Professional Documents
Culture Documents
TM
Volume 1 Number 5
The
Engagement
Issue
Give Back...
Get Back
The Engagement
Impact of CSR
Engagement
or Loyalty, I’m Happy
does it matter? to be Here!
How Engaged Employees
Improve Your Bottom Line
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DEPARTMENTS
6 What’s on Loyalty360.org Why Should We Care
8 Letter from the Editor
10 Contributors
What They Think?
LOYALTY FORUM 26
12 Your Voice
“When launching a new rewards program or
marketing promotion, what are the best techniques to
get employees informed, excited and committed to the
initiative?”
14 Q&A: Ask the Experts
“I’ve heard that there are challenges when valuing
points and managing redemption when dealing with
franchisee’s. What are the best practices that I should be FEATURES
considering?”
24 Engagement or Loyalty, Does it Matter?
16 Behind the Brand/People Mark Johnson
Interview with Phil Rubin, CEO & President,
rDialogue 26 Why Should We Care
What They Think?
18 Behind the Brand/People Carlos Dunlap – Kobie Marketing
Interview with Maurice Johnson, GE Money
30 I’m Happy to be Here!—How Engaged
20 Books
Employees Improve Your Bottom Line
Loyalty Reads
(And Make it a Great Place to Work!)
22 Excerpt from: “Made for Collaborating” Dan Paulson – InVision Business Development
by Rodd Wagner and Gale Muller, Ph.D.
36 e make a living
W
by what we get,
I’m Happy to be Here! we make a life by
How Engaged Employees Improve Your Bottom Line what we give.
30
Give Back...Get Back
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Delivers Results
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Engagement Expo
Sneak Peak 46
In 1967—the answer was
“plastics.” Today, the magic
word is “analytics.”
The New Plastics: Driving Share Through
Competitive Analytics
TECHNOLOGY,
TRENDS & REWARDS
46 The New Plastics: Driving Share Through
Competitive Analytics
Caitlin Schar
currency or use theirs?
Erin Raese
50
Kathleen Ninneman – Graphic Designer
Graphics Plus Inc. – Print Production
Contacts:
Article Submissions: Erin Raese (630) 235-8251
Advertising: Caitlin Schar (630) 850-7867
BEST BUSINESS PRACTICES
To subscribe to Loyalty Management visit Loyalty360.org. 50 Loyalty Marketing Beyond Programs
Phil Rubin – rDialogue
The Changing Face of Card Loyalty Empowering the “Pulse” Throughout Loyalty Marketing
by: Wong Wan-Ling, Insight Consultancy by: Mark Johnson
What is your #1 factor when determining what makes you most loyal? Why?
Visit Loyalty360.org to participate online or email your response to Mailbag@LoyaltyManagement.com.
Responses will be published in a future issue of Loyalty Management!
We’re here to help you in your search. Between this issue and
the upcoming Engagement Expo we will provide a wealth of
Loyalty 360
has announced
information—from philosophies to executable strategies to defining
the first annual success criteria to peer insights.
Engagement Expo
to be held in Chicago
at the Sheraton In this issue, Dan Paulson takes us through the 10 steps to engaged
Chicago Hotel & Towers employees ( page 32) and on page 36, Athena Golianis shares the
November 18 & 19 importance of corporate social responsibility and how it drives
employee engagement.
2010 Loyalty Expo to
be held on June 6 – 8 in
Orlando, FL at the Omni No one builds engagement and commitment with employees and
Champions Gate customers better than Disney. Meet the man behind the brand—
Lee Cockerell, former EVP of Operations at Disney and
Loyalty 360 on Twitter Engagement Expo keynote speaker—on page 60. You’ll also
–#LE360
enjoy Lee’s book Creating Magic (review on page 21.)
LOYALTY
TM
podoespr
nt Ext. What EviEw
En gagEmE about engagemen
this mean to you?
Everyone is talking
Erin Raese
Loyalty Management Editor-in-Chief
is now a bi-monthly Loyalty Management
publication. erinraese@loyaltymanagement.com
Expect the next issue
in late December!
!"#$%&%$'()*+,)$-./#0,1
Contact us for a demo of our web based Loyalty Dashboard at 800-416-2090x12
or e-mail us at info@incentivegroup.com
T
this done in a timely, cost effective manner (and keep the
reat them like your customers and sign them up,
information constantly flowing and updated) would be
engage them—only through positive experiences will
through an existing employee intranet that exists, email
they make your ‘program’ come alive.
communications such as an employee e-newsletter and
even creating a special branded email update specifically Stephen Fraser CRM & Loyalty Marketing Practitioner
for the rollout of the program and subsequent updates.
Verbal communication also needs to occur in tandem with
all email communication as well. This could be done through
any rollout training that occurs (with documentation of the
program for employees) and updates provided at monthly
S ome of our clients have announced the start of a
program by incorporating the info into regular
meetings, news letters, or on company websites; even the
meetings, conference calls/status calls (whatever the mode page that is reserved for employees only. Some things I
of communication is traditionally is for your organization) so have seen used to maintain momentum are to use the results
that it becomes a regular item on the set agenda. as a training tool but in a positive way. Try posting the results
online, or on a visible board in the lunch/break room. Public
Aileen Stacy-Forker Marketing Director at Smart
verbal recognition is always welcomed! Some things we offer
Button Associates our clients are online reporting tools so that, for instance,
the user can see trended results, or results of other stores for
T
comparison. That always gives incentive to do better.
hink frequency, relevancy and integration.
Frequency—there is no substitute for spaced repetition. Jennifer Adams Burket
Relevancy—earn the right to be heard with high value
content. This makes frequency palatable. Integration—say
the same thing with the same look through all possible
touch-points whether it is e-mail, newsletters, snail mail,
websites, face-to-face, etc.
I f it’s possible, it is important to involve employees (or
some of them) in the design of this program. If you are
involved in this creation, it is also part of you.
Todd Hanson CRP, CPIM, President and Founder, José Ignacio Ruiz (Iñaki) Orange—France Telecom
Catalyst Performance Group, Inc. Group
Barcelona, Spain L
Phil Rubin
CEO & President, rDialogue
You ran the 2008 Chicago Marathon (congratulations), what are you training for now?
Thanks. Now I’m thinking about a new “Rock ‘N Roll” marathon in New Orleans on February
28th of 2010. I’ve started riding a road bike and am also looking to do my first triathlon.
Maurice Johnson
GE Money
Maurice is considered an expert in Financial Services Marketing,
Lifecycle Marketing Strategy, Campaign Execution, Data
Segmentation Strategy Development and Strategic Project
Management. With over 10 years of consumer marketing
experience, he has worked with top brands such as: The Home
Depot, Lowes, Ethan Allen, Lenscrafters, Pearle Vision, Whitehall
Jewelers, Bernina ,and Ultra Diamonds.
When not working, what’s your favorite Which living person do you most admire?
way to spend your free time? Not one person in particular, but all those people
Visiting vintage resale shops. I love looking for that stood up for civil rights when physical or
clothes from the past, particularly the 60’s. Finding financial harm was the response. Even being
those funky outfits (pants, shirts, sweaters) that ostracized by your community or family for the
they just don’t make anymore and making it fit rights of others, takes a great deal of courage… no
into today’s wardrobe is cool! matter the race, gender, or sexual orientation of the
person.
Which sports team is your favorite?
I don’t really have the time to watch sports, but Which talent would you most like to have?
since I am from Chicago, I’ll root for any team from The ability to sing, not an ordinary voice
there regardless of the sport or skill.. I am more of a like many of today’s entertainers, but like a
big event person…. Olympics, super bowl etc… Stevie Wonder, Boz Scaggs or Sting.
Which book(s) have you been recommending? What’s your personal motto?
I generally go for the internet content or magazines. Limit pity parties to 15 minutes… There is no sense
But, I have been reading this book on Emotional in feeling sorry for yourself when things don’t go as
Intelligence. It’s really about cracking the code on planned… Move on already.
people skills and communication. Smarts are a
given when you get to a certain level, but the ability What have been your biggest challenges in 2009?
to motivate people , empathy, personality, and What can we expect from GE Money in 2010?
charm isn’t as easy for everyone.
