loyalty management 3rd quarter - 2014

8/10/2019 Loyalty Management 3rd Quarter - 2014

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Third Quarter 2014

VOLUME6NUMBER3

IN THIS ISSUE:

Raleys Keeps It Simple,

Intuitive, and Compelling

for Its Customers

Single-minded Focus on

the Customer Integral to

U.K.s Telefonica O2

MAACO-VER

Complete as Customer

Becomes Focal Point

Engagement &

Experience Expo 2014

Session Preview

The Loyalty360

CX Awards


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Expectation Matching: Being where your customer is, when they want you there,

with the right message, through the right vehicle, pre-transaction, during, and

post-transaction. Our CEO, Mark Johnson, first mentioned this concept at the 2012

Engagement & Experience Expo.

As we approach the 2014 event, the concept of expectation matching is still top of

mind. This issue and the event will share real-life stories from top brands working to

build the best possible customer experiences, and insights from experts focused on

best approaches and road mapping.

Raleys, which garnered three Platinum honors at the inaugural Loyalty360 Awards atthe 7th annual Loyalty Expo in March, shares its compelling story, best practices, and

how it always keeps the customer first in-store and throughout its organization.

Learn direct from the president of MAACO how he instituted significant changes by

placing the customer first and what this new focus has done for the brands positioning

and overall profitability.

Paul Conder and Laurie Meek from Lenati take you through the three key steps to

achieving a holistic customer experience loyalty strategy on pgs 50 51. Julia Barrett

of EffectiveUI teaches that personas and journey maps are essential customer experience

tools on page 45.

If you enjoy this edition, be sure to join us at the 4th annual Engagement & Experience

Expo, November 10 12 at the Renaissance Dallas Hotel, Dallas, Texas.

Sincerely,

FROM THE EDITOR

Erin Raese

Editor-in-Chief

Loyalty [email protected]

2 0

1 4

November 10-12

Renaissance Dallas Hotel | Dallas, Texas


5/68Loyalty Management THIRD QUARTER 2014

TECHNOLOGY,TRENDS & REWARDS

BEST BUSINESSPRACTICES

38 Digital Gift Card Trends: Convenient, Available,

and Versatile

Mike Fletcher | InComm Digital Solutions

40 Retail Innovation Reaches New Heights

Krishna Mehra | Capillary Technologies

42 Big Data Enables CPG Companies to Gain an In-Depth,

Personal Connection with the End User

Miklos Tomka | InfoTrellis

45 Contextualizing Customer Insight: Journey Maps

and Personas as Interfaces

Julia Barrett | EffectiveUI

46 The Love Matrix: loyalty to the brand, or (just)

to the programs discount?

Scott Robinson | Bond Brand Loyalty

50 The CX/Loyalty Connection

Laurie Meek and Paul Conder | Lenati

52 Use Customer Experience Management to Host

the Best Party in Town

Kelly Koelliker | KANA, A Verint Company

54 How Behavioral Economics Leads to Intimate

Brand Engagement

Christian Goy | Behavioral Science Lab

56 Four Hurdles to Great Customer Experiences

Syed Hasan | ResponseTek

60 Loyalty Powers Consumer Advocacy

John Bartold | Loyalty Solutions, Epsilon

WWW.LOYALTY360.ORG

2014 Loyalty360, Inc. and/or its Affiliates.

All Rights Reserved.

Reproduction and distribution of this publication

in any form without prior written permission isforbidden. The information contained herein

has been obtained from sources believed to be

reliable. Loyalty360 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 reflectiveof Loyalty360 and/or its affiliates. Loyalty360

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.

In this Issue..THIRD QUARTER 2014 VOLUME 6 NUMBER 3

Loyalty Management Editorial

& Production Team

Erin Raese - Editor in Chief

Mark Johnson - Contributing Editor

Christopher Schatzman - Design Director

Jim Tierney - Senior Writer

Crescent Printing Company - Print Production

Contacts

Article Submissions & Advertising:

Erin Raese

[email protected] or

513.800.0360, ext. 210

Digital Gift Card Trends:Convenient, Available, and Versatile

38 46

The Love Matrix:loyalty to the brand, or (just)to the programs discount?

Big Data Enables CPG Companies toGain an In-Depth, Personal Connectionwith the End User

42


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L360

LOYALTY360 ON THE WEB

ON LOYALTY360.ORG

brandDrawing from insightful conversations with brand CEOs and CMOs, Loyalty360 brings

you a new way to digest this information with the introduction of brandbites. Download to

get the inside scoop on what keeps todays top execs up at night.

Visit loyalty360.org/resources#research to download this pdf and view other resources.

BRANDBITES: EXCLUSIVE INSIGHTS FROM TODAYS TOP EXECS

Loyalty360 continues to elevate the customer experience conversation, talking with top brands

to uncover best practices, trends, and challenges in the marketplace. Check out the following

exclusive content and more on Loyalty360.org:

Red Lion Hotelsshared its retail industry approach to its new loyalty program Hello Rewards

as it strives to bring hospitality back to loyalty programs

With over two million members in 2 years, Stride Rites loyalty program has been deemed a

success, and the brand talked program insights as well as its new Stride Rite RewardsApp

Schneider Electrichas been making investments in innovation, and shared how its recent

implementation of SDLs Customer Experience Cloud is personalizing communications

with customers across the globe

ELEVATING THE CUSTOMER EXPERIENCE CONVERSATION

NEW MEMBER-ONLY FEATURE: BRAND PANELBrand Panel will be launching soon, and will offer an exclusive online community that

allows marketers, customer experience professionals, and customer engagement

professionals to consult with one another and gain insights.

Only accessible by members, Brand Panel is an online platform for:

Connecting with other professionals

Sharing and receiving news, ideas, advice and opinions

Gathering for regularly-scheduled roundtable discussions

Learn more about becoming a member by contacting Mark Johnson at

[email protected] or Erin Raese at [email protected].


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Phone. Chat. Email. Social Media. Surveys. Customers have more

ways than ever to communicate withand aboutyour business.

With VerintVoice of the Customer Analyticssolutions, you can capture

their interactions and sentiments, analyze them, then use the results

to surface hidden issues, detect trends, and deliver the kind of

experiences that keep customers coming back again and again.

Find out how Verint Voice of the Customer solutions can help

make Customer-Inspired ExcellenceTM a reality in your business.

Visit www.verint.com/voca or call 1-800-4VERINT.

2014 Verint Systems Inc. All Rights Reserved Worldwide.Speech Analytics | Text Analytics | Enterprise Feedback Management

Do you know what

customersare saying?

you will.With VerintVoice Of The Customer Analytics,


8/68

LOYALTY FORUM: YOUR VOICE

8 Loyalty Management LOYALTY360.ORG

What are the top ways you utilize

According to Loyalty360s most recent Loyalty Landscape Report, 24% of marketers say that consumers expect

more personalization now than 2 years ago. And when executed correctly, personalization improves both the

customer experience and aligns with business goals. With this in mind, Loyalty360 set out to see how marketers

are utilizing personalization to enhance the customer experience and positively affect the bottom line.

to drive revenue?personalization

Personalization depends on the quality of analytics as

a driving force:

1) Within Telecom, serving up relevant upsell offers

to customers. Example: You watched 15 Videos On

Demand last month. You like movies. Upsell offer:

50% off for 3 months on HBO Box Office.

2) Within contact center: Create an IVR Data Dip

for specific customer cohorts (defined by analytics

along multiple behavioral traits) and route calls

directly to specific queues, like Gold Queue or high-

revenue customers.

3) Personalization of self-serve web portals reduce CES

or Customer Effort score customers can get what

they need with minimal time spent.

- Shahzad Chaudry, Senior Director Loyalty Analytics &

Insights | Etihad Airways

I believe personalization can be interpreted in 2 main ways. One, personalization can,

and should, reduce customer effort. This, in turn, would drive customer happiness.

On the other hand, personalization can boost revenue by helping your customers buy

the right things for them. In a digital setting, we would recommend:

1) Get Personal:In an era full of noise, your customers seek to be acknowledged

as individuals, and feel that you are attentive to their unique needs. Create these

personalized experiences, while balancing aha moments and big brother ones.Use predictive models and machine learning to scale personalized decisions. Inject

personal touches throughout the experience, in a scalable way (e.g. visit history,

special offers for special circumstances, etc.).

