Here is a video which can be used for any stand alone restaurant, snack bar or lounge.   Bowling centers have far more capability to increase revenue since food and drink is one of several profit centers.  Bowling Centers should also have a membership program in place for their center.

Many centers are familiar with Kids Bowl Free, this would be an ideal Platinum Membership benefit with all the games loaded on the card (like chicken sandwiches in the video.)  We can text or email the kids anytime to come in and no coupons are necessary.  Everything is loaded on one membership card and centers would keep every penny of the membership fee.  They could do this for many different groups such as league bowlers, and run a tiered membership program which would bring in 10s of thousands of additional fees every year whether or not any customers even showed up.  

Creating Memberships for added profits and frequency.

http://screencast.com/t/jkhX3QOggqP

1. Customers will use Social Media to promote businesses which offer what they have requested.  These same customers will also use Social Media to communicate with others NOT to frequent certain businesses.  Customers want their community to be supported with every transaction and they want a simple, easy way to track and receive these donations.  They also want to be rewarded with every visit and want to feel value and appreciated for frequenting the business. 
2. Over 87% of consumers prefer cash back rewards and close to 90% indicated they would frequent a business more often if donations were tied to the transaction.  These are the top two requests and very few business owners implement them. 
3. Notice #2 trend has a lot to do with #1.  For business owners who insist on not listening to their customers, their business will pay a steep price.
4. The top 3 retail emotions are community support, personal value, green benefits.  We supply all three.
5. Relevance, there is the R word again.  No longer can you BLAST to a database, send relevant offers based on spending, age, frequency, groups, etc.  You must have a system tied to transaction so you can communicate with 30-40 year old female league bowlers or 18-24 year old cosmic bowlers in a certain zip code.  Communication needs to based on spending, purchases, visitation habits, etc.  Most business owners today are blasting to a database and will cause more damage than good while wasting money at the same time.   Text messaging will be even more strict than email. 
6. Stop with the same old points based programs or punch cards.  If you ride a horse to work then keep using them but if you have an automobile, then ramp up your loyalty program as well.

Editors Notes:  First off, any business without a loyalty program rewarding their customers at the time of purchase is making a clear decision to ignore every major study on how to increase sales and protect price points.  

Secondly, it’s NOT the points that make a difference it’s the reward and value associated with ANYTHING.  In other words, if POINTS work, then you can bet your bottom socks that the more relevant solutions work even better!  We have written for years that even TERRIBLE loyalty programs work to a certain extent since consumers are starved for recognition, value, good will and much more.  When you take a loyalty program and focus on BEST IN CLASS research based on what customers are saying, the results are obviously superior.  The amazing truth is that most business owners don’t seem to care about building their business.  They complain about the economy, groupon, and many other things, but they don’t take the time to install a loyalty program when every analyst in the world keeps sending research like below. 

Neuromarketing, Neuroscience Research

Every merchant seems to have a loyalty program these days. It makes sense to reward customers for their patronage and encourage even greater frequency. But, it appears there’s one kind of loyalty reward that may be more effective. One study showed that “irrelevant information” (in this case, largely valueless loyalty points) changed consumer buying decisions.

…irrelevant information may influence choice even when there is an easily justified basis for choice other than the irrelevant attribute. [From Irrelevant Information and Mediated Intertemporal Choice by van Osselaer, Alba, and Manchanda.]

What the researchers identified in their experiments was went beyond the logical and expected effect of a loyalty program: the mere presence of point values influenced customer buying decisions. Even when the value of loyalty points was less than the value of a real-money price difference, they were swayed by the loyalty points:

Choices were influenced by points even when consumers were provided with other truly discriminating information (e.g., price) and the irrelevance of the loyalty points was readily discernable. This implies that irrelevant information can influence choice when other, easily justifiable bases for decisions are available and, therefore, that irrelevant information can function as more than a tie-breaker. [Emphasis added.]