I think 2009 is still shaping 2010 for most
companies. It brought a more informed and
If you weren’t working for GE Money, vocal consumer to the forefront. Consumers were
what would your ideal job be? questioning the true benefits of products and the
Well I love what I do, this would be purely value. We will continue to use our voice of the
imagination at work, but a teacher or counselor customer to make/sustain products that have value
who would develop tools to customize and improve for our customers.
learning opportunities to educate and support
individuals. Word of advice for a novice loyalty marketer:
• Know who is your customer
What do you consider your • Talk to your customer
greatest accomplishment?
• Gather a variety of options/solutions
Professionally, I’d like to think it hasn’t happened
yet… but growing a business from practically • Test/Pilot
nothing to over $1.5B is pretty good. Personally, • Talk to the customer again after the results
my time in the US army. Anyone that • Test again
knows me would say that being in such a strict
environment isn’t me, but I was much younger then • Develop a launch/ongoing multi-channel strategy
and appreciated the time to grow and mature. • Develop a contingency/exit strategy
L
Loyalty Reads
Masterminds Unleashed:
Selling for Geniuses
by Nielsen, Greisen, Scholz, Smith, Paulson, Lunquist, Boykin, Kolster
How much do we know about why we buy? What truly influences our decisions in today’s
message-cluttered world? An eye-grabbing advertisement, a catchy slogan, an infectious jingle?
Or do our buying decisions take place below the surface, so deep within our subconscious minds,
we’re barely aware of them?
In BUYOLOGY, Lindstrom presents
BUYOLOGY is a fascinating the astonishing findings from his
groundbreaking, three-year, seven-million-
and shocking journey dollar neuromarketing study, a cutting-
into the mind of today’s edge experiment that peered inside the
brains of 2,000 volunteers from all around
consumer... the world as they encountered various ads,
logos, commercials, brands, and products.
His startling results shatter much of what
we have long believed about what seduces our interest and drives us to buy.
Filled with entertaining inside stories about how we respond to such well-known brands as Marlboro, Nokia, Calvin
Klein, Ford, and American Idol, BUYOLOGY is a fascinating and shocking journey into the mind of today’s consumer that will
captivate anyone who’s been seduced—or turned off—by marketers’ relentless attempts to win our loyalty, our money,
and our minds. Includes a foreword by Paco Underhill.
Many of the greatest accomplishments can be reached only by two people working together.
Tenzing and Hillary were the first to scale Mt. Everest. Malone and Stockton were the key to each
other’s success on the basketball court. Eisner was never as effective at Disney without Wells.
But while some partnerships reach
great heights, others fall short. Why do
Power of 2 will change some people click while others clash?
the way you think about What do great pairs have in common?
And what can you learn from the most
working with someone else. powerful partnerships to strengthen
collaboration in your work and personal life?
Based on Gallup’s groundbreaking research, Power of 2
details the eight elements that prepare partners to succeed in their most important endeavors. Rodd Wagner, coauthor of
the bestseller 12: The Elements of Great Managing, and Gallup World Poll leader Dr. Gale Muller share the science and the
secrets of successful collaboration.
Mixing key insights about human nature, field-tested discoveries, and inspiring stories of partnerships that reached the
pinnacle, Power of 2 will change the way you think about working with someone else.
Creating Magic:
10 Common Sense Leadership Strategies
from a Life at Disney
by Lee Cockerell
October 2008 | Broadway Business
Introduction
★★
Engagement or Loyalty,
Does it Matter?
by Mark Johnson – Loyalty 360
W
e keep hearing that traditional marketing is Do we want our spouses to be engaged or loyal? (I hope my wife
dead, that the social and mobile media, communities/ is loyal). I know there are times that I am not as “engaged” with
forums, interactive communication, and “engagement my family as my wife probably wants me too, but as I stepped in
strategies” are creating a “voice of the customer” movement. front of a car careening through our neighborhood with kids (mine
Engagement is the new buzzword that we keep hearing. Yet what is and others) riding their bikes last week, you cannot question my
it? Is it the replacement for satisfaction, or is it the new loyalty or is loyalty. Isn’t that what employers, brands, and companies want;
it both; or something completely new? We hear that “if you do not someone to step in front of the proverbial “bus” for their product?
engage your customers, your clients, your employees, and those Those are the true brand advocates, the brand champions all are
who partake in your brand that you are doomed to fail.” looking for.
T
Yet the more that I speak with marketing executives he goal for Loyalty 360 was to
across industries; in a time where there are a create a forum (yes a community) where
record number of “experts” and “visionaries,” thought leaders and those who had a
there seems to be more questions now than Being able to question or a challenge could interact to get
ever before. use multiple a “pulse” on the loyalty, incentive/reward
The more I hear about Engagement, and yes, the “engagement marketing”
it all seems to me another tool to create, communication media arenas. We continue to see the market
augment and sustain loyalty. Do you
want “engaged” clients or loyal ones,
and technologies and looking for guidance. New buzzwords
such as “engagement,” “marketing 3.0”,
do you want engaged employees that the resultant data “social media,” and “communities” seem
as soon as the next (better) opportunity
comes along they jump at the chance
to market to your to be creating more questions than they
have answered. It seems that as soon as we
and leave (no loyalty)? Do you want stakeholders effectively begin to understand email, blogs, CRM,
engaged fans that as soon as their team goes “versioned” direct mail, customer centric
3-13 (like my Denver Broncos are going to
is the key. and integrated marketing communication
this season) they switch teams (no loyalty)? I things change. What was once MySpace is now
would argue no. Facebook.
Engagement is a precursor and eventual complement As soon as we begin to grasp all of the technologies of
to loyalty, the temporal part of the process by which you can create yesterday, we are now faced with Twitter, Facebook, communities
a long term interactive dialogue which customer satisfaction and (replacing blogs), e-coupons, and mobile media/commerce, print
Loyalty can be achieved. The ability to effectively understand the and email communications that use behavioral, loyalty, CRM and
behaviors, interests and perceptions of anyone who touches your other opt in database applications to create customize communica-
brand, whether that is your customers, your clients, your employ- tions such as variable data print, data drive email communications
ees or your brand participants is the key. Being able to use multiple and PURL’s, not to mention all of the opportunity for mobile and
communication media and technologies and the resultant data to social media. These new mediums are such a small piece of the
market to your stakeholders effectively is also equally important. loyalty communication’s landscape, yet we have experts that claim
We know that a
significant change is
taking place in the way
T
they know how to effectively administer raditional marketing
these programs. The new pundits tell us companies interact with strategies focused on attracting
that if you do not move to the new mea-
sureable forms of media and integrated
customers, suppliers, consumers through
marketing, using any and all media to
push
I’m not going to waste my time telling you what The most interesting thing about him is his belief in a singular
you should be doing. approach with women. “Mark” would proposition each girl he
Capturing data, measuring unique transactions, acknowledging met in a social setting—between classes, at parties, while attending
loyal & valued customers, treating customers differently accord- sporting events—with the same offer: “Do you want to go on a
ing to their value, communicating with date with me?” This is no joke. Although
them in a relevant manner, analyzing I didn’t support it, this was a strategy he
consideration the
measured approach to marketing, initiative as an investment and profit center,
acquisition and ongoing commu- rather than a cost bucket; and you’ll be a hero
nications. Most importantly, your
ability to measure the appeal and re- variable buying- in their organization, as well as your own.
In addition to “doing the right things,”
sponses to all your communications
may make all the difference in your decision criteria of maybe it’s also time to reconsider the need
to track and measure to the “nth” degree,
marketing efforts. Understanding
and predicting your response rates
different segments of provide hundreds of redemptions options
and accumulate millions of dollars in points
and the correlating financial benefits
will help you design and justify your
customers. liability. Maybe, just maybe, we don’t have to
do those things in such a scientific, statistical
campaign prior to its execution. manner to make a real difference.
