Playing "The Zone": a new way to look at loyalty marketing.

I was recently rereading the 2013 Loyalty Manifesto from Loyalty Truth and there was one term that popped out to me because I hadn’t seen it before: “contextual loyalty”. It was coined by Loyalty Truth to describe the current loyalty landscape where, due to the emergence of mobile and social media, there are now a number of ways that your company or brand can engage with customers—and customers can engage with you.

The manifesto cited several key components of this new contextual loyalty, but for me this aspect stood out:

(Contextual loyalty) shifts the focus of customer engagement from channels and networks, the implied emphasis of Social Loyalty, to flexibly meet the customer wherever they are.

“Flexibly” meet the customer wherever they are? It’s a far cry from loyalty marketing of just a decade ago, where the points of contact between customer and company were few and far between—and usually limited to me sending you a piece of snail mail or e-mail and you connecting with me at my place of business, be it online or at a bricks-and-mortar establishment.

Today, of course, we have the ability to engage with customers virtually around the clock, via a number of different devices and in a number of different ways. It got me thinking of a sports analogy: these days, effective loyalty marketing is really about playing “zone defense”, making sure your customer is covered at all times.

Not familiar with “zone defense”? It’s a phrase used in sports, most commonly football and basketball. It means that each player on your team covers a specific area of the field or court, and guards his or her opponent whenever they venture into their ‘zone”.

In this case, think of each zone as a different potential customer touch point or engagement opportunity. These zones exist anywhere your customers might encounter your company or brand, and could include:

• your company’s locations, both in-store and online
• social media venues, like Facebook, Pinterest and Twitter
• location-based apps like Foursquare and Google Places
• push vehicles like snail mail and e-mail

Wherever your customer ventures into a zone (and in most cases, you should have a presence in all the places mentioned above), you need to be sure that customer is “covered”—and have the right messaging and response mechanisms in place to both recognize and engage that customer. It amounts to a 360-degree approach to loyalty that makes the most out of every company/customer encounter.

I was reminded recently of a company that makes the most of every customer touch point: Disney World. In discussing the theme park’s merits, a noted architect suggested that it was “a perfect experience”, one that “surrounds you at every possible moment”. And isn’t that what we should also be aiming for in loyalty marketing, “a perfect experience that surrounds you at every moment”?

Good Influence: taking word-of-mouth and supercharging it.

As a Loyalty Redefined reader, you may already be aware of the importance of identifying and nurturing “brand advocates”—that core group of customers who are so pleased with your products or services that they tell others about it. What makes brand advocates so valuable? Their ability to boost sales.

It has long been established that word-of-mouth advertising, where I tell friends and acquaintances about your product or service, is more likely to lead to a sale than paid advertising. And today, with the proliferation of social media, there are more ways than ever for your brand advocates to spread the good word, creating social loyalty, if you will.

That’s where Zapitude, a small company out of New Jersey, came up with a simple, but smart idea: What if you used the power of social networking to “amplify” the word-of-mouth of satisfied customers, enabling brand advocates to spread their word further and more powerfully than ever? It’s the concept behind their social media platform Good Influence.

Make a purchase at a site that uses Good Influence and, along with your order confirmation, you’ll see an iframe that invites you to share your purchase with the social media vehicle of your choice—be it Facebook, Twitter, Google+, etcetera. The greater your social reach, the greater your potential value as a brand advocate.

But that’s just part of the Good Influence story. I talked to the company’s founder, Dan Lynn, and he believes there are two key attributes that set the platform apart:

1. The flexibility to test outgoing messages in real time to see which are pulling the most shares and click-throughs—allowing them to tweak the messaging as they go to maximize effectiveness.
2. The ability to monitor what Lynn calls the “ripple effect” and measure just how far a customer’s social media posting travels and how their activities result in additional sales downstream.

Additionally, Good Influence has the ability to attach points to social media activities and reward customers for sharing, as well as engagement and conversions that result from that sharing. So marketers can potentially use the platform to create an old-school-style loyalty program with a tier-based reward system based on the total number of points a customer accumulates.

The platform generates a ton of data that helps identify which brand advocates have the highest value. For instance, if a customer named John makes a $10 purchase, Good Influence can tell you his connections bought in say $100 worth of incremental sales, while their connections bought in an additional $85 in sales. So, while John is a $10 customer, in this case he brought in $195-plus in sales through his social currency.

One example of the Good Influence platform in action is a recent campaign for Office Depot’s 2013 “Back to School” effort. Office Depot partnered with the pop group One Direction in a “Together Against Bullying” campaign that asked fans to get out an anti-bullying message via tweets, Instagram messages and Facebook shares. The top 50 fans, based on who drove the most total clicks to a contest Web page, were rewarded with special campaign merchandise.