2) Be Memorable:Employ the Pareto principle to personalization. Five strong and

well-calculated personalized offers or calls-to-action are more effective than 30+

messages that are perceived as junk mail.

- Idit Aloni-Halfon, Portfolio Marketing | Enterprise Group at NICE Systems


9/68Loyalty Management SECOND QUARTER 2014

1) Become outside-in.At its most basic, a conversation about

personalization is often the first time a large, multi-product organization

thinks about being outside-in - being centered around the

customer. Often our clients are coming from a fractured inside-

out web content strategy that is driven by product groups, services

and business unit silos, creating a web experience that is a bi-product

of their org structure. Personalization, at the very least, enablesorganizations to have that conversation, to consider a common

customer across each of these organizational silos and to enable

cross-sell.

2) Drive brand affinity and advocacy:The correlation between

promoting related products and lift in sales for the retail industry

is proven and well understood, but in other industries, like financial

services, its less obvious. In industries where the buying decision

is more considered than a discretionary spend driven by other

people also bought, its a different set of emotions that organizations

need to appeal to. Here, organizations can use personalization to

appeal to that specific visitors mind state, which drives loyalty,

brand affinity and creates advocates that will virtually coax other

prospects along the customer journey. For example, you need to

provide different content to engage someone who is cautious about

investing than to someone who is an ambitious entrepreneur.

3) Shorten the visitor task:Offering relevant content based on simple

triggers, such as the campaign that someone is responding to or

the search terms they used to reach the site, shortens the time for

the visitor to find what they need and transact. Each click fortodays distracted visitor, while they find what they need, is a

potential for them to bounce off the site. How many times have you

clicked on a banner ad, only to be left on a generic landing page and

it becomes your job to find the specific product or service that

meets your needs? Personalization can be used to adapt that

landing page experience.

- Ian Truscott, VP Content Strategy | Tahzoo

1) Tailor the offers to the updated customer state (needs/

preferences, and status) by selecting the best benefit

(type/size/value). This will increase the offering

relevancy to drive higher response rates and satisfaction.

2) Manage the engagement dimensions personally select

the best communication channel for the given customer,

decide on the marketing approach, whether or not to

define personal reminders and how many, set the

validity duration, use past responses and interactions

to adjust the this engagement accordingly, etc.

3) Use predictive analytics to further improve the above

2 bullets.

- Dilly Lachkim | Independent Internet Marketing Specialist

ALWAYS

MOST OFTHE TIME

SOMETIMES

NEVER

8%9.1%

22.7%

29.5%

30.7%

RARELY

To what degree does

your company deliver

personalized experiencesto customers?


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LOYALTY FORUM: BEHIND THE BRAND

BehindtheBrand


WITH LONNIE MAYNE |INMOMENT

2014 HAS BEEN A BIT OF A WHIRLWIND FOR YOU AND

INMOMENT; BRINGING TOGETHER TWO STRONG AND

INNOVATIVE ORGANIZATIONS ROLLING THEM INTO A NEW

BRAND. PLEASE SHARE INSIGHTS ON HOW THIS CAME ABOUT:

We had accomplished a lot at Mindshare, but we knew we wanted

to take the company and our customers - to the next level, and we

wanted to do so fairly quickly. There are a variety of options companies

have to accomplish this in a healthy way. One of these is acquiring

complimentary technology and expertise. We looked at that option,

and Empathica was a great fit. Once the acquisition was final, we

discovered that there were even more opportunities to innovate and

bring new value to the market than we had imagined. At that point,

we knew that neither the Mindshare nor the Empathica names fully

captured our new vision. So we decided to choose a new name one

that would represent our shared mission, as well as the new opportunities

we can now offer our clients, and the CX industry as a whole.

WHAT IMPACT DID THE CURRENT ECONOMY AND TRENDS IN

CUSTOMER BEHAVIOR HAVE IN THE DECISION TO MAKE THESE

SIGNIFICANT CHANGES?

The fickle economic environment and changing customer expectations

definitely present some real challenges. However, we see these as

massive opportunities. Customer experience will be the factor that

sets status-quote companies apart from leaders. Both B2B and

consumer customers are demanding more from brands. They want

more than a transaction; they want relationships. We made some big

changes to our company to ensure we have the right technology,

people and resources to help our clients deliver a world-class

customer experience. We made the decision to invest at a difficult

time because we had made a commitment to our customers to stand

with them, and help keep them out front.

WHAT CAN WE EXPECT FOR THE REST OF 2014 AND 2015?

More brands both large and small taking significant actions to

improve the customer experience. Weve seen CX leaders make some

phenomenal changes, orienting every area of their business around

the customer. And this isnt just a trend. Technology, economics and

buyer behavior trends all show that this is the new normal. Companies

that cant or choose not to make this shift will not survive. Those that

do, will move at the speed of light. And that includes InMoment.

WHAT DO YOU SEE AS THE NEXT BIG TREND IN CUSTOMER

ENGAGEMENT AND LOYALTY?

Customer engagement and loyalty will emerge from their silos and

become priorities for entire organizations. We are already seeing

this happen with our most innovative clients. I spent a good part of

this past year on the road, meeting with c-level executives, and even

boards of directors, answering questions about what more they can do

to connect with their customers. For years, our industry has identified

this as one of the most challenging barriers for both implementation

of best-of-class CX programs, and more importantly, the relationship

and financial results we know come from mature programs. Those

days are over. As a result of this enterprise-wide awareness, well also

see companies connecting the dots in all things customer through an

elegant stream of data points, creating the absolute best customerexperience possible.

WHAT IS THE BIGGEST CHALLENGE YOU ARE CURRENTLY

LOOKING TO SOLVE?

Hiring the right people fast enough. There are a lot of potential

employees with a great skill set and experience.

WHAT TREND OR TECHNOLOGY SHOULD MARKETERS EXPIRE AS

A FAD OF THE PAST?

Weekly circulars.

Lonnie has spent his entire career helping companies focus on the human side of doing

business. Whether its building a healthy culture for internal teams, or centering decisions

around customers and their needs, Lonnie is laser-focused on creating people-centric

enterprises that bring value to everyone they touch.



WHAT DO YOU BELIEVE IS KEY IN DRIVING TRUE CUSTOMERENGAGEMENT?

Really meaning it. If youre serious about transforming your company

from the old transactional model, to one based on real relationships,

authenticity is critical.

WHAT IS YOUR PERSONAL MOTTO?

Live! Not someday, but today!

WHICH BOOK(S) ARE YOU RECOMMENDING AND WHY?

Mindfulness for the busy person. Dr. Michael Sinclair and Josie Seydel.

Because in this crazy world slowing things down is essential. A great

book on mindfulness and focusing on whats right in front of you.

WHO HAS HAD THE MOST INFLUENCE ON YOUR

PROFESSIONAL LIFE

My uncle Bob, who recently passed away, had a huge impact on my

professional life. When I was very young, he brought me in to his

board and business meetings and asked my opinions. He showed me

what hard work is all about, but he also taught me that you have to

slow things down and focus on whats most important. The people!

FAVORITE LEISURE ACTIVITY? DOES THIS INFLUENCE YOUR WORK?

Hanging out with my children and grandchild, pretty much anytime

anywhere. I travel a lot, so my time with them is very precious.

HOW DO YOU MEASURE SUCCESS OR FAILURE?

Only by whether weve done our absolute best. If my team has given it

their all and we still dont accomplish our objectives, thats not failure.

Thats success.

WORDS OF ADVICE FOR THE NOVICE MARKETER?

Customers crave acknowledgement. They want to be seen and

understood. Talk with them, not at them. Try to create exceptional

experiences and your customers will reward you with

outstanding loyalty. L

WHAT IS YOURFAVORITE WORD?

PERSPECTIVE.

WHAT IS YOUR LEASTFAVORITE WORD?

CANT.

WHAT TURNS YOU ONCREATIVELY, SPIRITUALLY,

OR EMOTIONALLY?

WATCHING SO MEONE ,ANYONE, OVERCOMEADVERSITY AND DO THEIRBEST TO SUCCEED.

WHAT TURNS YOU OFF?