W
In fact, a 2008 study by Caslon & Company provides a founda-
tion for predicting your response rates based on your customer hat if we designed loyalty programs that are not
strategy, combined with the incremental benefits of personalized branded and customer facing? We call these little “l”
communications. Upon review of their findings it appears that per- loyalty programs. By having our clients utilize an internal
sonalized communications will garner you on average a 50% higher system that keeps track of their customers’ value based on actual
response rate, regardless of your knowledge of your customers or transactional behaviors may not tell everything, but it will provide
you with enough information to provide a good experience for program concept with the aid of minimal franchisee fees, while
returning customers, including the ability to reward their loyal the franchisees were given meaningful tools to customize and
patronage with surprise & delight gifts. For customers who deliver an appropriate, consistent and “rewardable” experi-
make several transactions of a certain ence based on measurable customer
dollar, why couldn’t a company value. Knowing what each customer
reward that loyal customer with a Knowing what each is thinking is not the foundation of
surprise reward such as: a sample of
a premium product or a temporary
customer is thinking is not a good loyalty program. Treating
customers according to the profits
subscription to a service they don’t the foundation of a good they generate, or can generate, is the
already purchase. Of course there’s ultimate goal and the key to reten-
also the options of a free gift or loyalty program. Treating tion and sustained financial benefits.
discount off the next transaction, Keeping customers loyal takes
but be careful since this may dilute customers according to more than a few promotional strate-
the brand value.
the profits they generate, gies and free samples. Clients must
Y
ou don’t have to galvanize and align their organiza-
know what customers are or can generate, is the tions around a true commitment
thinking in order to use to delivering on consistent and
your marketing dollars more wisely. ultimate goal and the key good experiences for their custom-
Recently, I received an invitation ers. Employees function as internal
from a prominent organization to retention and sustained advocates, who continually breathe
to “send my son to Australia to
participate in a Foreign exchange
financial benefits. life and passion into a successful cus-
tomer loyalty strategy. Engaged and
opportunity.” While on the surface satisfied employees, combined with
this seemed like an interesting enriching opportunity, I good products, services and value, ultimately lead to engaged,
struggled with the offer. I have two lovely daughters and no satisfied, loyal and profitable customers.
A
son—to my knowledge. So this well-meaning organization,
that features the names of most of the presidents of the past 4 s an industry, we are at a critical stage in
decades, doesn’t have to know everything about me. However, our evolution. With the innovations in technology
they should at least know the basics before wasting their money that allow for more efficient behavior tracking, our
and my time with such a meaningless offer. industry has no more excuses for not “doing it right”—
There are some companies that have the inherent ability to whether the loyalty program has a foundation of research,
know their customers and personalize customer experiences on points and analytics or if it simply provides a good experience
a real-time basis. A couple of years ago I had the opportunity to every customer, with an occasional treat or offer. Either
to consult with one of the world’s leading brands, who boasts strategy can work, but a combination of a “science and
a network of more than 6,000 well-branded franchisees. art” approach might be best. If you want to have retention
Unfortunately, not much of the customer data made its way and ongoing earnings, then recognize profitable customer
up to the parent company, and the franchisees didn’t have behaviors and reward them accordingly. Because it’s not their
the ability, sophistication or know-how to provide rewarding attitudes or intentions, but instead their actual transactions,
experiences to their best customers. that result in a positive P&L. L
However, what those franchisees did have, by the nature of
the services provided, was a personal relationship with their best
and most frequent customers. The designed loyalty solution
called for critical alignment between the parent company
and franchisee network. Their loyalty strategy
yo u on
rner ardless
allowed the parent company to
ll ga
s wi ate, reg their
fund the overall
t ion
m unica sponse r mers or and.
ze d com gher re ur custo your br
so nali 50% hi of yo w ards
r
Pe rage a e
edg titude t o
e n ow l
av our k ing at
of y nd
orr espo
c
Our years of experience ensure we acknowledge, understand and anticipate marketplace and consumer trends, helping us
design programs to motivate your customers’ behavior. Some of the most recognizable brands have employed our services
to develop loyalty solutions to meet their profitability goals. We believe loyalty should be a business strategy with a positive
ROI. And our proven loyalty solutions repeatedly result in profitability for our clients.
Just Another Day at this well recognized brand fall so far? Many point to the economy
as the source, but in reality that was only a small factor in their
the Restaurant demise. After years of growth, the leadership saw a huge expense
Recently I walked into a local fast food restaurant. It was shortly on the books. Many of its veteran salespeople were making a good
after noon and the place was fairly quiet after the lunch rush. living doing what they did. Because of this, they were collect-
There were a few people in line as I patiently waited my turn. ing sizable bonuses. The solution: replace the experienced (and
The environment was as you’d expect, busy with the movement of engaged) salespeople with less expensive, less experienced ones.
people taking orders, cleaning, and making food. Once I reached This move, as a cost saving measure, brought the company down
the counter, I greeted the cashier. No response. Just a blank stare in the end. Without engaged employees who connected with the
as she waited for me to tell her what I wanted. I ordered one of the customer, Circuit City’s service level fell to the point that when
value meals to go since I was on my way to a client and decided it people became more discretionary with their spending, they went
elsewhere.
would be best to eat on the road (i.e. the tables hadn’t been cleaned
yet). After telling her what I wanted, and that it was to go, she said
about the only words I would hear from her in our exchange. “Will
that be to go?” I confirmed (again) that yes it would. She told me
Getting Them Engaged
what I owed. I paid the balance and stepped aside to wait for my The fact is employee engagement is a concern for almost every
order. business out there. As a business owner, leader, manager, or
This is a common experience we can relate to as consumers. It is employee there is much you can do to get people engaged.
also the stereotypical example of a lack of employee engagement. Engagement is about getting people involved in the emotional
Yet in many workplaces in every community, you see this type of interaction that takes place between you and your staff. In ad-
behavior taking place. For business owners it equates to lost sales, dition, it also involves the emotional connection between your
poor production, and costly mistakes. For leaders it is what keeps staff and the customer. Rarely do we focus on this. In business
us awake at night as we try to figure out how to get people to care we often treat our interaction with people as a process and not
a relationship. Our goal is to provide a consistent outcome with
about what they do.
little room for error. McDonald’s perfected this approach in the
restaurant industry years ago, and people have tried to adapt it for
The Costs are High other things as well. It could be a customer service program, or an
employee engagement program, or a “how do you handle difficult
The absence of employee engagement is costly. A business that has people” program. You get the idea. There is a strong need to apply
engaged employees will grow, on average, at twice the rate of a a simple solution to a complex problem because we want to make
business that lacks that commitment from their staff. In fact, the it easy. Putting a program in place to handle customer complaints
average American company loses 20 – 40% of its customers each makes it easy for the employee to respond. Unfortunately there has
year! For a company that has a million dollars in gross revenue, that yet to be a program written that covers ALL customer problems. By
could equate to as much as $400,000 in revenue that needs to be having employees follow a system without some ability to think on
replaced. This is often done through increased sales efforts, more their feet they are left at the mercy of the procedures in place. How
spent on marketing and advertising, and discounting products and many times have you heard, “That’s not our policy.”
services. These expenses erode the bottom line and can make it The reality is employee engagement is simpler than you might
difficult for companies to survive in difficult times. think, but it’s not easy. It involves some discipline and trust on
One of the best examples recently is Circuit City. Once praised the part of your leadership team to make it happen, but if you are
by Jim Collins in “Good to Great”, this company now only exists committed, the positive results can be tremendous.
as an online brand bought out of bankruptcy court. How could
• No Minimums
www.fairlanegroup.com
For more info, please contact bluefish@fairlanegroup.com
As Anita Roddick, another, when price and quality are about equal, if the other
brand is associated with a good cause
founder of The Body • 38% percent have bought a product associated with a cause in
the last 12 months
Shop, once said, Cone went further and put these statistics to the test by conducting
an experiment with 182 consumers. Consumers were split into two
bed with a mosquito.” • A 28% increase in purchases for a toothpaste brand when associ-
ated with a cause. Nearly two-thirds of the participants (64%)
chose the targeted brand compared to only 50% who view the
corporate ad.
