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powered by Loyalty 360
Volume 3 Number 4
November 2011
Inside Scoop: CVS “Money Trasher”Campaign
New Frontiers in
Hotel Guest Loyalty
Driving Loyalty inthe B2B World
CustomerIntelligence
Issue-Securing C-Suite Buy-In
-Social Customer Satisfaction
-Maximize Actionable Insights
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Loyalty Management™ • LOYALTY360.ORG
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Loyalty Management™ • NOVEMBER 20
NOVEMBER 2011
DEPARTMENTS
LOYALTY FORUM
FEATURES
What’s on Loyalty360.org
Letter rom the Editor
Contributors
Your Voice
Behind the Brand
Shawn Bloom, Scene LP
360 Insights: The Challenge o Engagement:
The Paradox o the "Golden Rule" Mark Johnson, Loyalty 360
Q & A: Ask the Experts
We are looking to invest in a mobile strategy as partof our loyalty platform. Do I need both a mobile
website and a mobile app? How do I determinewhich is best?
6
8
10
12
14
16
18
20
24
28
30
WWW.LOYALTY360.ORVOLUME 3 NUMBER 4
This Month in
The LoyaltySocial Scene
pg20
pg30
Go behind the
scenes with
Shawn BloomBehind the Brand: Shawn Bloom
pg
14
The Loyalty Social Scene
Robert Passikoff, Ph. D. & Amy Shea, Brand Keys
The Four Fundamental Pillars o a Voice o theCustomer Program
Lee Orr, Cvent
The Bright SIde o Negative Engagement
Mike McDonnell, Afnion Loyalty Group
Jump-Start Your Customer Intelligence Initiative
by Securing C-Suite Buy-in
Connie Hill, VeraCentra
Secureyour
C-Suitebuy-in
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Loyalty Management™ • LOYALTY360.ORG
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Loyalty Management™ • NOVEMBER 20
NOVEMBER 2011
TECHNOLOGY,
TRENDS & REWARDS
BEST BUSINESS PRACTICES
Loyalty Innovation
New Frontiers in Guest Loyalty
Todd Hotaling, Lodging Hospitality Management
The Inside Scoop: The Westpac Group & Cyara
Solutions
Q&A with Sam Jackel, The Westpac Group &
Alok Kulkarni, Cyara Solutions
The Next Generation o Customer Feedback is
Social Customer Satisaction Intelligence
Ashish Gambhir, newBrandAnalytics
By the Numbers
Achieving CEM Goals Customer Experience
Competency Centers Drive ProcessesSid Banerjee, Clarabridge
The Inside Scoop: CVS: Don't Be a Money Trasher"
Campaign
Q&A with Melissa Studzinski, CVS/pharmacy
Don't Expect Loyalty Without Romance
Darin Rock, SolutionSet
Driving Loyalty in the B2B World
Karen Posey, Geehan Group
How Customer Intelligence Can Help Deliver a
Positive and Consistent Customer ExperienceQ&A with John Bastone & Wilson Raj, SAS
Loyalty Reads
Maximizing Actionable Insights through Multi-
Channel Listening
Chris Cottle, Allegiance, Inc.
Behind the Brand
Anita Emoff, Boost Rewards
Focusing on Key Customer Loyalty Metrics
Karl Sharicz, Simplex Grinnell
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38
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46
48
50
52
56
58
60
62
WWW.LOYALTY360.ORVOLUME 3 NUMBER 4
Loyalty Management
Editorial & Production Team
Erin Raese - Editor in Chief
Mark Johnson - Contributing Editor
Caitlin Schar - Editorial Director
Kathleen Ostoich - Graphic Designer
Crescent Printing Company - Print Production
Loyalty 360 Team
Mark Johnson - President & CEO
Erin Raese - COO
Caitlin Schar - VP Account Management
Amanda Chasteen - Manager, Marketing Operations
Kathleen Ostoich - Marketing Manager
Jillian Hensley - Corporate Marketing Manager
Lindsay Wagner - Sales Manager
Contacts
Article Submissions & Advertising: Erin Raese
[email protected] or 513.360.8680, ext. 210
To subscribe to Loyalty Management, visit loyalty360.org.
© 2011 Loyalty 360, Inc. and/or its Afliates. All Rights Reserved.
Reproduction and distribution of this publication in any form without prior written permission is
forbidden. The information contained herein has been obtained from sources believed to be reli-
able. Loyalty 360 disclaims all warranties as to the accuracy, completeness or adequacy of such
information. The opinions shared are those of the contributing authors and not necessarily reec-
tive of Loyalty 360 and/or its afliates. Loyalty 360 shall have no liability for errors, omissions
or inadequacies in the information contained herein or for interpretations thereof. The opinions
expressed herein are subject to change without notice.
This Month in
pg48
Don't ExpectLoyalty without
Romance
The Inside Scoop:CVS/pharmacy
(4
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LOYALTY 360 ON THE WEB
6 Loyalty Management™ • LOYALTY360.ORG
»Mobile LoyaltyPrograms. Not only do
cardless loyalty programslessen the clutter ofreward cards on your key
chains and in your wallets,but they’re better for the
environment as well.
»"Liking." Many merchants
will reward you withspecial coupons for a
“like” of their page. Othersreward all customers
with a discount codeonce they hit a certain
number of “likes” ontheir page. Others give
their customers pointseach time they “like” thebrand’s updates and then
let them cash those pointsin for free products.
»Fuel Rewards. Iaddition to your
frequent shoppesavings, gas savinare available. At
stores, your earnare reected on
receipt, at otheryou need to ask.
ask! Some peop
saving $.20+/gallof gas thanks to
grocery shoppinBONUS! Get G
Gifts…Many gronow sell gift card
a variety of retaiyou purchase gif
at the grocery stoften you can earewards on these
NOWtrending
MobileLoyalty
Programs
FuelRewards
"Liking"
Here' s a sna pshot o some o the fndin gs rom our weekl y poll series, T he Puls
83%report lo yalt y is
jeopardized when
a change in staff or
visit to a different
location results in
not being recognized
as a lo yal customer
42%are currentl y using
QR Codes. 24%
ha ve plans in the
works!77%
shared that with
incenti ve, the y w
some what likel y
around when a se
pro vider raises p
Nearl y 6% repor
are unlikel y to d
“Lo yal regardless
LOYALTY 360 THOUGHT LEADERS HIP SERIES WEBINARSLoyalty 360 has had a packed schedule offering a variety of topics and insights.
DID YOU MISS A WEBINAR? Loyalty 360 members have exclusive access to full playback.Check the Loyalty 360 archives and catch up on what you missed.
SAVE THE DATE! Check the winter schedule now and register for upcoming webniars atLoyalty360.org/webinars
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Loyalty Management™ • NOVEMBER 20
Loyalty Management Online!More articles, insights, best practicetips from your preferred tradepublication. Loyalty Management isnow available online at Loyalty360.org/
LoyaltyManagement.
Share and comment on your favoritearticles from this issue, and nd additionalweb-only exclusive content every month!
Turning Customer Data into Action: A New Whitepaper from TSYS & Loyalty 360
EXECUTIVE SUMMARY
Customer data is one of a company’s greatest, yet often underutilized, assets. Learning aboutyour customers and using that behavioral and transactional data to inform more relevantand meaningful customer interactions is the key to creating, building and maintaining strongcustomer relationships—and gaining a distinct competitive advantage.
New ndings from Turning Customer Data Into Action, a survey sponsored by TSYS andconducted by Loyalty 360 – The Loyalty Marketer’s Association, found while the vast majority of brands collectcustomer data they face myriad obstacles in using the data to drive strategic change. Marketers that are able toovercome these challenges, however, report that making the data actionable delivers bottom line results.
The full whitepaper is available now at tsys.com/GRSwhitepaper.
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TURNING CUSTOMER DATA INTO ACTION
Mark Johnson,President, CEO,Loyalty 360
Erin Raese,COO,Loyalty 360
2011TtalSystemServices,Inc.®llri htsreserve wrl wie.T talSystemServices,Inc.,an TSYS®arefeerallyre istere servicemarksf TtalSystemServices,Inc.,intheUnite States.TtalSystemServices,Inc.,an itsafliateswnanum erf servicemarksthatarereistere intheUnite Statesan inther cuntries.l l therr uctsan cmany namesaretraemarksf theirresectivec manies.(08/11)
NEWwhat's
on LOYALTY 360.OR
Some of the Featured Articles found exclusively on Loyalty Management online:
•Inside Scoop: AAdvantage - Destination LoyaltyLoyalty 360 Q&A with American Airlines Charlie Sultan
•Employee Motivation: Non-Monetary Rewards Work Bestby Tim Houlihan, BI Worldwide
•Business Blogging—A Company’s First Line of Defense for Engaging Consumersby Melissa Fernandez, Destination Interactive
•Five Critical Points for Social Media and Unied Communications in the Contact Centerby Bob Hockman, Empirix
•Customer Service, Engagement and Loyaltyby Peter La Porta
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Loyalty Management™ • LOYALTY360.ORG
FROM THE EDITOR
8
The Issue o Customer Intelligence.
Many thanks to all o you to joined us or the frst annual Engagement
Expo! With your support it was a huge success! A special thanks to all o our
speakers: the knowledge we gained rom your experiences will help us all as
we work to enhance our engagement eorts and strategies.
We ask our contributors to share what is topical and trending today. Our
open platorm allows us to share with you the most valuable and sought ater
inormation in the moment. Through no pre-planned agenda, this edition o
Loyalty Management developed to become our customer intelligence issue.
As a Voice o the Customer (VoC) organization we look to you or insights
to ensure that we share what's important to you. We talk about about how
cluttered the world is or our consumers; but as marketers we don't always
realize how cluttered our world is. We're all collecting an enormous amount
o data rom a ton o sources and touch points. How do we intelligently and
cost eectively use it to increase basket size, increase transactions and build
long-term loyal customers and advocates? This issue is sure to answer a gooddeal o your questions.
•Cvent shares our undamental pillars o a VoC program and insights
rom ProBuild Holdings; a group who has successully instituted the
undamentals.
•Lodging Hospitality Management shares their story o how they've
integrated personal service based on CI through their 12 properties.
•On page 48, learn how CVS is tying social media strategies into its loyalty
program to urther engage and build stronger relationships with its best
customers.•Want to try some o these strategies yoursel? Connie Hill rom Vera
Centra provides tips or educating and engendering support or your CI
eorts with your upper management.
Also, don’t orget to mark your calendars…Coming soon, Loyalty Expo
2012! March 18 - 20 at the Rosen Shingle Creek, Orlando, FL. For more
inormation and to view the agenda visit www.loyatlyexpo.com. See you
there!
Enjoy the issue!
Sincerely,
Erin Raese
Editor-in-Chie
Loyalty Management
Welcome newLoyalty 360Members:
Altair
Microsot
TCS
MotivAction
DestinationInteractive
TruAxis
BI Worldwide
TIBCOSaepio
Siegel + Gale
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Loyalty Management™ • NOVEMBER 20
loyalty is a journey.
we're here to guideyou along the way.
Find tools, tips, and connect with your peers to fnd the answers to your loyalty questions at loyalty 36
Looking to build your organization's engagement and loyalty strategies?Loyalty 360 makes it easy to nd a partner with the capabilities to help you reach your goals.
Want to be a part o the largest engagement and loyalty supplier directory?For only $2500/year, sign up to be listed with your own customizable member page.
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Loyalty Management™ • LOYALTY360.ORG
Mark Johnson
Lee Orr
Mike McDonnell
Todd Hotaling
Robert Passikoff, Ph. D.
CONTRIBUTORS
Sid BanerjeeAs CEO and Co-Founder of Clarabridge, Sid
provides executive leadership and strate-
gic direction and is a well-known expert in
customer experience, business intelligence,
and text mining.
Chris CottleChris Cottle is an entrepreneur and 16-year
B2B and B2C marketing vet. He leads the
marketing and product management teams
at Allegiance, a B2B software company
specializing in Voice of Customer Intelli-
gence solutions. Allegiance is an Inc. 500
company.
Ashish GambhirAshish Gambhir is the Executive Vice
President of newBrandAnalytics, the lead-
ing provider of social business intelligence
solutions. newBrandAnalytics uses social
media feedback to provide companies with
an unparalleled level of insightful business
intelligence.
Connie HillMs. Connie Hill, President and Founder of
VeraCentra, brings more than twenty ve
years’ experience delivering strategy and
execution services to the marketing com-
munity, and is passionate about helping
marketers manage the complexities of data
driven, customer relevant programs and
campaigns.
Todd Hotaling Todd Hotaling is Corporate Director of Rev-
enue at Lodging Hospitality Management.
He began his career with Lodging Hospital-
ity Management in 2008 after moving to St.
Louis from Kansas City where he worked
in Advertising and Public Relations for
Harrah's Casino and Hotel.
Mark JohnsonMark is the President & CEO of Loyalty 3
He has signicant experience in selling
signing and administering prepaid, loya
CRM programs, as well as data-driven m
keting communication programs.
Mike McDonnellAs Vice President of Product Managem
& Client Solutions at Afnion Loyalty Gr
Mike works to continuously nd ways
grow the company. Mike focuses on o
mizing the way ALG delivers merchand
to their clients, establishing a greater fo
on product development and acting a
consultant to understand loyalty needs
Lee OrrLee Orr spearheads the strategic direct
of Cvent’s Enterprise Feedback Man
ment solution and is responsible for n
business development, customer succ
and professional services. Under his le
ership, Cvent has helped hundreds of o
nizations run effective customer feedb
programs.
Robert Passiko, Ph. D.Robert Passikoff, Brand Key’s found
president, is a sought-after speaker
thought leader on engagement and loy
He has pioneered work in these areas,
ating the Customer Loyalty Engagemen
dex and the Sports Fan Loyalty Index. N
York University’s communication sch
declared Dr. Passikoff “the most-quo
brand consultant in the United States.”
Karen PoseyKaren Posey is a Senior Consultant at
Geehan Group with an extensive b
ground in executive engagement and fa
tation, sales leadership, strategy, coach
and the best practices that drive BEST (
ter Engaged Selling Time).
Chris Cottle
Ashish Gambhir
Connie Hill
Sid Banerjee
10
Karen Posey
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Loyalty Management™ • NOVEMBER 20
We create memorabl
customer experiencethat people will talk about through o
full suite of customer loyalty offering
Concierge and Customer Loyalty Programs, Customer Ca
Experiential Programs, Travel Assistance and Medical Assis
To learn more about us, visit:
www.VIPdesk.comOr call 1.800.631.3341
NOW SHOWING
CONCIERGE & LOYALTY
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GLOBAL SERVICE D
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Amy SheaDarin Rock
Karl Sharicz
Darin RockDarin brings over 25 years of experience
and a heightened understanding of con-
sumer empathy. Darin’s insight inspires
development of innovative marketing com-
munications programs tuned to the needs
of today’s consumer.
Karl ShariczKarl Sharicz is Manager, Customer Intel-
ligence at SimplexGrinnell, a Tyco Interna-
tional Company. SimplexGrinnell is a leader
in re and life-safety systems and services,
with one million customers and 150 local
ofces throughout the country.
If you would like to contribute to a future issue of Loyalty Management please contact Erin Raese at (513) 360.8680, ext. 210 or email at [email protected].
Amy SheaAmy Shea, EVP Global Director of B
Keys’ Brand Development, has wo
with brands for over 20 years, transla
research-based insights into effective
munications. Her work has been recogn
with the David Ogilvy Excellence Awar
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LOYALTY FORUM: YOUR VOICE
12 Loyalty Management™ • LOYALTY360.ORG
As a consumer, how do you feel about reward
with expiration dates? Does an expired
reward affect your continued loyalty?
don't dislike as much the expiry dates as the e-mailing/
newsletters sent by the program trying to sell you everything, but
they never mention that you have an amount of miles or points
that are going to expire soon. I would expect if they are sending me
newsletters every month, that at least they show some interest in
his customer and make a real effort in giving you a proper warning
that the points, miles or whatever are going to expire soon.
Werner Haeberle
manage RelianceOne, the loyalty program at Reliance Retail, one of the
biggest retailers in India. We recently dropped down the 'Points get Expire
two years' and changed it to 'Evergreen Points'. This has been taken very
with the customer and the Reward Points accumulation has increased by
in the very rst month. Previously, the customer felt cheated when their p
expired without their notice since we didn’t intimate them. Now they can
their shopping and redeem points as they like.Richa Tewari
I
II
T
THE CONSUMER POINT OF VIEW
can speak for consumers in Canada, and I can say in
certainty that we dislike programs with expiry rules. Not
very long ago, a new law forbade the sale of gift cards
with expiry dates. The same should apply to loyalty
programs. How loyal would customers stay, when they
nd out the rewards they collected for a program have
expired?Seta Elbekian
ypically the reward points are accumulated in bits and spent in bulk. So, accumulation takes time and by the time the customer is ready
for the spend he/she realize that the accumulated points have vanished due to expiration clause and thus poofs the dream. I have stopped
shopping with a few retail stores who have short (1 year or less) expiration dates on points.
Sanvir Singh Jham
It denitely does aect loyalt
(obviously); I understand the
draw to enacting expiration
dates on rewards, but adds
inconvenience.Chris Tarantino
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I
Loyalty Management™ • NOVEMBER 20
Loyalty 360 Pulse
77%o respondents polled confrmed
that YES! their continued loyalty
is aected when rewards expire.
MARKETERS' RESPONSE
When companies lose sight
o what is best or their client
customer then they are on thslippery slope to losing clientBill Hayward
here are lots of case studies demonstrating expiring points also
expires the consumer loyalty.
The best way to manage the points liability is sophisticated
actuarial management using your consumers behavioral database--
when a card is dormant for a period of time calculate the probability of
it being reactivated...obviously the longer it is inactive the higher theprobability it will never reactivate. You need to start by calculating this
probability/time relationship. As you gain experience look at other key
predictive variables like: balance, distance to store, owners vs renters,
RFM, age...
You can conservatively and scientically adjust the reserve for the
points in the pool of 'dead/dormant' accounts without expiring points.
This way you never disappoint your loyal customers and the
business lowers its program costs and reserve pools to what it
actually needs to for redemptions.
David Moxley
T
As with any loyalty initiative the points liability needs to
be carefully managed to ensure that the managing compan
does not run into trouble. Whilst 'points expiry' can have
very negative impact, especially for members who are sav
towards a specic goal, 'account expiry' should denitely b
implemented and points wiped off after a certain period (e
1 year of no activity) which will help ensure the liability is n
being inated by 'dead' members.
Tim Wilcox
would say, customers don't hate the expiry but hate not being notied about the same. It pinches, when they kept collecting them and th
points vanish all of a sudden.
I appreciate that some companies are offering lifetime validity of their loyalty points; however, I feel it sometimes becomes a very costly
proposition to do so. I suggest companies should have a point’s expiry policy while keeping few things in mind.
•Keep your customer informed; ne prints shouldn't be too ne
•Send notications well in advance when the expiry date is nearing.
•Expiry period should be carefully chosen.
Why I thing expiry policy is important is because:
•Loyalty points are like cash, which the company owes to its customers. Now, if the redemption rate is low then unlimited point collectio
policy might lead to a big liability on the company in future.
•Unnecessary balance maintenance cost for dormant cards
Mamta R.