PEOPLE WHO GIVE UP ANDCANT MANAGE TO STEP BACKAND REALIZE THAT THEY HAVE

THE POWER TO CHANGETHEIR CIRCUMSTANCESAND THEIR LIVES.

WHAT IS YOUR FAVORITE(PG-13) CURSE WORD?

IM PRETTY MUCH LIKETHE BROADWAY PLAY. THE

WORST YOURE LIKELY TOHEAR ME SAY IS CRAP.

WHAT SOUND OR NOISE DOYOU LOVE?

THE LAUGHTER OFCHILDREN.

WHAT SOUND OR NOISE DOYOU HATE?

AN AMBULANCE SIREN.

WHAT PROFESSION OTHER

THAN YOUR OWN WOULDYOU LIKE TO ATTEMPT? FILMMAKER.

WHAT PROFESSION WOULDYOU NOT LIKE TO DO?

ANY JOB WHERE I WOULDNTHAVE LOTS OF HUMANCONTACT -- WORKING WITHPEOPLE IS ESSENTIAL TOMY PROFESSIONAL ANDPERSONAL QUALITY OF LIFE.

IF HEAVEN EXISTS, WHATWOULD YOU LIKE TO HEAR

GOD SAY WHEN YOU ARRIVEAT THE PEARLY GATES?

WELL DONE.

*Inspired by James Lipton on Inside the Actors Studio we asked Lonnie to share his quick fire response

to the questions originating from the French series, Bouillon de Culture hosted by Bernard Pivot.

123

4567

8910

QUICK FIRE QUESTIONS


12/682 Loyalty Management LOYALTY360.ORG

LOYALTY FORUM: 360 INSIGHTS

The interest in customer loyalty has never been

greater. We launched our Brand Forum this past

summer with an increased focus on brands to

understand the challenges they are facing in this new

marketing paradigm. We continue to hear from brands

about their concerted efforts to understand their customers in

a more deep and meaningful manner. We see more brands

that are willing to discuss their customer journey with

most having a more pronounced need for metrics and

insight. The most common theme we hear is the need

for simplicity. Yet, simplicity is more challenging now than

ever before due to a number of factors marketers face

today. While these influencing factors themselves are not

misunderstood, they are daunting and numerous, and

include new technology, too much data, and ROI

challenges for old, new, and integrated technologies.

We have spoken with more than 100 brands since this summer and

hearing about their triumphs and travails is quite revelatory. We live

now in an age of data, yet how data is spoken about from vendor to

marketer can leave the marketer quite perplexed. There is the massive

challenge of leveraging all kinds of data: structured, unstructured,

internal, external, social, siloed, aggregated, experiential, qualitative,

quantitative, and sentimental all with the opportunity to create

actionable customer insight for the brand.

Brands want simplicity. They know they have challenges

and need more assistance in their journeys than ever before.

The need for simplicity in the relationships they have with their

customers is compounded by the dissonance that can be created

by technology (in practice, pitch, and performance) that is used

to facilitate this simplicity in the first place.

Brands ask us continually: Why is a new acronym necessary?

We are already confused with the current ones. We understand

the complexity involved, and we want to create it, so we need help.

We gleaned considerable insight from the Loyalty Landscape.

According to marketers, the top three must-have attributes for

loyalty programs are customer satisfaction with rewards value

(34%), easy to earn and burn rewards (26%), and easy to

understand programs (24%). Even as consumer expectations evolve

and the tools available to both customers and companies proliferate,

the most critical components of a loyalty program remain the value

of the rewards and the ease and speed of how they can be earned

and burned.

The biggest challenge faced by marketers is being

able to to deliver on consumer expectations

regarding value and relevancy (22%). Next are

those challenges related to profitability and hitting

revenue targets (18%). The push and pull of meeting ever-growing

consumer demands and expectations, such as top-notch experiences,

unique engagement techniques (18%), and always-on customer

service while navigating internal constraints is a real struggle for

many. Navigating the fluidity of emerging challenges, such as rapidly

developing technology (9%), mobile and omni-channel expectations

(3%), are somewhat lower on the list.

Loyalty:The Challenge of Simplicity in the Age of Complexity

The Continued Renaissance of

Mark JohnsonLoyalty360

Continued on page 14



According to marketers, the top three

must-have attributes for loyalty

programs are customer satisfaction

with rewards value(34%), easy toearn and burn rewards(26%), and

easy to understand programs(24%)

The biggest challenge

faced by marketers isbeing able to to deliver on

consumer expectationsregarding value and

relevancy (22%).

Mobile and

omni-channel

expectations (3%),

are somewhat lower

on the list.

LoyaltyLANDSCAPE

TM

Next are those

challenges related

profitability and hitt

revenue targets (18

The push and pull of meetiever-growing consumer

demands and expectation

such as top-notch experienc

unique engagement

techniques (18%).

Always-on customer service while

navigating internal constraints is a real struggle for

many. Navigating the fluidity of emerging challenges,

such as rapidly developing technology (9%).


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LOYALTY FORUM: 360 INSIGHTS


Brands told us through the landscape that benchmarking is the most

sought-after competitor insight (33%). Marketers want to know how

their competitors are performing on key success metrics like ROI,

profits, and sales. Without this critical information, its difficult for

many to make the case for budget spending on innovative tools and

techniques, yielding a greater commitment toward customers.

Most marketers (58%) indicate they are laggards when it comes to

using new tools, technologies, and techniques to build customer

loyalty. Without benchmarks to justify budget and gauge success,

it is difficult to get buy-in for tools and techniques that push loyalty

strategies beyond just points.

We look forward to presenting our first CX landscape at the 2014

Engagement & Experience Expo. We will be helping tie together the

challenges of Customer Experience (from a brand perspective) and

how that can be used to drive true emotional loyalty. We will also

be putting forth a series of metrics that will help brands understand

and benchmark their customer experience efforts.

Loyalty, at its core, is quite simple: It is an emotional commitment

(not always understood) to a person, process, team, or company. As

former Supreme Court Justice Potter Stewart once said: I know it

when I see it.

We know the brands, teams and passions that evoke loyalty; yet

we also know that the experiences (positive, negative, and post-

encounter / transaction) one has with a brand or team or process

can build loyalty / engagement metrics. But how? We know that the

active process of listening to your audience and putting in process the

products, services, and standards that the individual wants is what

you should do, but how to do it is another challenge.

Brands have a clarion call for simplicity and detailed 1-to-1 knowledge

like the corner butcher store from the 1920s that knew my great

grandparents needs on Tuesday (pork), Thursday (Chicken, right

Mr. Dorr) and Sunday (Lamb for Sunday?). They know that the

technologies today offer the greatest opportunity to create that

level of engagement; yet the simplicity of the 1920s is complicated

by the obtuse modern reality of technology and data.

We look forward to helping bring simplicity back to loyalty. L

The Continued Renaissance of Loyalty continued...

Loyalty, at its core, is quite simple: It is an emotional commitment

(not always understood) to a person, process, team, or company.

As former Supreme Court Justice Potter Stewart once said:

I know it when I see it.

Brands told us through the landscapethat benchmarking is the most

sought-after competitor insight (33%).


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LOYALTY FORUM: BY THE NUMBERS


Internet of Things:A Game of Give and Take

Internet of Things is a term that refers to the internets ability to

enable communication among physical objects. An exploding market,

this category includes devices such as wearable fitness trackers,

smart watches, appliances, thermostats, CO2 detectors and more,

all connected to the Internet. That connection can make these

devices powerful tools for consumers in their quest for health,

safety and efficiency, and a burgeoning source of rich customer datafor companies. But how are customers willing to share data,

and what are the benefits that connectivity should provide?

50%will share personal data ifgiven a coupon or discount

of consumers have privacy

concerns with wearable

Internet of Things (IoT)

connected technologies

80%

but...



Smart refrigerator?

Sure!

would like recipes on

their mobile device for

food to make from the

food in their fridge

85%

82%

would share car data in

exchange for free maintenance

60%

want location-based

automatic coupons on their

mobile device for

frequently purchased foods

86%

looking for the least expensive places

to purchase favorite food products

of consumers were willing

to pay more for a smart

alarm, compared to 59%

who were willing to pay

more for a smart refrigerator

83%

*Data from recent Acquity Group: Acquity Group, a leading Brand eCommerce and

digital marketing agency, now part of Accenture Interactive, recently released the

2014 State of the Internet of Things Study.



LOYALTY FORUM: Q&A

Q&AQ:What are some best practices for aligning onall fronts to ensure a consistent experiencethat customers love?