Based on these results it’s clear that consumers are happy to reward
companies that give back both with goodwill and with money.
Excerpt from: The Next Discipline Applying Behavioral Economics to Drive Growth and Profitability.
Customer Behavior is
Influenced More by
Emotion than Reason
by Gallup Consulting
B
usiness leaders, researchers, academics, and more for those products, returning more often, and staying
management consultants alike have expressed concern longer with the business. Rationally satisfied customers, on
that while customer satisfaction may be a necessary the other hand, behave no differently than customers who are
foundation for building strong customer relationships, by itself dissatisfied.
it is a relatively poor predictor of future customer behavior and This pattern is not limited to customer satisfaction
organizational financial performance. Our data support this responses; in fact, we see the same pattern for customer ad-
concern. Results from a large number of case studies suggest vocacy. Findings from a large number of case studies suggest
that customers who are extremely satisfied—those who provide that customers who describe themselves as strong advocates
the highest rating of overall satisfaction with an organization’s for an organization’s products or services—those who provide
products or services—fall into two distinct groups: those who the highest “likelihood to recommend” ratings—also fall into
are emotionally satisfied and those who are rationally satisfied. two distinct groups: those who are emotional (even passion-
Emotionally satisfied customers have a strong emotional ate) advocates and those who are merely rational advocates.
attachment to the organization while rationally satisfied Emotional advocates have a strong emotional attachment to
customers do not. Our research reveals that emotionally the organization while rational advocates do not. Our research
satisfied customers deliver significantly enhanced value to an reveals that emotional advocates—like their emotionally
organization, for example, by buying more products, spending satisfied counterparts—deliver significantly enhanced value to
Figure 1
an organization, buy significantly more products, spend sig- relationships. Beyond confidence lies Integrity, the essential
nificantly more for those products, and give a greater share of dimension of fair play. Does this organization treat me the way
their total spending to the business. Rational advocates, on the I deserve to be treated? If something goes awry, can I count on
other hand, behave no differently than customers who would this organization to fix it quickly? The next emotional require-
not recommend the organization to others. ment is Pride, a sense of positive association and identification
with the organization. Customers feel pride not because of what
S
o if these two traditional standby metrics fail their association with an organization says to others, but more
to deliver as advertised, how can we accurately gauge importantly, because of what it says to them about themselves.
customer sentiment? Taking a cue from behavioral The ultimate expression of a strong emotional attachment is
economics, scientists at Gallup Passion. Passionate customers de-
developed a method to measure—
reliably and accurately—the Emotionally satisfied scribe their relationship with the
organization as irreplaceable and
emotional connections between
customers and the organizations
customers deliver a perfect fit. Passionate custom-
ers are customers for life and are
that serve them. Our research significantly enhanced worth their weight in gold.
also sought to demonstrate the
linkages between this measure value to an organization... As illustrated in Figure 2,
our research revealed that
of customer engagement and
crucial business performance
by buying more products, across organizations of differ-
ent types, customers who are
metrics, including customer spending more for those fully engaged—those customers
retention, cross-sell, share of
wallet, frequency of purchase, products, returning more who have a strong emotional
connection to the organization—
profitability, and relationship
growth.
often, and staying longer represent an average 23%
premium in terms of share of
The resulting work suggests with the business. wallet, profitability, revenue,
that there are four key dimen- and relationship growth over
sions, as illustrated in Figure 1, to a customer’s emotional the average customer. In stark
attachment to an organization (along with the more rational contrast, actively disengaged customers—those customers
foundational elements typically associated with customer sat- whose emotional connection to the organization is weak or
isfaction). Each dimension represents a specific set of activities absent—represent a 13% discount. At a local business unit level
that meet customers’ emotional needs. (a store, branch, sales team, or other local unit), those whose
The first dimension of emotional attachment is Confidence. levels of customer engagement place them in the top 25% of
Is this organization trustworthy? Can its employees be trusted comparable units within an organization tend to outperform
do what they say they will do day in and day out? Confidence all other units on measures of profit contribution, sales, and
is the foundation on which higher levels of emotional attach- growth by a factor of two to one. Clearly, engaging customers
ment are built. But confidence alone is not enough to build on an emotional level has a significant financial benefit. L
long- term, sustainable, and emotionally connected customer
Read Gallup Consulting’s whitepaper, “The Next Discipline Applying Behavioral Economics to Drive Growth and
Profitability” in its entirety at Loyalty360.org.
Integrated Customer
Marketing ™
Marketing Integration’s Perfect Storm In 2007, Forrester Research found that just 9% of marketers
at or above director level at major companies said their customer
Achieving customer-centricity has been a desire of marketers and
communications were “very integrated” across channels. Two years
business leaders for decades. But the tools, capabilities, and support
later, the numbers haven’t moved much. Preliminary results of a
needed weren’t readily accessible—until recently.
new Forrester study commissioned by Merkle indicate only 17%
Today, key trends make marketing integration a financial
of senior marketers and managers say their companies’ customer
requirement, and the availability of technology, data, and ana-
and prospect communication activities are “very integrated” across
lytic know-how has finally made establishing a customer-centric
marketing, sales, and service (Figure 1).
organization realistic and practical. For the first time, companies
Some—but by no means all—of the major obstacles that have
are creating competitive advantage by managing their customers
prevented a customer-centric focus include:
for profit.
• A lack of executive support
• Organizational designs
Introduction • Compensation and incentive systems
Twenty years ago, Philip Kotler defined marketing’s role as setting • Measurement constraints
the strategic direction for the organization and its interaction with • Business models
customers for the purpose of satisfying needs of a target market • Data capture capabilities
at a profit. Importantly, Kotler advised that marketing activities • Analytic capabilities
should be manifest in all the activities of an organization to • Perceived high cost
create customer value. He suggested that this customer-focused, • Focus on short-term results
integrated approach to marketing would bring the strongest short-
and long-term results.
Despite the strong desire of marketers and business leaders to
become more customer centric, the tools, capabilities, and support
needed to implement an integrated approach simply weren’t avail-
able. Instead, the concept of marketing integration was applied and
tested within marketing campaigns, business units, and channels as
a tactic for improving short-term results.
Still, marketers remained eager to apply the concept as a strategy
across the entire organization. They took steps toward that goal
by embracing concepts such as customer relationship marketing,
1-to-1 marketing, integrated marketing communications, and
others. But organizations have yet to fully integrate the marketing
function by engaging the entire enterprise in building customer
lifetime value. None of these approaches achieved full, customer-
centric integration because they did not take into account the
activities of the customer.
A
I N D U S TRY V O I C E S uthor Christoper Vollmer, a partner with Booz & Company, writes in
his Spring 2009 article for strategy+business that the digital explosion has transformed
“Knowing that the competitive landscape into a survival of the fittest; “a kind of ‘digital Darwinism.’”
At this critical juncture in marketing, Vollmer’s message to marketers is simple: Evolve or die.
60 percent of your Some organizations have responded to the competitive threat by reorganizing and shift-
ing resources to capitalize on the online opportunity. But because the “customer ecosystem”
loyal customers are encompasses multiple channels and media platforms, the tactic is more a reframing of the
old product-centric focus to make it work in the digital world rather than a next step in
profitable is useless marketing’s evolution. Solving problems that have plagued marketers and their organizations
for decades, effectively competing in a brutal marketplace, and seizing opportunities as they
if you don’t know emerge, requires organizations to adopt a new dynamic.
I
Companies with whom n the past, the customers a company lost didn’t matter as much to Wall Street as the
they’ve had long standing number of customers acquired. That point of view is changing rapidly, particularly in the
current economy. Author and Assistant Professor of Marketing at the University of Florida,
relationships don’t seem to Michael Lewis, writes that researchers have recently noted that the health of a company—its
know them or their needs. value and future prospects—is often best understood by analyzing its customer base.