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Loyalty Management™ • LOYALTY360.ORG
14
LOYALTY FORUM: BEHIND THE BRAND
As a consumer, what inspires loyalty or you?In a word, relevancy. It is great to see when businesses
get this right. That they are using the information they collect
through their loyalty programs or nancial service products to
develop offers, products and services that are relevant to my
needs and served up through a channel I prefer. Businesses
that understand my interests, and can translate this into rel-
evant offers will win my loyalty each and every time.
In today’s marketplace, what is your avorite com-
munications channel or reaching loyal customers?Facebook has been a phenomenal tool for businesses to
create a dialogue with their customers. We currently have
over 200,000 fans between our English and French Facebook
pages and its really proven to be a very vibrant community of
entertainment lovers. We did some research a while back to
understand the make-up of our Facebook members and found
that they are some of most loyal and active customers. So the
ability to get instant feedback on changes we are making to
the program, on new offers or partnerships has proven to be
invaluable. In addition, these customers are some of our big -
gest advocates so having them tell their friends that they ‘like’
SCENE and posting testimonials online about a positive expe-
rience with the Program they may have had is more authentic
than any advertisement we could ever do.
What do you personally appreciate most about
Scene rewards program?From a consumer standpoint it has to be how easy it is to
get rewarded. Every tenth movie I see is free and I get 10%
off of concessions on every visit! Plus, with the ability to earn
more points at the concession stand, at Cineplex’s online
store and with a Scotiabank Visa and Debit card the rewards
add up really quickly.
From a loyalty marketer’s perspective it is the ability to
get rich customer data and insights that we can use to make
better business decisions and develop deeper relationships
with our customers.
Shawn BloomGeneral Manager, SCENE LP
Loyalty Management™ • LOYALTY360.ORG
Shawn Bloom has over 13 years o loyalty management experience
in Financial Service, Retail and Entertainment. In his current at
role as General Manager o SCENE LP, Shawn is responsible or
program development and the overall perormance o SCENE,
the entertainment loyalty program rom Cineplex Entertainment
and Scotiabank. Since its launch in 2007, SCENE has become
Canada’s leading entertainment loyalty program, providing movieand entertainment rewards and benefts to over three million
Canadians.
Businesses that understand my interests, and
can translate this into relevant oers will win my
loyalty each and every time.
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Loyalty Management™ • NOVEMBER 20
How are today’s emerging trends impacting
Scene and their plans or the uture?For us a priority right now is in enhancing our ability to
reach and engage our membership through their mobile de-
vice as we see this as such an important communication plat-
form going forward.
For example, mobile has given SCENE the opportunity to
overcome one of barriers to joining any loyalty program which
is the necessity to add another card to ones wallet. Through
our mobile app we are now offering our members the ability
to store their card right on their mobile device. Mobile also
gives us the opportunity to enroll members into the program
wherever they are. We recently launched mobile enrolments
and it has already proven to be extremely popular. Next for
us in this space is to leverage mobile to further engage our
members by pushing them relevant and timely informationand offers.
Words o advice or a novice loyalty marketer?Your goal as a loyalty marketer should be to inuence
positive changes in customer behavior. So start with the cus-
tomer. Leverage whatever tools are at your disposal to de -
velop the capabilities to understand your customers better
and closely measure your ability to lift, shift and retain. Do
this well and your well on your way to a long career in loyalty
marketing.
Loyalty Management™ • NOVEMBER 20
We also asked Shawn
some quick fre questions
about some o his movieavorites…
Favorite movie theater snack: Peanut M&M's.
Favorite movie: The Shawshank Redemption
Favorite actor? Will Ferrell (For his outlandish
characters including…Chazz Michael Micheals,
Ron Burgundy and Ricky Bobby).
Best quotable movie line? “Why so serious?”
(Heath Ledger as The Joker, The Dark Knight)
Hypothetically, what flm character would you
most like to be? James Bond. For the gadgets.
Favorite movie type? Action, Suspense,
Drama, Comedy…
Love a good laugh so have to go with comedy.
Start with the customer.
Leverage whatever tools are
at your disposal to develop
the capabilities to understand
your customers better and
closely measure your ability
to lit, shit and retain.
L
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16
LOYALTY FORUM: 360 INSIGHTS
Loyalty Management™ • LOYALTY360.ORG
t the recent inaugural Engagement Expo, the refrain
from marketers (although more inquisitive and loquacious) re-mained the same: brand engagement and loyalty in this eco -
nomic environment continues to be a challenge.
They’re striving to determine: How do we most effectively man -
age in this era of brand malaise? How do we make our com-
munications programs and marketing messages work most
effectively?
In the midst of a challenging economic environment, we as con-
sumers want the brands (much like our family and friends) with
which we “engage” to show us a modicum of responsiveness
and respect. Yet, most brands just do not “get it.” Their lack of
mutuality continues to confuse us. Engagement is and should
always be simple and rational, yet marketers make it so com-
plex—confounding the most astute marketing and intellectionminds.
When one thinks of engagement, the “Golden Rule” should
come to mind. Do unto others as you would have done to you.
Marketing purists realize the tremendous opportunities that
exist when a brand, merchant or bank engages in best practices
around true engagement and loyalty. To partake in and execute
a voice of the customer response tool creates great interactivity
and reciprocity, and drives signicant behavioral and nancial
results. So why do marketers forlorn the opportunity?
The Challenge o
Engagement: The Paradoxo the “Golden Rule”
"Beyond Loyalty: Meeting the
Challenge of Customer Engagement,”
a report from the Economist
Intelligence Unit, illustrates the
bottom-line impact of decreased levels
of customer engagement. Among the
survey’s key ndings:
•Nearly 90% of all respondents stated
that customer relationships are either
very or extremely important to thesuccess of their business.
•In addition, they believe more
customer engagement would translate
into: Improved customer loyalty
(80%); Increased revenue (76%);
Increased prots (75%)
A
by Mark Johnson, Loyalty 360
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Recently, for example, Bain researchers stated that while 90
percent of brands feel they are engaged with consumer, only
a mere nine percent of consumers feel that way. This clear dis-
sonance between what a brand hears and what their customers
are “saying” is a huge dichotomy.
Adding to this conundrum, in a re-
cent study conducted by Economist
Intelligence Unit, 86 percent of the
survey respondent’s (comprised of
311 executives) believed insufcient
engagement from their organization
costs between 25 to 75 percent of
sales. Yet 43 percent of these same
respondents stated that engage-
ment strategies can get side tracked
because of other priorities. Being a
small business owner myself, to for-
sake 25-75 percent of my sales due
to a lack of customer engagement would be a formula for fail -
ure. To put this into perspective: Focusing on other priorities
aside from loyalty and engagement is akin to the chain smoker
who has emphysema partaking in one more cigarette. Or, the
diabetic who continues to the defy the doctor’s warning for a
more healthy diet and lifestyle as they sit on the couch watch -
ing their favorite football team while eating a bag of chips and
imbibing the next six diet Cokes. It’s just not rational.
The recent global IBM study of mid-market CMOs revealed that
building and sustaining brand loyalty is the top concern for to-
day's mid-market CMOs, yet 72 percent do not feel sufciently
prepared to effectively build this loyalty. Today's CMOs need to
be prepared to deal with an empowered consumer who is im -
pacting brands instantly on Twitter, Facebook and other social
channels. 61 percent of mid-market CMOs are struggling with
how to manage the impact that social media will have on their
marketing function, reveals the IBM study.
So what should marketers do when the “Golden Rule is broken?”
Acknowledge the mistake, admit you (the brand) were in er-
ror, apologize and rectify. The simplicity of this process should
Bain researchers stated
that while 90 percento brands eel they are
engaged with consumer,
only a mere nine percent o
consumers eel that way.
It’s like the frst grade student that raises his hand 20 times,
never to be called on. Like the student, that brand participant will
eventually quit raising his hand. The only dierence, however, is
the participant is ree and willing to leave (and they will).
not be understated, as it will create more brand engagement an
loyalty than doing nothing. Yet in an environment that allows fo
greater interaction with brands, one has to wonder why brand
don’t take the opportunity to listen to, engage with and respon
to their most loyal fans. Why would they not embrace a chance t
make these bonds stronger?
We now read that customer satisfa
tion is not equal to customer loyalt
More than 60 percent of defectin
customers indicated they are sati
ed right before they leave (Busines
Week) and 40 percent of satise
customers switch suppliers withou
hesitation (Forum Corp). How can th
be true in the age of increased data i
sight, comprehensive brand analytic
and media that allows for real time i
teractivity, response and communic
tion? Simple: these metrics are short term. Data doesn’t alway
equal actionable insight, and brands don’t effectively take adva
tage of all media.
Most brands forsake the numerous interactions (both past anpresent) and the customer considerations (both positive an
negative) that have had an impact on the user. It’s like the rs
grade student that raises his hand 20 times, never to be called o
Like the student, that brand participant will eventually quit raisin
his hand. The only difference, however, is the participant is fre
and willing to leave (and they will), while the rst grader is boun
to stay for the remainder of the term!
Brands continue to disregard engagement and voice of th
customer driven strategies for short term couponing and pric
matching in the hopes that one additional sale will create tha
brand advocate for which they and their competitors are vyin
For every 100 Reed Hastings there is only one Steve Jobs; for e
ery 100 Yahoos there is only one Amazon; and for every 100 we
sites focused on temporal gains there are few mystarbucks.com
But remember…you, too, can be an Amazon or a mystarbuck
com. The opportunity of fullling a brand promise remains for a
Loyalty Management™ • NOVEMBER 20
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Loyalty Management™ • LOYALTY360.ORG
Ask the ExpertsQ
&A
Q:
18
LOYALTY FORUM: Q&A
We are looking to invest in a mobile strategy as part of our
loyalty platform. Do I need both a mobile website and a
mobile app? How do I determine which is best?
The short answer is: it depends. The
best place to start is with your over-
all business objectives. Dene what members
are looking for from your program, and what
you want to enable them to do, then look at
how you can make that experience more con-
venient or more engaging on a mobile device.
If you’re looking to acquire new members
through mobile, to initiate and build a new re-
lationship, a mobile website is a great destina-
tion. If you plan to do mobile advertising, or to
create mobile versions of your emails, you want
to have a mobile-optimized website where youcan drive members and prospects. If someone
starts an action on mobile, you want to make
sure they can complete it on mobile. But build-
ing a mobile website doesn’t mean you have
to duplicate your entire website for mobile de-
vices. Look at the top actions and transactions
your members are doing from mobile on your
website today, and start by building or optimiz-
ing those rst.
If you’re looking to strengthen a relation-
ship with your membership base, and can
offer them content or functionality that they
will want to access on a regular basis, a mo-
bile app can deliver the best experience. It
can offer a much richer and more interactive
experience, and can overcome barriers that a
plastic card and a website are not able to. You
want to make sure that there is a reason for
members to come back to your app again (and
again). The stickiest actions are functional—a
card-on-phone, a location-based search—or
entertaining—a new way for members to en-gage and have fun with your brand.
Chances are good that your members want
to engage with you on mobile. They may even
expect it. How you enable them to do that is
up to you. L
A:
—Lindsay NortonSenior Marketing Manager,
Member Engagement, SCENE
Look at the top
actions and
transactions your
members are
doing rom mobil
on your website
today, and startby building or
optimizing those
frst.
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Loyalty Management™ • NOVEMBER 20
When determining any mobile
marketing strategy it is impor-
tant to not only measure your Return On
Investment but also your Return On En-
gagement. How will you provide a mem-
orable, user-friendly mobile experience
that rewards the customer for frequently
engaging with you? How will your mobile
campaign assimilate into your target audi-
ence’s world and become equally impact-
ful in the lives of their friends and family?
Let’s examine both strategies keep-
ing in mind that neither solution alone is
perfect to reach all of your customers and
the answer comes from carefully listening
to your customers. A recent IBM Global
CMO strategy, stated seventy percent
of the marketers surveyed said they feel
incapable of analyzing and responding to
the glut of data available about their con-
sumers. An alarming statistic, but an im-
portant insight to take note of. How can
you build out any marketing strategy with-
out understanding the needs and wants ofyour customers? Your data holds the key
for creatively experimenting with inter-
active mediums based on the insights it
provides.
A mobile website will certainly al-
low consumers to shop on-the-go, ac-
cess product reviews, etc. but an app can
heighten the user experience for loyal
customers. An app is an excellent way to
reach loyal customers who want to inter-
act with you on a regular basis and a fuller
experience than just a mobile website. For
instance, the app can allow consumer to
earn points by checking in, sharing anexperience on social networks such as
Facebook, Twitter, foursquare and Google,
identify local stores, neighborhood events,
and local dining areas, pick up products
in-store, have them delivered anywhere
and deliver rich media content to highlight
seasonal trends, promo-
tions, downloadable
rewards catalog, add
A:
—Melissa FernandezSr. Advisor, Destination Interactive
A:Each Company really needs to evaluate and assess
mobile solutions and platforms that are best for
them it and most importantly, ones that t their customers’
needs. Ensuring that you launch the right product and plat-
form for your customers’, which also meet your goals as a
company, these really are the keys to success with any mo-
bile strategy, no matter if you decide to go with a mobile app,
a mobile website—or both.
At Best Western, we chose both. We launched a brand
app and a brand mobile site, as well as a mobile site for
our rewards program, as research has shown that morecustomers are prone to go to a company’s mobile site rst
and transact there. We rst launched our brand mobile site
to ensure that we were one of the rst in market, the we
launched our brand app, “Best Western To Go” followed by
our Best Western Rewards® mobile site.
Ensuring that we were one of the rst to have a mobile
version of our brand website provided our customers with
hotel availability no matter where they were and, no matter
which device they were using. We also have an app because
it helps us build brand awareness and engagement. It also
offers our customers an enhanced experience on our mobile
app, keeping our brand top of mind.
—Tammy LucasBest Western
L
an item into their shopping cart by shak
ing their phone, etc. The retailer could
take the idea one step further and add a
gaming component rewarding consum
ers with points through scavenger hunts
Some marketer’s worry that a customer’s
interaction with an app may take a tumble
after the customer’s rst experience with
the app or even after a month, so how will
you re-engage customers and nd new
ways to heighten their senses? The an
swer lies in push notications. Push no
tications are sent out to your users with
a short message providing relevant mes
sages and key reminders of why your app
peaked their interest in the rst place. The
best part about push notications is that
the user controls how often they are no
tied and which notications they would
like to receive.
Loyal customers will provide you with
valuable and actionable insights you need
to develop marketing strategies that in
crease ROI and ROE. Your loyal customers are your brand advocates and expect
to you to provide a rich experience that
moves beyond a basic mobile website
The search should not be for the silver bul
let in mobile marketing which will leave
you with overspent budgets and frustrat
ing returns. The search should be how do
you deliver intrinsic value that begs your
customers to ask for more. L
Ensuring that you launch the
right product and platorm
or your customers’, which
also meet your goals as a
company, these really are
the keys to success withany mobile strategy, no
matter i you decide to go
with a mobile app, a mobile
website—or both.
An app is anexcellent wayto reach loyalcustomers whowant to interact withyou on a regularbasis and a ullerexperience than justa mobile website.
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20
FEATURES
t’s no surprise that loyalty marketers have taken digital
and made it part and parcel of loyalty offerings. Or tried to.Why not? Social media marketing and the various connect-
ing tools and social platforms can be extraordinarily useful in
creating connections between brands and customers.
But for real loyalty to be created, outreach must be more
than just connection and more than just “communication” or
“outreach,”—and far more than a new form of “coupon,” or
“freebie,” or, excuse me, “value add.”
However, let’s be clear about the distinction that must
be made: engagement with social media and consumer-gen-
erated content forums should not ever be mistaken for en-
gagement with the brand or loyalty-building. And, yes, that
goes for when engagement with those platforms resulted in
the delivery of an entertaining brand message, that in turn
received a quippy consumer comment, gave out a coupon, or
provided the chance for that consumer to add their name to a
list of 432,621 other “close friends” of the brand.
One can easily see the attraction—and potential—of us-
ing social media when it comes to loyalty efforts. But these
tools should never be mistaken for the brand mission. Like
any great conversation, it can be a part of growing a rela-
tionship, but it's the relationship itself that matters. Which
is where understanding brand loyalty and loyalty to a Social
Network comes into play.
Social Media “usage,” or “visitation,” or “friendings” have
The Loyalty Social Sceneby Robert Passiko, Ph.D. & Amy Shea, Brand Keys, Inc.
become the 21st century version of last century’s “awareness”
paradigm. We know the argument: no, it’s not just aware-
ness; it’s engagement, because consumers are not passive,
but actually doing something on the social network. But let’s
be real: that “something” is just clicking a button that means,
okay, I will give you enough attention to let you talk to me.
Until I don’t; until you disappoint me by asking me to be your
friend but not giving me one good reason why I would want to
be. The “edit friends” feature is just another content lter, but
likely more decisive than the TV remote.
This may be a good time to remind you, dear reader, that
simply offering coupons are not the answer. They are readily
available on the internet, and you don’t have to get annoyed
by a brand’s FB status updates in the process. Just saying.
It’s not enough to be known. In fact, most of the brands
playing in the social media space today are already known
to this generations’ grandparents. You have to be known for
something meaningful to hold hands with consumers on that
coveted loyalty road. And it’s that critical truth that so often
gets overlooked as brands create a new colored siren and big -
ger balloons to attract consumer attention. It’s what is at the
destination that matters, not simply the social media stunt
that gets you there.
A brand can create a kind of perfect storm when it comes
to loyalty, where the power of brand and platform meet—
where the brand understands and is delivering on what’s
I
Loyalty Management™ • LOYALTY360.ORG
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driving engagement in its category, and is shaping social me -
dia tactics to deliver against what’s driving engagement on
the social media platforms themselves. When a brand has
that, it’s delivering brand meaning in a meaningful way.
According to the 2011 Brand Keys Customer Loyalty En-
gagement Index (46,000 consumers, Male/Female, 18-65
years of age, drawn from the 9 US census regions, self-se-
lecting for participation in the social media space) loyalty to
Social Networking Sites can be described via four critical cat-egory drivers:
1. User Self-Image,
2. Ease of Connection,
3. Security and Control, and
4. Brand Value & Content Connection
Twentieth century-mode was to talk about “time spent”
gures or sputter about “number of visits” or “number of
friends,” or “the number of e-coupons collected over a 24-
hour time period.” But take a moment, and looking through
the lens of these consumer-generated drivers (we did noth-
ing to create or rank them—consumers did that), does the
site you are using, or thinking of using, deliver against these
expectations? Or might you just be collecting names, enter-
taining the masses, or, even worse, actually degrading the
brand’s value-for-dollar proposition?
Loyalty rankings aren’t based on awareness levels, but on
the ability for the social network platform to meet expecta-
tions consumers hold for the Ideal in the category—that is,
delivering against those drivers listed above. Here’s how the
six Social Networking Sites included in our Brand Keys Cus-
tomer Loyalty Engagement Index ranked when we conducted
the survey in January of 2011. For those of you shackled to
awareness, it should be pointed out that Friendster had high-
er awareness levels (according to the number of unaided cus-
tomer mentions) than Flickr at the time of the survey:
1. Facebook
2. MySpace
3. LinkedIn
4. Flickr
5. Twitter
6. Friendster
But as we are talking about “loyalty” here and not “aware-
ness” it should be pointed out that seven months later, in Au -
gust 2011, in our Brand Keys Loyalty Leaders List, Friendster
ranked #522 of 528 brands when it came to loyalty.
