There was a panel recently at the Direct Marketing Association’s annual meeting in San Diego comprised of some of the top people in Coalition Loyalty marketing. These company leaders from around the globe included representatives from AIR MILES, FlyBuys, Payback and Upromise. And one thing they all agreed on was that a true Coalition Loyalty program that has national reach and national appeal is destined for launch in the United States. The question in my mind is which of those companies, or one of their able competitors, will be the company to figure out how to make Coalition Loyalty work? Read the rest of this entry »
American Express today announced that it is acquiring Revolution Money from Revolution LLC, a company founded by AOL founder Steve Case. Revolution Money processes payments over the Internet without transmitting names or account numbers, and cardholders use a personal identification number to authorize transactions online. Revolution Money was trying to reinvent the world of credit cards by drastically reducing transaction fees (in some cases a few percentage points) paid by the retailers. Revolution Money struggled early on to find both cardholders and merchants willing to accept their cards. But a recent search within 15 miles of my zip code found almost 100 merchants. Not bad considering where they started. The WSJ came out with an article quickly and seems to think the deal will be beneficial for both side. I’m sure this will provide some much needed money to help the business grow but I worry about Amex’s intentions with the company. They typically have some of the highest interchange fees and many merchants won’t take Amex cards because of those fees. How will developing a system that reduces interchange fees be good for Amex and its industry brethren? Only time will tell. From a consumer standpoint, the Revolution Card, which is the plastic consumers carry, had some Loyalty program options associated with the card. It will be interesting to see if card holders can now earn Membership Rewards or some other currency in the future. Stay tuned…this could get interesting.
I received a comment today that said I need to update my Blog more often. I know that is true so will do my best to do so. It’s been so long since I’ve written anything that there are too many possible things to discuss. I think I’ll pick a few and then continue to add topics over time.
Some Upromise Updates
I had the pleasure of participating in the 2009 Chat Bash online chat about rewards programs hosted by CompareRewards.com. I was there to help answer questions about Upromise where I have my day job. It was really interesting to chat with members and have the ability to answer questions about Upromise and how the program works. If you aren’t familiar with CompareRewards, this is a site that discusses the pros and cons of the many different cash-back programs available to consumers. It’s a great way to learn about the various programs out there if you have any questions. It’s also a great resource for updates on changes in the various programs. Read the rest of this entry »
It’s time for me to start updating this Blog again and for me to get out and re-engage with what is going on in the Tech world. It’s been a very busy Spring/Summer but alas that is no excuse. My re-emergence will begin on Thursday, September 3rd at TECH Cocktail Boston - 3. In case you aren’t familiar with TECH Cocktail, you should check them out. They do a great job of bringing together people from all over who are engaged in the world of technology. But that includes marketers, PR people, developers, geeks (said affectionately), venture capitalists and more.
I’m also really excited to see if anyone attending has a Poken, if anyone knows about Poken, or if anyone is interested in buying a Poken. I’ve been selling them now for about six months and the volume is definitely increasing. I think events like these could really help increase the awareness of the product and drive a market for them. I won’t retire from this effort but I love the product.
As for the Loyalty Marketing side of this Blog, look for an update soon with a summary of happenings, ideas and various information in the next few days.
This post is not so much about Loyalty but about a really cool tech gadget that is making big waves in Europe and just starting to catch attention in the U.S. The device is called a Poken and at its most basic form, it is an electronic business card. You meet someone who has one, you put the two devices next to each other and they wirelessly transmit information about the owners. Then when you get to a computer, you can upload the people you met automatically and now have access to their social networking sites (i.e. Facebook, LinkedIn, etc.). Personally I think this is one of the coolest new devices I’ve seen and I can imagine a lot of very practical uses.
Imagine walking around a conference where networking is one of the most valuable things you can do. Instead of handing out tons of business cards or collecting tons of cards, you simply touch your Poken to their Poken and you’re done. When you get back to your computer, you upload and all your new contacts are organized for you. You have details of the date and time you met but you can also see a picture of your new friend and link directly to their LinkedIn profile to get connected. This could be a huge timesaver.