-Peter Oxley | ResponseTek

A: Teamwork is the beating heart of every successful organization. Without it, communication lines getscattered, goals move off track, and, most detrimentally, customers receive poor service.

Organizational alignment from the executive level right down to the front lines is an imperative step

for a successful customer experience program. Here are five ways you can get your company train on the

right track:

1. Brand Your Customer Experience Program

A strong identity and catchy name will go a long way. This means all content, training materials, reports and

communications must reflect the brand and its goals.

2. Give Everyone Access to Customer Experience Insights

All levels in your organization should have access to the customer experience insights that are relevant to

their role. This ensures each employee understands how their role in the company affects the customer.

3. Set the Benchmark

Variety is the spice of life, but consistently good experiences make customers loyal for life. Ensure your

customer experience program has benchmark questions across all channels. These questions create clear,

consistent, measurable metrics and standards you can ACT on.

4. Make It Worth Everyones Time

Tie compensation programs directly to customer experience targets for effective performance management.

Celebrate the people in your company who are customer experience heroes too. Reward them for a job well

done and make them role models for the rest of the company.

5. Eat Your Own Dog Food

Ask your employees the same questions you ask your customers, but be careful to only ask questions thatyoure willing to hear the answers to (and are prepared to act on).

Great service = great business. Take the time and resources to get your team on board with your customer

experience program and youll see returns in greater NPS scores, customer satisfaction rates and overall sales.


19/68

-Peyton Lindley | EffectiveUI

A: While there's a great deal of discussion around designing and building great products andservices that customers will love, we often inspect the organizational ecosystem in which these

products are conceived. Without a customer-centric culture, willingness to pivot, and ongoing

leadership, alignment is incredibly difficult to maintain. We've done some preliminary research with

our clients on their best practices for customer centricity, and have identified five key focus areas:

Organizational structure

Customer focused initiatives cross many disciplines, yet departmental structure gets in the way (silos,

poor communication, competing agendas, limited resources). What organizational changes have been

made to capture and translate customer need?

A digital focus

Customer-centric organizations put digital at the heart of everything they do. Your customers are

connecting with your brand at all hours, from any location and any device. Are you providing a

great experience?

Infrastructure

Teams need the right tools, training and environment to experiment and rise above the status quo

and move your organization forward. What systems are in place to allow teams to build/test/refine

with customers?

Customer-driven methodology

Do you have a user-centric design process (that actually involves real customers) that focuses ondesigning for customer outcomes rather than designing a predefined solution?

Technical capabilities

Strong IT organizations that are involved early and buy in to the vision are essential to success.

Customer-centric technologists, well-architected APIs and clean data are all part of the solution.

A: As customers, we want to find the same information, assistance and experience with any part ofthe organization regardless of the channel of interaction. The root causes of most customer experience

opportunities are often hand-offs, design vacuums and communications within and between organizations

and systems. There are many ways that can help brands be more consistent:

Create structure and accountability to embed a cross-team approach for both reacting to customer

issues and for designing/improving existing interactions.

Ensure flexibility in the organizational structure to support caring for the end-to-end

customer experience.

Create formal customer experience guidelines including checkpoints for meeting those guidelines, to

ensure teams are complying with designing end-to-end and optimized experiences.

Journey mapping sessions create very eye-opening and memorable experiences for cross-team attendees.

Provide education and learning opportunities about customer experience. Everyone in the organization

should have some level of customer experience practitioner expertise depending on their role.

Recognize associates that model the desired cross-team approach that carries the entire

customer journey.

-Diane Magers | AT&T



FEATURES

SOMETHING EXTRA

The result: Raleys is giving Something Extra to its customers.

As Something Extra was being developed, Tom Hutchison, Director Marketing, CRM

& Analytics at Raleys Family of Fine Stores, constantly asked, In order to effectively

compete against Walmart or Amazon, how do we create compelling value?

The answer: Its about fair and consistent pricing, understanding customer elasticity,

bringing the right tools to bear, and placing the customer at the center of our world,

he says.

Hutchison says Raleys overarching goal is to make the shopping experience as easy

as possible for its customers, while providing a world-class experience.

Customers are finding that shopping with Raleys is getting easier, more intuitive,

and is providing them with more value, he says. The intuitive piece comes from

Raleys using the data to dramatically improve assortment, adjacencies, category

shape and store flow. The value comes from the offers, but also from using the datato smartly improve pricing and promotions.

Raleys has seen great results in communications (open rates, click-throughs),

program engagement (enrollment, offer activations, offer redemptions, customer

feedback), and top and bottom l ines business improvement.

Every single tactic is measured through test and control, and the ROI for the overall

program is significantly positive, Hutchison explains.

LOYALTY PROGRAM BI G PART OF SALE S

In its first year, the Something Extra customer loyalty program accounted for 65% of

Raleys total sales.

The Something Extra program is not a two-tiered loyalty program where members

get a reduced price and non-members get penalized, Hutchison says. To reach 65%in the first year is unprecedented. Like many grocery retailers, Raleys faced negative

sales trends during and after the economic downturn and before the launch of the

program. Since the programs launch in September 2012, Raleys has seen a return to

sales and share growth. At a time when the rest of the grocery industry is negative,

Raleys has turned the corner.

In recognition of its highly successful Something Extra customer loyalty program,

Raleys garnered three platinum honors at the inaugural Loyalty360 Awards held

in March at the 7th annual Loyalty Expo, presented by Loyalty360 The Loyalty

Marketers Association.

Raleys took home top honors in the following three categories: Best Reward Program,

Platinum Winner; Best Customer Experience & Engagement, Platinum Winner; and

Best Technology in Loyalty Marketing, Platinum Winner.

In the aftermath of the recession ofthe late 2000s, retailers across thecountry were faced with the challengeof examining how they could engagewith customers in smarter ways thatwould drive long-term loyalty. ForRaleys, this was an opportunity toreturn to its roots by providing worldclass service based on delivering onwhat customers were saying is

important to them.The competitive grocery landscapein Northern California and NorthernNevada had become intense andRaleys officials needed to find a wayto differentiate themselves whileholding a steady eye on the ultimategoal: Providing a world-classexperience to the customer.

Keeps It Simple, Intuitive,and Compelling for Its Customers

Jim TierneyLoyalty360



RALEYS SURGES WITH 1-TO-1 APPROACH

Hutchison, who came to Raleys in March 2012, has spearheaded the

companys team creating a resurgence toward customer-centricity,

implementing a hugely successful loyalty program thats easy to use,

developing data insights, focusing on 1-to-1 marketing, and making

innovation an ongoing theme.

Raleys 1-to-1 approach to marketing is more complex when compared

to more traditional loyalty programs because almost all regular

communications are unique to each Something Extra member.

Whats more, senior leadership ensures that everyone is alignedto its customer-first strategy.

Personalization is at the heart of the Something Extra program because

we know share of wallet is a privilege and not a right, Hutchison said.

We want to earn our customers trust and, subsequently, their

business by engaging them in a relevant 1-to-1 dialogue.

Raleys Family of Fine Stores is a privately held, family-owned

supermarket chain that operates 118 stores under the Raleys

(76 stores), Bel Air (20), and Nob Hill Foods (22) names in Northern

California and Nevada.

PUTTING THE CUSTOMER AT THE CENTER OF RALEYS EXPERIENCE

Having that world class service/world class experience, and having

the right assortment for our customers in our stores is crucial,

Hutchison says. And thats born out of a lot of research. But its also

about the experience we provide in our stores. Raleys wants to make

shopping better, easier, and more personalized. The customer is at

the center of that and were committed to giving them a world class

experience.

Here is how Raleys focuses on rewards and relevance:

Points-based program:Customers earn 1 point for every dollar spent

as well as points for various activities (buying specific products,

attending wine events, etc.). At the end of every calendar quarter,

each customer who has a balance of at least 500 points receives a

voucher in the mail (or digitally for load-to-card) for the value of the

points. Points are each worth 1 cent (e.g. 500 points = $5.00, 2100

points = $21.00).