The results: Over 10 million visits to the campaign Web page and almost 500 million impressions driven across social and digital channels. It also resulted in an increase in Office Depot sales, while potentially creating a large new group of Office Depot customers. (Admittedly, it helps when your campaign features the world’s most popular teen pop band, but the results were impressive nonetheless!)

Stop and think about your brand or the brand you work for. Are you making the most of your brand advocates? Is there a way to make them an even more powerful selling tool than they already are?

This post previously appeared at Loyalty Truth.

Westin and a healthy approach to earning customer trust.

Good advertising tells us what a product does and why you should buy it. Great advertising expresses what a brand stands for and invites you to share in its beliefs.

The quote above is from Edward Boches, the former Executive Creative Director at the Mullen ad agency, and I think it does a pretty good job of summing up why some advertising not only resonates with customers—its message is so powerful, it wins their confidence and trust. And a company that’s hitting that lofty target right now is Westin Hotels.

With a new global initiative called the Westin Well-Being Movement, the Westin brand seems to be taking a genuine interest in its customers’ health and well-being. The effort includes “innovative partnerships and programs” across what Westin calls its six pillars of well-being: “Sleep Well, Eat Well, Move Well, Feel Well, Work Well and Play Well”. It’s all reinforced by the campaign tag line “For a Better You”.

Westin appears to be delivering on its message and has set up a beautiful Web site to support the program. And looking over the program’s details, it appears they’re backing up their initiative with features that have real value and substance.

Here are a few of the areas that stand out to me:

• One enticing feature of the Move Well pillar is a “Run Concierge” who can help “turn your workout into an exploration of the locale”. For a runner like me, often hesitant to run in an unknown area, I like this perk a lot. I’ll take an outdoor run over the treadmill any day.

• The Eat Well pillar offers a signature SuperFoodsRx™ menu developed by doctors and nutritionists “that cultivates ‘food synergy’, the pairing of certain foods to increase their nutritional value so you can focus on meeting challenges of your day”. I’m not sure what it means, but it sounds interesting!

• With the Play Well pillar you can indulge in a Heavenly Spa by Westin and—and if you’re traveling with kids, drop them at a Kids Club where they “get to explore with a Discovery Pack containing a disposable camera, compass and more…(and enjoy) activities that include storytelling and sandcastle competitions.”

All told, the Well-Being Movement is an initiative that sets Westin apart from its competitors, and also meets Boches’ criteria for great advertising and marketing. It not only expresses what the brand stands for but encourages customers to share in its beliefs.

Bravo to Westin for a program well done.

This post originally appeared on Loyalty Truth, May 2, 2014.

Is the customer experience the key to customer loyalty?

If you pressed me for a quick definition of loyalty marketing. I’d probably tell you it’s about “recognizing and rewarding best customers”. Yet, this definition leaves out what I believe is the most important factor in gaining your customers’ loyalty and keeping it: the customer experience.

After all, you can give me a spiffy reward or recognize me with upgrades and fancy perks—but if I’m bumped from my flight or my hotel room stinks of cigarettes or I’m hit with an unexpected service fee, you risk ticking me off and losing me as a customer. This got me thinking about a statement my former Frequency Marketing colleague (now leading Knowledge Development at Aimia) Rick Ferguson once made:

“It’s not about transactions, it’s about interactions.”

While it can be easy to get caught up in the data aspect of loyalty, we should never forget the importance of the ”interaction” in which a brand or company has a touch point with a customer. This can occur during a phone call to customer service, a response to a customer complaint via Twitter and most importantly, during face-to-face encounters in which a customer interacts with your company or brand.

I was reminded just how important the customer experience is during a recent stay at The Muse hotel in New York City, a part of the Kimpton boutique hotel chain. I’m a member of their InTouch loyalty program and generally, my stay there was great. The Muse’s lobby, under construction the last time I was there, looked fantastic. I found the staff to be cheerful and accommodating. I enjoyed a couple of glasses of wine at a complimentary happy hour, a nice touch.

There was just one major issue: upon waking Sunday morning I discovered there was no hot water—meaning no shower. I called the front desk and was first informed a service man would be sent up. 30 minutes went by, nothing. A second call revealed that in fact the problem was throughout the hotel and the person on the phone blamed the issue on “the city”.

I was travelling with my 14-year old daughter and, as those of you with teenage daughters can imagine, this became a big issue. We waited for over an hour to see if hot water might again begin to flow, but ended up venturing out shower-less. The problem did appear to be fixed once we returned a few hours later, but by then it was time to check-out.