So much for correlating awareness and loyalty. Friendster
ended up erasing all the remaining photos, blogs, and tes-
timonials on their platform and reinvented itself as a music
and games site. All that’s left are the original basic proles
and friend lists, i.e., an outdated list of people you currently
‘friend’ on Facebook. To add real insult to virtual injury, they’llbe using Facebook Connect. How do you think those actions
and interactions affect loyalty? How fast do you think it took
disloyalty to set in?
Social media marketing for brand and loyalty building,
once the refuge for very small or very young or very quirky
brands, has become a commonplace element in the ever-
growing toolbox of more established brands. And those
established brands should have long-ago learned that the
platform is a delivery system. It’s a relevant message, cus-
tomized to that platform, which will deliver the best results.
Transferred to the social media space, that still makes sense.
There’s a reason brands don’t take their print ads and stick
them up on television, but use the power of the media to max-
imize their messages. The same holds true for social media.
That means not stopping at expecting loyalty using plat-
forms and programs alone. It means trying to create real
engagement with the brand—and understanding how those
platforms themselves drive loyalty.
Brand Keys denes loyalty and engagement as the result
of efforts—social and otherwise—that cause the consumer
to “see” the brand as better meeting or exceeding her or his
expectations for the category Ideal. This consequence-based
denition is one we stick to, as most brands get very touchy
about making entertaining advertising that makes viewers
laugh but does nothing to ring the register. But all tools tradi-
tional, digital, and those still coming down the road should be
able to provide some measure of Loyalty Return-On-Invest-
ment, otherwise why do them at all?
Okay, it’s true that for some brands looking to leverage
loyalty, playing in the social media arena is just a matter of
not wanting to be lagging behind what seems to be really
cool, high-tech marketing, although that classication is fad-
ing quickly in this rapidly changing digital age. Or they just
don’t want to be left behind competitors. That never changes.
Or for some brands, having only recently discovered that the
newest member of the Brand Group is their CFO, it all seems
a more cost-effective very-trackable expenditure, certainly
more so than traditional marketing platforms, and seemingly
provides some easier form of ROI.
But for most brands, largely it’s the fact that social media
has grown at a pace and has become a driving force as to how
brands of all sizes and types—new, small, medium, and large,
B2B, B2C, for bricks, clicks and clicks-and-mortar brands—
are trying to create and build more emotional, loyalty links
between themselves and consumers. For brands it turns outthat social media has become not only a useful augment to
traditional tactics, but for many it’s become an indispensable,
21st century brand management tool. Happily, a surrogate
form of ROI can be observed on the basis of advocacy levels
attained, the numbers of new, informed insights gleaned, and
actual cost reductions achieved.
Guaranteeing some degree of branding success has al-
ways been reliant upon a brand establishing an emotional
bond between itself and the customer. That need has only in-
creased. So, done correctly, social media marketing can pro-
duce a greater emotional bond between the consumer and
continued on next page
Engagement with social
media and consumer-
generated content forums
should not ever be mistaken
for engagement with the
brand or loyalty-building.
Loyalty Management™ • NOVEMBER 20
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22
the brand. Done correctly, customers and prospects, able to
interact with brands in more active and personal and emo-
tional ways, can lead to connections that create higher lev-
els of brand engagement, and higher levels of brand loyalty,
which actually does correlate with sales and protability.
So, from an advocacy perspective, brands have found
social media an incredibly useful way to socially interact
with—and, at the same time, monitor—their most-loyal cus-
tomers and create a word-of-mouth forum for loyalists whocan advocate on the part of the brand, and exert a powerful
inuence on others in the brand engagement process – also
leading to insights.
Done appropriately, brand involvement in social media
can also signicantly change the traditional brand-marketing
paradigm. That used to be reach and frequency-based to cre-
ate a some level of awareness, to develop some degree of
consumer interest, in the hope that the marketing program
generated a reasonable level of desire, and, ultimately, acti-
vated the consumer I.e., got them to go out and buy the brand.
Social media loyalty programs have now become—or
should become—exercises to delight the consumer and cre-
ate higher levels of involvement with the brand. It can engen -
der some social interaction by means of communications,and create activities that are sufciently resonant and rel-
evant and of real utility to the consumer. Enough so that so-
cial conversations via electronic round tables, where opinions
can actually be shared, might be regarded as a more emo-
tional experience by consumers than, say, having a coupon
emailed to them because they visited a social network site
and/or clicked a link.
More and more social media brand conversations have
to do with far more involving expressions of what consum-
ers really expect. Comments regarding recommendations for
brand improvements, discussions of category specics, and
L
true consumer confessions to which brands might not other-
wise be privy can be of real value in craf ting loyalty. Collected
and culled, these insights can be used to inform a brand’s
loyalty positioning, strategic options, and tactical market ac-
tivities. And, because it was the consumer who was actively
involved with all this, marketers also likely to see increased
levels of brand engagement. And brand loyalty.
Finally, brands can look to certain social media activities
to help reduce costs. Social media networks like Facebookand other online communities can act as surrogate support
services. Just take a look at how many actual social media
interactions and conversations have to do with getting help,
answering problems, seeking ratings and recommendations,
or just learning how to do something for/with/about the
brand. It shouldn’t be too hard to understand that such social
media self-diagnostics and user-generated contributions can
help to alleviate some of the stress on service cost centers.
Oh, and loyal customers actually enjoy participating in the
interaction. They’re six times more likely to do so than the
average consumer.
And the traditional, word-of-mouth, aka a friend’s rec-
ommendation or a conversation with a “friend,” is still alive
and well and making a high percent-contribution to loyalty,engagement and protability—only these days it’s also being
conducted via “tweets” and on smarter-and-smarter smart-
phones via text messages. And that’s only going to increase.
The poet Ralph Waldo Emerson noted, “Conversation is
an art in which man has all mankind for competitors.” Brands
already acknowledge that a larger consumer discussion is be-
ing conducted, a good deal of it over via Social Networking
Sites. Brands that want more loyal customers will be listening
for, measuring properly, and capitalizing upon those chang-
es—if they want to successfully be part of that social scene.
The Loyalty Social Scene (continued)
Social media loyalty programshave now become—or should become—exercises to
delight the consumer andcreate higher levels of
involvement with the brand.
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ANALYTICS
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Loyalty Management™ • LOYALTY360.ORG
FEATURES
rganizations have been collecting feedback rom
customers orever. However, over the last several years, the
need or a deep understanding o customer needs has increased
tremendously. With the popularity o the internet and the ease
o publishing thoughts, opinions, ideas and reviews, customers
have been given a new voice. I an organization doesn’t pro-
actively collect eedback rom customers, chances are, they’ll
never hear rom an unhappy customer until it’s too late.
Voice o the Customer (VOC) is a complete, well-defned
customer eedback program that encompasses the entire cus-
tomer liecycle. The overarching purpose o a VOC program is
to gain deep customer knowledge and use it to grow the busi-
ness, regardless o whether your specifc program goals are
to increase customer renewals, grow market share, arm your
sales team with an understanding o customer requirements,
or something else entirely. The knowledge obtained rom a
VOC program is oten a springboard or innovation.
Successul VOC programs are not a single customer sur-
vey, but an ongoing investment to collect actionable eedback.
The Four Fundamental
Pillars o a Voice o theCustomer Programby Lee Orr, Cvent
When done correctly, large organizations see revenue return
in the hundreds o millions. Regardless o the size o the org
nization, there are our undamental pillars in the custome
eedback loop:
•Listen. Listen broadly to what customers are saying the
need or want, but also keep your ears open or their ru
trations. There should be clear mechanisms or capturin
eedback on specifc interactions and overall perceptions
whether they be good or bad.
•Interpret. Understand what customer eedback means o
the organization. Are customers commenting on the symtom o a bigger issue? What are the key takeaways?
•React. Take action based on what you’ve learned. Establis
a process to ensure customer insights are being used whe
making business decisions.
•Monitor. Ater making changes, don’t orget to monito
the results by continuing to gather customer eedback an
mapping changes to business results.
O
24 Loyalty Management™ • LOYALTY360.ORG
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Loyalty Management™ • NOVEMBER 20
Within each o these pillars, there are common roadblocks an
organization can ace. Let’s dive into these challenges and how
you can eectively overcome them.
Listening HurdlesEectively gathering eedback rom customers is the ounda-
tion o an eective VOC program. Similar to constructing a build-
ing, it’s critical to pour the oundation correctly, otherwise you’ll
develop cracks as the program matures. There are several prob-
lems that occur in this part o the eedback loop; below are two o
the most common:
A Lack o Goals: Establishing clear goals is critical in obtaining
buy-in rom senior executives and setting program expecta-
tions. Without goals, you risk ending up with the wrong in-
ormation, fnding inaccurate insights, and not being able to
prove program value and ROI.
A Narrow Scope: Think broadly about how customers interact
with your organization. All too oten companies only collect
eedback ater interactions, such as service calls. In actuality,
you should collect it beore a customer signs on, throughout
the entire liecycle, and i a customer decides to stop using
your product or service.
Interpretation Hang-upsThe best VOC programs incorporate data rom one project
with internal data sources. But, otentimes, organizations will
eel paralyzed with the sheer volume o inormation, so they sim-
ply zero in on the collected eedback rom the project at-hand and
neglect the additional insights. However, companies should look
at this extra data as a valuable resource.
You already have a lot o customer inormation rom internal
sources, such as your CRM system: when they frst purchased,
the last time they called support, general demographics about
who they are, etc. It’s common to orget about this data and sim-
ply ocus on what the customers said but, when combined with
customer eedback, it gives additional context. For exampl
someone who has been a customer or years is dieren
than one starting implementation. A 360-degree custome
eedback program can only be achieved by bringing in thes
other sources o customer data.
Once you’ve combined the various eedback ows, th
best way to avoid paralysis is to lay out a plan that answer
specifc questions, such as: What are the key perormanc
indicators (KPIs) your C-suite wants to see? Is it Net Pro
moter Score, Customer Satisaction Index, or one o the oth
er many loyalty and satisaction metrics?
You’re moving towards being able to share and act upo
your fndings. KPIs are easy or the organization to rall
around with analysis supporting the reasons behind thos
scores.
Reacting FailuresThis is the most important VOC pillar. Unortunatel
many organizations come to a standstill when interpretin
eedback. You can do all o the research and analysis you
want, but i it’s not acted upon, the impact will be small. Thi
happens or a number o reasons, the most common bein
that fndings and insights aren’t shared throughout the o
ganization.
Findings won’t be internalized by simply distributin
a single 60-page report. Various groups within the organ
zation need to see dierent inormation—or example, th
CEO’s requirements may dier rom a project manager’
The best approach is to consider the specifc needs o eac
audience separately and then tailor the presentations a
cordingly. When done eectively, every employee will b
more customer-ocused in their day-to-day activities.
Finding the best way to share customer eedback is
journey that evolves over time. Read more about how on
company tackled this eat below.
Establishing clear goals is critical in obtaining
buy-in rom senior executives and setting
program expectations. Without goals, you risk
nding inaccurate insights, and not
being able to prove program
value and ROI.
continued on next page
Loyalty Management™ • NOVEMBER 20
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34 Loyalty Management™ • LOYALTY360.ORG
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Bringing a VOC Program In-HouseProBuild views its VOC program as a continuous
customer eedback loop, with no real beginning or
end. The company starts with defning what it wants
to know, then identifes the best method to collect
that inormation. Ater that, it implements the ap-
propriate research methodologies, analyzes the eed-
back and shares the fndings internally. Then, thecontinuous customer eedback loop starts over, with
ProBuild asking: knowing what we know now, what
do we want to know next?
For ProBuild, the quantitative values that codiy
customer satisaction are just the beginning. The
company also strives to determine the “why” behind
the customers’ ratings. For example, in a satisaction
survey, anytime a customer is dissatisfed, the com-
pany asks how it can improve. This way, ProBuild
can implement the appropriate changes, rather than
making changes based on guesswork.
Communicating the Findings
ProBuild rarely just distributes an internal reporto its fndings. Instead, the company presents the
fndings through one-on-one meetings, small group
presentations, or video conerencing applications.
ProBuild has ound that this osters more in-depth
discussions on the “why” behind the report’s data
How ProBuild Holdings Manages its VOC ProgramProBuild Holdings Inc., supplier o proessional building ma-
terials, brought its market research in-house one and a hal years
ago. Prior to that, the organization was limited in its research
capabilities and typically engaged one-o projects conducted in
conjunction with third party research vendors to obtain primary
and secondary data.
With separately commissioned studies rom disparate groupsand decentralized ownership, the company ound that it had a
series o project-based studies that each had a discrete hard stop.
This made it difcult to efciently address ollow-up questions,
understand what data already existed, and integrate data rom
separate projects into one cohesive understanding o their cus-
tomers. ProBuild quickly realized there would be great beneft to
having the resources in house to conduct ongoing longitudinal
studies, rather than continuing to contract out a series o proj-
ects.
“Research is an integral part to building a strategic market-
ing organization and is the backbone o enabling a culture o us-
ing data to understand our customer’s needs,” said Lisa Peterson,
vice president o Marketing and Communications or ProBuild.
“Given the strategic signifcance, it is a unction that we eel isimportant to own and manage internally, versus outsourcing.
While third party research vendors are still utilized as supple-
mental resources, we eel that being intimately involved in the
data collection and analysis gives us the opportunity to ‘slice and
dice’ the data in ways that can be meaningul to our operators.”
The Four Fundamental Pillars of a Voice of the Customer Program (continued)
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value o the research comes not just rom the report per se, but
rather in the discussions that ollow.
The End ResultBy bringing its market research in-house, ProBuild now spends
more time listening to customer eedback and truly understand-
ing their needs, and less time educating third-party research
vendors on industry vocabulary and nuances. The marketing department is now better able to combine inormation rom one
customer research project and relate it to insights rom other
projects. The result? A holistic view o the customer base, and a
clearer understanding o the voice o ProBuild’s customer.
Monitoring BreakdownsSimply taking action doesn’t mean you’re done; customer eed-
back is a continuous journey. I you’ve avoided the other pillars’
major pitalls, your organization will continue to want more in-
sights and the loop will continue. Companies love newly-gained
customer knowledge and use it when making business decisions,
but what impact do those decisions have on the organization? It’s
important to monitor successes, as well as ailures, to inorm u-
ture decisions.
Untracked Results: Monitoring results involves both a cus-
tomer and business perspective when selecting metrics.
Common key perormance indicators include the customer
satisaction index, Net Promoter Score, customer lietime
value and customer churn rate. You don’t need to
track every KPI, but it’s important to be able to tie
insights to decisions to business results. Without
it, it’s difcult to maintain internal buy-in.
Stagnant Goals: It can be overwhelming to start
a VOC program i you try to tackle everything
at once. Instead, break it up into smaller, more
manageable phases so you can prove ROI. As yourprogram matures, reevaluate the goals you set in
the beginning. Are you still listening to the right
things, conducting the right analysis and taking
the right actions? Without reexamining the goals
throughout the program’s evolution, the potential
may be stunted, and the organization will miss
growth opportunities.
There are a lot o pieces that come together to
make up a successul customer eedback program,
and getting started can be intimidating. However,
when you come up against pushback, point out the
many benefts: improved process efciency, in-
creased customer lietime value, and the ability to
identiy new market opportunities. In today’s hyper-
competitive economy, the most successul organiza-
tions are that the ones living and breathing customer
eedback, constantly asking themselves, “with what
we know now, what do we do next?” L
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Loyalty Management™ • LOYALTY360.ORG
FEATURES
28
iven the technological evolution of social media, dis-
cussions about customer engagement are ubiquitous. From
retail to travel to banking and industries in between, compa-
nies understand the need to engage customers in a positive
manner.
Sometimes, though, even the best companies fall short of
customers’ expectations. Dissatised customers are unhap-
py, even angry with a company, but they are engaged
nonetheless. And the 2010 Cus-
tomer Experience Report by
Harris Interactive revealed
that 82 percent of consum-
ers have stopped doing
business with a com-
pany as a result of
a negative ex-
perience.
Instead of dreading these negative engagements, com-
panies can learn to recognize the opportunity inherent in en-
gaging a disappointed customer. A company that correctly
handles a negative engagement can convert a dissatised cus-
tomer who never wants to do business with them again into a
positively engaged customer—one who genuinely desires to
interact.
Give customers a platform to be heardThe Customer Experience Report shows that 58 percent of
respondents would like the company to respond if they left a
comment on a social networking site like Facebook or Twitter.However, only 22 percent of those who left a comment on a
social networking site actually received a response. Your cus-
tomers are having conversations, whether you are listening or
not. With social media, you can hear those conversations and
participate.
During a recent Loyalty 360 webinar entitled “The Bright
Side of Negative Engagement,” 58 percent of respondents
noted that they have a strategy in place for
listening to customers.
These companies
understand the importance of listening and the
impact that it can have to your bottom line. After
all, the Customer Experience Report notes that
85 percent of consumers would be willing to pay
more—up to 25 percent more—to ensure a supe-
rior customer experience.
The Bright Side o
Negative EngagementRecognition and Personalization Rated
the Most Useful Strategy for Astonishing
Customersby Mike McDonnell, Afnion Loyalty Group
G
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Loyalty Management™ • NOVEMBER 20
Recognize and evaluate their feedbackOften, recognizing a complaint goes a long way to diffusing,
or even reversing, the negative situation. However, evaluate
the feedback rst. Not all complaints are created equal. Look
at the motives behind the feedback and respond accordingly.
Be accountable, remove obstacles, andastonish them
Social media and engagement expert Clay Hebert coined
a great saying, “Carpe Defect. Seize the defect, clean it up,
make it better and create life-long fans.” Through a nationwide
advertisement, Domino’s Pizza turned a customer-submitted
photo of a poorly delivered pizza into a rallying point for im -
proved customer service. They even took it one step further
by broadcasting customer ratings of their food on the Times
Square JumboTron.
A company that correctly
handles a negative
engagement can convert a
dissatisfed customer who
never wants to do business
with them again into apositively engaged customer.
When it comes to astonishment, 32 percent of webinar respon
dents are in development with their strategy and an equal number
noted that it’s “on their radar screen” to develop one. Nearly 60
percent felt that the most useful strategy for astonishing custom
ers employed recognition and personalization. Domino’s certainly
employed recognition and personalization when they had their
pizza makers “sign” their pizzas and then displayed customer
comments on the JumboTron. Talk about astonishment.
Build trustIn his book Enchantment, Guy Kawasaki devotes an entire
chapter to achieving trustworthiness. He urges, “If you want peo
ple to trust you, you have to trust them. Consider what you have to
look forward to: When people trust each other, they stop playing
games, they look beyond temporary problems, and they expose
themselves with less hesitation… Get this right: The rst step is
to trust others—as Zappos trusted its customers not to abuse the
ability to return shoes with free shipping.”
Make them look goodAnd, nally, establish that emotional connection with custom
ers. Understand who they are, what they are interested in and
what their goals are. Whether it’s looking smart, cool, funny or
philanthropic, know what appeals to your customer and help her
achieve it.