But I also see this at work in social settings such as at a bar. No more writing phone numbers or email addresses on scrap paper. Adding someone to your cell phone seems like going overboard for someone you just met. Poken is perfect! Just tap and go and decide later if you want to connect.
Poken was featured recently on NPR and has been getting some good coverage in Europe. If you want to buy a Poken, go to PokenPlace.com. I’ve set up my own little Poken store just to sell the devices since I’m such a big fan. Enter the promo code “Loyalty” at checkout and I’ll give you 5% off. Remember, you read it here first – Poken will be HUGE!
With the economy in the dumps, companies appear to be doing one of two things to survive. They are either retrenching to fight off the bad times or they are trying new things to stand out from the crowd. Very few if any are sitting still and not doing anything. For the companies retrenching, who can really blame them? Everyone keeps talking about how difficult these economic times are and how very few people still alive today can recall economic conditions this bad. Not since the Great Depression have we seen this level of corporate failures and stock market woes. Perhaps cutting back and looking for things to improve before one spends money will be a wise course of action. I however prefer the more adventurous approach – to try some new things and see if you can actually grow your business. Some people are even using the difficult economic times as an easy excuse if something they try doesn’t work. Instead of blaming a failed strategy or a bad idea, one can easily point to the bad economy and have some justification for failure.
Many people in news articles and blogs have already pointed out that companies like Kellogg and Proctor and Gamble were created during the Great Depression and used advertising to grow their companies. Kellogg overtook Post Cereals through creativity and a new approach and has never looked back. Some of the keys to success for these companies were their approaches around advertising. Spending may have been down and some people may have truly been struggling but some spending was still happening as it is today. The questions decision-makers at companies need to ask themselves are what new things are worth trying and how will we judge success?
One area receiving a lot of attention is customer Loyalty. There are many ways to address Loyalty and how it impacts your business. There have been numerous articles over the years giving the “inside secrets” on how to make your Loyalty Program successful. Personally I find this “one size fits all” approach disturbing. Sure there are certain tenets that are relevant for most businesses. But your business is not the same as your neighbors so your Loyalty Program shouldn’t be the same either. You need to focus on what makes your business unique and find specific solutions that address your customer’s needs. Spend a few hours talking through your ideas with a Loyalty consultant. A small investment now could save you a lot of money in the long run.
For some resources that may be helpful, see the following articles:
An interesting email from Upromise showed up recently announcing that Zappos, the popular online shoe site, was leaving the Upromise program. I have to admit that I was surprised. Not that I got an email from Upromise but that Zappos would be leaving the service. I’m not sure why they chose to do so - maybe all the publicity they’ve received has gone to their heads and they think they don’t need affiliate traffic. I’ve been told they are terminating any affiliate programs that offer something back to the consumer (i.e. college savings, cash back, points, etc.). I for one will be telling everyone they shouldn’t shop with Zappos anymore and to give the other merchants that still work with Upromise and other online shopping programs a chance. Perhaps someone from Zappos will see this post and enlighten us as to why they would choose to no longer help people save for a college education or some other worthwhile goal.
I received an email inquiry from a prospective client recently who read an online article and a comment I made almost two years ago. It always amazes me how things on the Internet stick around for so long. Luckily I still feel as strong today as I did two years ago about the topic - “Online Loyalty Programs Can Increase Repeat Shoppers.” There are many pros and cons around developing stand-alone Loyalty programs vs. participating in broader Loyalty Coalition programs and in some cases, there may be an opportunity to do both as long as the economics support that direction.
Thinking about the previous article/comment reminded me of an article I contributed to recently in DM News. The topic was whether or not a Loyalty program should be exclusive to only certain members or open to everyone. You can read the article yourself but I think the premise is too black and white when there are definitely shades of gray. My stand was that you could do both so long as the program was structured properly. There’s no question that your best customers deserve something special, perhaps even more than your average customer. Airlines have been doing this for many years with their tiered frequent flyer programs. The argument goes that getting someone to preffered status and giving them a “taste” of the good life will keep them more loyal so they don’t lose those benefits. I definitely think this works as I once flew cross country and back the same day just to put me over the mileage requirement before the end of the year. It was the longest “Roberto’s Run” in history I think. But I digress.