Offers:Customers also receive highly targeted offers (coupons)

on a regular basis both digitally for load-to-card and paper-based.

These are called Personalized Offers. Customers also have three

other sources of offers they can interact with and use. Extra Friendzy:

Social commerce offers where customers load high-discount, limited

quantity, limited time offers to their cards and this information is alsoposted to that customers Facebook newsfeed. Social Evangelism:

Something Extra Try-It is a social advocacy platform where Raleys

elite customers can receive free and highly discounted products with

the expectation that they share their feedback with all their friends

and family both online (social media) and offline. A key aspect of the

Something Extra loyalty program is the extreme focus on relevancy in

total experience, in content, and frequency. The program has a fixed

learning period with a calculated contact frequency aimed at providing

increasingly relevant content to the customer as Raleys learns more

about them and at teaching the new member about the program and

its mechanics.

The Rewards and Relevance campaign response rate is more than

75%, a staggeringly high figure considering the industry norm is 11%.

It speaks to the success of the relevance and reward strategy, and the

strategy to wade in slowly toward increased frequency, Hutchison says.

Whats more, manufacturer (CPG) support of the Something Extra

program is significant and very encouraging, Hutchison adds. More

than 150 manufacturers representing over 300 brands are actively

engaged with Something Extra.

Raleys has over 1,000 offers/coupons in the system from these

manufacturers to target to customers, which is much greater than

the industry norm of 300, he explains.




FEATURES

COMPETITIVE LANDSCAPE PROPELS INNOVATIVE CUSTOMER

EXPERIENCE STRATEGIES

The competitive landscape for grocery retail in California and Nevadais highly saturated, Hutchison explains. Customers have an abundance

of options in brick-and-mortar and ecommerce.

This highlights the need for effective and forward-looking customer

experience and engagement strategies, which will build loyalty and

share of wallet, Hutchison says.

Raleys customer experience and engagement strategies focus on

ease, reward, relevance, and value, Hutchison outlines.

Ease:Raleys is focused on making life easier for its customers as it

pertains to grocery shopping (pre- and during shop). Our aim is to

reduce the amount of time needed to plan, shop, and check out. This is

accomplished by thoroughly understanding our customers, providing tools

to help them plan and shop, using customer information to provide

only those things most relevant (thus reducing search), and integrating

all of our programs to ensure seamless checkout.

Reward:Raleys shows its loyalty and thanks to customers by rewarding

them for shopping. This reward comes in the shape of cash back on

purchases and highly relevant and rich offers.

Relevance:Raleys is committed to ensuring that all communications

are personalized and contain highly relevant content to each customer.

Customers worlds are increasingly overloaded with information and,

amongst this sea of noise, our customers need to have confidence that

when they get a communication from us that it has value they want to

see and experience.

Value:Raleys is pursuing multiple avenues to provide value to its

customers. Raleys is partnering with manufacturers and thirdparties to get offers (coupons and promotions) and were illustrating

them in a variety of ways, both targeted and untargeted. Were using

proprietary tools to ensure we have the best promotions in front of

customers in the stores and our communications, and were using

our loyalty data in combination with market data, research data and

proprietary tools to ensure we get pricing right for our customers. We

have a robust training and organizational engagement practice, which

motivates our store frontline team members and empowers them with

the right information to engage the customers.

CRM/customer data:This is central to the customer experience and

engagement strategies employed by Raleys.

GREAT PLANNING SPARKS ENHANCED QUALITY OF INTERACTIONS

Great planning has taken place to build the systems and processes

to store, organize, cleanse, access, and execute against customerdata toward our customer experience and engagement strategies and

tactics, Hutchison says. Were zeroing in on perfecting quality of our

interactions, and well continue to refine our frequency of interactions.

We felt it very important to start on the low end of communication

frequency so as not to violate promotion overload, and we will learn

more and more about each customer to better understand their

optimal communication frequencies.

The customer-centric loyalty approach and its customer experience

and engagement strategies are changing customer behavior and

drawing market share as well as profitability, Hutchison says.

With more tools and customer solutions launching continually as

part of Raleys customer road map, these positive returns will only

accelerate, he says.

Raleys customer segments are divided among five groups: Premiers,

Valuables, Potentials, Uncommitted and Lapsed. Premier offline shoppers

shop three to five times per week, while our click-and-collect

ecommerce grocery shoppers shop online once every two weeks.

Making suggestions based on their purchase history is how we can

help change behavior, Hutchison says. You have to do it and do it

well, and that will set those companies apart by putting the customer

at the center of the organization.

When asked about how Raleys targets customers and personalizes,

Hutchison explains: We look at each customer and their shopping

behavior and their derived communication preferences and we

personalize effective tactics for them.

Hutchison is excited about evolving the companys digital space,

which will provide an enhanced shopping experience with

cross-selling involved as well.

But what it really comes down to, Hutchison says, is delivering on the

core, simple threads.

Some customers want a lot of noise and movement, others want it

to be quiet, he says. We have to focus on things people will focus

on and present it in a clean and compelling way. Shopping can be

stressful for people. How do we take this potentially stressful chore

and make it more pleasant?

Offline and online need to be aligned, he says, as far as look and feel,

tone and personality.

Raleys continued...


23/68

NOT JUST LIP SERVICE

This isnt just lip service, he says. Were

setting ourselves apart by putting ourcustomers at the center and asking, Does

this project deliver on one of these promises,

whether its accounting, supply chain,

operations, merchandising or marketing?

Its all customer-centric.

Hutchison says Something Extra is aptly

named because we dont penalize our

customers who arent members, and we

give them a compelling reason to swipe

their cards a check they get back at the

end of every quarter.

Raleys tracks measurable metrics related

to sales growth and customer opinionsas key metrics to define success and

improvement.

If it cant be measured, you should not do

it at all, Hutchison believes. The customer

is at the center of every decision Raleys

makes. One of the most rewarding things

about Hutchisons job is when he receives

notes from customers.

I get handwritten letters from our

customers who love the fact were making

their lives easier, he says. They dont

have to search for coupons online. We

send them coupons that are relevant tothem. Relevancy, rewards, experience,

and giving back. We personalize their

experiences for them and we tie into all

the other ways our stores differentiate in

positive ways. You have to keep it simple.

Were not Walmart. Were not Safeway.

Were not Amazon. Manufacturers can

spend their incremental dollars with us

because were showing this return on

every dollar they spend with us. L

Can you talk a bit more about what youre

doing from a customer experience/employeetraining perspective? How often do you train

and what are the overarching categories in

which Raleys trains?

We have a cross-functional team engaged

within the organization focused on ensuring

Raleys delivers on commitments made to

our customers. Part of that effort is making

sure our team members know what the

commitments are, and how to effectively

deliver upon them. Were using a technology

solution as well as team leadership driven

efforts for training, which includes scenario-

based training. The most important part is

that this is supported at all levels of thecompany and is based on strong organizational

engagement principles and best practice.

Can you talk about how Raleys leverages the

CPG/manufacturer offers? Are these the

offers that are sent to customers?

Personalization is a key pillar of our CRM

efforts. Offers are one of the primary fuels

in engaging our customers, and if theyre to

be personalized, then we need to have offers

representing a breadth of products across

the store. For that to be achieved, CPG/

manufacturers have to be highly engagedand in-sync with Raleys. We have spent

a lot of time and emotion building the technology,

processes, and relationships to support the

acquisition on the offers from CPG, the

intelligent targeting and dissemination

of those offers to our customers, and the

reporting of the results to our CPG partners

and internally. The result is a streamlined,

yet evolving system that ultimately delivers

relevant offers to our customers in a

relevant channel.

Does your research and/or database allow for

a matching of behavior to offer?

We absolutely use behavioral data to target

the offers for each customer on a 1:1 basis.

What do the manufacturers think of the

process? With this targeted approach, are the

manufacturers able to hit their numbers?

We have excellent relationships with our CPG

partners where we work together towards a

common goal of building loyalty with our

customers. We also recognize that both the

CPG partners and Raleys have businessobjectives that need to be met as well.

