helpful your staff are will deter- than traditional advertising.

Marketing
mine how successful you are at forming relationships with your
customers. Simple acts like smiling, saying hello, and remem-
Beyond that, 88% of those
bering the names of customers who come into the store regularly consumers trust online
create an emotional connection between your customers and
your brand. Renowned business author Michael LeBoeuf said, “A reviews written by other
satisfied customer is the best business strategy of all.” Success-
ful retailers are those that strive to not only meet their custom-
consumers as much as they
ers’ expectations, but exceed them. trust personal recommen-
As most of us already know, rewards programs are a great way to dations. With these types of
make your customers feel special and go beyond their tradi- results, one thing is clear:
tional shopping experiences. Programs with personalized offers
are even better! Retailers can create offers for loyalty members Word-of-mouth marketing
based on past purchases, interests, and spending habits in order
to foster engagement. Then, once a customer has built up their
is not to be ignored.
loyalty, retailers can grant them reward access to in store events,
special promotions, limited merch, and one-of-a-kind experi-
ences. While most customers are more actively engaged with
programs that make them feel heard, people respond strongly to
Kasey Cover, FasTrax Solutions personalization, innovative experiences, and access to exclusive
Digital Marketing & Consumer Loyalty offers. Loyalty rewards programs do all this data-recording for
you, so it should only take a quick review to set up a few cam-
paigns and get your personalization going!

Where you connect with your customers can have just as much
influence on their purchasing decisions as how you interact
with them. In today’s day, the majority of customers all inter-
With all the different advertising mediums out there, Author and entrepreneur Jim Rohn said, “One customer, well act with their preferred brands online. This could be through a
why is word-of-mouth marketing still so important? taken care of, could be more valuable than $10,000 worth of brand’s website or their social media. Taking the time to read
advertising.” That’s because good customer service not only cre- and respond to customer questions and comments you receive
It’s simple. People trust people.
ates customer loyalty, but it also drives word-of-mouth referrals. via your online outlets should be part of your customer loyalty
Customers who were referred through word-of-mouth typically strategy. It offers you the ability to recommend new products, as
Paid advertising has its place in fostering brand rec- have a lower churn rate and a higher lifetime value. well as promote sales and in store events to potential customers
ognition, educating consumers on your products and who may have never stepped inside your store.
services, and drawing some foot traffic, but the prob- While the ROI for word-of-mouth remains tricky to gauge, there
lem lies in the very nature of paid advertising. When are enough statistics that prove that word-of-mouth marketing Social media also provides customers a platform to give you
people know they are being “sold,” that marketing deserves a fair share of your marketing dollars. According to the necessary feedback to improve your business. If a customer
a Nielsen report, 92% of consumers believe suggestions from trusts that you will listen to their complaints and make every
medium doesn’t necessarily create a personal connec-
friends and family more than traditional advertising. Beyond effort to resolve them in a way that is fair to both parties, then you
tion to the brand. They know it’s in YOUR best interests that, 88% of those consumers trust online reviews written by can create a customer for life. Not only does resolving a customer
to get them in your store, but the question remains in other consumers as much as they trust personal recommenda- complaint online help that customer, it also shows numerous
their mind: “Is it in MY best interests to shop there?” tions. With these types of results, one thing is clear: Word-of- potential and existing customers that you care about their issues
With the increased rate of targeted ads and sponsored mouth marketing is not to be ignored. and concerns. When other customers see how attentive you are
posts, consumers are skeptical of paid ads. to your patron’s needs, your word-of-mouth marketing plan will
Though many word-of-mouth referrals happen without a busi- take effect in full force. So go get social!
It may increase your brand awareness, but is it really seen as credible? ness doing anything beyond solving a customer’s problem or
That’s why word-of-mouth referrals remain the number one source for filling a need, there are several things that can boost your odds The key to successful word-of-mouth marketing is trust; both
credible customer acquisition. of turning your customers into brand ambassadors. Invest- building it and keeping it. Every customer has the potential to
ing in customer service, offering incentives through rewards either bring you more customers or turn potential ones away,
programs, and strategically using social media can all increase making customer service, rewards programs, and social media
WHY WORD-OF-MOUTH MARKETING IS SO word-of-mouth referrals. Creating a word-of-mouth market- top priorities for retailers. Whether your customers are stand-
IMPORTANT ing strategy is a lot like rolling a boulder downhill. It might take ing on line in your store or hanging out online, you can take
an initial shove (the investment) to get it rolling, but it picks up steps to create a connection with your customers that leads
The very nature of direct word-of-mouth referrals as unpaid, and gener- momentum along the way. to more word-of-mouth referrals.
ally unbiased makes the source much more trustworthy than other
forms of marketing. That’s because the person doing the referring most One of the most tried-and-true strategies to ensure that your
likely shops at the store themselves, is known by the consumer, and customers keep coming back is to create a consistently positive
typically wants to help the person whom they are referring. customer experience.