The key takeaway is that the airlines don’t offer their program only to their best customers, they have a program that appeals to the average consumer and tries to encourage them up the ladder of engagement. Companies should keep in mind strategies for how to best engage their customers, attract new customers and drive long-term economic value. And if you’re confused about how best to do this, let me know because Loyalty Marketers would be happy to help.
First of all, please allow me to apologize for ignoring this Blog for such a long time. There are too many excuses and none worth mentioning. Suffice it to say that I’ll be doing a better job going forward to keep this updated with interesting news and more. I have quite a backlog of things I’d like to say.
Since my last series of postings, the business world has taken a sharp decline. 2008 was a very difficult year for a lot of people and a lot of companies. Not surprisingly, the world of Loyalty had its own set of ups and downs. One such casualty was uTANGO which posted a message on its website on January 30th announcing that it was terminating the program. You can read the message here. I am personally saddened by this having worked with the founding team for a short time. We can debate (and I’d love to do it) their business model of rewarding Loyalty through marriage and whether it was a good idea or not, but what isn’t debatable was that they built something from scratch based on industry best practices and had a lot of passion for the business. Perhaps in my personal experience too much passion. But uTANGO was not alone. Even Dale & Thomas, the delicious popcorn company closed its Loyalty program – The PopClub – due to business challenges.
Nevertheless, the capital crunch continues to make business difficult for a number of would-be start-ups. I am on the advisory board of one company that is looking for funding and did a consulting project for another that has a great opportunity to start something outside the U.S. based on what we’ve done here but they too are having some difficulty finding investors. I also know there have been layoffs at many of the top loyalty companies and I think it will get much worse before it gets any better.
But enough with the doom and gloom. There are some bright spots on the horizon if you know where to look. If you are in Loyalty and are looking for a job, one of my contacts is attempting to fill a position with a successful restaurant chain for a Director of Loyalty Programs position. If this is something you would be interested in, please contact me and I’d be happy to make an introduction.
I’m also pleased to say that I had an article published recently in DM News. It is a short article on whether or not Loyalty programs should be exclusive or open to all customers. I took the stand that a program can work for all customers if designed properly. You can read the article here. I’d love to see what you think so please be sure to leave a comment. And check back for more updates in the not so distant future.
So I have been remiss in writing for this Blog for the past month – things seem to be very hectic and this is the part of the business that suffers. Loyalty Marketers continues to move along with various consulting assignments both in the Loyalty Marketing space as well as the Website consulting space. They don’t necessarily make sense together though they are the skills “we” bring to the table. Our latest website project should be going live soon – it is now in internal Beta – and once it is we’ll publish the link. The site looks great thanks to the wonderful work of Embolden Design of Rhode Island. They specialize in non-profits and do fabulous work.
On the Loyalty Marketing front, I came across an interesting article in AdAge about the impact of Cause Marketing on consumer behavior. According to the article, consumers will choose a particular company for their spending based on the causes those companies take up. For example, Box Tops for Education by General Mills or the various companies that use the Susan G. Komen for the Cure logo on their packaging. There are many examples of companies that use Cause Marketing in one form or another with the hope that it will improve consumer perception and ultimately improve the bottom line.
I’m a big believer in Cause Marketing because it provides a simple way for people to support causes they believe in. The interesting part comes from those people who could care less about the cause but still buy the product because they want the product. There may still be some residual benefit among this crowd and it would be interesting to see that measured.
One thing I question though is whether someone is more motivated to support a cause such as a respected non-profit like St. Jude Children’s Research Hospital vs. their own self-interest. For example, if one company supported a charity through your purchase and the other gave you rebate for your purchase through a Loyalty Program like Upromise to help someone save for their own child’s college education, it would be interesting to know which one might have the greater impact on consumers.
What do you think – what motivates you when making purchase decisions?