The business case for fully integrating the marketing function extends well beyond achieving
campaign response rates and monthly sales quotas. As Lewis implies, current research strongly
suggests it may only be a matter of time before shareholders and analysts include among key
evaluation criteria the health, stability, and long-term value of an organization’s customer base.
When the customer portfolio is maximized, then shareholder A lack of a coordinated, enterprise-wide approach has clouded
value is maximized. the ability to view customers across the organization.
Merkle describes this corporate asset—the pool of customers Top company executives aren’t typically involved in marketing
currently engaged with an organization’s brand—as the customer strategy and that’s problematic, too. Without C-suite leadership
portfolio. According to Merkle President and CEO David and active involvement in the development of universal metrics,
Williams, marketers need to start thinking of themselves as respon- including the relative value of different customer segments to the
sible for the management of a financial organization as a whole, the opportunity
asset. “Marketers are the true managers to integrate in a way that builds long-term
of the customer portfolio,” Williams says. Launching an initiative value becomes increasingly difficult.
Launching an initiative to accomplish
to accomplish full full integration across a vast and complex
Why is Integration
So Difficult to Accomplish? integration across a vast organization is also understandably
daunting, which is why so few companies
Historically, most organizations have and complex organization attempt it. Those who initiate enterprise-
struggled in their attempts to implement wide implementation as a single work
a systematic approach to delivering is also understandably “project” rarely succeed. Day-to-day
customer interactions that drive value. daunting, which is why so demands usually place the effort as a low
priority and the complexities involved
The reasons are complex and numerous.
A lack of a coordinated, enterprise- few companies attempt it. make integration seem impossible and
wide approach has clouded the ability to impractical, especially when undertaken
view customers across the organization. without a framework that provides a clear
Without an approach that involves enterprise management, it’s pathway.
been impossible for most companies to develop a common cus- But the short- and long-term benefits outweigh the obstacles.
tomer segmentation strategy that makes sense to all departments, The organizations that use a systematic framework and view in-
all the time—rather than in response to fluctuating departmental tegration as a multi-step journey, rather than a marketing project,
goals or a single campaign’s objectives. are best positioned for success. Organizations that implement
Basics, such as routine customer data collection sharing and integrated marketing stand to achieve both incremental and sus-
accessibility, have been long-standing issues in many organiza- tainable advantages. L
tions. In reporting the results of its April 2009 Data Management
Survey, DMNews reported that only 31% of respondents—253
top company and marketing executives, directors, and managers
from across the US—said their companies integrate data collection Read the complete, “Integrated Customer Marketing”
channels. When it is already difficult or impossible for one depart- whitepaper with additional information on:
ment to access customer data collected by another department, What is Integrated Consumer Marketing?; Building ICM
for instance, the prospect of successfully implementing a strategy
involving enterprise-wide sharing and collaboration is often viewed Currencies; and ICM in Practice, at Loyalty360.org.
with great skepticism.
T
he financial downturn, high unemploy need—how can retailers and financial institutions become
ment rate, and increased costs for basic goods and laser focused on the most valuable and productive data?
services, have put retailers and card issuers in a trying There are a variety of ways retailers and banks can get an
and complex situation. Consumers aren’t spending. They are edge on their business through insightful data and the sig-
limiting purchases to necessities, and any purchases that can nificant amount of information available to them today. The
be delayed—big and small—are. Those who are spending internal customer database is the first line of defense in terms
are looking for a deal, a discount—any way to conserve cash of building a good competitive offense. Generally speaking,
and spend less. As retail sales decline, competition for the customer retention is more cost effective than customer ac-
active consumer increases—retailers and card issuers alike are quisition—and the purchase behaviors and patterns evidenced
searching for ways to increase both share of wallet and overall by a retailer’s CRM database set the stage for the development
market share in a challenging economy. of most of the marketing initiatives that will be put in place.
Hopefully, recovery is on its way. But until then, and even Industry sales data is another tool to be exploited to full
after, what’s a retailer and card issuer to do? effect. The National Retail Federation is one good resource. In
In 1967—the answer was “plastics.” Today, the magic word addition, there are a number of websites which provide various
is “analytics.” We live in an age of information with far more types of data, such as retailnet.com; plunkettreseaarch.com, as
tools and technologies than ever before. However, despite the well as industry bloggers like Barbara’s Retail Industry Blog
advances overall, accessing competitive data in the retail indus- at About.com (www.http://retailindustry.about.com/b/) and
try has become increasingly difficult as economic pressures and Wall Street research reports.
regulatory restrictions have caused companies to progressively Affinity Solutions (www.affinitysolutions.com), which
reduce the amount of information that is made public. Given works with retailers and financial institutions to build online
that, getting access to competitive data has become harder by and offline relationship marketing programs, has come up with
the minute. a unique solution to the challenges of sourcing, aggregating
Why is data so important? Because this information unlocks and analyzing competitive data. Through its work managing
the door to successfully managing the three p’s—product, hundreds of loyalty programs for financial institutions, Affinity
pricing and promotion. For retailers, the key to winning in this Solutions has access to a unique data set of consumer behavior
environment lies in the ability to make better decisions in these and purchasing information. Affinity Solutions President and
critical areas. Closely aligned with that is the need to focus on CEO, Jonathan Silver, and his team saw an opportunity.
new customer acquisition—today more than ever—as the land “Not only were we hearing our customers’ data and insight
grab is now. Across the nation, customers who were once loyal requests increase, but because of the tumultuous markets, they
to particular retailers must find new places to shop in the face wanted as much information as they could get, as quickly as
of a rash of retailer bankruptcies. Finally, retailers must focus they could get it. We knew that through our work we were
on ways to increase loyalty among existing customers while sitting on a treasure trove of data, and we knew that if we could
increasing the average ticket, maximizing every store visit. design a way to repurpose it for our clients, that would be an
So, in this age of information—where there is too often invaluable resource. The only logical solution for us was the
too much to wade through and not enough of what you really development of the Affinity Dashboard™,” says Silver.
S
ilver explains that the Affinity Dashboard™ information from Affinity Solutions’ database of the 60 million
provides a window into the spending patterns of 60 cardholder transactions. The data is aggregated across all of
million debit and credit cardholders and their daily Affinity Solutions’ financial partners to ensure that they are
transactional behavior. With the increasing need to know capturing a truly representative sample of data that accurately
when and where consumers are spending, the timing of the represents the movement in the retail environment.
available data has become the ultimate attribute of the Affinity While retailers and card issuers remain challenged in today’s
Dashboard™. economic landscape, there is hope on the horizon and real-
“This is actual, real-time data, delivered to retailers in an time tools and strategies that can be effective today. More data
easy, customizable format,” explains Silver. “We wanted to give with a focus on competitive analysis is one of them.
our retailers a leg up by allow-
ing them to compare their own
data with their competition in Through its work managing hundreds of loyalty
real time. Most retailers tend to
have a lot of data and informa- programs for financial institutions, Affinity
tion on their existing customers
through their own transactional Solutions has access to a unique data set of
database and primary qualita-
tive and quantitative research, consumer behavior and purchasing information.
but are very limited as to
competitive spend. The Affinity
Dashboard™ fills in the gaps with a focused look at not other- “The Affinity Dashboard™ is the only solution that offers a
wise easily available competitive analytics.” unique insight into the spending pattern of 60 million card-
In terms of usability, the Affinity Dashboard is designed holders and the ability to target key customer segments within
so that customers can walk into their Monday sales meetings them,” Silver said. “These tools give us the inside view of how
knowing how their competition did the week prior. we can develop the programs and strategies that will allow us
Silver describes the process behind Affinity Dashboard™ as to emerge as winners as the economy steadies and begins its
fairly simple. Each week the varied data points and modeling inevitable climb back up.” L
tools of the Affinity Dashboard™ are updated with the latest
Loyalty Alternatives
Create my own currency or use theirs?
by Erin Raese
M
arketers spend a lot of
time discussing customer loyalty
solutions. Often these discussions
revolve around the creation of a loyalty
program—spend this, earn points, get that.