The day after my visit, I received a survey in my e-mail inbox from The Muse asking me about my stay. It was one of those automated, check-the-box questionnaires which I dutifully completed. I gave them high marks overall, but in my comments mentioned the hot water glitch. I expected my response would disappear into a cyber-file somewhere to be reviewed at a later date. But that’s not what happened.

Within 2-3 hours of completing the survey, Sarah Rosenberg, the Guest Service Manager at The Muse, reached out to me via e-mail. She apologized for the inconvenience. And after I gave her a few more details, she responded by giving me a credit toward my room rate plus a special rate on my next visit.

So what could have been a fair-to-middling customer experience, was turned into a positive one—all because someone was paying attention to those automated customer surveys. And for me, it’s the difference between maybe staying at The Muse during my next NYC visit, and definitely staying there.

How about you—have you had any great customer experiences, lately?

This post originally appeared on Loyalty Truth, April 6, 2014.

Are you getting the most out of your loyalty and CRM e-mails?

Over the years, if I did business with your brand or company, or signed up for your loyalty program, I opted in for your e-mail stream. As a result, I now receive a ton of e-mails each week—from hotels and airlines, restaurants and retailers, casinos, sports teams and brewpubs. Name even the most obscure vertical, and I probably get an e-mail from it.

The problem: I’ve reached the point of e-mail overload. So the other day I began to finally thin out my e-mail subscriptions, deciding which e-mail streams to keep and which to unsubscribe from. To stay on the “keep ‘em coming” list, the company had to meet one of two criteria:

1. Did they recognize me as an individual—or was they blasting the same e-mail to me that that they were sending to everyone else?
2. Did the e-mails bring me value, offering relevant or interesting content—or were they the equivalent of a digital sales circular?

What I saw were a lot of missed opportunities. Here are a few examples.

Staples. At some point I signed up for e-mails from Staples Rewards but I can’t say I’ve opened a single one in 2 to 3 years. Why? In the words of Chris Brogan, too much “selly-sell” and not enough value.

The main focus of their last e-mail was to “save 50% off cleaning and break room supplies”, which might be relevant if I had a break room. What would have persuaded me to stay: some content aimed at me, the independent business person, that established Staples as a thought-leader in the small business space. VERDICT: UNSUBSCRIBE

Avis. While they do recognize me by name: Thomas, Save With The Avis Corporate Awards Program read one recent subject line, there is no other recognition of my past history with the company—including the fact I haven’t rented a car from Avis in well over a year. If the company had realized I had fallen off the radar and used a “win-back” approach to try and regain my business, I might have kept them in the mix. VERDICT: UNSUBSCRIBE

Hilton. As a member of Hilton HHonors, I receive a regular stream of e-mails enticing me to get special deals on Hilton locations in San Francisco, Hawaii and even China. What I don’t see are e-mails tailored to the actual cities I visit.

Now one reason may be that I don’t always stay with Hilton on my travels. But if they took the time to survey me on the locations I’m most interested in hearing about, they could personalize their communications to me and my specific travel needs. VERDICT: UNSUBSCRIBE

Booking.com. This travel site knows that I was recently looking for rooms in both Atlantic City and New York City and sent me an e-mail with the following enticing message: Last-minute deals for Atlantic City and New York City. Get them before they’re gone!

Since I never volunteered this info to the site, they obviously “cookied” me the last time I was there. Sure, I’m aware of the Big Brother aspect of this, but it’s the way the game is played these days and Booking.com is playing it well. Their e-mail was tailored to my needs. VERDICT: KEEP ‘EM COMING

New York Mets. I have to commend my favorite baseball team for taking the initiative this past offseason and sending me an e-mail that linked to a long-survey to try and figure out who I was. While it’s too early to gauge the results, they wanted to know how many games I attended in person each year, how much I watched games on their network and even my take on the team. It will be interesting to see how they use this info in the months ahead. VERDICT: KEEP ‘EM COMING

Patagonia. I’m a sucker for a good story and Patagonia has plenty of them. Sure, they’re trying to sell me stuff, but their e-mails also link me to stories about exotic places, via adventurers who travel the world decked out in Patagonia gear.

It’s soft sell at its very best and it emotionally ties me to the brand. It also doesn’t hurt that Patagonia has a great product—their clothing lasts forever. VERDICT: KEEP ‘EM COMING

How about you—are there any e-mails you receive that keep you connected to a brand? Or are there any that you believe are missing a golden opportunity?

This post originally appeared in Loyalty Truth.

Is the next big loyalty marketing play coming to a stadium near you?

I read a headline in the trade pub Ad Age recently that instantly grabbed my attention and got me looking for the details. Here’s what it said: "Verizon tracks sports fans after the game. Precision Insights Division can tell a team if attendees heeded sponsors’ messages."