The payoff? If you focus on engaging customers in a way that
resonates with them on a personal level, you can convert them
into loyal, long-term fans of your brand. Fans often are less sensi
tive to price, more understanding of service issues, provide mean
ingful input for product development and become genuine word
of-mouth advocates for your brand. L
www.veracentraFollow us on Twitter @verac
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30
FEATURES
arketers are feeling the pressure to ramp up their contributions to the top and
bottom line. They can do so by taking ad-
vantage o the customer intelligence needed
to execute on a customer-ocused strategy.
Savvy marketers know that by implementing
a customer-intelligence solution they can ag-
gregate and leverage data collected through-
out the organization to improve proftability.
Yet many marketers struggle to get a solution
implemented within their company because
they ail to get buy-in at the executive level.
To successully take a customer-intelli-
gence initiative rom vision to reality, market-
ers need to connect with executives on issuesthat are top o mind. By applying the guidance
shared here, marketers can articulate their
business case in language that resonates with
the executive team – and gain support or the
technology needed to produce customer intel-
ligence.
Winning Over the Corner OceMore and more CEOs are defning their vi-
sions to establish a customer-centric culture.
Jump-Start
Your Customer
Intelligence
Initiative
by Securing
C-SuiteBuy-in
However, until CEOs get on board with a so-lution that helps their organizations tap into
their customer data, this customer-centric
vision will remain out o reach. While many
CEOs have supported investments in CRM
and other customer-related systems, they’re
likely unaware o the missed opportunities
to ully take advantage o the data exploding
across their organizations.
A Customer Intelligence Platorm isKey to Harnessing Customer Data
Convincing the CEO to invest in a custom-
er intelligence solution hinges on explaining
how this helps marketers maximize customerproftability while improving the customer
experience. Uniting multiple data sources
rom multiple applications throughout the
organization leads to more eective analysis,
deeper customer insights, and the develop-
ment o a successul customer strategy. Op-
timizing the use o customer data to create
relevant customer messaging improves the
customer experience, creates true loyalty, and
increases proftability per customer over time.
What is Customer
Intelligence?
According to
Forrester Research,
customer intelligence
is the management
and analysis o
customer data romall sources, used
to drive marketing
perormance and
business strategy.
by Connie Hill, VeraCentra
M
Loyalty Management™ • LOYALTY360.ORG
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continued on next page
How Customer
Intelligence Aligns
with the CEO
Perspective
According to
Forrester Research
Vice President and
Practice Leader o
Customer Intelligence
Suresh Vittal and
researcher Emily
Murphy, customer
intelligencesupercharges loyalty,
making it possible to
design and sustain
loyalty programs
that stand out
due to advanced
segmentation and
highly relevant
targeting thatdelivers an enriched
customer experience.
Tip: Understand yourorganization’s businessstrategy and yourCEO’s agenda—and
align your purchase ocustomer intelligencewith the top initiatives.
Clariy the OptionsMarketers must also lay out solution
choices: leveraging internal business intelli-
gence tools, developing an in-house solution,
or opting or an outsourced solution. Though
developing an in-house solution can appear to
be the most cost-eective option, the trade-
o is time. Because marketing initiatives are
requently waitlisted while other projects getpriority, in-house customer-intelligence solu-
tions can take up to 24 months to develop and
implement, even i companies are leveraging
an existing business intelligence tool.
With customer centricity as the new com-
petitive advantage, time is o the essence.
Ambitious organizations opt or outsourced
solutions that leverage cloud or on-demand
platorms specifcally designed to support
customer marketing, rom a provider with
combined marketing and technical know-how
and analytic expertise.
Customer Focus Starts with the CEOSavvy CEOs should be ully behind any
investment that provides a oundation or a
customer-centric strategy and empowers the
organization to manage and track all related
initiatives to overarching corporate goals.
Such an investment will help transorm the
organization into one that realizes long-term
fnancial benefts.
Speaking the CFO’s LanguageTo gain the support o the CFO, market-
ers should explain the pressing need to gain
better customer insight and how that insight
will translate into increased profts. Withthis keen understanding o the customer base,
marketers can segment based on customer be-
havior, liecycle stages and the overall proft
potential o each customer. By explaining how
they can use customer intelligence to increase
share o wallet, convert occasional buyers into
high-value customers, increase the requen-
cy and value o transactions, or increase the
proft o customers over a longer period i time,
marketers gain the CFO’s attention.
On-Demand Customer IntelligenceDelivers Rapid ROI
The CFO will appreciate marketing’s new-
ound ability to measure customer value and
improve the ROI o marketing spend on exist-
ing customer programs. In act, the CFO can
be a valuable ally when evaluating solutions.
CFOs value a ast return on investment,
and long, drawn-out internal implementa-
tions o up to 24 months can hurt the bottom
line. By hiring an outside provider that under-
stands data, business intelligence and market-
ing, an organization can have an on-demand
solution up and running in 90 days or a ast
return.
Plus, an on-demand solution is a low-risk
investment. Because the company won’t incur
expenses or inrastructure, the initial and
ongoing outlay is in line with the CFO’s push
to drive down costs.
To achieve even greater CFO buy-in, mar-
keters can collaborate with their CFOs to es-tablish metrics around incremental customer
value based on customer retention, growth in
the number o repeat customers, longer cus-
tomer tenure, and higher profts.
Tip: Share quantiablemetrics with yourCFO – both showingwhat the solution
provider’s customershave achieved andwhat your organizationcan expect to realize interms o ROI.
Real-world Returns rom On-Demand
Customer IntelligenceOne company improved the top line by
working with an outside customer intelligence
provider, VeraCentra. COIT Services, started
in 1950, is one o the largest specialty cleaning
and restoration companies in the world.
Concerned about the growing costs to
acquire new customers, COIT used the on-
demand customer-intelligence solution rom
VeraCentra to analyze its customer buying
patterns and trends. It ound that new cus-
tomers were less likely to place a second ser-
vice order, but those that did place a second
order within a certain time rame tended to-
ward long-term loyalty. COIT then created a
Loyalty Management™ • NOVEMBER 20
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Jump-Start Your Customer Intelligence Initiative (continued)
32
strategy to improve the customer’s frst-time
experience and secure that valuable second
purchase. The results? An increase o 34% in
repeat purchases, leading to a 25% lit in in-
cremental revenue per customer and perorm-
ing 66% over the established ROI goal.
Making the CIO Your Champion
To secure the CIO’s buy-in or an on-de-mand customer-intelligence solution, ocus
on three points:
•Leveraging IT’s expertise in evaluat-
ing a solution
•Ensuring the organization’s data is se-
cure
•Expressing appreciation or the com-
peting priorities the IT group is con-
stantly balancing
Leverage IT’s ExpertiseBecause CIOs must ensure non-stop oper-
ations and scalability, the solution being con-
sidered must be a good ft with the company’stechnology approach and strategy. Engage a
member o the technology team early on to
explore this issue. By doing so—and demon-
strating respect or IT’s perspective—market-
ers can ultimately gain a champion or their
initiative.
Fear o Losing ControlSome CIOs resist an outsourced solu-
tion, earing the worst when data leaves the
corporate frewall. Yet, corporate data leaves
the company every day, via emails, portal
exchanges, axes, and phone calls. Moreover,
with companies increasingly relying on theInternet to conduct business and compete
in a global marketplace, they ace a growing
number o security threats. The reality is that
sensitive company data is at risk within the
corporate network, whether due to hacking
attempts or unintentional oversights or mis-
takes by employees.
THINKstrategies has ound that SaaS and
cloud computing vendors, and the solutions
they oer, can actually help organizations
better protect their private data because they
are ocused entirely on storing and process-
ing mission-critical corporate data in a secure
ashion.Again, by asking IT about their concerns
and including them in the solution evalua-
tion process, marketers can address and allay
these concerns.
Ofoad the IT GroupOtentimes, marketers are a burden on
technology groups due to constant requests
or customer lists, data queries and reports.
Today’s on-demand customer-intelligence
solutions are designed or business users,
alleviating the IT group o the need to run
time-consuming and bothersome queries
and reports.
At the same time, these solutions place
minimal demands on IT. Help the CIO un-
derstand that, while IT’s involvement may
be needed or initial integration, the time
commitment can be measured in days, not
the months or years needed or sotware in-
stallation or in-house development. In act,
IT can connect the company’s data sources
to cloud-based customer-intelligence solu-
tions using application programming in-
teraces and other connectors that enable
quick linkage.
Moreover, a cloud-based solution scales
to support a company’s growing needs
without the need or additional capital in-
vestments. In other words, it will handle
growing data volumes while obviating IT o
the need to deploy additional hardware.
Tip: Share thesolution provider’sindependentcertication with yourIT team to show ithas achieved SAS70certication andmeets the minimumrequirements or aSarbanes-Oxley Actaudit.
Put Forth a Compelling Business
CaseAt the heart o successul customer-
centric strategies is customer-intelligence
solutions that unite – and help marketers
tap into – the silos o rich customer dataound throughout their organizations. Em-
powered in this way, organizations can
create a viable customer-ocused strategy
backed by well-defned market segmenta-
tions, compelling messages and oers, and
measurable improvement in incremental
customer proft. Tap into these best practic-
es or building a business case to secure C-
suite support or deploying an on-demand
customer-intelligence solution. L
Loyalty Management™ • LOYALTY360.ORG
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One Size Doesn’t Fit All: Inspire People with Meaningful Rewards
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our rewards specialists have already strategically selected rewards that are meaningful and motivating to y
audience – resulting in inspired employees, customers and partners that can help you achieve your business go
For more information about our reward options, email [email protected] or call 1-877-4MARITZ.
©2011 MasterCard.
MasterCard and the MasterCard Brand Mark are trademarks of MasterCard International Incorporated.
ADVANCING LOYALTY ADVANCING CO
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GoRebate MobileGoRebate mobile apps, launched by the leader in rebates, provides consumers and
businesses a valuable shopping tool
Parago (www.parago.com), a leading provider of innovative re-
ward programs that drive behavior and promote brand loyalty with
consumers launched GoRebate Mobile™, the rst mobile shopping
applications for iPhone and Android focused on rebates that allow
marketers to deliver rebates directly into the hands of value-seeking
consumers.
GoRebate Mobile, which launched in the iTunes App Store and
Android Market is free to download, utilizes an intuitive and user-friendly design and allows users to:
•Be presented with available rebates based on their current location
•Browse for rebates in their area either by retailer or product category
•Access rebate terms and conditions
•Share specic rebate promotions with others via text, email, Facebook or Twitter, or tag
them for a reminder at a later date
•Track submitted rebates to see where they are in the redemption process
•Track the card balance of their rebates paid out on prepaid cards issued by Parago
•Set alerts for rebates by proximity and frequency
LoyaltyInnovationPRODUCTS,
ADVANCEMENTS,
& TECHNOLOGIES
TECHNOLOGY, TRENDS & REWARDS
34 Loyalty Management™ • LOYALTY360.OR G
GoRebate Mobile was designed to be
practical tool for value-seeking consume
that are likely to use rebates, and deliver hig
value content to people seeking savings. T
progressive technology behind GoRebate
lows it to seamlessly integrate into consume
existing shopping routines and enables brow
ing for or notication of rebates in their area
The app’s innovative sensitivity featur
are intelligent enough to know when to query Parago’s server not only based on ne
location, but also on rate of movement. F
example, rather than continually notifying
user that is driving down the highway of ne
rebates, it can send notications of nearby
bates when the user has slowed or come to
stop.
GoRebate Mobile aims to solve a genui
problem in the marketplace: until now retaile
had to actively do something to market reba
promotions to the public or they had to ho
that consumers would notice them in th
stores. GoRebate offers a whole new aven
for businesses to make consumers aware rebates and to drive store trafc and sales l
For more information about GoReba
download the application for free in the iTun
App Store or Android Market or visit http
www.gorebate.com.
Until now retailers had to actively do something to
market rebate promotions to the public or they had to
hope that consumers would notice them in their stores.
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ActivePathTechnology partnership creates new op-
portunities or building loyalty, benet-
ting retail merchants, card issuers and
consumers alike.
A new technology partnership an-
nounced by Cardlytics and ActivePath
presents an innovative opportunity for
loyalty marketers. The program builds
customer loyalty and drives adoption of
eStatements for banks and card issuers,
attracts new customers and builds repeat
customer trafc for retail merchants, while
generating tangible rewards for consumers.
Joining forces has combined unique
capabilities from Cardlytics’ Transaction-
driven Marketing™ solution and Active-
Path’s interactive ActiveMail™ system,
enabling custom incentive offers to beembedded into secure interactive eState-
ments. Banking customers receive, view
and transact the offers directly directly
within the email message at their conve-
nience, without the need to log on to online
or mobile banking or download the state-
ment.
Customers viewing their eStatements
nd incentives clearly marked at each rel-
evant transaction. Clicking to view the re-
ward automatically activates it to the debit,
credit or prepaid card associated with the
loyalty program. The next time the cus-
tomer uses their card to make a purchase
that meets the offer’s conditions, the of-
fer is automatically transacted without the
customer having to enter promotion codes,
clip or print coupons.
When the customer makes a purchase
with the designated card, their savings are
automatically shown in their account. At
the end of the following month, the savings
are credited directly into their account. It’s
all done through their bank’s reward pro-
gram and managed through the safe, se-
cure environment of their bank.
Loyalty Management™ • NOVEMBER 20
One of the “11 Big Ideas for 2011” in
American Banker’s January cover story
of the same name, was ‘building loyalty
through merchant rewards’ citing Cardlyt
ics and its adopters, First National Bank of
Omaha and Regions Bank. The article not
ed that simplicity prompted First Nationa
to implement their loyalty program, presenting bank customers with offers from a
wide range of businesses.
The Cardlytics program has already at
tracted a wide range of participating mer
chants, including national, regional and
local apparel retailers, discount retailers
restaurants and individual brands such
as The Body Shop. Now with the addition
of eStatement rewards delivered and acti
vated within email, ActivePath and Cardlyt
ics have streamlined the loyalty marketing
process for customers, retail merchants
and banks alike.
Read more about the potential applications and best practices, including a case
study and supporting data, in the unabridged
article, “Technology partnership creates new
opportunities or building loyalty, beneftting
retail merchants, card issuers and consum
ers alike” on Loyalty Management online at
Loyalty360.org.
AnametrixInstaVista™ Business Analytics (BA) lls the gap between home-grown spreadsheets and costly Business Intelligence (BI) or better
corporate decision making.Marketers need a more effective way to understand how promotional campaigns specically reach and impact
prospects and clients from a holistic perspective. With so much data from so many divergent sources, the ability to
measure and compare performance within the marketing mix can become overwhelming. To justify programs and
allocate budgets, ROI can only be determined by knowing how marketing efforts across multiple initiatives translate
into generating new business opportunities and extending relationships with current customers.
Anametrix InstaVista enables marketers to see vast amounts of online and ofine source information funneled to
one simple interface. Real-time, customizable cloud-based dashboards offer powerful interactive visualizations of:
•Web Analytics
•Point of Sale (POS)
•Social Media
•Search Engine Marketing (SEM)
•Video & Audio
InstaVista frees resources required to pull, clean, and understand information across an organization. Created specically to help
companies make faster, better decisions, InstaVista combines disparate data feeds and offers predictive alerting of trends, opportunities,
and even problems before they arise, not after a campaign ends. Executives can focus on determining which activities are performing or
not performing and immediately adjust programs to positively impact the bottom line.
Smarter than spreadsheets but yet much less complicated than traditional business intelligence technology, InstaVista also features
seamless Microsoft Excel bi-directional synchronization, an industry rst. This exclusive function enables organizations to align day-to
day employee activities with enterprise systems to drive quality decision-making across multiple applications without burdening IT staff
Individual end users across all departments quickly and cost-effectively move beyond Excel to visually navigate combined complex data
points and uncover unseen relationships within their own business units.
For companies with brick-based storefronts as well as click-based digital presence, Marketers can clearly determine correlations and
amortizations across an entire user base by tracking all on/ofine activity associated with cross-channel advertising initiatives. Data
segmentation by product line or locale accelerates speed to market, builds customer loyalty, and maximizes market share by weeding
out inefciencies.
•E-mail Campaigns
•Market Research Surveys
•Customer Relationship Management (CRM)
•Loyalty Programs
•...nearly any source data
Customers viewing
their eStatements
nd incentives clearly
marked at each
relevant transaction.
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36
verything old is new again.” Peter Allen penned those lyrics about fash-
ion and fads, but it’s an apt description of the latest guest loyalty advances in
the hospitality industry. Positive word of mouth among friends, family, and
colleagues has always been hoteliers’ most coveted and effective form of
marketing because it drives repeat business. The difference now is that those
recommendations take place online. Social media channels such as Facebook
fan pages and TripAdvisor have become the electronic back fences over which
people exchange travel tips on what to see and where to stay.
The good news is that today hoteliers can be part of that conversation to de-velop stronger, more guest loyal relationships. An active social media strategy
combined with a comprehensive property management system (PMS) allows
us to directly engage both repeat and potential guests. The web-connection-
ready Maestro PMS technology we use, makes it possible to earn a reputation
for superior customer service the old-fashioned way—by getting to know our
guests so that we can fulll their needs and provide their preferred amenities
and services. And when guests feel properly pampered, they come back.
Online Conversation Leads to ‘Book Now’Adding social media and a exible internet-savvy PMS to the formula al-
lows hospitality marketers to engage modern travelers and be a part of their
decision making process. Software applications enable hoteliers to monitor
keywords throughout various social media channels. The Lodging Hospitality
Management (LHM) team continually monitors social media sites to assist
guests who are traveling to the St. Louis area. We operate 13 properties un -
der major ags and two independent boutique hotels, so we can offer a vari-
ety of options. LHM uses the Maestro PMS at our two luxury boutiques, The
Cheshire and The Seven Gables Inn to place a ‘book-now’ reservation button
on the propertys’ Facebook pages so visitors can join our conversations and
book a room without leaving their social media page.
Here is an example of how we use social media. Someone may post a query
on a travel site stating, “Visiting St. Louis for the rst time. Can anyone recom-
mend a hotel?” This gives us a chance to educate potential guests about our
properties and offer a solution to their travel needs. They might ask, “Which
hotel is near my meeting? Where can we stay near the zoo?” By assisting po-
tentials guests, we often convert online conversations into clicks on the ‘book
now’ button.
New Frontiers in Hotel
Guest Loyalty:Technology Enhances Time-Honored Formula
for Success and Personal Service at Lodging
Hospitality Managementby Todd Hotaling, Lodging Hospitality Management
PMS Empowers Front Desk with GuesReady Wish List
When you feed social media intelligence into
web-connected front ofce system like Maestro PM
you empower your front desk staff to fulll a traveler
wish list when they arrive. You can begin to learn from
online conversations a guest’s preferences and antic
pate other sales opportunities such as room upgrade
food and beverage recommendations, and futur
bookings, and this recognition creates loyalty.
Once a prospect becomes a LHM guest, our Ma
stro PMS from NORTHWIND adds to what we learne
online by compiling information such as historical sta
patterns, arrival times, and special requests. If w
were late on delivering a guest’s extra towel reques
during their last stay, our PMS will remind us and w
avoid these issues on subsequent visits. LHM also r
lies on its PMS to help its team devise and track cr
ative loyalty programs for our agged hotels and i
dependent boutique properties. These programs ar
particularly important to independent hotels becaus
they do not have the name recognition and marketin
muscle of a major ag.