Most all of us can agree, these programs are
effective if done correctly. However, as a
practitioner handed the word from above,
“increase our customer retention rate by and engage by offering these miles to the
20% this year”, one can feel overwhelmed best customers. This is especially helpful for
and unsure of the most efficient and effective smaller companies. If you have less than 100 to create a unique value proposition for the
way to approach this demand. Many will locations, leveraging a currency with broad consumer and the brand. Some popular
recognize this bottom line driven necessity appeal and wide recognition will allow you to examples are found in the restaurant indus-
as huge mountain to climb, and remain not only increase transactions and basket size try—Rewards Network, Restaurant.com,
daunted with the task of determining the with existing customers, but also give people OpenTable.com, and Passport Unlimited.
easiest, safest and most efficient way to get not yet a customer a stronger reason to choose Each of these organizations offer discounts
to the top. or added value to the consumer
Loyalty programs are for dining; for the restaurant
definitely a great solution for You now have the opportunity to they provide marketing, new
many organizations. However,
initial and ongoing investment,
utilize the same marketing customer acquisition, increased
retention with new and existing
continuous analysis, unique strategies involved in running your customers and the analytics to
promotion and finding proof own program, but without the cost support the marketing efforts.
These programs specifically
in the statistics to support this
type of strategy are slippery and commitment of developing Rewards Network and Passport
steps up the mountain side. The your own currency. Unlimited are membership based
programs where consumers must
good news—there are options.
The most basic alternatives raise their hand to participate.
involve utilizing various communication you over a competitor. You’re offering them This type of active consumer has proven to
vehicles and your database to support cus- something additional—something that they be more active and engaged therefore bring-
tomer engagement strategies. Incentive and WANT. ing larger, more frequent transactions to the
recognition can be achieved without points. participating merchants.
C
However, if your management is convinced onsumers like this strategy
T
that a program structure is the answer—there because it allows them to bundle hese alternative options
are cost effective alternatives. their earnings into one currency. This are a great way to learn, engage
Are you aware that many organizations, provides higher and stronger redemption customers, and increase sales without
that have made the commitment and the value, opposed to earning less from multiple the commitment of your own loyalty
investment in developing their own currency, vendors with different currencies (where it program and program currency. Often
are open and willing to sell their currency to can take much longer to ever earn enough organizations use these options as a stepping
you? You now have the opportunity to utilize to collect a reward). Top currencies to stone to learn what works and what doesn’t
the same marketing strategies involved in look at are airline and hotel programs, or for their customers as well as a way to identify
running your own program, but without the credit card programs like American Express their customers and glean information and
cost and commitment of developing your Membership Rewards and Citibank’s Thank insights from them.
own currency. For example, a business cater- You program. For more information or help determining
ing to the small business market could choose Another popular alternative is to tap into which direction is best for your business, visit
to buy miles from their hub airline. These coalition programs. There are a number of Loyalty 360 — The Loyalty Marketers Association
miles become the loyalty initiative; incent organizations bringing like brands together (www.loyalty360.org). L
T
oday, the need to engage and retain customers the customers experience with your product. Remember trying to
to spend their remaining dollars with you has never been replace your first windshield wiper? I do. What about fixing your
more important. Online video can help you engage them. computer or software how-tos, wouldn’t it be great to get off the
I’m not talking about the crazy, wacky videos, but rather using phone with customer service and plug in online for a visual walk-
informative online videos that engage current and potential through? Apple has some great examples of video tutorials on their
customers in different ways. Trends for using online video are website. Check out how they use video to demonstrate how to use
positive. As connection speeds get faster, the number of views and the Apple iLife software (www.apple.com/ilife/tutorials).
length of views are increasing, which
should be good news for marketers Testimonials—Who better to
worried about short attention spans. It is much easier to explain the benefits of your service or
Online Video is becoming more
widely used... Before I describe ways to engage customers product than your best customers? A
video testimonial gives them the ability
use online videos, it helps to understand
why this medium works so well. First, it
in a visual medium to talk directly to your prospects, and
is much easier to engage customers in a than it is with printed because your customers are talking peer
to peer, you can reduce the time involved
visual medium than it is with printed
words. Video lets you demonstrate
words. Video lets you in building trust. Testimonials usage
isn’t just for infomercials anymore—it
your idea — with action, with humor, demonstrate your idea— is growing as a tool for engaging both
with the credibility of a great presenter.
Ask yourself: Would you rather read an
with action, with humor, consumers and employees and we will
see in the near future wide use across
instruction manual or see an actual dem- with the credibility of a the marketplace. Need an example? Visit
onstration? Additionally, people respond
positively to seeing a person on the other great presenter. YouTube (www.youtube.com), –type
“Testimonial” into the search box (there
side of the conversation; a stronger con- are thousands, I’m sure). Disney uses
nection occurs when one can see facial video testimonials frequently and well,
expressions. Finally, with online videos, prospects can get a closer for an excellent Disney sample view Disney’s: “Dream Makers” /
look at the features and benefits of products, or view testimonials “Testimonial” on YouTube.
from current users.
Engaging Ways to Use Online Video When you decide to use online
videos consider the following....
Advertising—Forget the sales pitch. People are getting tired
of traditional advertising. Be authentic and try to use real people Production costs for online videos are significantly lower than
and places. Create a compelling message that answers how you traditional 30 second media spots allowing you to create and build a
meet the viewer’s needs and provide a call to action which can tie library. Further, data can be collected that can help identify whether
directly to a purchase opportunity. For an example, JP Morgan consumers are merely satisfied or truly loyal. Did they recommend
Chase just launched their Ultimate Rewards program; they’re using the video to a friend? Additionally, cookies will be replaced by deep-
online video advertising to teach us about the program (www. packet inspection (DPI), which monitors the pages consumers’
ultimaterewards.com). Additionally, several companies including visit, the emails they send, and every search entered online. Just
VideoClix (www.videoclix.com) can add interactive hotspots to think of serving up videos based upon who is looking, versus the
your video that allow viewers to see more product information or content of a page. Incidentally, the FTC is developing guidelines
even make purchases. The interactions can be tracked and all the regarding privacy concerns that this practice raises, including the
viewer needs is Adobe Flash Player. invisibility of the data collection to consumers and the risk that the
information collected—including sensitive information regarding
Tutorials—Learning from a live person produces a better health, finances, or children—could fall into the wrong hands.
understanding of the information that is being presented, as Two final points to remember. Tag the video right so it is search
opposed to reading the material. Printed instruction manuals can engine friendly. Make sure the video is high quality. Low quality
be frustrating because the information might not be clear or there is video will not keep the consumers attention and will leave them
too much or too little information. Reducing frustration enhances with a negative impression of your business. L
Loyalty Marketing
by Phil Rubin – rDialogue
More than twenty years after the first frequent flyer program, loyalty
marketing is still largely defined and equated with frequent flyer-type
programs. It’s an easily accepted and digestible paradigm:
have relationships with, Here are four questions that would lead us to believe that your
company is capable, if not already practicing, loyalty marketing:
not loyalty programs. 1. Can you easily identify a majority of your customers (how
The loyalty strategy is to contact them, what and when and where they buy)
and do you use that as a basis for better understanding
the means to that end, them?
and really a part of the 2. Are those customers engaged, opted-in and responsive
to communications?
brand strategy. 3. Are you able to drive new revenues and profits from
those customers in a measurable, consistent and even
predictable way?
4. Are the activities related to the above questions build-
ing measurable and sustainable value, with increasing
expertise, effectiveness and meaning, for all parties?
The Challenge
The best loyalty “program” in the world is only as good as the brand
it supports. The loyalty program has to flow from the brand strategy
and the broader business. The best loyalty “programs”—strategies—are
often a way to package or merchandise a collection of brand benefits
and value drivers that a company is already providing to some (if not
all) customers.