Maximizing Loyalty Program Impact

The Neuromarketing takeaway from this research is that exposing customers to point values at the time of purchase can amplify the effectiveness of the loyalty program. Want to encourage sampling of a new product, or drive upgrades? Or get a customer to visit you instead of your competitor? Try something along the lines of, “100 extra Rewards Points with every purchase!”

Loyalty Inflation?

It might be worth setting the value of the loyalty currency in a way that lets you use larger vs. smaller numbers. E.g., “100 points” might be more effective than “1 point” even if the value was the same. I’ve often wondered about the effectiveness of airline mile restaurant promotions. I often get notified that a local establishment is offering “triple miles” if I use my airline-branded credit card. The final number of miles earned seems rather paltry, and I don’t think my purchasing behavior has been affected at all.

Then again, maybe at some level my brain HAS responded with, “Oooh! Three times the points!” and my rational, conscious thought process has merely justified the dining choice on a seemingly logical pretext

BORDERS CHAPTER 11 Plan:  Did you know that in the filing of the Chapter 11 papers, the CEO of Borders has stated a new commitment to loyalty solutions will help pull the company out of its problems?  Don’t wait until it’s too late, there are many signs on the wall to prepare and strengthen your business now.  

• This program has a great communication cadence.  Rewards come quickly (how about a free dessert after one visit?) and additional offerings are varied and frequent (seem to be appearing every 2-4 visits afterwards).  Panera has embraced the concept of proactive gifting driving future visitation and purchases, a key differentiator from traditional QSR loyalty models.
• The majority of the rewards are “thank-yous” vs. % and $ off.  MyPanera does not have a heavy “upsell” feel to the program.  Most of the rewards at register are Free items, and Free works much better than the % off.  The architects of this program have largely avoided % and $ off items that can feel like “non-rewards” to customers, and I’m hoping a few of the recent $-off rewards remain in the minority.  or go away.
• Strong focus on in-store experience.   The program quite simply enhances the in-restaurant experience.  I find myself waiting anxiously for associate to tell me what special treat I have received.  It’s fun, and enhances the interaction while not sacrificing speed at register. 

There is still opportunity for this program to evolve and expand, and Panera’s ability to identify customers and drive repeat visits could be greatly enhanced if the scale of rewards & benefits were better communicated.   Prospective members should not be left wondering if the rewards were going to be meaningful for them, especially when being asked to subsequently register online.

And while Panera indicates they are tailoring these rewards based on members’ purchasing history, the free item rewards appear fairly broad-based according to some sampling over the past few months.   There is a great opportunity here to increase rewards relevance as well as further entice members to buy add-on items, and this is a capability we anticipate will be strengthened as the program’s data history becomes more robust.

It’s delightful to see a program like this cited as a major driver of financial results, as Panera did in their mid-February WSJ article.   With a few small (but key) changes, the MyPanera program could quickly evolve to an even stronger customer loyalty driver, and a dominant element of Panera’s business intelligence strategy moving forward.

Fred Thompson is a COLLOQUY contributing writer and Partner, Retail Practice Lead with LoyaltyOne Consulting.

1.  Relevance

2.  Relationship

3.  Rewards

When the three R’s are followed correctly, then the fourth R kicks in ROI.  Although these three R’s sound as simple as Reading, Riting and Rithmetic, over 95% of business owners today are not following ANY of the three R’s even though consumers are screaming at the top of their lungs for them.  What a time to represent loyalty solutions, the offline retail world is just starting to wake up and beginning to realize that newspaper ads and little pieces of paper with discounts are no longer necessary.  Do you happen to know any business owners desiring to reduce costs, increase profitability and eliminate discounting?  If you can find one, they are a good start.

Email Trends Underscore Shifting Media Habits

Date: March 03, 2011

Author: David Gardner, Contributing Writer, CMO.com

Mobile and social platforms are making a significant impact on consumers’ brand engagement, according to a new survey by customer relationship marketing (CRM) agency Merkle.