There’s No Such Thing as a ‘Bad’ OnlineReview
Most hotels make an effort to survey guests abou
their stay via comment cards. Social networking cha
nels extend our reach and keeps LHM in post-sta
conversations.
We nd that guests tend to post two types of o
line reviews—glowingly positive or strongly negativ
We appreciate a thumbs-up review, of course, bu
we also focus on turning complaints into opportun
ties that cultivate loyalty. We do this by immediate
TECHNOLOGY, TRENDS & REWARDS
E
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addressing negative reviews with personal messages from upper
management and issue a public online response. This strengthens
our personal relationship with guests and our online reputation.
Online reviews are also an invaluable source of good sugges-
tions for increasing business. Comments such as “I wish theyopened the pool earlier” or “I would have stayed at property X, but
they have no airport shuttle” also helps LHM hone its amenities
and services.
Nothing Sells Management Like SuccessIncorporating social media as a marketing component is a
major shift in how hoteliers do business—probably the most sig-
nicant change since we began using third party channels to sell
our inventory. Social media involvement is a learning process that
takes time to do well. But, building social media into the staff’s
daily tasks builds a corporate culture of service.
The secret to selling a new approach to staff is presenting posi-
tive outcomes. Efcient online processes to review selected social
media sites combined with a web-connection PMS streamline ourguest service and loyalty efforts and help keep labor costs low.
Top management at LHM quickly saw the value of a good on-
line reputation when they viewed positive guest comments
that result from monitoring and responding to our proper-
ties’ reviews.
Social Networking + PMS = The New NormalLHM rolled out multiple training programs across
all departments to engage its teams in seeing the
value of listening to what our guests are saying
about us online and how to use this information
during the guest’s stay. We now have a month-
ly scorecard that evaluates team members’
social networking efforts and gauges howour properties rank throughout the web.
Management has gotten onboard
with this technological sea change for
the same reason that other advances
have become standard practice—it
created guest loyalty that produc-
es more business. L
Building social
media into the staff’s
daily tasks builds acorporate culture of
service.
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38
he Westpac Group and Cyara recently spoke at
SpeechTEK in New York on the topic o creating and man-
aging customer-centric, speech-enabled, interactive voice
response applications. This interview was a ollow up to their
joint presentation.
What current marketplace challenges broughtCyara & The Westpac Group to work together?Sam Jackel: “From my perspective, the cost o poor quality
is high. The service landscape is very competitive and the key
consumer dierentiator is service. We needed to be able torepeat speech testing, quickly, efciently and cost eectively
and to monitor our production systems to alert us in the event
critical customer experience issues. We view Cyara as a key
plank in our strategy around quality and efciency and use
Cyara or end-to-end regression, systems integration, unc-
tional, stress, perormance and load testing and real-time
monitoring o the customer experience in the production en-
vironment.
Alok Kulkarni: “We provide a solution that our customers
tell us is the most complete, mature solution or helping them
ensure their customers calling in have a avorable phone-
based customer experience. We provide automated, interac-
tive voice response (IVR) simulation and testing, and load,agent routing and CTI simulation, testing and monitoring.
Companies like Westpac oten have requirements such as
end-to-end testing; simulating a caller entering the voice sys-
tem and interacting using natural language speech or DTMF
input and traversing the established paths and exercising the
data integration and agent routing so that they get a true pic-
ture o how the system is really perorming rom a custom-
er’s perspective. We automate very tedious, time-consuming
testing and monitoring, which means companies end up test-
ing applications and systems more quickly, more requently,
and more broadly with less time and eort, which ultimately
results in the kinds o quality and efciency improvements
Sam mentioned. Customers also like the idea that we run on
non-proprietary hardware, oer a choice o deployment mod-
els a at the right price point.”
Are there any marketplace trends, unique toAustralia (vs. US), which require a particularapproach to Customer Experience Management(CEM)?Jackel: “From a banking perspective there are a small num-
ber o banks competing or client business when compared to
Europe or the USA. The challenge is to dierentiate rom acustomer service and relationship management perspective.”
Kulkarni: “We have a global customer base and while there
are nuances and challenges unique to each region and each
vertical—banking, telecommunication, utilities or retail, etc.—
what we fnd common is the need to fnd a way to balance the
goals o delivering exemplary customer experience while en-
suring operational efciencies and bottom line results.
Why is CEM important to Westpac at this time?Jackel: “Westpac takes a customer centric approach to
speech recognition design, designing the system around cus-
tomer requests rather than around business or organization-
al structure. This approach allows us to keep dialogue with
our customer short and sharp but at the same time efcientin terms o the inormation gathered about the customer’s re-
quest. Customers gain access to banking representatives very
quickly and with a very high degree o accuracy. From a cus-
tomer experience perspective, this is unique among speech
recognition applications in the Australian market. Customer
experience as measured by Net Promoter Score (NPS), a rat-
ing based on the simple question o how likely one is to rec-
ommend Westpac to a riend or colleague, is a strategy that
underpins everything we do and think about at Westpac.
Each member o sta is ocused on improving customer ex-
perience and this is a shared scorecard measure.
The Westpac Group
& Cyara SolutionsQ&A with Sam Jackel, Project
Director, The Westpac Group &
Alok Kulkarni, CEO, Cyara Solutions
TECHNOLOGY, TRENDS & REWARDS
TAlok Kulkarni
Sam Jackel
Loyalty Management™ • LOYALTY360.ORG
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Sam Jackel, Project Director, Contact Center Transormation
The Westpac Group
Sam Jackel is a voice technology expert, who has experience in
implementing innovative technology solutions and large scale projects.
Sam has been working in the fnancial services industry since 1998, and
his career has encompassed roles in online banking, project deliveryand voice channel management. Sam is responsible or the delivery o
Westpac's new speech recognition system.
The Westpac Group
Westpac was established in 1817 as the
Bank o New South Wales. In 1982 it
changed its name to Westpac Banking
Corporation ollowing the acquisition o the Commercial Bank o Australia.
Westpac has branches and afliates throughout Australia, New Zealand
and the near Pacifc region and maintains ofces in key global fnancial
centers including London, New York, Hong Kong, Singapore and Shanghai.
How are Cyara & Westpac working together toimprove upon the customer experience?
Jackel: We take a continuous approach to testing andimproving the quality o our speech application.”
Kulkarni: I think the simplest answer is beore you can
fx a problem, you have to identiy and pinpoint where
the problem is, as ast as you can. We help customers like
Westpac understand where problems exist in the appli-
cations and systems their customers use to interact with
the organization. And Westpac quickly responds and im-
proves the application. And as Sam mentioned, it’s not a
one-time eort. Westpac takes a continuous, unrelent-
ing approach to testing and improving the quality which
has a direct, positive impact on customer experience.
What has been the impact on overall customer
satisaction as a result o these eorts?Jackel: This cannot be directly attributed to the speech
recognition program or the partnership with Cyara,
however since a broader program o work was com-
menced over 2 years ago, customer satisaction mea-
sured via NPS has lited rom 30's to 60's in the contact
center channel.
Kulkarni: We are all consumers. One o my avorite
statistics Sam quotes when talking about the impact o
improving customer experience at Westpac is the reduc-
tion in the time a customer must spend in the automated
system beore reaching their intended destination. What
took a minute and a hal dropped to 13 seconds, which
means customers are getting their needs met morequickly, which has actor into how likely they are to rec-
ommend Westpac. “
Alok Kulkarni, CEO
Cyara Solutions
Alok Kulkarni is the co-ounder and CEO o Cyara, a pioneer
o next-generation premise and cloud-based solutions or
simulating, testing and monitoring IVRs, voice biometrics and
other contact center systems and applications via automatedload and unctional testing and production monitoring.
Cyara Solutions
Cyara Solutions is helping
Fortune 500 companies
around the world redefne
their customer service through a better contact center
experience. Cyara is a pioneer o next-generation premise and
cloud-based solutions or simulating, testing and monitoring
IVRs, voice biometrics, outbound dialers, voice callback and
contact centers.
How does this partnership drive customerengagement?
Jackel: The solutions we deploy are high quality, quick to marketand we get it right the frst time.
Kulkarni: Cite any survey or your own consumer experience and
you will note there is vast room or improvement or phone cus-
tomer service. One o the barriers to improvement is how much
time, money and eort it takes understand where or how to tweak
and improve the applications and systems. Our solution in com-
bination with the broader overall commitment to truly taking a
top-down, customer-centric approach to service as Westpac does,
drives positive customer engagement as he’s indicated rom their
NPS improvements. And rom our perspective, we view custom-
ers as partners and consider our relationship a two-way street. We
have continuous dialog with and take input rom customers like
Westpac and roll that invaluable eedback into every product re-
lease.
O course, we have to ask, what is next or Cyara?The Westpac Group?Jackel: Westpac will continue to leverage its recent investment in
the contact center channel and ocus on continued improvement
in customer satisaction. We also continue to extend relationships
with our existing clients.
Kulkarni: Cyara continues to ocus on helping Fortune 500 re-
duce risk and project timelines with their oten disruptive and
transormational technology and process contact center deploy-
ments. In the second hal o this year, we opened an ofce in the
United Kingdom to serve a growing customer base in EMEA and
continue to serve and support a growing customer base in both theU.S. and APAC regions. And, we look orward to sharing more pos-
itive deployment results such as Westpac’s in the coming months.
Background on Interviewed & the Companies They Represent
From my perspective the cost o poor quality is high. The
service landscape is very competitive and the key consumer
dierentiator is service. -Sam Jackel, The Westpac Group
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40
TECHNOLOGY, TRENDS & REWARDS
ustomer surveys. Mystery shopping. Printed com-
ment cards. Inbound emails. Website comments. Call ins.
Not too long ago, marketers relied on these traditional
forms of feedback as the primary methods to gauge cus-
tomer satisfaction. As feedback volume from these sourc-
es continues to decline—response rates from these chan-
nels has fallen from 50% in 2007 to 28% in 2011—the
value of traditional guest satisfaction is being questioned.
During the same time period, mentions per store per
year on social feedback channels grew exponentially, sky-
rocketing from 450 to 9,330. Social media feedback israpidly growing, has tremendous reach, and is unbeliev-
ably inuential.
•Facebook boasts some 750 million active users
worldwide,Twitter receives 95 million Tweets
everyday and Yelp has surpassed 50 million
monthly unique users.
•The number of Foursquare check-ins exploded
by 3400% in 2010.
•90% of consumers online trust recommenda-
tions from people they know; 70% trust opinions
of unknown users.
The Next Generationof Customer Feedback is Social CustomerSatisfaction Intelligenceby Ashish Gambhir, newBrandAnalytics
Given these staggering numbers, there is no denying
that your customers are talking about you online—and
with great reach and inuence. They are tweeting, post-
ing, and blogging their experiences with your brand—both
the good and not-so-good. They are also talking about
whether or not they will return to your location, buy your
product again, and recommend you to their peers.
As Jeff Bezos says, “Make a customer unhappy in the
real world, they might tell six friends. Make a customer
unhappy on the Internet, they can each tell 6,000 friends.”
One good or bad experience can be easily shared andbroadcast to thousands of existing and prospective cus-
tomers, magnifying its effect within minutes.
Knowing what customers are saying online and put-
ting all of the social media activity to work in a productive
way is a business imperative. Mining and translating the
rich information embedded in online customer mentions
arms brands with the unltered, real-time, voice-of-the-
customer insight they need to enhance customer satisfac-
tion and earn their loyalty.
The question on the minds of most marketers, how-
ever, is HOW. Yes, the vast majority of companies today
Loyalty Management™ • LOYALTY360.ORG
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capture customer feedback in some form. But, nearly all are
struggling to create structure in the unstructured and unsolic-
ited feedback re hose that is online customer feedback. How,
they ask, do I turn volumes of online insights into actionable
opportunities?
For instance, a hotel may cull samples of online feedback
and notice an unsettling service issue, but is it enough to war-
rant action? Management may even be able to see an inconsis-
tency in service from a few customer mentions online, but are
the authors credible? Collecting the data via current method-
ologies does not pinpoint clear opportunities for improvement,
let alone what actions need to be taken to turn the situation
around, re-engage the customer, and earn their loyalty and
brand ambassadorship.
The answer: Creating social customer satisfaction intel-
ligence.
The intersection of online customer feedback with busi-
ness intelligence—or what is known as social customer satis-
faction intelligence—is the sweet spot from which brands can
most effectively leverage online feedback for operational, mar-
keting, and strategic insight. By tapping into tools that blend
social media feedback themes, customer satisfaction, author
credibility algorithms, web analytics and enterprise business
intelligence, brands can capture a complete, real-time view of
customer satisfaction, synthesize it into the richest customer
insight, and distill the actionable insights needed to improve
customer satisfaction and loyalty, increase revenue, and drive
sustainable bottom-line results.
Gaining this deeper level of social customer satisfaction
intelligence is just what Parasole needed to take its customer
experience to the next level. Minnesota-based Parasole is one
of the nation’s premier restaurant concept generators, opera-
tors and developers (founders of Oceanaire, Buca Di Beppo).
In November 2010, Parasole opened Mozza Mia, an up-
scale pizza shop and mozzarella bar. The company found that
for its portfolio of restaurants, feedback gleaned from tradi-
tional sources gave them some insight into guest satisfac-
tion—but certainly not a complete picture. So, from the time
of Mozza Mia’s launch, Parasole monitored every single online
mention about the restaurant (as they do on a regular basis
with all their establishments) working with newBrandAnalyt-
ics to mine the Internet for customer satisfaction feedback.
Specically, Parsasole identied three key strengths during
its rst few months: authenticity, taste, and ambiance. With
the same social customer satisfaction intelligence tools, Para-
sole realized a key and credible concern: customers wanted
the ability to build their own pizza.
“We learned that some patrons enjoyed the authentic pizza
combinations we offered on our menu, but others really want-
ed the exibility to make their own creations—from a simple
pepperoni pizza to ones with a variety of ingredients,” says
Sarah Nerison, Social Media Marketing Manager at Parasole.
“Gaining this deeper level of social customer satisfaction intel-
ligence enabled us to revise our menu in order to meet—and
often times exceed—our customers’ expectations. What’s
more, the analysis also helped us hone in on how we should
promote our new menu. We learned what messages would
be most impactful for our current and prospective customers.
And, because we were able to see where online these folks are
talking about us, we knew exactly where to engage them in a
conversation about our new menu. The theme in the feedback,
generated by the newBrandAnalytics approach to social cus-
tomer satisfaction intelligence, would otherwise not have been
identied.”
And that’s precisely what Mozza Mia did. In additional to
several other marketing channels, they posted the news about
their new “Build Your Own Pizza” on their Facebook page: “Ask
and you shall receive. We now offer a "Build Your Own Pizza"
at Mozza Mia! Beginning with a freshly baked crust, red sauceand shredded Mozzarella cheese, then it's up to you to build
your own creation!
Says Nerison, “We introduced the build your own pizza on
April 1, 2011 and already nearly 10% of our pizzas ordered are
build your own. That’s one in ten people who are now choos-
ing to create their own Mozza Mia pizza experience. Besides
increased sales, we are no longer receiving negative online
reviews that can persuade potential Mozza Mia customers.
We’re enhancing the experience of our guests by listening to
them and eliminating any reason they would have to not be
pleased with our pizza options."
We learned what messages
would be most impactful for
our current and prospectivecustomers. And, because
we were able to see where
online these folks are
talking about us, we knew
exactly where to engage
them in a conversation.
—Sarah Nerison, Parasole
L
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Loyalty Management™ • LOYALTY360.ORG42
BY THE NUMBERS
BY THE NUMBERS
Highlights rom Recent Industry
Research
Nearly 89% o consumers surveyed would like to make
payments using their mobile phone at their avorite stores.Mobile preferences included the ability to link to various payment options:
•77% of survey respondents wanted the ability to link a Credit Card to their
mobile phone
•64% would like to link their ATM/Debit Card•54% would attach a Git Card as a payment method on their mobile device
Nearly 78% of consumers surveyed are open to receiving targeted location
based offers on their mobile device.
89% reported interest in using their mobile phone as a preferred shopper/
loyalty card, and 90% would like to use their mobile device to redeem rewards/
benets in store.
Where do consumers want to use this new technology oering? Grocers ranked frst
as the top desired location or using a mobile device.
The Customer
Experience Report
notes that 85 percent
of consumers would
be willing to pay
more—up to 25
percent more—to
ensure a superior
customer experience.
Javelin StrategyGroup reports that 71
percent o requent
credit card users
indicate that rewards
are key to top o
wallet position.
DIRECT MAIL DISCONNECT FROM A RECENT ACXIOM SURVEY
CONSUMER RESPONSE L360 MOBILE WALLET SURVEY
of consumer respondents
are currently using a credit
card or gift card to make
payments using a mobile
device!
60%
People who welcome SMS marketing (marketers guessed 25% o customers would be happy to get text
messages rom brands)
Consumers feel they are ‘in control’ of their brand relationships and receive marketing only when
they want it—50 percent higher than the proportion o marketers who think their consumers are in control
Consumers who say they receive "inappropriate" marketing communications
Consumers happy to receive mail from organizations they are already customers of
82%
25%
71%
9%
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Loyalty Management™ • NOVEMBER 20
In “Turning Customer Data into Action” Loyalty 360, on behalf of TSYS, polled marketers to learn
more about if and how brands are using customer data. The results o the research provide
keen insight into the types o data marketers are collecting, where and how they’re
collecting it and challenges they must overcome along the way, and how they’re using
the data to drive act-based marketing decisions.
KEY FINDINGS HIGHLIGHTED IN THE RESEARCH INCLUDE
•82% o respondents collect data with the goal o growing their marketing
database and building marketing campaigns (81%).
•Nearly two-thirds also collect data on their prospects.
•The data-collection sources most often cited include website, point-of-sale,
call center and loyalty program.
•Lack of budget and lack of support from other departments most often impede datacollection.
•While 68% report using the data they collect, limited sta (51%)
and systems integration issues (49%) make using the data
eectively more challenging.
•The 32% that sometimes or never use the data report that limited analytics expertise is
the bottleneck.
•Results most often realized by using the data include increased loyalty program participation
(59%), increased marketing ROI (55%), increased number of transactions (53%), and
increased marketing effectiveness (53%).
Find a ull copy o the whitepaper, “Turning Customer Data
into Action” on Loyalty360.org
94% o respondents are collecting
data on their customers.
Data Insights rom "Turning
Customer Data into Action"
Loyalty Management™ • NOVEMBER 20
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44
BEST BUSINESS PRACTICES
ustomer Experience Management (CEM) has been a hot topic this
year, with the c-suite engaged and looking to launch enterprise-wide
initiatives tied to this new discipline. Competitive realities and market
volatility have created ever more complicated customer requirements.
Customers want value, they want to be heard, they want their sugges-
tions acted upon, and they don’t have time and loyalty for companies
that can’t listen to and act on their feedback. Now more than ever com -
panies need to quickly collect, analyze and act on customer feedback.
Getting feedback and using it to solve the right problems more proac -
tively increases sales and improves customer retention. And equally
important, CEM programs can help pinpoint opportunities to create
customer sales, support, and marketing efciencies, saving money.