The best brands are iconic and absolutely incomparable to other
brands in their space. There is only one Apple, only one Nordstrom
and only one Amazon. They should all have correspondingly unique
loyalty strategies. Assuming your brand is unique, why shouldn’t yours
have one too? L
Building
Advocacy
Before the
Purchase
by Doug Fleener – Dynamic Experiences Group, LLC
M
ost companies and experts look at the
relationship businesses have with their customers in three
steps with seven stages. Known as the Customer Relationship
Lifecycle. (CRL) the three steps and seven stages are:
Most companies think that only buyers
Pre-Purchase
1. Awareness 2. Knowledge 3. Consideration
can be advocates, but the fact is that
some of your best advocates may not
Purchase
4. Selection or trial
have made a purchase yet—and maybe
they never will.
Post-Purchase
5. Satisfaction 6. Loyalty 7. Advocacy
Too bad so many companies take this approach because it has a 2. Make it a company goal to deliver an amazing and
huge fundamental flaw. What’s missing? Advocacy. Most companies delightful experience to every single customer.
think that only buyers can be advocates, but the fact is that some of I love the retailer who told me that her goal is to have every cus-
your best advocates may not have made a purchase yet—and maybe tomer who leaves her store feels better than when they came in.
they never will. ow the experience is delivered varies from retailer to retailer but
H
Smart retailers focus on building advocacy during the pre-purchase what doesn’t vary is that retailers who deliver a superior experience
step for three reasons: have identified the steps to delivering the experience. It’s usually
• To potentially turn non-buyers into advocates. a combination of activities including a warm welcome, a drink or
some other gesture, and may include a surprise that delights the
• To lead more buyers into becoming advocates.
customer. The easiest way to get customers to advocate your store
• To use the advocacy elements to influence the consideration is to give them something to tell others about. What happens in
stage and improve the purchase potential. your store that your customer will most likely tell a friend or family
member about?
To focus on creating advocates in the pre-purchase stages, consider
3. Capture contact information for all visitors. Retailers who
the following:
only capture the contact information at the point of sale are losing
1. Teach your employees that some non-buyers actually revenue opportunities and potential advocacy by non-buyers.
create a lot more revenue than the average customer Give the customer a reason to give you the contact information in the
spends. As a matter of fact, some studies have shown that in pre-purchase phase and you’ll increase the number of post-purchase
some businesses the highest spending customers are not the most people.
effective advocates. This is why we like to teach all retail employees So let me ask, is building advocacy in your pre or post-purchase
to never label a customer as “just a looker.” stage? L
Measuring Engagement:
Simplicity is Key
by Bob Konsewicz – Maritz, Inc.
Behavioral Metrics sales mix in a sales channel program or increasing the categories of
products purchased in a consumer loyalty program. In both cases,
Measurements around people’s behaviors are typically easier to the greater breadth of activity leads to a more extensive relationship
capture and track. And there seems to be general consensus that
with the brand and thus, becomes a significant measurement of
actual behaviors are meaningful indicators of engagement. Plus,
engagement.
they can also be linked directly to your company’s profitability. For
example, if an “influencer” strategy creates more sales of high margin
product, it directly impact profits. Measuring engagement through Method Three: Modeling
behavioral metrics can be accomplished in a variety of ways.
A more sophisticated and predictive approach to measure behaviors
is through modeling. In modeling, advanced analytical techniques
Method One: Scoring are used resulting in predictive scores. A good example of modeling
Scoring techniques are one of the fastest ways to convert behaviors is lifetime value analysis, which can be applied in a variety of
into measurable metrics. They can be sophisticated or simplistic “influencer” strategies. Lifetime value analysis allows your company
in nature. The first step is to determine the desired behaviors that to know where to invest dollars to motivate individuals through
associate closely to your company’s definition of engagement. The relevant communications, campaigns, and rewards.
second step is to rank or weight behaviors by importance. From
there, a scoring algorithm is created that can be used to record the Summary
progress of behavioral changes. Scoring algorithms can also track
the impact of stimuli, such as relevant communications, marketing Even though the definition of engagement may be all over the
campaigns, or rewards. board, it’s important to keep things simple when measuring the
impact of “influencer” strategies. It’s easy to get bogged down
with attempts to develop a comprehensive metric. So keep
Method Two: Breadth Of Activity it simple. Choose two or three key behaviors and/or attitudes
“Breadth of activity” is another useful approach using behaviors that are known to drive stronger brand engagement. Make sure
to measure engagement. The concept generally applies to all kinds they can be measured and tracked and that they relate closely to
of “influencer” strategies – whether it be increasing the product profitability. L
Rock Bottom
MUG CLUB®
Probably one of the more unique restaurant loyalty programs out there.
Why? They are, “The club that rewards you just for visiting.”
So simple, yet so right! There is no effort to making this program
work. Simply show up, sit down, eat, drink and be CHECK OUT THE COOL PRIZES1:
merry. Provide your Mug Club card to your server, and with your
check Rock Bottom provides a Mug Club statement, which tallies
5 visits: Logo Pint Glass
not only visits, but also number of pints you have consumed. 10 visits: Mug Club Baseball Cap
25 visits: Growler Cooler
Once you have accumulated enough visits for your reward, there 35 visits: Mug Club T-shirt
is no need to go through a lengthy or time-consuming redemp-
50 visits: Mug Club BBQ set
tion process. Nope — your waiter brings you your prize. It’s like
a little gift you may not have even anticipated when you walked 50+ visits: Every 10th visit after 50, get $10 Club Cash
through the door. On numerous occasions — as our visit
totals climbed — we were surprised when our waiter 120 pints: Plaque in 1/2 Barrel Club
*Prizes subject to change
showed up with our prize or let us know that we had
earned a $10 Club Cash award — AWESOME! The $10
Club Cash can often be immediately deducted from your total bill
or saved for a future visit (these do expire). Things to know…You must be 21 to join the Mug
Club. You must register your card online providing at
“We even got a tour of the brewery, least your name and address or email. As always, be
sure to visit the website for full terms and conditions.
from the brewmaster himself, and an
education on the beer making process. PROGRAM PROS
Way to make us feel special.” •Program is FREE!
Beer fans have another club goal to strive toward. After 120 pints •Earn credit for visits.
they are made permanent honored members in the ½ barrel club •Special upsized mug for members.
where their name is added to the side of a half-barrel in their local •Cool prizes, zero hassle.
Rock Bottom. Seem silly? Depends how serious are you about your •Attainable program goals – initial prize awarded
micro-brew! Did I mention Mug Club pints are just a bit larger than
the standard size beer order? At some locations, you get to drink
(& instantly redeemed) after just 5 visits!
out of your own specialized mug. We haven’t taken advantage of
this feature — but I have seen the steins hanging above the bar at
a local RB. How cool is that! PROGRAM CONS
Additionally, when you register your Mug Club Card you get in- •You must have your Mug Club card with you.
vites to cool events like special beer tappings. We even got a tour •Only one visit and four pints can be counted per day.
of the brewery, from the brewmaster himself, and an education on
the beer making process. Way to make us feel special.
Verdict: THUMBS WAY UP! All you have to do is show up (bring your Mug Club card); Rock
Bottom does all the legwork. Oh, and I should mention the food, beer and atmosphere do keep us
coming back again and again. Try the ballpark pretzels, yum!
Each issue we’ll be sending our secret shopper out to experience a particular brand first hand. Our shopper will sign up for the loyalty
program, if one is available, and interact with the company at least three times, then share their experience with all of us. Your suggestions
for the next brand review are welcomed: email your suggestions to mailbag@loyaltymanagement.com
Brought to you by Loyalty 360 and ePrize, the Engagement Expo is a forum
to openly discuss today’s challenges and their solutions by bringing together
best-in-class speakers and partners. Join us for the inaugural Engagement
Expo, to connect with leaders from companies around the globe - seeking a
better understanding of engagement and loyalty.
The top three areas of focus for the Engagement Expo are:
•Insight into what engagement means and how to manage that across the
multi-cultural, multi-faceted employee and client constituencies.
•Social networking and how to leverage this in your marketing communication
strategies to create more engaged participants. Tools such as best practices,
processes and analytics will give you much more granular insight.
