Understand the Capabilities of Your Organization Before Launching a Loyalty Program

Understanding the capabilities of your organization is one of the key components when a brand considers launching a loyalty program.

This was one of the overarching messages from Tuesday’s Loyalty360 webinar titled, “Executive Perspective: Finding the Right Level of Sophistication For Customer Loyalty and CX Initiatives.”

Loyalty360 CEO and CMO Mark Johnson, and Emily Rudin, Chief Customer Officer for CrowdTwist, discussed this report, which was co-sponsored by CrowdTwist.

Thirty brands were interviewed in the report, and they responded to the following questions:

• How sophisticated would you say your customer experience and customer loyalty initiatives are? 
• How sophisticated are the customer experience and customer loyalty initiatives of your competitors and other most brands today?
• From the very nascent stages of considering a program to the ability to assess and integrate an array of complex new technologies that create consistent and seamlessly connected programs, where do brands exist along this spectrum?

Rudin told attendees that CrowdTwist sees loyalty programs that run the gamut, from basic spend experiences and milestone celebrations, to others that leverage higher levels of sophistication.

“Some programs start out very sophisticated at launch,” Rudin explained. “Technology plays a huge role in this, making sure audiences are curated.”

As loyalty marketers seek greater levels of personalization, sophistication lends itself moreso to customer loyalty and customer experience initiatives.

Johnson asked Rudin about the importance of a company’s organizational and cultural makeup.

“The important thing when starting a loyalty program is understanding the capabilities of your organization, and being equipped to support these,” Rudin said, noting things such as welcome emails and monthly recap emails.

The report’s brand responses are broken down into the following categories: Sophisticated and Succeeding; Not There Yet; Always On; Culture-Conscious; and Sticking to the Basics.

Here is a sampling of the responses:

SOPHISTICATED AND SUCCEEDING: Lisa Malat | Vice President, CMO; Barnes & Noble College: “To me what I am most proud of and what I think is most sophisticated really is our commitment to research and our investment in that which has allowed us to create very targeted customized programs based on segment. When we roll out a student program to really target sophomores, or graduating seniors or alums, we’re doing this on a national scale. However, we’re built to have the flexibility to customize at a local level. For example, when we’re engaging with new students and it’s July, they’re getting ready to come on to campus, they have to get their dorms set, and they have to figure out what their dorms are going to look like. We work with the individual resident life offices to make sure when we’re sending that communication that we’re not sending a generic dorm checklist like you might get at Bed Bath & Beyond. We’re sending something that came directly from residential life at the University of Akron that says this is what’s recommended for the dorm and dorm set up. We’re able to take this research and build these national programs, but we are so nimble and so flexible, it allows us to customize at a local level based on that unique community and that unique culture on each individual campus.” 

NOT THERE YET: Richard Long |Strategic Marketing Leader and Advisor, Allstate: “I don’t think we are the most sophisticated out there. I would say we’re above average and I would say we also have to consider our program. Allstate Rewards, as a non-insurance product, yet we fit in the insurance industry space and we are also associated with one of the most widely recognized brands in the country. So, we have legal and regulatory restrictions that we still need to adhere to including being open to non-customers as well as Allstate policy holders. We can’t treat one group differently than an another. But again, we’re still able to provide a meaningful a value proposition as we can the program itself is free to join and encourages safe driving behavior by rewarding the participants. We do certainly keep abreast of what is going on in the customer loyalty industry and we are always monitoring the best practices, trends, motivating techniques, and changing needs. We aren’t a typical purpose driven loyalty program like all those other ones out there that are probably commonly known. In terms of sophistication, there are some similarities. We do have a lot of the same features in place, we do use mobile, social, and try to have our touch points be as seamless as possible. But in other ways it’s like comparing apples to oranges between our programs and those other sorts of programs.”

ALWAYS ON: Anka Twum-Baah |VP Customer Loyalty & Content Asia Pacific, Marriot International: “Technology can make experiences more seamless and effective, and it can be a vehicle to drive loyalty. The Marriott Mobile App, for example, has encouraged many people to become members. We’ve also partnered with Alipay to provide alternative payment options across most of our properties in China. We’ve received extremely positive feedback about partnering with Alipay, because it allows customers to pay easily and seamlessly. It’s a straight-forward piece of technology, but it’s also transforming how customers interact and do business with us. “Our award-winning customer service is now seamlessly supported by digital channels like WeChat, which help us service customers and engage with them in an exciting way. Marriott Rewards’ presence on WeChat has grown almost 50 percent year-on-year. We are leveraging new technology to create more enjoyable and efficient experiences for our customers, and in return, they are more likely to be loyal to us once they see that we are leading the pack in innovation.”

CULTURE-CONSCIOUS: Andy Moore | Director of Communications, Hwy 55 Burgers, Shakes, & Fries: “When I came onboard a couple of years ago, the customers who actually knew about our loyalty program liked it. But letting people know about it was a bit of a challenge for us. We didn’t really do a very good job of communicating it. So what we did was we had a couple of seminars where we invited a lot of our high-level wait staff to attend and we talked to them about how the loyalty program actually helps them build better relationships with guests. One thing that we’ve known for a while is that we have really dedicated Hwy 55 fans who come back once, sometimes two or three times a week, and this is a way for the restaurant staff to learn their names and remember their orders. It’s a way for to kind of encourage them to keep coming back and for us to actually reward them for coming back. Once we brought the wait staff on board, we developed a really great employee contest with some serious financial rewards for the stores and the people that signed up the most guests. It kind of skyrocketed from there. The cool thing about it is I can’t really say that this was something that corporate dreamed up, where we said, ‘alright, the 2014 mission is to grow the loyalty program.’ It was more that a lot of people who work in the frontlines in the stores said, ‘This is something that I could also find really useful. This is something that’s going to help me build a better relationship with my regulars.’ That was it and I we’re actually planning on doing another contest next year to kind of reinvigorate the staff, but it really paid huge dividends getting them involved from day one and growing the program.”

STICKING WITH THE BASICS: Jaimin Barot | Vice President, Pricing and Revenue Management, Alaska Airlines: “We are always looking at our programs and our initiatives to see how we could do better and, in that sense, we are always evolving. For instance, we want to give more value to our customers. If you’ve been following some of the loyalty programs that other airlines, especially legacy carriers, they are all mostly revenue-based programs in which it doesn’t matter how much you pay if you fly from Miami to New York you get the same number of miles. Now what they have done is moved to a more value-based model where the more you spend the more miles you get which actually dilutes the value of the program and if you see the loyalty customers that have been flying American or Delta for years, they’re not really happy about it, but at Spirit we don’t want to move toward that model. We still award miles on distance flown, because we value savings. We did a promotion where we gave more miles for more savings. You get more miles for the less you pay. That promotion is going on right now. If you pay less than $75, you get 1,000 miles. The more you pay the less miles you get.”

Rudin offered brands some advice when considering a loyalty program.

“Set clear KPIs as to what you want to accomplish in the first six to 12 months of the program and then in later timeframes,” she said. “As you set those clear milestones, make sure you position your program and organization against them.”
A company that unwaveringly stays true to itself is always on a safe loyalty path because that resonates with customers.

“Sticking with your roots is always the way to go,” Rudin said. “We’re seeing a lot of brands sticking with the basics. It embodies who they are and they’re winning.”

Recent Content

Membership and Pricing

Videos and podcasts

Membership and Pricing