Friday, July 25, 2008

Trails and Triggers!

As marketers, our endless thirst for seeking to understand more about our customers often leads us to miss out on the information trail that a customer is leaving in her daily interactions with your brand.

There are two types of trails that are left by customers, the "Tangible" trails, distinguished by those that can be captured by your systems, and the "Intangible" trails that may be observed by your channels and customer facing colleagues.

The former would include her birthday, size of items purchased or time of shopping, value of salary credit into account etc., whereas the latter would include the details of other shopping bags she has carried into the store or the perfume she comes wearing in........

The challenge is two fold. Which of these trails are relevant for your business, and how can you act on them?

(Have come across one too many programmes in which customers receive birthday cards from brands who have not touched their lives for at least 11 months prior to that event! And even worse, these cards quite often bear signature stamps. These programmes are quite often templated and in my opinion a waste of time!)

Globally credit card issuers have leveraged "tangible" trails and defined trigger points to their business advantage quite well. Hence it is not too surprising to receive an offer for sales finance, when you've conducted a high value electronic item purchase. Now of course the challenge lies in when is it that I receive the offer? Is it an SMS the customer receives within a few seconds of the transaction or after a fortnight when the card statement is sent!

The larger challenge lies for organisations that can communicate with their customers cost effectively only when the customer walks in ( as mailing out coupons can be quite an expensive and time consuming process!)

Do you believe that systems and processes are attuned to pick up relevant customer trails, define accurate trigger points and communicate customer benefits in real-time?

Believe that a fair amount of investments are sunk into reward points and mailing costs. It would be refreshing to see business managers diverting some of those budgets into systems which would allow them to listen better and deliver greater value to their customers!

Tuesday, July 22, 2008

So what if I don't want to engage?

The loyalty buzz phrase of the moment seems to be “engagement marketing”. It a phrase that’s been around for several years, but its meaning seems to have morphed from engaging customers with the brand via dialogue and personalized communications, to inviting customers to actively participate with the brand, via interactive blogs, viral video contests and social networking sites.

Either way, the question I’ve been pondering is, what if I’m a loyal customer and I don’t want to interact with the brand? The fact is for every rabid Apple, Xbox and Toyota Prius customer, there are other customers that just want to be left alone to enjoy their product or service in peace. And for low involvement categories (think auto insurance) there may be few to zero customers who want to actively engage with you.

The point is, in the rush for companies to launch a corporate blog, put a page up on MySpace or release a new-fangled widget, it would be a mistake to forget the basics--the “blocking and tackling” that should be a part of every loyalty or customer retention program.

During my days as Creative Director at the now defunct Frequency Marketing, it was drilled into us that every loyalty program was about rewards and recognition. Rewards were the tangible stuff, the free flights, etcetera. But equally important, was the recognition—the intangible “thank you” messages and soft benefits like invitations to VIP customer-only events that showed your best customers you truly cared.

So in the rush to jump onto the Web 2.0 bandwagon, let’s not forget the basics. It’s still far more effective to send a personalized, relevant e-mail to a best customer than a come-on to become a Facebook friend. In loyalty, as in life, it’s the little things that matter most.

Tom Rapsas, Associate Creative Director, MRM Worldwide,

Friday, July 11, 2008

Guerilla Loyalty!

Was driving past a leading retail chain the other day, when the advertisement led me to take an instant U turn and head instantly towards the store! The tactic was refreshingly amusing and definitely merited a visit at the least.

The promotional campaign was quite simple, wherein it invited loyalty members of other leading retailers and offered a 20% discount on your purchases, provided of course you showed your loyalty cards with the other stores!

Not entirely original, but always an effective method in inviting the serious shoppers. In an environment where similar brands are available across most large format stores, and the absence of high quality store level apparel brands, the choice of store in multi brand formats is quite often led by the ease of parking, the service and ambience and of course any carrots that may be tossed in for a good measure.

This was a fairly new store situated in a street which has over 8 malls in a one kilometre stretch. The promotion obviously had customers flashing the loyalty cards in their wallets and diving into one more. Quite smart. Target the relevant high spenders and drive them in.

This raises another critical aspect and challenge for loyalty programmes w.r.t customer selection. Which customer should you invite to your loyalty programme and which one should you perhaps let go! The "I welcome all" approach results in large programme management costs and the management getting bogged down by the low active rates on occasion.

Most mass market retailers have either no / low entry barriers for their loyalty programmes, and the common criteria being the value of purchase on the day or in a defined period of time.I often question the perceived value of a product / service which I receive with extreme ease! Hence, do these programmes make the necessary initial impact at the welcome stage or was there a missed opportunity? Also, is the ticket size the only feasible entry criteria?

Hence, could all customers purchasing Swarovski crystals by default be invited to the programme, or men purchasing ties! What gives the customer's entry into the programme that distinctive edge, and in the bargain makes your customer selection more relevant and accurate?

As an endnote, I did'nt end up purchasing a single item at the above mentioned store, as at the cash counter they politely indicated that I needed to make a purchase equivalent to approximately USD 75 to avail of the offer ( I was a few dollars short...) ! And yes, I did leave without a single purchase. They definitely got the buzz, but lacked the fizz.....