•Cross over of emerging (wireless, mobile) and traditional medium to make the
most of your engagement marketing strategies.
Mark Johnson
President & CEO
Engagement Expo
Lee Cockerell
Disney’s top trainer
& former EVP of Operations
for Walt Disney World Resorts
Learn from Lee Cockerell, the former Executive Vice President of Walt Disney World, how
to create DISNEY magic in your organization; which begins with world class employee
performance, leads to committed loyal customers, and finally to strong business results.
•four management & leadership competencies •how vision statements work & why they are
•four customer expectations vital
•four employee expectations •the most important behavior of a leader
•the customer experience cycle •what a leader’s real role is
•why the customer does not come first •the ten common sense strategies that enable
•why loyalty is not enough your organization to create magic too…just like
•why job & purpose must be clear to every Disney
employee
Don’t miss this opportunity to learn from Cockerell about creating magic in
your own organization and business. You’ll come away with valuable skills
in leadership, customer service and employee engagement.
How do you inspire Magic in others? Most defining moment in your career?
Treat everyone with respect, make them feel Getting fired from a job in 1973 that my wife
special, treat them as individuals and develop and Priscilla told me not to take. I told her, “I know
educate them so they can have a better life. what I am doing.” The hotel went bankrupt 90 days
after I got there. I now listen to Priscilla. The day I
What’s your personal motto? was fired she did not even say, “I told you so.” We
“Be careful what you say and do as they are have now been married 41 years because I learned
watching you and judging you.” to listen to the experts at home and at work.
What are the qualities you most admire in a Share with us your last customer “ah-ha”
person? experience.
Humility, trustworthiness, and passion for what A guest wrote to me to tell me that Disney World is
they are doing. the only place in the world her family can go on va-
cation because their son is paralyzed from the neck
down and must have all of his food pureed. She
Lee Cockerell takes a told me that no matter what restaurant they go to at
moment with his family to Disney that when they make this request, the chef
celebrate the new window
dedicated in his honor. comes out and discusses exactly their needs and
then takes care of it with no problem. She went on
PREVIOUS PAGE
Lee Cockerell poses with to tell me that other restaurants outside of Disney
Mickey Mouse after the do not appreciate such requests and make dining
unveiling of his “tribute”
window on Main Street out a real hassle. I have learned over the years
U.S.A.® in the Magic that everyone has a problem that you don’t know
Kingdom®. The window
reads: The Main Street about, which makes me kinder and helpful to all,
Diary: True Tails of Inspi- no matter what attitude they display. That is what
ration, Lee A. Cockerell,
Editor-in-Chief. we try to teach every single Disney Cast Member.
ured
feat kers
hear from thought leaders pea
at top companies like … s
Brad Keown
Midwest Director of Sales of Facebook
Consumers are talking about your brand, do you want to be part of the conversation? Brad
Keown will be discussing ways that brands can leverage consumers social graph and become part of
the conversation. 250MM people are on Facebook and understanding how to leverage the platform
will help small, medium, and large businesses develop relationships with your customers and increase
your sales.
corporate social
responsibility:
doing good engages
employees & customers-
& drives the bottom line.
Bottom line: People - customers and employees - want to be associated with companies that are
good corporate citizens. However, simply engaging in cause marketing is not enough to
drive results. Companies need to distinguish themselves by putting a meaningful
stake in the ground that resonates with their consumers and their employees. Only
by making this connection will they create and implement strategic, integrated CSR programs that
build an overall positive company reputation, increase engagement and loyalty of key stakeholders
(customers, employees, shareholders, and others), and ultimately, drive the bottom line.
HERE’S WHAT WE KNOW ABOUT CSR’S IMPACT ON ENGAGEMENT:
•Giving back and “doing good” is good for business and, therefore, should become an expected business strategy.
•Externally-facing CSR programs drive consumer behavior.
•Because internally-facing CSR programs allow employees to be better corporate citizens, these initiatives create
loyalty and engagement, which leads to increased retention, performance, and productivity.
Golianis will explain some of the key challenges companies face as they embark on the
CSR journey and present strategies for overcoming them.
engagement is a
science & an art
Ivan Frank
Chief Marketing Officer of ePrize
First, you have to know the four components of engagement and apply them. Each has a
discipline with rules, structure and analysis. But, working the science alone only gets
you so far.
The most important aspect of engagement is to apply gray matter and creativity as the final
ingredients. ePrize will show you how to marry the science and the art. Attendance at this
session may create inspiration and engagement. Join us at your own risk.
applying behavioral
economics
John Fleming, Ph.D
Principal & Chief Scientist — Customer Engagement
& Human Sigma for the Gallup Organization
The secret to driving higher levels of growth and profitability in today’s hyper-competitive
business environment hinges on leaders working with the human nature of their employees
and customers. Employees and customers must be viewed as people first, and employees and
customers second.
•Learn the basic
principles of an emerging
management discipline,
“By looking beyond the rational thoughts and feelings
behavioral economics of employees and customers, and going to the emotional,
•Hear case studies of business leaders can find the answer to why customers will
companies who applied
behavioral economics to
pay more to purchase a product from another company
their business model and and why employees will forego a large increase in salary
how they outperformed
their peers, in a one-year to stay at a job at which he excels.”
period.
Social Media represents a powerful vehicle for reaching customers, however, it faces some daunting customer
engagement challenges. The questions remain; how do marketers harness social media and what is social
media’s true role in customer engagement?
THE AUDIENCE WILL LEARN:
•The psycho-economic principles
that underlie customer indifference and a focus on the best trade-off
between price and convenience.
•The psycho-economic principlesthat get customers emotionally engaged in a manner that leads to
greater desire and demand for the outcomes the product or offering enables.
•How these principles can be used to increase customer engagement in social media initiatives.
•How to envision and implement a marketing automation system that can manage
large customer databases, yet
enable the individualization necessary for sustained, meaningful customer engagement.
contemporary engagement
measurement:
using engagement to measure
cross-media marketing
Robert Passikoff Jim Harris
Founder & President of Brand CEO of Office Media
Keys, Inc. Network
Consumer engagement with new and old media is evolving rapidly. “New” media technologies are becoming
more regarded and relied upon as media platforms - by marketers AND consumers. Measures currently
used to evaluate media touch points are not considering variables relevant to today’s consumer, and
therefore are not an accurate predictor of in-market behavior. While the value of media entities (and
combinations thereof) can be defined by their size of the audience or their demographics,
they cannot be uniquely differentiated unless we examine the levels of engagement they
engender. Brand Keys will present a real consumer-centric, engagement-based holistic measure for cross
media planning..
gamification:
driving engagement & revenue
with game mechanics
Rajat Paharia
Founder & Chief Product Officer of Bunchball
QUESTIONS
DON’T WAIT UNTIL SHOWTIME - ASK NOW! We want you to feel prepared so that your
show experience is the most valuable and enjoyable. Please do not wait until the show to ask
your questions. The more prepared we are to help address any show-time concerns, the better
we can provide the best show experience for you! Call us - we are happy to help 513.545.5612
or email info@loyalty30.org.
Loyalty 360 brings you the best of the best in loyalty marketing
and supports your customer strategy needs. Some of the tools we offer include:
The Engagement Expo will take a deeper look at the best practices of engagement and
experience management, focusing on brand, client and employee perspectives. We will
bring a strong list of speakers, sponsors, and exhibitors to address the various areas of
word-of-mouth, experiential marketing,
engagement such as
social media, interactive media & technologies, forums
& communities, as well as traditional media — and how to leverage these as
part of your marketing communication mix.
LOYALTY 360 ANNOUNCES TWO NEW SESSIONS FOR THE 2009 ENGAGEMENT EXPO
Lee Cockerell Jim Harris Robert Passikoff
former EVP, Disney Properties CEO, Office Media Network President, BrandKeys
KEYNOTE SPEAKER “Contemporary Engagement
“Creating Magic: 10 Common Measurement: Using Engagement
Sense Leadership Strategies to Measure Cross-Media
from a Life at Disney” Marketing”