That is how a sound CEM process works, whether it’s reacting tonegative feedback on a new product or identifying and acting on cus-
tomers’ suggestions, addressing the customer input quickly and effec-
tively translates into signicant ROI. In today’s tough economic envi-
ronment, it’s no wonder that more and more c-suites now include Chief
Customer Ofcers who are building out their organizations to create a
new organization—the Customer Experience Competency Center.
Making It HappenSo often, the rst question asked by companies who understand
the need and importance of CEM is: How can we do this quickly and
cost-effectively? You need to deploy technology that “activates” all the
Achieving CEMGoals: CustomerExperienceCompetency Centers Drive
Processes
by Sid Banerjee, Clarabridge
listening posts and sources of customer in-
puts to rapidly spot and track specic issues
and problems that can impact revenue.
The latest, proven analytical tools for
doing this includes advanced text analyt-
ics, based on natural language processing
(NLP), as well as accurate sentiment scor-
ing techniques that return meaningful and
actionable data. Feedback can be as short
and sweet as a tweet, or as detailed and ver-
bose as a ranting review about a bad expe-
rience from a survey or a site like yelp.com,
but either way you need NLP and advancedsentiment scoring algorithms need to be
able to precisely identify, for every single
piece of feedback, what is being said about
products, services, people, experiences, and
qualitatively how it’s being said. And, once
you have the data, you need to build a team
who can take advantage of all the feedback,
track it, use it to create and manage perfor-
mance management programs, and execute
changes to the business as needed, to create
maximum business benet and impact. And,
C
Loyalty Management™ • LOYALTY360.OR G
CECC: A central clearinghouse for all
CEM analyses, its mission is simple:
drive effective, coordinated and
customer-focused decisions throughout
the enterprise
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those very people make up a Customer Ex-
perience Competency Center (CECC).
A CECC is built on the concept of being
a “process-driven” entity that proactively
monitors and responds to global Voice of
the Customer (VoC) feedback by driving
action across all business units in an enter-
prise.
Who are these people and depart-
ments concerned with monitoring and
acting on customer feedback? Certainly,
product marketing spends a good deal of
effort to identify what people want and
why, as well as seeking out the most up-to-
date information about quality and safety
issues. Marketing specialists need input to
accurately gauge the effectiveness of their
own initiatives. Customer service
personnel are tasked with dis-
covery—what keeps customers
happy and loyal and what drives
them away. And, human capital
is always looking for hot buttonissues to act more quickly on em-
ployee feedback. A company may
choose to add more people to
the mix, but these core individu-
als within a CECC ensure analysis based
on customer feedback gets processed and
disseminated throughout an organization
as required.
A CECC should be viewed as a central
clearinghouse for all company-related CEM
analyses, tasked with leading communica-
tion efforts with appropriate individuals or
business units. Its mission is simple: drive
effective, coordinated and customer-fo-cused decisions throughout the enterprise.
Without a structured cross-functional
CECC in place, many companies’ CEM ef-
forts have been ad hoc, with duplication
of efforts between business units and in-
efcient or sporadic action taken based
on customer feedback. The types of data
inputs are wide and varied (i.e., surveys,
call centers, website feedback) and com-
plicated further by emergent input from
the likes of social media, blogs and chats.
Recognizing that the data management di-
lemma can be insurmountable, companies
need a means to integrate raw data fromall available sources of customer input and
render it into analytics and insights that
can be acted upon.
Armed with actionable data, a CECC
determines and implements an agreed
upon set of cross-functional processes
specically tailored for improved CEM.
These could include sales alerts (i.e. spe-
cic products are “spiking” in feedback
with negative sentiment, sales staff are not
addressing questions about a hot product,
a food product is alerting with quality de-
fects suggesting a recall is needed); prod-
uct quality issues or actions (products are
hard to use, difcult to congure, poorly
labeled, contain defects, are generating
excessive customer support inquiries to
call centers). A CECC uses these insights
to communicate xes via customer sup-
port and plan HR response tactics to en-
sure the customer is prioritized and that
employees know they are essential to the
process. When these processes are built
and enacted effectively, producing more
satised customers, cost center savings
and enhanced sales and marketing capabil-
ity—and that’s denitive ROI.
Functional PillarsTo ensure processes are properly fol-
lowed that result in positive metrics, a
CECC needs to operate on ve functional
pillars: Organization, Listening, Collection
and Analysis, Communications and Deliv-
ery.
Organization
For a CECC to succeed, it must be sup -
ported at the executive level. In fact, somecompanies have created executive posi-
tions directly responsible for CEM over-
sight, while others might assign responsi-
bility to an existing marketing executive’s
organization. Without senior leadership
support, a competency center cannot take
root within an organization. Similarly, in-
vestment must be made in a team capable
of analyzing and disseminating practicable
information within the enterprise.
Listening
Capturing VoC data requires the es-
tablishment of “listening posts” that de-liver consistent, high-quality data from call
centers to social networks. Inbound “chan-
nels” should be aligned with relevant busi-
ness units and generate data that supports
those constituents. Conversely, outreach
initiatives, such as surveys, should be co-
ordinated to avoid redundancies and an-
noyed consumers.
Collection & Analysis
Robust sentiment and text analytics
platforms are essential to a CECC, in that
they manage the heavy lifting involved
gathering and transforming text-bas
customer feedback from listening po
into actionable insights. Utilizing sentime
and text analytics technology empower
CECC to establish itself as a repository
all aggregated customer experiences a
feedback, which can be used to devel
strategies and tactics to grow and sercustomers over time.
Communications
A CECC’s functional responsibility is
create greater transparency throughout
organization, so that important insights a
more easily shared and outbound effo
not reproduced. The ability to conn
and build internal relationsh
with individual organizatio
is elemental to a CECC, a
providing regularly schedu
updates on customer insigh
such as an electronic newslet
or report, helps maintain strostakeholder relationships. R
ognition that a CECC provid
customer experience insig
that directly supports business and p
ductivity is a common theme.
Delivery
Timing and communications tactics a
the buttresses that support effective de
ery of CE insights within an organization
CECC works to get the right informati
to the right person at the right time, a
in the right format. Achieving this involv
a deep understanding of internal clienneeds and the use of different communi
tion channels to deliver data, from onli
reporting tools and sales playbooks to R
feeds and iPhone apps.
Revealed ROIBusiness is driven by ROI. According
Forrester Research’s 2009 report, “C
tomer Experience Boosts Revenue,” on
erage, a large company can net $284 m
lion per year with a modest improveme
in its customer experience manageme
based on $65 million in increased sa
$116 million from a reduction in churn a$103 million from new customer conv
sions through positive word of mouth.
Clearly, CECCs possess an enormo
potential to support ad grow business
while also improving internal commun
tion of customer insights. Most importa
ly, for those businesses that understa
the undeniable importance of custom
satisfaction and loyalty, CECCs should
given serious consideration when asse
ing current CEM goals and processes.
Customer service personnel are
tasked with discovery—what
keeps customers happy and loyaland what drives them away.
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Loyalty Management™ • LOYALTY360.ORG
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BEST BUSINESS PRACTICES
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What is a “MoneyTrasher”?Melissa Studzinski: “MoneyTrashers” are customers who
“trash their money” by not doing simple things like checking
their receipts for ExtraBucks® Rewards before tossing them
in the trash, or redeeming special coupons cardholders re-
ceive by email and at in-store ExtraCare Coupon Centers.
What inspired the creation o the campaign?Studzinski: CVS/pharmacy’s customers save millions of
dollars each year by redeeming their rewards—in fact, the
ExtraCare program has grown into the largest and most
popular retail rewards program in the country because so
many people do take advantage of the savings availableand love how the program caters to them in a personalized
way. However, there are millions of other customers that
are throwing their earned ExtraBucks® Rewards away when
they receive them, either because they don’t realize they
have earned them or forget to use them during their next
shopping trip. CVS/pharmacy launched the MoneyTrashers
campaign to encourage more ExtraCare cardholders to take
advantage of their ExtraBucks® Rewards.
What is the goal o the “MoneyTrasher”campaign?Studzinski: The goal of the campaign is to help more cus-
tomers realize that ExtraBucks® Rewards can be used to
buy items they need and want at CVS/pharmacy. Duringthe rst and second phase of the MoneyTrashers campaign,
which launched alongside the July 1 and October 1 Extra-
Bucks® Rewards payout dates, CVS.com/moneytrashers
and the CVS/pharmacy Facebook page featured interactive
content, including playful videos showing shoppers how
to avoid being a “MoneyTrasher,” as well as an interactive
pledge application so customers can take a pledge to not be
a MoneyTrasher and share their commitment with friends
and family.
How did CVS engender internal support or thisinnovative approach to customer engagement?Studzinski: As the largest retail loyalty program in the coun-
try, a key part of ExtraCare’s success is the choice we give our
members in terms of how they want to engage with us. Over
the past year, social media has become an important way
for us to engage with customers who prefer to connect with
us this way. We are constantly offering sneak peeks and ex-
clusive deals through Twitter (Twitter.com/CVS_Extra) and
Facebook (Facebook.com/cvs) and have utilized our social
networks as a platform for fun and interactive campaigns such
as MoneyTrashers. These campaigns foster a sense of com -
munity among our cardholders and make it even easier for
our customers to share their excitement about the ExtraCare
Rewards program, which ultimately helps more people learn
how to participate in the program and save more during their
shopping trips.
Tell us about the CVS “MoneyTrasher” campaign?Does it tie into the CVS ExtraCare Rewardsprogram?Studzinski: The ExtraCare Rewards program is designed to
make it easy and convenient for our customers to save money
on health, beauty and household items throughout our stores,
and ExtraBucks® Rewards is one of the primary saving options
available through the program. CVS/pharmacy’s customers
save millions of dollars each year by redeeming their rewards,
however, there are millions of other customers that are throw-
ing their ExtraBucks® Rewards away when they receive them.
This educational and fun campaign puts a spotlight on the mil -
lions of customers who aren’t taking advantage of their Extra -
Bucks® Rewards and encourages them to redeem them. Ad-
ditionally, CVS/pharmacy launched a redesigned ExtraBucks®
Rewards coupon this past July to help make the rewards stand
out more prominently to encourage shoppers to take notice
and redeem the rewards on register receipts.
CVS: “Don’t Be
a Money Trasher”Campaign
oyalty 360 had the opportunity to hear rom Melissa Studzinski, Vice-President o Customer Relationship Management
or CVS/pharmacy or an inside scoop on the CVS “Money Trasher” campaign. Melissa shares insights into what inspired the
campaign, why social media is an important channel or CVS ans, and how the campaign has lead to greater engagement with
CVS customers.
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Loyalty Management™ • NOVEMBER 20
How can shoppers save money by spending
points at CVS?
ExtraCare cardholders receive 2% back on nearly every dolla
spent in store, every time they shop, regardless o whether or
not they participate in any sales or special oers. Additionallyin nearly all U.S. states, or every two prescriptions flled at
CVS/pharmacy, ExtraCare cardholders automatically receive
ExtraBuck® reward. At the end o each quarter, these automa
ExtraBucks® Rewards are printed on the bottom o cardholde
receipts during their frst visit.
Each week certain items are also marked with instant earned
ExtraBucks® Rewards oers in the sales circular and on store
shelves. By purchasing these qualiying items, cardholders ea
instant Extra Bucks coupons that print on the bottom o the
receipt ater the transaction is completed.
In addition to automatic quarterly earned ExtraBucks® Rewar
and instant earned ExtraBucks® Rewards, there are a numberdierent ways customers can save:
•ExtraCare E-mail Alerts: I an ExtraCare cardholder prov
an email address at sign-up, or links an email address to
their ExtraCare card online at CVS.com – they will also
receive special money-saving oers by email that are
personalized just or them. Additionally, CVS/pharmacy
recently announced the launch o a “Send to Card” digital
savings option, which gives cardholders the ability to send
select ExtraCare coupons received by email directly to the
ExtraCare card.
•ExtraCare Coupon Centers: These ‘scan and save’ kiosks
have also been introduced in nearly all stores – they let
shoppers swipe their cards at the beginning o trips and ge
personalized coupons they can use right then and there
•ExtraCare GreenBagTag: Available or 99 cents, the
GreenBagTag rewards customers every time they use a
reusable bag or simply decline a plastic bag. For every ou
scans members receive $1 ExtraBucks® rewards
•ExtraCare Advantage or Diabetes: ExtraCare members
who opt into the program receive savings on diabetes-
specifc products, including 4% “DoubleBucks” back on m
than 100 store ront items
•ExtraCare Beauty Club: ExtraCare members who sign up
receive rewards or purchasing qualifed beauty products,
including $5 ExtraBucks ® rewards or every $50 spent onbeauty.
•Social Media Savings: Shoppers can ollow the CVS/
pharmacy ofcial ExtraCare Twitter eed (twitter.com/CV
Extra) or “Like” the CVS/pharmacy Facebook page (aceb
com/CVS) or the latest deal, savings advice and inside
scoop updates, as wll as exclusive coupons and contests.
Additional inormation about the ExtraCare Rewards program
can be ound at cvs.com/ExtraCare.
How are consumers guilty o wasting rewards & becoming, “MoneyTrashers”?Studzinski: Some don’t look close enough at their receipts
and others don’t realize that they’re throwing earned Extra-
Bucks® Rewards in the trash. Some even leave them at the
register or lose them in the bottom of their purse. These
actions are a result of customers not realizing they can usetheir earned ExtraBucks® Rewards to buy almost anything
they want at CVS/pharmacy.
The “MoneyTrasher” videos have gone viral,
what drove the decision to include videos in thecampaign?Studzinski: CVS/pharmacy incorporated videos into the
MoneyTrashers campaign to provide our savviest custom-
ers with fun, digital resources to spread the word and teach
their friends and family to stop ‘trashing’ their ExtraBucks®
Rewards.
Any an avorites?Studzinski: During the rst phase of the MoneyTrashers
campaign which launched July 1, CVS/pharmacy encour-
aged viewers who came to the Facebook page to vote on
their favorite videos and ultimately help spread the word to
their friends and family on Facebook and Twitter to teach
them to “Stop Money Trashing.” The most popular videowas “CVS/pharmacy ExtraBucks® Thriller” but the others
were well trafcked as well.
What have you learned about (or heardrom) the CVS customer as a result o your
“MoneyTrasher” campaign?Studzinski: Since launching the campaign, the number of
cardholders redeeming their rewards has increased and it is
clear the message is resonating with our customer base and
people are really having a lot of fun with it.
Social media has become
an important way or us to
engage with customers who
preer to connect with us this
way. Our campaigns oster a
sense o community among our
cardholders and make it even
easier or our customers to
share their excitement about the
ExtraCare Rewards program.
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BEST BUSINESS PRACTICES
48
H ow do you dene “customer loyalty”. Oten, the term “loyalty” in
marketing is used to mean one o two things: 1) Increased purchase re-
quency, or 2) lower likelihood to attrite. Sometimes it means both at the
same time.
This casting o loyalty tends to entrap the concept as a tactical applica-
tion—another tool in the marketer’s arsenal. One that can be prescribed or
the right set o circumstances, but is known to take substantial overhead
to run, needs a long ramp up to generate ROI, and requently becomes an
Albatross o liability and maintenance.
Thinking o loyalty programs this way reects the years o weather-
ing the concept has endured, not to mention the rigorous scrutiny every
marketing idea now undergoes—especially in a less exuberant economy.
It certainly takes us away rom thinking about customers as people, and
ar rom the meaning o “loyalty” as a positive quality or partners in a
relationship.
Oh yes, relationship.
Don’t Expect LoyaltyWithout RomanceI your loyalty program seems to be missing that “spark”, maybe it’s time
to put some real eort into spicing up your relationship eorts.
by Darin Rock, SolutionSet
I I described a customer that was680% more likely to buy with you,732% more likely to make timely
payments, 18% more likely to staywith you, more likely to tell you aboutthemselves and denitely more likelyto talk about you with riends and othercustomers, would you call them loyal?
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Have we lost that “loving” eeling?In April o this year, Forrester reported that more than
40% o loyalty programs the marketers they surveyed have in
place under perorm. The problems cited included lack o di-
erentiation, increase in cluttered oers, and disconnect with
the brand, among others. In essence, these initiatives treat
“loyalty” as a bolt on program—lacking brand relevance and
cause or engagement.
With all the money and time these programs require tomodel, build and approve, there’s a lot o eort that ends up
with all the “un” going into a dis-un-ctional relationship.
But i we look where relationships are creating a big impact
or marketers, we might discover some new developments that
could rekindle our hope or loyalty.
I I described a customer that was 680% more likely to
buy with you, 732% more likely to make timely payments, 18%
more likely to stay with you, more likely to tell you about them-
selves and defnitely more likely to talk about you with riends
and other customers, would you call them loyal? Would you
say they’re engaged?
I’m guessing “Yes”. And you might even agree signs are
pretty positive on the relationship ront.
These are the results reported by the marketing team atCareOne debt relie services in January this year. The driver
or these high results: a well nurtured social networking pro-
gram aimed at increasing engagement.
While these results where shared to prove the value o so-
cial media, I think it’s impossible to miss the value they dem-
onstrate or engagement to drive all the classic goals or loy-
alty programs—and more. It also points out that engagement
comes rom a broader and more integrated eort.
Putting luster in loyaltyThe CareOne discovery validates the not so surprising idea
that building engaging relationships that lead to genuine loy-
alty takes more than tabulating points or customer behavior.
Ideally you’re scoring some relationship points yoursel—giv-ing your best and most responsive customers experiences, ex-
citement—an expression o your character and their value to
you.
There’s clearly an exciting potential or social media to
be employed to achieve engagement, and with rewards like
badging, it’s not too hard to see how you can make your social-
ites your loyalists. I we take a step back and revisit our ull
marketing arsenal with a mind toward reshaping what and
how to crat more engaging loyalty programs, we discover a
rich vocabulary and a wide range o touch points at our dis-
posal.
Every company and situation has its own unique strengths
and possibilities, but a good lineup o areas to examine or op-
portunities to liven up your “loyalty relationship experience”include:
•Company brand: what do you stand or and how can a
loyalty program ampliy it? Is it outstanding customer ser-
vice? Premium quality? Exclusivity?
•Contact points: how well are you integrating channels
to deliver unique experiences? Is the web an online ware-
house, the store a clearance center and the phone center
“cross-sell” powerhouse? How are your best customers ex-
periencing these and other points o contact?
•Listening: Are you doing all the talking? How oten do you
ask your best customers or input or or their preerences?
Perhaps you can dedicate more communications to jus
hearing back rom them.
•Response communications/recognition: Recognition i
a powerul reward that can be a lot less expensive than
discounts. How oten, how ast and how well are you re
sponding to purchases, web visits or calls? Are your loya
ists hearing rom you on their birthdays and anniversary
dates?
•Customization : How tailored can your experience beWhat would it take to allow your best customers to pick a
design or their bag, choose a type o music or their room
pick a category o quotes to be printed on their receipts
Mass customization may be easible in unexpected and
aordable ways that allow your customers to eel more in
control with your brand.
•Promoting "hookups": Are there opportunities or you to
connect similar customers? Provide them with things to
talk about? Help each other with a complicated purchase
or process? Tap and reward your best customers or help
ing others.
•Life stage: Are you paying attention to changing need
over time? Are there liecycles to products they’ve pur
chased or experiences they’ve had that you can recognizeto show you value their history with you?