The great news is that building loyalty with

customers results in achieving business

objectives of CPGs and Raleys. The key is in

the smart execution of the loyalty program

and in ensuring that proper measurement and

reporting follows. Another key is having a host

of tactics within our marketing portfolio to

satisfy a variety of business objectives for

CPGs. Some are solely 1:1 and some allow for

greater degrees of customer acquisition.

Can you offer a few more specifics on

this statement?

We felt it very important to start on the low

end of communication frequency so as not to

violate promotion overload, and we will learn

more and more about each customer to better

understand their optimal communication

frequencies. Essentially, our goal is to get to

a point where we understand the desires and

action points for each of our customers with

respect to communications from Raleys.

Some customers would prefer to receive one

communication every two weeks, while others

would prefer to receive three per week, while

others just want to receive communicationswhenever there is relevant news from Raleys.

While we work toward that knowledge level,

we are starting from a point of less is more

whereas some other companies prefer to start

by sending communications daily to customers.

Can you expand a bit about what Raleys

is doing now digitally, and how that might

change in the future?

We use all of the primary digital communication

channels including email, SMS, Push Mobile

(both iBeacon and Geo-fencing), mobile apps,

web, and social media/social advocacy. With

social advocacy, we have the worlds first

retailer-owned platform. Were constantly

evaluating where to go with respect to all of

those, and particularly with our web and

mobile platforms. The aim is to provide

solutions that make our customers lives

easier, better, and more personalized.

with Tom Hutchison, Director Marketing, CRM & Analytics

Q&A

Loyalty Management THIRD QUARTER 2014



FEATURES


We knew when we launched Priority Moments it was go big

or go home, Stevenson says. We had to offer our customers

something they couldnt get anywhere else.

Mission accomplished.

In the last two years, weve developed Priority Moments to be the

powerhouse it is today, Stevenson explains. The combination of

a rich proposition centered around our customers passionssport,

shopping/leisure, entertainmentexclusive and best-in-market offers,

relevant content, and money-cant-buy experiences.

Stevenson says Priority Moments has had to differentiate itself amid

an increasingly saturated daily deals market.

By consistently innovating and pushing boundaries, O2 has changed

the market with more sophisticated targeting and integration of

content with the introduction of 4G, and continued to enhance and

offer customers a better, richer, and more rewarding experience with

once-in-a-lifetime experiences communicated using real-time insight

and targeting.

Stevenson says the results speak for themselves: every minute of

every day, five Priority Moments are being redeemed by O2

customers from more than 150 leading U.K. brands including

Odeon, M&S, ASOS, Halfords, New Look, Caff Nero, and WHSmith.

Stevenson says the company has gleaned a plethora of actionableinsights from the highly successful loyalty program.

One of the most crucial insights weve drawn from O2 Priority is

that matching experiences and rewards against the right customer

passions is the most important characteristic to get right when driving

engagement with the program and delighting customers, he explains.

In fact, its more important than the mechanic of the reward (be it a

competition, a free reward or a discount), and even more important

than how well known or famous the brand is that offers the reward.

O2 Priority was founded on this core principle to make O2 customers

feel special by giving them experiences and rewards for the things

they love, accessed through O2s Priority platform, and working with

some of the UKs leading, and most influential brands.

For example, Stevenson says: We know that film, like music, is a very

motivating passion and we know what sorts of offers work best, so we

gave Priority customers the chance to see films like Despicable Me 2

or Rio 2 before anyone else, as well as big money-off deals on cinema

tickets with Odeon.

Whats more, Stevenson says the program takes that one step further.

Its what we refer to as a Heart and Soul approach when we know

what our customers want, we really go for itheart and soul, he says.

Whereas some of our competitors dip their toe in the water of

passion, we jump in and make the biggest splash. With film, some of

our competitors offer just cinema tickets we dont. We offer Prioritycustomers the chance to win tickets to the premier of the biggest

movies, we offer everyone great deals on cinema tickets, and we throw

in the popcorn and drink to enjoy while they watch it, or offer them

great rewards to see movies at home. We also do the same with food.

We offer our customers free coffees on a cold day from Caff Nero,

free chocolate slabs from Hotel Chocolat for a spot of indulgence,

great deals on restaurants across the country and of course, a

lunch for 1. We always go for it and were constantly innovating

to do more.

Understanding what customers want and how they want it isa crucial aspect of the program.

We learned from the analytics that the most effective mechanic atengaging the highest volume of customers is offering them the chance

to win fantastic prizes, such as holidays for their family, tickets to

premiers, and even cars, Stevenson says. After that, our customers

love to be given free rewards, so we have invested to offer our customers

more free treats from free chocolates from WH Smiths, flapjacks from

Holland & Barratt, to a free car screen wash from Halfords. We know

that getting the passion right, along with the right combination of offer

characteristics, can make an offer 13,000 times more successful than

getting any one of those factors wrong. Priority is an insight-led loyalty

program and we continuously invest to learn more using a mix of

analytics and research to stay ahead of the game.

Single-mindedFocus on the Customer

Integral to U.K.s Telefonica O2Priority Moments Loyalty Program

When Telefonica O2 UK (O2) launched its Priority Moments customer loyalty

program two years ago, Mark Stevenson, the companys Marketing Director

of Priority and Sponsorship, was fully cognizant of the stakes involved.



Due to the staggering success of the Priority Moments loyalty

program, Telefonica O2 garnered the International Markets, Silver

Winner award at the inaugural Loyalty360 Awards which were

handed out in March at the 7th Annual Loyalty Expo, presented by

Loyalty360 The Loyalty Marketers Association.

Some of the direct brand metrics used to measure the program arechurn and registration while some indirect metrics include consideration,

attractiveness, and value for money.

Telefonica O2 UK (O2) has changed the way mobile operators

approach loyalty with the success of Priority Moments. Priority

Moments is a mobile loyalty program that uses real time insight

and targeting to offer O2 customers unique experiences and exclusive

rewards from brands they love via their mobile phones (app, mobile

web, online and MMS/ SMS), based on their interests, behavior,

and geo-location.

Priority Moments meteoric rise had a lot to do with O2 not being

afraid to take risks.

Telefonica O2 U.K. operates in, arguably, the most fiercely competitive

mobile market in the world, Stevenson explains. The market suffersfrom high churn, increasing subscriber acquisition costs (SRC), limited

differentiation, and low customer engagement and loyalty, driven

by consumer demand for heavily subsidized and increasingly costly

handsets in the intense battle waged to win and retain new customers.

As a business, Telefonica O2 U.K. thinks differently, Stevenson says.

Create a loyalty program that customers would engage with every

day, offering outstanding value in a tough economic climate, yet

dramatically different from the multitude of daily deals sites that had

saturated the market, he explains. O2 wanted to dramatically stand

out and offer its customers something they couldnt get anywhere

else. Priority Moments was born.

What makes Priority Moments the U.K.s leading loyaltyplatform?

Without doubt, the insight and the inherent functionality of the

programme, Stevenson says. By maximizing the technology at

their fingertips (mobile; geo-location; targeting capabilities), and

consistently innovating to improve the platform, O2 deliversexclusive rewards to more than six million registrants every single

minute of every day.

Priority Moments wouldnt be possible without the greatest persuasive

device ever invented: the mobile phone, the remote control to our

customers lives, which allows us to have two-way conversations,

encouraging engagement and building loyalty with an ongoing

interaction, Stevenson says.

At the heart of Priority Moments is location-based technology and

valuable customer insights, as well as the sequencing of relevant

experiences and rewards, which enable O2 to reach and engage

millions of customers wherever they may be.

Geo-location enables customers to reap rewards from leading

partners whenever and wherever they are.

Proximity alerts and push messaging driven by geo-fencing delivers

relevant and easy-to-redeem rewards.

Bespoke algorithm highlights the nearest offers and experiences

within a determined area, including customers individual

preferences and behavior.

Priority Moments takes advantage of all the available channels to

customers: The app, instant messaging - SMS, MMS, email, 460 high

street retail stores, contact centers with more than 3,500 personal

advocates, and then the offers come to life with innovative brand

experiences, such as O2 Angels giving out free lunches with

Upper Crust.

To ensure we consistently increase our levels of customer engage-ment, differentiate our proposition and add value, we have introduced

two new functionalities (as of April 2013): featured offer, which uses

our location technology to find the very best hero brand offer at that

exact moment in time, and introducing rich video content with the

launch of 4G, Stevenson says.