Facebook, for instance, is used by nearly two-thirds of the online adult community, and a growing percentage of their time there is spent on commercial communications, also called permission e-mail, Merkle found.

However, Merkle’s survey of more than 3,500 consumers shows that e-mail remains the bedrock of consumer commercial relationships. “E-mail is still the most preferred method [of viewing brands,” said Rich Fleck, vice president of Merkle’s digital studies group, in an interview with CMO.com. “We’re seeing an uptick in social networking, but e-mail remains the backbone.”

In fact, nearly 75% of survey participants said e-mail is their preferred method of commercial communications, even over direct mail by a margin of nearly five to one. Overall, commercial e-mail usage has been gradually gaining market share--in 2005, 17% of consumers e-mail time was related to business, compared to 30% now--and is poised to surpass personal e-mail use in a year or two, according to the report.

Another interesting finding from the study was the symbiotic relationship between social networking--primarily Facebook--and mobile phones, which have become a “gateway” for consumers to read e-mails, surf the Web, and participate in social networking, Fleck said.

“It’s no longer about these separate, distinct marketing channels, but about the consumer experience as a whole, and smartphones have become tools to augment that experience,” said Lori Connolly, Merkle’s director of research and analytics, in a statement.  

One reason for the rapidly emerging growth of e-mail on mobile devices is “hyper e-mail checkers” who repeatedly check their e-mail; 43% of mobile e-mail users in the Merkle study do so four or more times a day. Merkle noted that those who use social networks like Facebook are likely to be hyper e-mail checkers, too.

"This means that the marketers sending email are likely to have a regular viewing audience of at least their brand and subject line," the report states.

Also useful to know about these Facebook users: On average, they like 12 company brands. In addition, friend referrals are important to them--and for Twitter and MySpace users, too. Some 20% of the respondents in the survey said they are likely to become a fan of a brand after a friend indicates a like for the brand.

For marketers, the challenge will be to adapt their digital marketing strategies for successful engagement.

“Seasoned digital marketers will confirm that many of the same questions regarding content and frequency are being asked of newer media--like mobile--as they were 10 years ago when commercial e-mail was fledgling,” the report states. “What has changed, however, is the customer intimacy of the newer media. The personal space [has] shifted to mobile, that intensely personal, always close device that demands more responsible marketing than has been required in the past.”

Editor’s Note:  The writing is on the wall (this comes from the book of Daniel and what happens afterwards is not pretty) blasting to databases either by email, text, or any other communication method will not produce the proper ROI and may indeed cause brand damage.  Solutions must be in place which are more personal and relevant in nature than simply offering everyone the same deal, discount or special.  There is quite a bit of ‘behind the scenes’ info in this article, but the theme continues from all over the world, customers are demanding more relevance these days and business owners must have a loyalty program tied to the transaction allowing them to communicate to customers based on age, demographics, spending patterns, visitation habits, birthdays, anniversaries and much more.  In addition ‘soft’ benefits such as membership privileges should be implemented immediately by almost every business model. 

Editor’s Note Research Article Below:  The real power of social media is not in a bowling center, restaurant, or local business creating a Facebook presence or tweeting on Twitter.  Of course they should, but to ignore the real power of Social Media with word of mouth referrals is a big mistake.  The proper customer loyalty program will cause customers to share their experiences with 100s (if not 1000s) of friends and thus makes implementing a loyalty strategy even more important for basic business survival.

Cause Marketing has a huge impact in creating WOM champions and so does effective customer service communication tools using relevant information to show value and appreciation to customers.  We have all these tools in place now and the early movers will benefit tremendously.  The case for proper loyalty solutions has never been more clear.