•Metrics: Have you widened your view to lietime value? I
the name o the game is short term gain, you likely won’
build a relationship that lasts. Think about the metrics tha
reect the net eect o your eorts and help you improve
relationships over time—customer lietime value and a
dashboard o your marketing mix are the tools o tomor
row or many marketers.
Rediscovering the magicPoints programs defnitely added spark to our marketing
mojo when they were frst being institutionalized with trave
and hotels some 30 years ago. They continued to add spice to
the mix as they expanded to every grocery, department andpet store we know.
But, as with those other relationships we keep, too much o
the same thing oten transorms magic to mundane.
Today, most consumers belong to upwards o 14 loyalty
programs. Most only care about two or three. Arguably, those
top picks are the lucky lie essential stores that are able to earn
requency, but may not be making magic or their loyal cus
tomers.
There’s an opportunity to stand out and rediscover the
magic. Let’s remix, realign and redesign loyalty to ashion a
new kind o relationship that won’t go stale anytime soon.
Building engaging relationshipsthat lead to genuine loyalty takes
more than tabulating points orcustomer behavior. Ideally you’rescoring some relationship pointsyoursel—giving your best and mostresponsive customers experiences,excitement.
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50
BEST BUSINESS PRACTICES
A major aspiration for companies today is to be in ‘high growth’
mode, which can be challenging given the current economic climate.
In the Business to Business (B2B) world, high growth is achieved
through sustainable, predictable, protable growth (SPPG), for
which many factors come into play, most importantly customer loy-
alty.
Three key areas are outlined for marketing executives to considerfor leveraging customer loyalty to transform their organizations: the
Pareto Principle, Levels of Loyalty, and the Value of Engaging Deci-
sion Makers.
The Pareto PrincipleMarketing in the B2B world greatly differs from marketing in the
Business to Consumer (B2C) world—mostly by the sheer number of
customers alone. B2C companies have thousands, some even mil -
lions, of customers while B2B companies have a vital few. The Pareto
Principle, or the 80/20 rule, best describes a B2B company: 20% of
customers generate 80% of revenue. Do you know the top custom-
ers that make up 80% of your revenue?
For example, Walt Disney Company does $39 billion dollars in
revenue and has 100 million customers. AmerisourceBergen’s DrugCompany division is nearly twice the revenue of Walt Disney Com-
pany with just 3500 customers.
Driving Loyalty in the B2B Worldby Karen Posey, Geehan Group
Levels o LoyaltyUnlike B2C companies who depend on frequent buyer progr
to track customer loyalty, B2B companies must apply a differen
proach by targeting three distinct levels in top customer organizat
•Users
•Inuencers
•Decision makersSpending marketing dollars on all three levels is critical. How
we often nd organizations spend disproportionately at the user
inuencer levels. Through a recent assessment conducted by
han Group for a client, we found 75% of their marketing spend
at the user level and 25% at the inuencer level, leaving no marke
dollars invested with decision makers. This was clearly a contribu
factor to low customer retention rates.
A recent study from Business Week states over 60% of defec
customers indicate they are satised right before they leave. Wh
customer survey results reect one thing, while actions suggest
the opposite? Unfortunately, organizations usually survey custo
users and inuencers, neglecting the ultimate decision makers.
Vicki Cooney, Vice President of Health Systems Marketing
AmerisourceBergen, shares how they allocate marketing resouto decision maker levels. “We evaluate marketing spend acros
three levels on a yearly basis,” Cooney stated. “Over time we h
evolved our marketing spend to 25% with decision makers, which
improved our position with top accounts.”
The Value o Engaging Decision MakersAfter the Pareto Principle has been applied, the next step in ac
ing loyalty is through engaging decision makers. Why engage dec
makers? There are three reasons:
•Insight
•Relevancy
•Relationships
B2C B2B
Walt Disney Company AmerisouceBergen
$39 Billion Revenue $64 Billion Revenue
100 Million Total Customers 3,500 Total Customers
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Over 60%of defecting
customers are
highly satised
right before
they leave.
A common theme we see when organizations want to engage at
the decision-maker level is that they are nervous because these are
their top customers. Often they have been working with users or in-
uencers, and while they may know who the decision maker is, they
don’t have a relationship at that level.
However, decision makers give you insight that users and inuenc-
ers within an organization simply cannot provide. They can tell youwhere the market is going, their biggest challenges, and their percep-
tion of your company, for example. This feedback is vital for your or-
ganization to provide more relevant offerings and solutions to their
challenges.
At AmerisourceBergen, several years ago the entire pharmaceuti-
cal model was changing and they needed insight. Leadership Forums
were established with hospital decision makers to learn where the in-
dustry was going and what was important to them. “We learned a lot
from these forums,” explained Cooney. “The opportunity to engage
these decision makers in a different way gave us tremendous insight.”
For AmerisourceBergen, however, the Leadership Forums were more
geared to position them as thought leaders and build awareness. Am-
erisourceBergen achieved their objective with these events. However,
they realized there were two missing pieces: enhancing decision-mak-er relationships and gaining insight—keys to driving long-term loyalty.
AmerisourceBergen decided to create an Advisory Council to
build long-term relationships and loyalty with decision makers in their
top accounts. They evaluated their top customers and chose 20 that
t their established criteria. Leveraging learning from the Leadership
Forums, they knew they needed a program that could be sustained,
allowing them to integrate insight from decision makers to guide the
transformation of their organization.
Cooney shared, “We are in the midst of a transformation. Engag -
ing our decision makers in a different way will be key to sustaining
long-term growth.” Cooney is not alone. Our research found that
engaging decision makers helps organizations drive loyalty in the
following ways:
Engaging decision makers builds and institutionalizes the
tionship. Once you have internal buy-in, it is important to leve
the executive team to build relationships with your customer
sion makers (especially critical with products and services that h
low switching costs, like travel and incentive programs, for exam
Leveraging your executives to start building relationships outsideselling motion is critical to achieving game-changing relationshi
ConclusionCustomer loyalty for B2B companies requires consistent eng
ment, creation of relevant solutions, executive-to-executive relaship-building, and an organized team approach.
Keep in mind three areas required for success:
•Identify the top customers driving the majority of revenue
•Balance marketing resources among all customer levels: u
inuencers, decision makers
•Engage decision makers to gain insight, relevancy and ins
tionalize relationships
Transformation happens when your organization integrate
sight gained from decision makers (through an Advisory Cou
into shaping the future direction of the company. This is a ma
ing executive’s ultimate secret weapon to not only loyalty, bu
achieving sustainable, predictable, protable growth.
Decision Maker Engagement
Not Engaged Engaged
Retention 72% 90%
Account Growth 4% 12%
Reference-able 28% 94%
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52
BEST BUSINESS PRACTICES
he Loyalty 360 editorial team recently sat down to talk with John Bastone and Wilson Raj—two of the resident Customer Intel-
ligence (CI) gurus at SAS Institute—about how organizations can use CI to help them ensure all of their decisions and actions are as
customer-centric as possible.
How Customer Intelligence
Can Help Deliver a Positiveand Consistent CustomerExperienceQ&A with John Bastone and Wilson Raj, Customer Intelligence Marketing at SAS
T
Loyalty Management™ • LOYALTY360.OR G
Wilson RajJohn Bastone
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•Think multi-channel data: Think from an online and ofine
perspective. Multiple channels inuence a purchase decision
a brand choice, a loyalty commitment, and so on. The key is
to understand your customer’s journey, identify the appropr
ate touch-points and dene the relevant data points to inform
your actions.
•Start connecting the dots: A single view of the customer is
essential to deliver positive and consistent customer experiences. With analytics, businesses can start mining for the
hindsight, insight, and foresight to help take the appropriate
marketing actions, make the relevant marketing investments
and pull the correct marketing operations levers. Think
through these possibilities and develop a roadmap for co
lecting and testing these data points as they become avai
able and actionable.
There are so many media and channels that today’s
marketers can use to engage consumers, and
some o them didn’t even exist 5 years ago. How
can organizations plan to make analytics-based
decisions today that will put them on solid ootingor the uture?Bastone: In many ways the rules haven’t changed—you have
to test hypothesis at a smaller scale, do proper test and contro
learn and iterate, constantly. Yet in many other ways, things have
completely changed, as companies now have the opportunity
(and in many industries, the responsibility) to track interactions
with customers at a very detailed level. If you know every promo
tion you’ve exposed a customer to, across every channel, what
response was elicited, and overall activity, you have all the raw
materials to understand exactly what works, what doesn’t, and
to what extent. There’s still room—lots of it—for creative think
ing, and gut feeling on all manner of marketing. But what’s unac
ceptable is not using the data you have to mitigate your risks.
Raj: I agree with John’s points and would just add that the step
by-step approach I outlined above will serve companies well to
day and in the future—this logical progression builds the founda
tion to support current and future goals.
What’s the rst thing someone unamiliar with
Customer Intelligence (CI) should know?Raj: The rst thing to realize is that all organizations already have
customer data and information amassed through the varied in-
teractions they have with their customers. Customer Intelligence
is simply the next logical stage: gleaning insights or knowledge
from the collected data to drive more desirable and protable
interactions with customers, both immediately and over time.
Customer Intelligence is the process of gathering information
from wherever your customers are, distilling this information into
insights, and sharing these with stakeholders across your com-
pany so you can improve products, marketing, customer service,
and more. In short, CI allows ALL decisions and actions to be
customer-centric.
Bastone: To build on Wilson’s points, I’d add that CI is the glue
that holds together any truly differentiated Integrated Marketing
initiatives we see in the marketplace today. At SAS, our CI focus
targets three core areas: providing companies with the smarts to
identify gold nuggets of protable opportunities, providing infor-
mation so the factory can take the best marketing actions rooted
in those insights, and providing the integration with core nancialand operational systems to drive real cross-business impact. SAS
customers who execute on these three points aren’t just smarter
or delivering more (and more integrated) campaigns, they’re
having measurable impact on prots and customer loyalty.
What are your tips or organizations as they begin
to think about using analytics and CI to drive loyalty
programs and customer marketing decisions?Bastone: Well, as a somewhat grizzled veteran of loyalty efforts
in the Grocery and Consumer Packaged Goods sectors, I can tell
you that any loyalty effort needs to start with the end in mind. And
the end in mind shouldn’t be another two-tier pricing scheme, or
a “me-too” points program, but the basis of something that trulyallows a company to offer a differentiated customer experience
that impacts the bottom line, favorably. Companies committed
to doing that are doing amazing things.
I think Wilson can expand on the concept of “start with the
end in mind” and give us some step-by-step pointers on how best
to approach it.
Raj: Yes, in my experience, steps successful organizations should
take the following steps to accomplish best-in-class CI and cus-
tomer loyalty efforts.
•Start small: test the waters by deciding which marketing
goals are priorities, then collect and organize data according-
ly. For example, typical marketing goals could be to increase
demand generation, improve quality of engagement, evalu-
ate campaign effectiveness, and enhance customer personas,and so on. Start by picking the one or two areas that make the
most sense for your business.
•Get a landscape perspective: Try to identify other customer
interaction points as they relate to your specic marketing
objectives. Isolate various data points or inputs that may be
of value. For loyalty programs for instance, data that reects
RFM (Recency of purchase, Frequency of Purchase, Mone-
tary Value) may not be sufcient. The most successful loyalty
programs are those that recognize lifetime customer value.
continued on next page
I you know every promotion
you’ve exposed a customer
to, across every channel, what
response was elicited, and
overall activity, you have all the
raw materials to understand
exactly what works, what
doesn’t, and to what extent.-John Bastone
Loyalty Management™ • NOVEMBER 20
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56
Once organizations begin collecting large amounts
o data on their customers, what’s the best wayor them to share that data across the rest o their
business?Raj: The top three barriers to effective sharing of the data
gleaned from CI efforts are: lack of a comprehensive customer
view, organization culture and skills, and limited appreciation or
applicability of CI to the broader business. Let me describe what
I mean by all three of these in more detail:
•Lack of comprehensive customer view
Start by building and evolving the data and intelligence infra-
structure that allows you to mine insights from multi-channel
customer interactions.
•Organization culture and skills
Typically, organizations are structured around brands, verti-cals, channels, solutions, products, etc., but not necessarily
around the customer. While this is slowly changing, many or-
ganizations still don’t have a “catcher’s mitt” for all the data
and insights that are coming in. Build centralized teams that
mine the data for customer intelligence and can translate
insights to actionable recommendations for marketing. Thisrequires insights teams or CI practitioners to have left- and
right-brain skills and to focus on problem-solving.
•CI applicability to broader business
The responsibility here is to show that data-driven and in-
sight-fueled actions can increase marketing effectiveness. In
other words: demonstrate business value. CI practitioners
have to evangelize and teach the rest of the organization the
value of insights by aligning with the various organizations’
success measures but also help create a culture of data-driv-
en strategic thinking.
Bastone: Those are all good points. I’d sum them up by saying:
don’t just share data, add value. I’ll use a retail example here. If
I’m running a loyalty group, and I’m churning out reports on the
retention rates or sales averages for my top customer segment,
what’s the category manager for electronics going to care? If I
can identify that this same segment constitutes 60% of the prof-
its in electronics, that’s the start of a more interesting conver-
sation. And if I know who’s most likely to lapse as a shopper in
How Customer Intelligence Can Help Deliver a Positive Customer Experience (continued)
As CI matures, most practitioners are adapting to the need to capture,
integrate, analyze, synthetize, and apply insights to marketing decisions.-Raj Wilson
Loyalty Management™ • LOYALTY360.OR G
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the next 6 months, and can project that negative impact on
the consumer electronics business, now you’ve got a strategic
conversation. If I can guarantee within a few percentage points
ROI for a campaign that engages those shoppers, using some
of that electronics merchandising budget, that helps electron-
ics hit its sales target, now I’m core. Finally, if I can quantify
why it is a better spend for the business to invest some of the
mass circular budget into ongoing attrition campaigns, that’swhen marketing actually moves the needle.
I you could look into a crystal ball and see the
uture o using analytics to maximize customer
experience and loyalty, what do the most
successul practitioners look like?Bastone: They’re intensely curious. Those successful practi-
tioners look at every customer interaction as a chance to learn
something to improve sales downstream. They’re also math-
ematically literate, with the knack for taking something com-
plex and telling a compelling story. Where the crystal ball gets
cloudy is where we will nd this next generation of marketers.
Raj: As CI matures, most practitioners are adapting to the
need to capture, integrate, analyze, synthetize, and apply in-
sights to marketing decisions. The notion of analytics as a key
strategic capability is becoming more mainstream for CMOs
and other executives. Having a single view of the customer
is now considered “tablestakes,” despite the difculties and
challenges involved. The most successful CI practitioners are
not only doing some of the things we mentioned, but are taking
analytics to the next level.
We’re seeing successful practitioners extend data capture
beyond traditional sources. As newer channels emerge, prac-
titioners are now integrating social, mobile, location-based
intelligence and insights to optimize marketing performance.Newer sources will also likely include interactive TV, tablets
(digital and mobile data), and apps.
Second, there is an increasing pressure on CI practitioners
to deliver “real-time insights,” not just “real-time data.” The
multi-channel, “always-on,” reality of today’s customer neces-
sitates that practitioners deliver actionable insights almost in-
stantly so that businesses can operate at the velocity of their
customers.
Third, the more successful practitioners are not only using
CI to optimize marketing. They are extending the value of CI
to other business functions: sales, customer service, merchan-
dising, manufacturing, design, supply chain, etc. These leaders
establish customer intelligence as a core strategic asset and
valued at all levels of the organization.
John Bastone and Wilson Raj are part of the Worldwide Marketing
Team at SAS, a leader in business analytics. They focus on helping
SAS Customers understand Customer Intelligence solutions. L
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56
Loyalty Reads
LOYALTY FORUM: BOOKS
Loyalty Management™ • LOYALTY360.ORG
Profles in Marketing ExcellenceBy Pamela Lockard
DMN3 Institute | 2011
Marketers spend the majority of their career
focused on buyers. In a recently published
book, “Proles in Marketing Excellence,” Au-
thor and Marketer Pamela Lockard decided
it was time to focus on the marketers them-
selves.
"I have always been interested in suc-
cessful marketing leaders," Lockard said. “I
wanted to know what makes other successful
marketers tick. This curiosity led me to searchthe globe to nd 25 marketing experts willing
to share their knowledge, experience and wis-
dom."
All the people in “Proles in Marketing
Excellence” are successful in their eld, or,
in some cases, multiple elds. Many come
from companies, like JC Penney, HP, Shell and
Radio Disney. Others are marketing profes-
sors, such as Dr. Mary Ann Stutts of Texas
State University, or industry leaders, like John
Jantsch of Duct Tape Marketing.
With the unique question-and-answer for-
mat of the book, it is easy to read. You learn
where these experts see the future of market-
ing going. You also nd out how they plan to
tackle the ever-changing world of marketing.
Each marketer provides insights in to hisor her background, thoughts and dreams.
After reading, you will like them and want to
know more. So, add “Proles in Marketing
Excellence” to your library. You'll gain new in-
sights about marketing and meet 25 engaging
marketing thought leaders at the same time.
Books to Know About NowThe B2B Executive
PlaybookBy Sean Geehan
Clerisy Press | November 2011
Business-to-business (B2B) companies
undamentally dierent rom busine
consumer
(B2C) companies. But ar too oten
leaders try to apply B2C strategies an
tics in their companies with disappo
even disastrous results. B2B
success requires a completely diplaybook.
In this seminal book, Sean Ge
draws upon over 20 years of e
ence to outline the proven characteristics of successful B2B comp
and the executive customer strategies they adopt in order to thrive
playbook described in the book is supported by case studies and rese
from market-leading B2B companies, including HCL Technologies,
ris Broadcast Communications, Crown Partners, Henny Penny, Spr
Science+Business Media, Wells Fargo, Intesource, Oracle, and more
This extraordinary book is an invaluable resource for executiv
small, medium, and global B2B companies.
Geehan’s approach tp B2B success helped us rene our strat
build customer retention rates, and grow our revenue and margin.
Social Media Leadership:
How to Get Off the Bench
and Into the GameBy Michael F. Lewis
Leigh Walker Books | August 2011
Business just got a jargon-free guide to
social media. Social Media Leadership:
How to Get Off the Bench and Into the
Game (2011, Leigh Walker Books) ex-
plains the eld in plain English and offers
experience-based counsel on practical
solutions in key disciplines for companies
of all sizes. The book is based on the expe-
rience of Mike Lewis, chairman of ILD Corp., a $100 million operations
company, who learned the hard way to use social media for research,
customer support and marketing. He wrote the book to take other busi-
nesspeople beneath the hype so they can see and seize bottom-line
opportunities that social media presents. In this practical guidebook for
businesses, Lewis relates the evolution of his own social media aware -
ness from “sleeping in the back pew,” as he puts it, to full-edged evan -
gelism for the global phenomena that is changing the way the world
does business. Lewis shares his own lessons learned along the way as
well as abundant examples and best practices of those companies who
are successfully using social media to build their businesses and their
brands.