One of the most crucial insights weve drawn

from O2 Priority is that matching experiences

and rewards against the right customer

passions is the most important characteristic

to get right when driving engagement with the

program and delighting customers.


when we know what our customers want, we really go for it heart and soul



FEATURES

You have to give

customers more of

what they want and less of what they dont,

Stevenson explains. And more than that, you have

to inspire and motivate them with something new

that they cant get anywhere else, all with an

understanding of how to do this in a way that

most positively impacts your business.

Telefonica O2 continued...

1. Extraordinary Moments

Totally unique, un-missable experiences, content and rewards that

cant be found anywhere else, which create extraordinary moments for

hundreds and thousands of customers, rather than just a lucky few:

To celebrate the Jubilee, a free pair of Union Jack flip flops from BHS An upgrade on the Heathrow Express and airport lounge pass

A totally free lunch with Priority Moments, at Upper Crust

The chance to get a new game, or DVD release before anyone

else at HMV

2.Extraordinary Offers

Exclusive offers giving O2 customers real value and savings on

everyday items and more occasional treats:

1 for a pizza and unlimited salad at Pizza Hut

4 free Millies Cookies

M&S Dine in for 8

50% off movie tickets at Odeon

20% off at TONI&GUY hair salons the first time in

40 years theyd run a national discount

Buy one pair of shoes at Office for the party season,

get another pair for free

3. Thank-Yous

Targeted rewards based on value segment to thank O2 customers

for their loyalty on their two year anniversary with O2 when NPS

typically dips, or just to surprise them. Customers are targeted via

SMS/ MMS and collect their personal Thank-You via the PriorityMoments app, or mobile web site:

A Caff Nero Iced Coffee on a hot day just to say thank-you

5-20 mobile gift card to spend at Debenhams

A handpicked gift box from Hotel Chocolat

4. Headline Moments

A package of un-missable rewards to create excitement and a sense

of urgency at a key moment such as Christmas, where O2 can help

customers make the most of the festive season. For Christmas 2012

O2 created an advent calendar of 24 extraordinary rewards, exclusive

content and outstanding offers: Christmas master class with renowned chef Jean-Christophe Novelli

giving customers tips on how to create the perfect Christmas dinner

and 25 off all the ingredients with Ocado

A free de-icer and scraper from Halfords executed in a super timely

manner - when it snowed

30% off at New Look

10 to spend on Christmas presents at The Fragrance Shop

Exclusive shopping events and grotto at Bluewater

5. The Ultimate Experience

To offer customers more of the exceptional, O2 created

a layered approach to rewards, in which customers could

unlock and access according to their level of engagement.

O2 therefore created a prize draw functionality which offers

unique one-off experiences for customers through animmediate call to action.

Free coffee for every week for a year vs. one free coffee

Win a trip to Quicksilver surf camp vs. 20%

Quicksilver clothing



You have to give customers more of what they want and less of what

they dont, Stevenson explains. And more than that, you have to

inspire and motivate them with something new that they cant get

anywhere else, all with an understanding of how to do this in a way

that most positively impacts your business. At O2, our customers areour priority in every sense.

Listening to customers is an absolute imperative.

We ask them what they want, when they want it, and how they

want it, Stevenson says. We then track what happens and learn

and improve what we do based on their behavior and the feedback

they give us across all of our channels. We have done this from the

inception of Priority, and we will continue to do so, using new

technologies to give them what they want and what they need at

a time when is perfect for them.

Stevenson believes many brands fail when they set KPIs, measure

against them, but then dont shift behavior or do anything different

based on what they learn.

At O2, we focus on innovation from the brands we partner with

in the delivery of Priority, the types of rewards we offer, when, how

and to whom we offer them, and how we communicate them,

he explained. We strive to improve continuously. As time has

progressed, we have gotten smarter at how we measure, what we

track and how we apply those learnings. New technologies are an

enabler of this. We use profitability as our key measure and then

develop the correct ROI model according the channel and

the customer.

O2 is always ruled by the customer, Stevenson says.

A great example of this is O2s film program, he explains. Using

customer feedback alongside our business intelligence, we looked

at our customer segmentation and their passion areas; this research

told us that film was one of the biggest motivators. We therefore builton this popularity and elevated film to more than just popcorn and

tickets, by giving customers ultimate VIP experiences that they could

only get through O2 Priority.

When asked what one thing has led to the enormous success of

Priority Moments, Stevenson didnt hesitate: Single-minded focus

on the customer, always. L

The Arena, London


28/68

FEATURES



MAACO desperately needed a makeover when

Jose R. Costa became president of the company

about 19 months ago. The Charlotte, N.C.-based

retailer was very much a strong player, but very

dormant in many aspects.

One of Costas key tasks was to transform the brand from

the 1970s to a contemporary player.

During the past 18 months, Costa says many aspects of the

business have been transformed. But he singled out and

explained the three most important areas of transformation:Training Curriculum:We used to have a four-week in-class

training program called MAACO University. Throughout the

past 18 months, weve narrowed the program down to three

weeks, while introducing e-learning, on-site training, and

hands-on, real-time customer training in a model shop in

Charlotte. This combination has been a true success since

our new owners are performing above historical levels in the

first three to six months.

Revamping Marketing Approach:Our next challenge was

to revamp our marketing approach, from our brand positioning

to the way we engage with customers. In the past, weve

invested up to 20% of our budget in Yellow Pages. However,

in the past 18 months weve migrated those resources to

social, mobile, and digital platforms where we are getting

great results. Our marketing team has seen a lot more

consumer engagement and all of our key metrics have gone

up, from CSI scores to all key brand health measurements.

Production Management System:This is the neural system

of our operations and it has brought new light into our day-

to-day consumer engagement. Previously, we had a home-

grown system that fulfilled our production needs, but was

becoming archaic in todays technological landscape. For

this reason, we partnered with a leader in the industry

(Audatex) to roll-out a state-of-the-art POS system that

offers ease of use, increases accountability, and enhances

the customer experience.

During the past year, Costa says MAACO partnered with

some of its best franchisees and developed a POS system

that fulfils both operational and customer needs.

The platform makes our employees lives easier because

they can track every aspect of the repair, Costa explains.

We are now able to measure bottle necks in production and

idle time per team member, among many other metrics. It

makes production flow seamlessly because there are stations

throughout the facility where employees can see how much

time and supplies a single job is using, as well as review

delivery dates.

From a customer standpoint, it creates transparency andcommunication with the local center, Costa says.

Consumers are able to receive real-time updates through

email and text including pictures of their car through the

stages of repairprep, sanding, painting, and detailing.

Since Costa came aboard, MAACO has received a makeover

and grown to be the No. 1 franchise in its category.

MAACO is North Americas body shop, with close to 500

body shop locations across the continent. MAACO provides

auto paint and auto body repair services for more than

12,000 vehicles a week, 600,000 a year more than any

other company in North America.

Costa took it upon himself to visit as many MAACOfranchises around the country soon after he took over as

company president. In his first six months on the job, Costa

had visited over 400 MAACO shops.

We had to put our franchisees first because theyre our

No. 1 customer and we need to answer their requests, he

explains. First, we needed to listen to our franchisees,

employees, and consumers to better understand what was

and wasnt working. So I personally spent months on the

road meeting with as many people as I humanly could.

Secondly, we used analytics and insights to determine the

direction that we wanted to take the brand. Once we had all

the analysis done, it was easy to craft a vision since it was

validated by all our key constituencies. Everyone has been

as Customer Becomes Focal Point

MAACO-VERComplete

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very excited and supportive of our direction and I cant wait to see

where MAACO will be in five years.

One of the biggest hurdles Costa had to clear was a negative public

perception attached to MAACO.

Historically, we had positioned the brand around a negative

event, an accident, he said. We repositioned everything around a

positive perception and went completely away from the advertising

you remember, Uh Oh, Better Get MAACO! We completely changed

the image and re-launched the brand.

Costa says during the companys major rebranding process more than

18 months ago, MAACO officials capitalized on the positive side of its

business and the aspiration of turning the vehicle you drive back into

the vehicle you love.