30 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 31
BEST PRACTICES

“Without the knowledge, skill and support


of your store associates, your marketing
program will never be complete.”

ARE YOUR EMPLOYEES


DRIVING YOUR
Store associates are an operational necessity. Retailers need Or, it may be conducting a manager training session on
people to stock shelves, answer questions and collect money. the upcoming customer event with materials provided
But consider this: store associates are interactive advertising. allowing the manager to train the associates. Or, it could
On shift or off, employees are critical marketing assets. If be a comprehensive training curriculum on living the brand
they’re engaging with customers on site, they can add a new promise for each and every different employee role. It could
dimension to the experience, reinforcing your marketing spell out the entire customer journey. Show the importance of
message and clearly demonstrating the importance your their role as a guide on the customer’s journey and help them

CUSTOMERS AWAY?
organization places on customer care. understand how critical they are in satisfying customers and
reinforcing a healthy brand image.
But if they seem disinterested, robotic or are simply ignoring
customers, their actions speak volumes and can undermine all
your marketing efforts in just a matter of seconds. 2. ENGAGE & RECOGNIZE
Employees want recognition for their accomplishments.
Marketers are laser focused on their channel performance There are many ways to engage and recognize team members
constantly monitoring the last email’s performance. They – from small kudos to large scale incentive and rewards
can be obsessive about open and click-through rates. They programs. Consider consulting with incentive professionals
closely track social ads and watch for conversion rates on their to help model behaviors at the associate level and determine
retargeting campaigns. There are dozens of marketing channels the best approach to engage and recognize your team.
to strategize, create and, execute daily. However, without the
knowledge, skill and support of your store associates, your
marketing program will never be complete. 3.MEASURE & HIGHLIGHT
Just as important as communication and recognition, the
Store associates can seem out of reach as a viable marketing way you follow up is critical to your success. Most marketing
A look at how to complete your marketing program with your front-line assets – your channel, often because they fall under a different area of the programs end when the promotion or event ends, and only
employees.Think back to the last time you walked into a store. It can be any store – depart- corporate umbrella. Yet, it’s critical that marketers plan for the marketing team looks at the post-campaign results. This
ment, grocery, even a convenience store. Try to remember the experience. Maybe you rushed employee engagement in their initiatives. They must work cross is a missed opportunity to further engage your employees.
functionally to align the promotional objectives with the goals of Consider doing a one-page recap of your marketing program
in towards the items you needed and grabbed them as quickly as possible. Or maybe you the employees and define success metrics showing employees and highlight areas or associates that really hit the mark.
browsed around aisle by aisle. After selecting your items, you made your way to the checkout, how the promotion is performing. Here are three key ways to This engages employees with the outcomes of your
paid the total and walked out with a shopping bag. incorporate employees into your marketing program: program. It can also show your employees real-life
examples of success and create heroes for them
to emulate. Telling heroic stories of employees
1.COMMUNICATE & TRAIN
Now think about your experience with store associates during your visit. who succeeded offers lessons others can use
Your employees want to be successful in their roles, and to do right away to more fully engage customers. That
that they need information. Empower your associates with changes a promotion into more than simply an
• How many store employees did you interact with during your journey? details on the program you are running. Provide specifics on the event, but rather an inspiring tale of living the
promotions rolled out as a part of your overall program. Explain brand promise.
• Did anyone greet you? your branding campaign to them. Treat them as a critical part of
your store event. To make the most of your marketing initiatives, Remember, your marketing
• Did you ask for help? employees need to know … program can never be truly successful
without including front-line personnel.
• Were employees pleasant or disengaged? Disengaged employees with little knowledge
a) Why it’s important to the company or empowerment will inevitably damage the
• Did the cashier talk to you? b) How it’s valuable to customers brand perception and the customer experience.
• Did you have issues during checkout? c) And specifically what they can do to help However, informed and inspired employees
can engage your customers and create a
drive the initiative
• Were your items handled with care? positive experience that drives success in
your business and elevates customers’
Communications and training may be as simple as sending
• How did you feel when you left the store? a flyer on a promotion to all of your employees with an FAQ
perception of your brand.
attached to it to help them understand the promotion.

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BEST PRACTICES

Partnerships can enhance the customer loyalty proposition

S H I P S :
We already know that good partnerships are a great tool to drive customer acquisition, but they can also play a big role in building customer

PARTN E R
loyalty across the whole decision-making journey. When looking at the “Customer Loyalty Quadrant” through a partnership lens, we are
seeing brands developing truly compelling propositions which resonate with their customers’ values and needs, keeping them coming back
for more and in turn realizing customer growth.