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Loyalty Management™ • NOVEMBER 20
Onward: How Starbucks
Fought for Its Life
without Losing Its SoulBy Howard Schultz & Joanne Gordon
Rodale Books | March 2011
In 2008, Howard Schultz, the presi-
dent & chairman of Starbucks, made
the unprecedented decision to re-
turn as the CEO eight years after he
stepped down from daily oversight
of the company and became chair-
man. Concerned that Starbucks had
lost its way, Schultz was determined
to help it return to its core values
and restore not only its nancial health, but also its soul. In Onward,
he shares the remarkable story of his return and the company's on -
going transformation under his leadership, revealing how, during one
of the most tumultuous economic times in history, Starbucks again
achieved protability and sustainability without sacricing humanity.
Onward represents Schultz's central leadership philosophy: It's
not just about winning, but the right way to win. He gives readers
what he strives to deliver every day—a sense of hope that, no matter
how tough times get, the future can be just as or more successful
than the past, whatever one denes success to be.
How We DecideBy Jonah Lehrer
Houghton Mifin Harcourt | February 2009
The frst book to use the unexpected discoveries o n
roscience to help us make the best decisions.
Since Plato, philosophers have described t
decision-making process as either rational
emotional: we carefully deliberate, or we blink a
go with our gut. But as scientists break open t
mind's black box with the latest tools of neuro
ence, they’re discovering that this is not how t
mind works. Our best decisions are a nely tun
blend of both feeling and reason and the precise m
depends on the situation. When buying a house,
example, it's best to let our unconscious mull over the many variables. But wh
we're picking a stock, intuition often leads us astray. The trick is to determ
when to use the different parts of the brain, and to do this, we need to thi
harder (and smarter) about how we think.
Jonah Lehrer arms us with the tools we need, drawing on cutting-edge
search as well as the real-world experiences of a wide range of deciders fro
airplane pilots and hedge fund investors to serial killers and poker players. L
rer shows how people are taking advantage of the new science to make bet
television shows, win more football games, and improve military intelligence.
goal is to answer two questions that are of interest to just about anyone, fr
CEOs to reghters: How does the human mind make decisions? And how c
we make those decisions better?
Flowing in the Workplace: A Guide to Personal and Professional SuccesBy Lawrence Vijay Girard
Fruitgarden Publishing | June 2011
Each day we are challenged to nd meaning and fulllment in our lives. The workplace demands strength and toughness, wh
our personal lives we seek simply to be happy, with a positive sense of purpose, and a joyful loving relationship with our frie
and family. Is there a way to achieve outward success and inward fulllment?
The idea that business and the rest of life are two separate things is a myth. Science itself has declared that life is one un
whole. The truth of the body/mind/spirit connection is accepted by most people. The problem is: What do I do about it?
do I make it practical?
Lawrence Vijay Girard has bridged the gap between an inspirational and practical approach to business. Based on a f
expression of time honored precepts about how life works from the "inside out", Flowing in the Workplace presents a formu
success that takes into account how life actually works and each person's unique circumstances. The precepts and techniqu
this book can be applied to virtually any life or business challenge.
This is no set of beliefs with vague theories, but a very specic step by step guide; including techniques and examples. E
area of discussion is applied to three overarching areas of application: Sales, Customer Service and Management. In this way
reader can very clearly see how basic principles can be applied in all aspects of business.
Who Hired These People? by Peter A. LaPorta
Author House Publishing | April 2009
Thirty ve register lanes available but only two lanes open. You approach the customer service desk to voice a complaint
the rude woman behind the counter tells you that the customer service department is now closed. A typical response in a w
where customer service has slipped away.
Everywhere you go in the world today service has been downsized or eliminated. The wonderful concept of self-sedominates everything from your local gas station to the world wide web and everything in between. You call a customer ser
phone line and there is no one to talk to. You go to fast food restaurants and they don’t give you fast food or fast service. R
banks, rude servers, rude clerks. Where does it all end?
Former DISNEY leader and best selling author, Peter A. LaPorta, takes you on a fabulous tale-telling journey in Who H
These People? Story after story brings you into the hilarious but incredibly true world of customer service disasters. No pun
are held back as Peter shares real life experiences of encounters with such giants as Walmart, Denny’s Restaurants, Ban
America, and much, much more.
Just when you think all service has gone down the drain, Peter takes you into the wonderful service world of champions with such companies as Walt Dis
Co., Walgreens, Darden Restaurants, Stew Leonard’s and several others. Organizations such as Angie’s List are heralded for promoting customer loyalty and
port. He shares their best practices and gives us hope for a brighter tomorrow.
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58
BEST BUSINESS PRACTICES
veryone is talking about social media and its
impact on managing customer eedback. However, most
customers are still using traditional channels to engage
with brands, such as email, phone and web site orms.Combining these unsolicited eedback channels, includ-
ing social media, with solicited survey responses can
provide the most complete picture o customer loyalty
and engagement.
A recent survey by the Temkin Group ound that 34%
o consumers shared a very bad experience directly with the company by phone,
email, letter or web site. Even ewer, 20%, put a comment on Facebook, while
only 4% posted something on Twitter. (How Customers Give Feedback by Tem-
kin Group). Thereore, to ensure that your company is gaining the most intelli-
gence rom customer eedback, it is important to incorporate solicited customer
surveys together with unsolicited eedback channels to uncover key insights.
A good example o the benefts o this approach is 3Rivers Credit Union in
South Bend, Indiana. 3Rivers created a company-wide member experience initia-
tive that provided timely, relevant and meaningul responses to member eed-back, thereby increasing member engagement. An essential part o that initiative
was to obtain member eedback in as many touch points as possible, immediately
acting upon the eedback and measuring the engagement level.
Although 3River’s average member is about 48 years o age, the credit union’s
long-term uture lies within a younger demographic group. The Temkin report
ound that 18 to 24 year-olds are the least likely to give direct eedback to com-
panies. Thereore, generating eedback rom this group became a major priority.
3Rivers also wanted to increase customer engagement levels and be more visible
in the community.
Maximizing
ActionableInsights through
Multi-Channel
Listeningby Chris Cottle, Allegiance, Inc.
E
Loyalty Management™ • LOYALTY360.OR G
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Gathering and Centralizing Feedback3Rivers created an easy way or members to provide un-
solicited eedback and to respond in a timely manner to im-
prove customer engagement. Feedback was given at several
touch points such as branches, phone center, web, email and
mail. The credit union also decided to survey members ater
transactions to improve the customer experience as well as
measure customer loyalty through NPS scores.
3Rivers implemented the Allegiance Engage Voice o
Customer (VOC) platorm in April o 2010. Allegiance En-
gage gathers eedback rom all channels into a single, in-
tegrated platorm to help organizations grow and become
more proftable through improved customer/employee loy-
alty and engagement. Specifc
eedback mechanisms include
an ad-hoc/sel-serve survey
engine, a transaction survey
engine, relationship surveys
and unsolicited eedback
management, all in one plat-orm with easy-to-use report-
ing and analytics.
3Rivers decided to link the
VOC platorm to an “I have a
voice” button on the company
Web site. Upon clicking the
button, customers can quickly
enter a suggestion, comment,
concern or question, which is
categorized and immediately
emailed to the appropriate
person within Member Ser-
vices.
Using the Allegiance web-based sotware, 3Rivers had
a central point where all customer eedback was captured,
in real time, acted upon and measured. For example, every
two weeks 3Rivers’ cross-unctional team meets to review
recurring issues rom customer eedback and discuss per-
manent changes and actions. The results are captured in an
Actionable Item Report or easy monitoring and ollow up.
Since many comments have a ollow-up action associated
with them, managing them properly is an important compo-
nent o the customer experience.
3Rivers also uses the Allegiance survey tool to create a
fve-question online survey to ollow up each VOC interac-
tion and assess the customer’s satisaction level. The survey
includes a Net Promoter Score (NPS) question to determinethe impact o the interaction on the customer’s overall im-
pression o the company and ascertain customer loyalty.
Several other surveys provide 3Rivers with additional
insights. The CustomerPulse survey is sent to each member
twice a year to identiy customer engagement levels as well
as the key drivers o engagement. 3Rivers is also using Pulse
to assess what happens to new customers ater the ‘honey-
moon stage’ is over. The survey is especially important or
young customer groups, because 3Rivers ound they had
shorter honeymoon periods than older groups.
Identiying Actionable Insights3Rivers tries to give each member immediate eedback,
even i it will take time to resolve the issue, so that they know
their voice has been heard. The frst CustomerPulse survey
uncovered a ew surprises. It highlighted issues that 3Rivers
didn’t know about that could have had serious consequences.
For example, the qualitative eedback rom the survey indi-
cated members weren’t happy about the way the credit union
had communicated a change in interest rates on certain types
o accounts.
The credit union took this unexpected and crucial fnding
to heart and changed its process. Now it sends important no-
tifcations with more advance notice, using multiple methods,
not just by email or a post-
ing on our Web site
In another example,
when 3Rivers implement-
ed new online security
procedures, it received
nearly 100 comments.Without the VOC mecha-
nism, the credit union
might have lost a signif-
cant number o disgrun-
tled customers. Instead,
these individuals became
part o the problem-solv-
ing process.
Since implement-
ing the Allegiance VOC
platorm, 3Rivers has
increased the number
o customer reerrals by
eight times, on average,rom 25 to more than 200
per month. The credit union’s overall Net Promoter Score also
increased rom 56% to 66%.
3Rivers has also expanded ‘wallet share’ o its customers
rom increased engagement and reerrals, as evidenced by in-
creases in active checking account balances, total and average
savings balances and average ree checking balances.
The multi-channel VOC program has also helped 3Rivers
understand which customers oer the best opportunities or
increased wallet share. Members are segmented into groups—
by age, by income, by preerred transaction method, by cus-
tomer duration—and the percentage o engaged members are
identifed in each group. 3Rivers then looks at the qualitative
inormation within each group to identiy what will have thequickest impact on engagement. This helps them come up
with a game plan that will increase the likelihood that less-
engaged customers will become strong proponents.
This example rom 3Rivers shows that, to gain the most in-
sights rom customer eedback, be sure to consider customer
demographics and the eedback channels most applicable to
them. Then set up a system to gather eedback rom multiple
channels in order to gain the most comprehensive customer
intelligence, identiy the actionable insights, and improve cus-
tomer loyalty. L
Be sure to consider customer
demographics and the eedback
channels most applicable tothem. Then set up a system
to gather eedback rom
multiple channels in order to
gain the most comprehensive
customer intelligence, identiy
the actionable insights, and
improve customer loyalty.
Loyalty Management™ • NOVEMBER 20
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Loyalty Management™ • LOYALTY360.ORG
Careul considerationo trends, especiallyin the choice o rewards, may make
your program muchmore relevant to theemerging youngeraudience in theworkorce.
President, Boost Rewards
Anita Emo
Last year you were named a 'Rising Star' byPromotional Products Business Magazine.Congratulations! You were recognized or thechanges you instituted at Boost Rewards, correct?Please tell us about this.
As a relative newcomer to the Incentive industry, I quick-
ly understood the value immersing myself into the industry
through association involvement, developing relationships
with industry superstars and being bold with our approach
to designing performance based solutions that were relevant,
fresh and highly scalable. Our rapid growth, enabled by our vi-sion and leadership team, has been catching the eye of many
industry analysts.
What’s new with Boost Rewards since?In 2009 I became the majority shareholder in Boost Re-
wards and we achieved our WBE certication shortly there-
after. Our focus on process and technology led us to the
development and release of our latest platform—Boost 7.0—
enhancing our client experience, reporting suite and reward
options. We’ve also built a very tight implementation process
for on boarding new clients with built-in communications to all
involved in the process. I’ve lead a major investment in R & D
and will be launching a patent pending and innovative market
solution in the rst quarter of 2012 that will enhance consumerto employee recognition like nothing ever seen in the industry
before.
What changes are you seeing in the marketplacetoday? What should our readers we be aware o?
My observation is that there are two major changes emerg-
ing in the market. The rst is a technological evolution—pri-
marily on the provider side, which includes integration with
social media, ease-of-use, mobile apps, advanced communi-
cation, measurable data tracking and award integration. My
opinion is that if you are not engaged with leading technologyyou will likely earn new business through price cutting. Second-
ly, there is demographic evolution of the typical consumer and
employee which means that careful consideration of trends,
especially in the choice of rewards, may make your program
much more relevant to the emerging younger audience in the
workforce. Positioning yourself with relevant, sexy and high
demand items that appeal to multi-generational workforce will
prove the most effective motivator to modify behavior in to -
day’s market space.
BEHIND THE BRAND
60 Loyalty Management™ • LOYALTY360.ORG
Boost Rewards™, an award winning WBENC-Certifed Women’s Business
Enterprise, is a trusted partner or organizations committed to achieving total
workorce engagement. As the President o Boost Rewards, Anita oversees
the operations o the company to create smooth client implementations o
employee perormance programs, and has been a critical leader in designing
new technology solutions that have given Boost Rewards a competitive edge.
Her sales and management experience rom prior work along with her driven
personality have guided Boost Rewards to become one o the Fastest Growing
50 Woman Owned Businesses.
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Loyalty Management™ • NOVEMBER 20
Anita and her team
Anita and her family
What do you believe is key in building the ideal employeerelationship?
Creating a trusting and caring culture is paramount. Showing youremployees that you truly care builds trust—trust however must be
earned. My advice to any business owner is to understand that your
employees must have clearly dened expectations of their role in the
organization.
How do you view the relationship between employee andthe customer?
The consumer is the ultimate boss of the employee—my view is that
the customer is in fact, always right. An organization will have rules and
procedures, however, I am a rm believer that the employee should be
empowered to make decisions at the moment of truth to satisfy the cus-
tomer. Unfortunately, in our society today, human interactions are being
hindered by voice mail, email and text messages. Wouldn’t it be refresh-
ing to get back to developing personal relationships with the customer?
What would you like to see change in the market’sapproach to employee experience, engagement andloyalty?
I would like to see the market embrace an approach to recognition
that evolves as employees do. There are simply too many outdated solu-
tions in the marketplace. Without the constant infusion of bold and in-
novative solutions that challenge the status quo, the incentive industry
is at risk of appearing ineffective.
What is your personal motto?I have a favorite Maya Angelou quote that I
think sums up how I approach everything that I
do.
“Love life, engage in it, give it all you’ve got,
love it with a passion, because life truly does give
back, many times over, what you put into it.”
I live my business and personal life in this
manner. With that said, I have become very in-
volved with the “Pay It Forward Foundation”—
www.payitforwardfoundation.org/wristbands.The foundation believes that we are a community
of hope-focused individuals whose mission is to
inspire, promote and celebrate the practice of pay
it forward principles.
Who has had the most infuence onyour proessional lie, and why?
My inspiration comes from my husband and
business partner Michael. He’s been in the indus-
try for 30 years—his vision, advice and belief in
me has been the fuel for my professional growth.
What can we expect rom Boost
Rewards in 2012?There are some amazing, unique and inno-
vative solutions on the horizon! Some of these
solutions you would not expect from the typical
incentive platform. We are committed to provide
fascinating on demand solutions to both large and
small organizations. You can expect to see new
solutions focused on the consumer loyalty mar-
ket.
We like to end these interviews withsome words o wisdom. Would youplease share one or two key lessonsyou’ve learned over the years that could
help?From a personal perspective, keep people that
you love close to you and do things that you are
passionate about. I love my family, Zumba, trav-
eling and experiencing other cultures—My per-
sonal life keeps me vibrant.
From a professional perspective, engaging in
a structured and strategic process, surrounded by
strong team players, is the key to success—I have
a fantastic team! L
My inspiration comes rom myhusband and business partner
Michael. He’s been in the industry
or 30 years—his vision, advice
and belie in me has been the uel
or my proessional growth.
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Loyalty Management™ • LOYALTY360.ORG62
Focusing on Key Customer
Loyalty Metrics
BEST BUSINESS PRACTICES
aving run the customer loyalty program at SimplexGrinnell
for the past several years, I’m often asked to provide ONE met-
ric that will provide a clear picture of customer loyalty. And while
there are several metrics that are regarded as primary indicators
of “loyalty”, none of them will provide you with sufcient informa-
tion if used alone.
The longest running metric that I’m aware of is overall satisfac-
tion (OSAT), which is what the American Customer Satisfaction
Index (ACSI)* was built upon. The ACSI has more than 12 years of
empirical evidence supporting the relationship between customersatisfaction scores and key nancial metrics. It is the gold stan-
dard of measurement. Academic research and literature has at-
tested to the value of the ACSI in measuring customer satisfaction
and predicting business success.
Since 2006, we have used OSAT along with two additional key
indicators of customer loyalty—“likelihood to continue purchas-
ing” (renewal) and “likelihood to recommend.” The “recommend”
metric, Net Customer Advocacy (NCA) score, is our version of
NPS*, based on a 5-point scale instead of a 10-point scale.
I do not subscribe to the idea that you only need to measure
customer loyalty using one metric. To the contrary, I nd all the
measures critically important. A pilot would never consider y-
ing an aircraft having just one instrument, and likewise we should
never believe that one customer loyalty metric will sufce. Overal
satisfaction is a baseline requirement. Without that measure rm
ly established and returning levels of 8.2 (on a 10-point scale) and
higher, we cannot and should not expect high levels of customer
renewals, and certainly not customer referrals.
These loyalty metrics serve only as indicators and without fur
ther clarication as to why the customer rated us as they did, we
would have no clue about what we could do to improve the rating
Therefore, each of the loyalty metric questions is followed by arelated open-ended question, so we can obtain additional insights
through verbatim comments. Without these verbatim comments
all three metrics would be academic and entertaining at best—but
certainly not actionable. Metrics and verbatim customer com
ments must go hand-in-hand.
The chart below shows the three key customer loyalty indica
tors we have used since 2006, along with the scale applied to each
its calculation, the exact syntax of the quantitative survey ques
tion, and the syntax of the related open-ended question. These
are the primary KPIs we report monthly by company, by operation
by region, and by district. Because we have other variables in ou
customer upload data-le, we have the ability to report each o
these KPIs by product, by vertical market, by customer tenure, and
by contract value.Survey design should always include metrics that lead to the
most accurate assessment of customer satisfaction and loyalty
It’s best to avoid single metric approaches and instead combine
several to serve as key performance indicators and help trend cus
tomer loyalty over time. Overly complicated and lengthy surveys
that challenge the patience of the recipient should also be avoided
in favor of carefully constructed surveys that maintain the balance
between quantitative and open-ended responses.
OSAT Likely to Renew Likely to Recommend
How loyalty is
currently measured
Average score on a 10-point scale where
one is low & 10 is high
The percentage of top two scores on a ve-
point scale where one is low & ve is high
The percentage of top scores minus the
percentage of the bottom two scores on
ve-point scale where one is low & ve is
How is the question
ramed?
Please rate your overall satisfaction with
this service experience.
Based on this most recent service
experience, how likely are you to continue
doing business with SimplexGrinnell?
Assuming you were allowed, how likely
would you be to recommend SimplexG
to colleagues or others based on this m
recent service experience?
Related open-ended
question
In light of your responses to the
questions we've asked so far, what could
SimplexGrinnell have done differently to
improve your satisfaction with this service
experience?
Could you please provide an example or
reason for your response?
Could you please provide an example o
reason for your response?
Simplex Grinnell's Key Loyalty Indicators
by Karl Sharicz, Simplex Grinnell
Survey design should always
include metrics that lead to the
most accurate assessment o
customer satisaction and loyalty.
H
L
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Loyalty Management™ • NOVEMBER 20
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