Call me dim-witted, but at first glance I was scratching my head. How would Verizon know that after attending a NY Jets’ football game and seeing a sign for Buffalo Wild Wings, I then went there for a cold beer and post-game snack? And then it quickly dawned on me. Of course, they know where I am—I’ve got a global positioning device sitting in my pocket, aka a cell phone.

The program is run by Precision Market Insights, a division of Verizon Wireless. Looking at their Web site their mission is pretty straight forward: “use actionable insights…(to) provide unprecedented 360-degree views to help you understand your target audiences, engage them more precisely and ultimately transact with them more profitably.”

In the case of tracking stadium fans and their behavior post-game, the site says “the idea is to help teams and arenas know more about event attendees, and connect the dots between sponsor messages at the game and who went to that sponsor’s location later.” The company has already run this type of program for the NBA’s Phoenix Suns in conjunction with advertisers like Jack in the Box.

Is this cool or creepy? After all, it appears the sports patron doesn’t know they’re being tracked. And it’s not like Foursquare where I’m voluntarily offering up my geographic location.

I can see how some might have concerns with privacy issues, but let’s face it—as soon as you turn on your cell phone, your wireless carrier knows where you are at all times. So to this direct marketer it seems fairly innocuous that Verizon Wireless is providing this information behind-the-scenes to upscale fast food joints. That said, I can see how this could get some privacy advocates riled up.

It also got me wondering, if there might be a bigger marketing play for Precision Market Insights: Might this service have implications for loyalty marketing? For instance, what if they got me, the customer, to opt-in to being tracked instead of doing it surreptitiously? And in exchange for my opting-in, I received a discount on my wireless service and/or a special deal from whatever retailer or restaurant I visited the moment I walked through the door?

I’m betting this idea—the real-time delivery of offers via your wireless carrier—will be coming to a market near you soon. And personally, if Buffalo Wild Wings wants to send me a free beer with purchase after I suffer through the next Jets’ loss, I won’t mind Verizon Wireless tracking me one bit.

This post originally appeared on Loyalty Truth, December 6, 2013.

Back to the future: Forget loyalty programs, it’s about customer engagement.

When I read the recent headline “Only 16% of Consumers Redeem Loyalty Rewards” on the pages of Direct Marketing, I was taken aback. Are loyalty programs really that ineffective these days? If so, that’s not good, because if your customers aren’t redeeming for rewards, they’re likely not seeing any value in your program.

The 16% redemption figure was one of the key findings in a recent report from Forrester Research titled “The State of Loyalty Programs 2013,” which was based on surveys of executives at 50 member companies of Loyalty360. A Forrester analyst suggests the results signal a movement away from traditional loyalty programs.

“Loyalty marketing is on the cusp of an evolution,” says Forrester analyst Emily Collins, who directed the study. “There's a shift in focus from the idea that loyalty is all about transactions and discounts. In the future it needs to be more about engagement and emotion.”

I’m feeling a sense of déjà vu and maybe you are, too. Almost three years ago, I penned an article titled “The Death of Loyalty Rewards As We Know Them?” for Loyalty Truth, but in actuality this movement away from “transactions and discounts” toward “engagement and emotion” goes back much further than that.

I would argue that the idea of engagement was first introduced as “permission marketing” by Seth Godin way back in 1999. At the firm Bill Hanifin and I once worked at, Frequency Marketing, we took this idea and ran with it in the early-2000’s, promoting “dialogue” between customers and companies and stressing the need for engagement across multiple customer touch points.

That’s why this recommendation from the same article on “The State of Loyalty Programs 2013,” sounds positively retro, at least until you hit the words in bold type:

Embrace channels featuring two-way interaction. The top three channels used by marketers in communicating with club members are email, websites and Web portals, and call centers. Forrester strongly recommends that businesses begin dialogs with loyal customers via mobile and social media.

The addition of these two new ways to communicate with customers are the fresh components in the mix, as the way we engage with customers continues to expand. And it’s interesting to note that, while not mentioned in this article, old-school direct mail continues to be one of the best ways to interact with many segments of the population.

There’s one more passage in the story had me smiling, as it also brought me back to the past, and it had to do with the nature of rewards. Again, what is being passed as a current recommendation sounds dated to this loyalty vet:

Balance the reward mix with personalized offers that present customers with one-of-a-kind experiences, such as concert tickets or cooking lessons.

It’s something we at Frequency Marketing called “experiential rewards”, a phrase that John Bartold (or was it Mike Charron or Tom Parker?) coined a decade ago and has been in the loyalty marketplace for years. But just like the emphasis on “engagement”, maybe everything old is new again. Or as the saying goes, the more things change, the more they stay the same.

This post, by Tom Rapsas, was previously published at Loyalty Truth, October 23, 2013.