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Loyalty marketers are always looking for an edge that can push their loyalty efforts over the top. Success has been found in programmatic efforts that build customer reciprocity and status, or provide value in the form of savings back to the customer. A common theme among the most successful strategies is customer centricity – developing a deep understanding of your customers to create personalized experiences and an emotional connection. The insights and relevancy gained from an outside-in customer focused approach should form the foundation for all of your customer loyalty efforts.

What if I were to tell you there is an approach that can provide the edge you’re looking for, and has been there all along?
An approach that puts the customer at the center of your loyalty strategy?

Customer feedback drives value proposition

An approach to customer loyalty not often used, but with the potential to be highly effective, is co-creation – broadly defined as allowing your customers to participate in the planning and creation of the product or service value proposition. A classic example of this is Lego Ideas, an online community where members can share, discover, receive feedback and vote on their favorite design ideas. If a project is chosen by Lego, the creator earns a percentage of the sales and is recognized on all packaging and marketing. The customer experience and product development benefits derived from this type of direct customer input and feedback can be significant and includes the ability to gain customer insight at a much deeper level than traditional research methodologies leading to innovation. It also includes a reduction of R&D costs through efficient feedback processes and lowers the risk of product launch failures since the ideas resonate with the most important audience, your customer.

“70% of companies that deliver outstanding customer experience rely on customer feedback to do so, compared to just 29% for CX laggards”.

Estoban Kolsky, the CEO of thinkJar

Another example of co-creation facilitated through community can be found at Sephora with their Beauty Insider. This is a community where consumers can find beauty inspiration, ask questions, and get advice and recommendations from other consumers. According to Deborah Yeh from SVP Marketing, “since the social platform launched in August, the beauty retailer has seen over 100,000 live chats started on product pages, with the majority of customers’ questions being answered within minutes. On top of that, users have shared over 20,000 photos on the platform — great initial indicators of a rabid and enthusiastic audience.”

These are exciting and worthy business metrics for deploying a co-creation strategy. Loyalty marketers, however, are also concerned with developing emotional loyalty to drive customer behavior and create positive business results in metrics such as member retention, incremental revenue and ROI. So, what does co-creation look like when used to drive these important metrics and how can a marketer harness this powerful, but under-used strategy, to increase customer loyalty? A few years back, during my tenure of leading lifecycle marketing and loyalty at Ancestry.com, we put this approach to co-creation to the test, literally.

Powerful marketing tool

Subscribers to the Ancestry.com service care almost exclusively about one thing: content. Content here means the millions of family history records and databases they can search through to help them discover their family’s story.
This is important since it is where we decided to ask for their input for co-creation, and it was the start of a longitudinal engagement and feedback loop test plan.

We sent a survey to members asking them to rate almost 300 content blurbs, each featuring a unique database of records; for example, Civil War Muster Rolls of 1865 or Irish Immigration Records of the 1850s. While this survey collected valuable information for the planning of our content roadmap, what was even more important was to demonstrate how much we value individual member feedback. Without using an incentive, the survey generated a 30% completion rate – high for any email sent invitation, let alone one with almost 300 questions. Each responder was then followed up with a thank you note.

The feedback loop continued by sending all members who received the survey a summary of the results – proving to our members that we were listening to them and reinforcing how much their feedback is valued. The feedback loop was completed by creating a multi-channel letter and rich brochure from the CEO showcasing a content roadmap for the coming year, tailored to their areas of interest. These communications proved to our members they have a direct and important role in the direction of their service, and created a sense of anticipation for future content.

Epilogue

Ancestry.com was able to significantly increase member retention and reactivation versus the holdout cell driving large revenue gains, ROI and improvement to Net Promoter Score.

This co-creation test was rolled out to the entire membership base in subsequent years and became an important part of Ancestry.com’s member retention and loyalty marketing efforts.

As we’ve seen, co-creation can be leveraged in many different ways and is a powerful tool for creating customer loyalty. Loyalty marketers should determine what is important to their members, and develop an engagement strategy based on active member participation, trust, and a personalized experience. If you would like to speak to someone at Kobie Marketing about how co-creation can enhance your 2018 loyalty marketing efforts, drop us a note at [email protected] We welcome your questions and comments.

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