THE SECRET WEAPON TO + +


BUILDING CUSTOMER LOYALTY? Headspace, founded in 2009, has since developed some really
interesting partnerships to apply their product to real life customer
Value doesn’t have to be an offer or a stamp. In fact, it can be
much more lifestyle led. The partnership between Starbucks
experiences. These include airlines (to address fear of flying) and retail and Spotify shows how you can offer “value added” benefits to
to fitness (to improve motivation) and now sports teams. In March customers to ensure your brand stays front of mind, even after
Bill Finaldi this year they announced their partnership with the NBA. As part of you leave the store with your coffee. Benefits include access to a
Director of Channel Sales
Iris Worldwide the partnership, all players of the NBA receive free subscriptions to Starbucks playlist through the Starbucks app and integration with
the Headspace app. Also, the NBA and Headspace will co-develop the Starbucks loyalty program. In addition, Starbucks employees
mental training content and Headspace will conduct events across the also get a free Starbucks Premium subscription – a clever way to
NBA, ranging from league employee wellness programs to mindfulness engage employees and turn them into advocates.
sessions with NBA team staff. A great example of understanding
customer needs and enhancing a proposition accordingly.

Building customer loyalty is an objective


most businesses are striving to achieve +
I constantly get asked questions from brands about how they can drive customer
+
growth: How can we get customers to come back again and again? How can we Lyft in the US gives customers the ability to donate to a charitable
steal share of wallet from competitors? How can we get customers to buy more? cause off the back of your taxi ride. All a customer has to do is opt in via In Blue Planet II our eyes were opened to the devastating impact
How can we get customers to recommend us to their friends? And so on… a ‘Donate’ button and choose their cause from a list, including Phoenix of plastic on our ocean’s habitat. It’s estimated eight million
Children’s Hospital and USO. Lyft will then automatically round up each metric tons of plastic waste make the journey from land to ocean
fare and donate on your behalf. This is a great example of how charities each year. And adidas has started to turn the tide. Since 2015,
are starting to understand and address the barriers to donating and are adidas has partnered with Parley for the Ocean. Their partnership
leveraging tech partnerships to make it easy for customers to donate on with Parley is working towards transforming plastic into high
a daily basis. Director of Influencer Marketing Bette Ann Schlossberg performance sportswear. This mission-led partnership gives
says, “While Round Up & Donate adds just a few dollars per month, the adidas a whole new space in which to engage with its customers.
Focus on the proposition Lyft community has donated over $7M across all of the charities.” It works well to generate positive PR and reinforce common values
that consumers hold – making them feel good about choosing
With 77% of consumers reporting that they are retracting loyalty at a faster pace adidas as the sportswear brand to be wearing.
than three years ago and 61% of consumers looking for brands that tailor experiences
to them, it’s clear that brands need to focus less on a loyalty program and more on the
loyalty proposition. A compelling proposition should put the customer first and deliver Strive for long term, strategic
against all four aspects of what I call the ’‘Customer Loyalty Quadrant”
partnerships which bring mutually ”You can talk about who you are
Product Interaction beneficial business value as a brand all day long but having
Without the right product, it doesn’t matter Make the interaction easy and seamless, those partnerships to authenticate
what else you do to drive loyalty; customers mostly enabled by tech, and customers will If done right, partnerships can play both into the emotional and
just won’t want to buy it. choose your brand over another. rational levers to drive customer loyalty and deliver true business that message is really critical for
growth. Ultimately, the best partnerships are well planned, long every brand.”
Value Engagement term, strategic partnerships where data is leveraged to mutually Swave Szymczyk,
Of course customers want value, price led, Be interesting and relevant in the lives of deliver against business objectives. adidas
offer led or even added value, but it must customers, from awareness right through to
resonate with your customers expectation. advocacy, not just at POS.

Get in touch - Iris Concise delivers a multitude of fully integrated specialisms within creative, consulting and content to some of the most progressive
clients around the world. For more information about how we can support you in developing a partnership strategy or simply to help you get the most
out of an existing partnership please get in touch. bill.finaldi@iris-worldwide.com

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Conference Preview
Conference Preview

MAY 20-22
Sheraton Charlotte Hotel
Charlotte, North Carolina PRESENTERS

MAY 20-22 This year’s Expo will include presentations from, among others:

Sheraton Charlotte Hotel | Charlotte, North Carolina


KEYNOTE
The 2019 Loyalty Expo kicks off the week of May 20 at the Sheraton Charlotte Hotel in Charlotte,
North Carolina. The Expo will feature a host of distinguished speakers from some of the nation’s
top brands. In addition, more than 500 marketing industry leaders are expected to attend. Chris Malone,
The Loyalty Expo runs from Monday, May 20, through Wednesday, May 22.
Founder and Managing Partner
It is presented by Loyalty360, the Association for Customer Loyalty. of Fidelum Partners

As digital technology has proliferated during the past


decade, it seems that customer and brand loyalty have
become more difficult to develop and sustain. Have the
traditional principles of brand building and loyalty become
obsolete? Chris Malone, co-author of The HUMAN Brand:
How We Relate to People, Products & Companies, will
address this question and provide insight on how to build
and sustain customer and brand loyalty in the Digital Age.