We conducted extensive consumer research before launching the

repositioning and immediately knew we had a winner with consumers,

Costa says. This was the first time in 42 years that MAACO

positioned itself emotionally with consumers. We ensured all

brand communications were uplifting, aspirational, had an Americana

sentiment, and ultimately drove sales. Our advertising featured young

people, families, women, and the everyday cars that get them from

point A to point B. It has been incredibly well received by consumers

and our sales are a reflection of that.

In April 2013 MAACO, which is part of the Driven Brands family of

automotive brands, launched a completely new image and branding

campaign. The new image work is designed to reinvent the consumer

relationship by adding the positive, emotional benefits of car owner-

ship through the essence of transformation the MAACOVER to

the brands strong value proposition.

The campaign kicked off with the concept of a #MAACOVER,

and is rooted in social interaction via Twitter, Instagram, Tumblr,

and Facebook to create a new type of conversation with MAACO

customers. In a category traditionally known for pushing information

out, MAACO wanted to turn industry communications on its ear by

inviting the customer in with its use of the hashtag and a host of social

initiatives that encourages dialogue directly with the brand.

We wanted to show that MAACO can turn the car they drive back

into the car they love, Costa explained. We gave a positive spin to

a negative event.

Costa explained that every key metric has moved in a positive

direction since the rebranding. Having an in-house call center has

greatly improved repair issues for customers.

We rolled out a Customer First vision, Costa said. Every training

activity we do revolves around satisfying customer concerns. We

try and solve everything as smoothly as we can. We record someinteractions for training and coaching purposes. Weve transformed

from an operations-driven company to a customer-driven company.

Im not saying were there, but were making a lot of progress.

Whats more, Costa says email communications have vastly improved.

Email communication has improved with the increased data collection,

he explained. We now require all estimates to capture an email so

we can establish a relationship with new and existing clients. This

allows us to make communications smarter and more personalized.

Now we can track engagement, we can perform A-B testing with

different offers, and we can segment consumers depending on our

business objectives.

MAACO also uses email collection to capture and retain retail estimates.

We have the ability to track where a consumer is in his/her purchase

consideration and follow up with them with the right offers that

incentivize based on the services they need, Costa explains. We have

also incorporated promotions into our social media platforms. This

has increased engagement with consumers and we have propelled the

number of followers we have on social media.

Costa says in his industry, MAACO constantly battles for the

No. 1 spot.

You build from the ground up, he says. We have a shop in Colorado

that does $5 million a year in sales and they also conduct training

classes at the shop. Some of our key metrics revolve around how fast

repairs take and how many mechanics are involved in a specific repair.

MAACOs average repair costs $1,000, Costa says.

A Franchise Advisory Council, comprising about 20 representatives,

meets multiple times throughout the year to discuss various aspects

of the customer lifecycle, Costa says.

We value their voice, he says. Its nice to spend time with the

people who know the business better, the franchisees.

Employee engagement has reached an all-time high, Costa says.

A lot of our employees believe that MAACO is well positioned with

our new brand road map to achieve our goals of doubling the size of

the company in five years, he explains. We want to be a billion dollar

brand with close to 1,000 locations by 2018. L

Uh Oh, Better Get MAACO!We completely changed the image and re-launched the brand.

This was the first time in 42 years that MAACOpositioned itself emotionally with consumers. We

ensured all brand communications were uplifting,

aspirational, had an Americana sentiment, and

ultimately drove sales.

-Jose R. Costa, President | Maaco



FEATURES


c u s t o m e r e x p e r i e n c e a w a r d sXC

The ceremony will celebrate todays top

companies who deliver exceptional customer

experiences to consumers through innovative

services and offerings. We received entries from

companies around the world, and presented

them anonymously to a jury of industry experts

for an unbiased judging. The winners have been

chosen, and we are thrilled to be honoring

these leading organizations at the Loyalty360

CX Awards.

In preparation for the ceremony, we want

to give you a sneak peek into our entries,

and briefly showcase some of the industry

techniques that our award winners are utilizing

in the realm of customer experience excellence.

Here are some ways that our award winners are

moving the needle in loyalty:

Using customer data to truly develop

customer relationships

Breaking down silos within organizations soproper entities can access customer

feedback and act on it

Understanding interactions at every stage of

the customer journey

Using customer data to fuel best employee

hiring, company culture, and

internal incentives

Providing intuitive and unique digital and

mobile experiences

For many companies, acting on data can be like

a giant game of Tetris: data is always coming in,

but how do you make sure it is being used mostefficiently? Among our winners, there were few

qualifying strategies more often stated than the

importance of utilizing customer feedback data

to shape better experiences.

For a consumer, there is nothing more frustrating

than feeling like an organization cant hear

your voice. Our winners passed in flying colors

in voice of the customer strategies. In order

to truly provide stellar experiences by serving

customer needs, organizations must open their

internal floodgates and allow communication

and feedback to flow to the proper entities.

Our winners have shown that the best customer

experiences add meaningful interactions not

only at the point of sale, but also before and

after the transaction. The value of creating

engagement at these moments means that

consumers will be more likely to think of your

company first, and not just when theyre making

a purchase.

Whether a company is a mighty redwood or

a young sapling, great customer experiences

can really only grow from one place: the roots.

Our CX Award winners are adamant that best

employee hiring practices, company culture,

and internal incentives, when combined and

nurtured, will sprout incredible returns for the

customer experience. When you elevate your

employee experience, they will naturally be

more inclined to pay-it-forward.

In the past, there was only one thing that

companies had to worry about in consumers

pockets their wallets. Those same consumers

are now equally as likely to reach for their

phone, so it is no surprise that the realm of

mobile and digital has become an immensely

important consumer touch point. By now, many

companies have adapted responsive web layouts

for phones and tablets, and created mobile

apps that allow direct access to a companys

products or services. Our winners understand

that in this mobile engagement inundation, only

the cream will rise to the top. Companies who

can turn a digital interaction into a profound

encounter will see amazing results from their

customer experience efforts.

To hear from our award winners who will be sharing

their company results and actionable insights, join us

at the inaugural Loyalty360 CX Awards during the 2014

Engagement & Experience Expo, November 10-12 in

Dallas, Texas.

Loyalty360 CX Awards:How Sweet it is

Its good to be appreciated, isnt it?

This fall at Engagement &

Experience Expo, Loyalty360

is showing appreciation for the

companies that appreciate you

at the inaugural Loyalty360 CX

(Customer Experience) Awards.

Michael GuarenteLoyalty360



LOYALTY FORUM: TRE NDING NO

CUSTOMER EXPERIENCE.Of course, the customer experience is at the heart of loyalty, but it is getting pushed

to new heights all the time. There has been a recent focus on connecting with customers

at every stage of their experienceeverything from research, point of purchase, to

follow-upand utilizing various channels to ensure that any available touch point

offers an interaction. The overall experience is highly valued by customers, and more

and more they are expecting to receive rewards for non-dollar based activities and

interactions. The good news is that any type of engagement builds the relationship

and drives sales.

WhosLeading

theWay?

Apps toCheck Out:

What toLook For:

WEARABLE TECH.Tech geeks arent the only ones delving into the world of wearable tech these days.

With devices like wearable fitness trackers and smart watches becoming more

common, expect to see the whole category continue to rise in popularity. And loyalty

can leverage it too some companies are already introducing wearable tech apps

that allow the user to make loyalty transactions with wearable tech devices. And

though privacy concerns exist in regards to any data-tracking, research shows that

many consumers would be willing to share personal data collected by such devices

with third-party retailers when presented with compensation such as a coupon or

discount (see By the Numbers page 16).

MOBILE COUPONING.Digital devices, mobile apps, digital coupons none of these are new, relativelyspeaking. But, the collision of digital with the in-store experience has presented an

interesting trend. A recent study from PunchTab that focused on back-to-school

shopping showed that 60% of moms use their smartphones in-store to find coupons,

and that while in-store, moms are four times more likely to use their smartphone to

look for coupons as compared to other mobile activities. In addition, mobile coupon

apps are gaining popularity, with several free apps that are revolutionizing what it

means to clip and save.

TrendingNow


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FEATURES



The Advantages of a

Customer LifecycleStrategyWith so much discussion centered on

customer-centricity, customer engagement,

and enhancing customer experiences,

a hot industry topic related to th

loyalty management 3rd quarter - 2014

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