36 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 37
Conference Preview Conference Preview

MAY 20-22
Sheraton Charlotte Hotel | Charlotte, North Carolina PRESENTERS

Jennifer Leitman Michelle Musgrove


Vice President of Experience
Executive Vice President of
Strategy & Governance
Marketing at The Family Coppola
“Michelle Musgrove has more than 15 years of specialized marketing experience
Moving beyond transactional rewards programs to create true brand affinity including strategy, product development, segmentation, multi-cultural marketing,
has been goal for many brands operating in the customer loyalty space. While loyalty program management, relationship management, and customer
transactional programs have benefits, experiential programs offer the promise of experience management. Currently, Michelle serves as Vice President, AARP
differentiation in a cluttered market. The Family Coppola, a company that offers Experience Strategy & Governance at AARP. In this role, Michelle has supported
wine, spirits and, unique experiences, has decided to focus on experiential rewards to the launch of the customer experience management function with a focus on
drive deeper emotional engagement with its customers. One of the main strategies strategy, change management, communications, and generating early wins. Prior
the company has undertaken is to treat customers like family members. to joining AARP, Michelle led successful engagement and loyalty programs at
AOL, American Express, and JP Morgan Chase.

38 Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org Loyalty Management™ | Q1 & Q2 2019 | loyalty360.org 39
Conference Preview Conference Preview

MAY 20-22
Sheraton Charlotte Hotel | Charlotte, North Carolina PRESENTERS

KEYNOTE

Roger Dooley
Julie Roy Author of Friction
and Brainfluence
Vice President of CRM,
Digital & Analytics
Roger Dooley is an author and international keynote speaker.
In 2018, DSW re-launched its loyalty program as “DSW VIP” to tremendous His books include Friction: The Untapped Force That Can Be
success. The revamped program offers faster rewards and a new tier, and overall Your Most Powerful Advantage (McGraw Hill, April 26, 2019)
creates a more personalized customer experience for members with relevant and Brainfluence: 100 Ways to Persuade and Convince Consumers with
and compelling rewards. Since the relaunch of the program, DSW has seen Neuromarketing. He writes the popular blog Neuromarketing as well as a
double-digit new customer enrollment growth, best-ever member retention and column at Forbes.com. He is the founder of Dooley Direct, a consultancy, and
reactivation rates, and increases in average member spend. VP of Marketing, co-founded College Confidential, the leading college-bound website. He’s been
Julie Roy will share how the program was designed and continues to evolve. a serial entrepreneur since he left a senior strategy position at a Fortune 1000
company to enter the then-nascent home computer market.

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Conference Preview Conference Preview

The Expo will also feature a variety of sessions led by


MAY 20-22 brand experts from a variety of companies, including:
Sheraton Charlotte Hotel
Charlotte, North Carolina PRESENTERS

Mark Staples In addition, more than 20 interactive


Associate Director workshops and breakout sessions will focus on:

Customer Experience Creative Campaigns


“Mark has over 15 years’ experience in loyalty, promotions, and consumer relationship
Customer Loyalty B2B Customer Loyalty
marketing. His work began at ePrize (now HelloWorld) where he led the loyalty and
Innovation Technology and Trends
promotion strategy for Coca-Cola and the MyCokeRewards program. He has held
Experiential Retail Social Impact
roles at the Kellogg Company, leading the creation, implementation, and activation of Understanding Metrics Influencer Marketing
national promotions and key strategic partnerships. For the last 2.5 years, he has led Customer-Centric Marketing Employee Engagement
the Kellogg’s Family Reward program and has been instrumental in its evolution from Emotional Connections
a code based program to one based on receipt image and loyalty card validation. A
graduate of the University of Michigan with both a Bachelor of Arts and an Master
of Business Administration, Mark enjoys spending time with his family, reading, and
getting outdoors.
The Loyalty Expo will also unveil Loyalty360’s “Loyalty Landscape
Report: The State of Customer Loyalty,” which offers thoughts from
thought leaders on where the customer loyalty industry is headed.

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7695 Beechmont Ave.
Cincinnati, OH 45255

SPECIAL
OFFER

Loyalty360 Members have special access to content,


research, networking opportunities and more. For a special
discount on a Loyalty360 Individual Membership,
use the code L360IND for a 10% discount!

LoyaltyExpo.com

Code cannot be combined with other offers or applied to existing memberships. Valid until July 1, 2019.

513.800.0360 | loyalty360.org | @loyalty360