Contact a loyalty expert today, every minute you wait is lost revenue.  If you need to enroll in our online course to earn your Master’s Degree and then your PhD. please visit www.wildboarstraning.com for the introductory Piglet Exam.

 by Sharon M. Goldman2/25/2011 VOLUME 19 / ISSUE 1

In 2009, COLLOQUY conducted a consumer research survey exploring the intersection of consumers who participate in loyalty programs and their word-of-mouth (WOM) activity (“TalkTalk: The New Champion Customers”). In 2011, we returned to the topic, looking even more deeply at the relationship between loyalty and advocacy and the role of customers we call WOM Champion Customers (those who are both “Connectors” who are able to and do recommend brands they like and “Advocates” willing to recommend the brand). With 91% of WOM Champions surveyed saying they belong to one or more loyalty programs, the strong, powerful connection between Connecting and Advocacy is crystal clear.

We found that social media and word-of-mouth are closely intertwined when it comes to WOM Champions: Our survey results show that social media is significantly more useful and important to Champions than ever. In 2009, 27% of Champions said they used social media to recommend or discuss products or services. In 2011, 48% of Champions said they used social media—a jump of 77%.

Not surprisingly, Facebook is the WOM Champions’ platform of choice for discussing or recommending brands: A whopping 85% of member Champions use Facebook, while 77% of member non-Champions do so. Twitter, too, is popular with member Champions—31% use Twitter, which is 63% higher than non-member Champions.

With the idea of “trialogue” becoming more prominent in 2011, social media is clearly fueling amazing growth of Champions’ WOM behavior. Only a few years ago, a WOM Champion was limited to one-to-one or one-to-a-few conversations conducted face-to-face, via telephone and email, or through other means. Champions continue to use such media, but today social networks allow far broader impact—both positively and negatively—as they share either satisfaction or displeasure with potentially thousands of others who can pass the word along.

You know who your WOM Champion Customers are: They’re likely found in the membership rolls of your loyalty program. They are your best customers, your brand advocates—take them seriously, because they can exalt your brand or tear it down through social media. They’re conversing in spaces where you should be working on trialogue as well as dialogue. Want to increase your loyalty success through social media? Get the conversation started with your Champions—today.

Sharon M. Goldman is a COLLOQUY Contributing Editor.

Notice consumers are members of 14 programs on average. Think they have ONE card that can work everywhere? Not a chance. Imagine the coalition potential of one card delivering instant cash back rewards on everyday purchases which can be used at multiple locations across town. All this one sentence does is deliver what millions of customers say they want and what most of our Fortune 500s fail to deliver.

What a crime! The list of popular rewards programs is nothing short of horrific. The Rite Aid program is terrible and Borders just declared Bankruptcy and they are the top two! If there was ever a list that verified the value of our services it’s this list of preferred programs. The only reasons customers like them is that there are so few who do it right, they are stuck with programs who at least do something. CVS and Staples fail in a number of fundamental ways and so do ALL of the others. The timing in delivering proper loyalty solutions to a starving marketplace and consumer has never been more needed. There is a HUGE void in competence.

This is essential stuff: Think I make this stuff up? Almost every business consultant is mentioning this as essential, mandatory, required, words of this nature and yet we see millions of businesses who don’t even know how to build a database. Representing proprietary solutions in this space has never been a more lucrative pursuit. Time to find the right partner and jump in. I think I know the right partner, but it’s sure easy being the right one, all you need to do is have a D grade point average and you are pretty much on top of the heap!

Wow, what a statement (directly under the title).  Sure this sounds like common sense, then why do over 90% of businesses I frequent not offer anything?  Small business owners are in crisis mode, any business not offering some type of reward to their customers or utilizing some type of  loyalty solution are ignoring every major research study in the market. 

There has never been a more important time to reward consumers and there has never been a more important time to do it right.   In spite of everyone agreeing on this basis assumption 80% -90% of business owners still offer NOTHING, what in the world are they thinking?  What a great time to be in the loyalty business

Loyalty programs handcuff unhappy consumers

“Every consumer wants something different,” he said, “but every consumer wants something.”

No one wants to give up their rewards over a surly customer-service agent

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By Jennifer Waters, MarketWatch

CHICAGO (MarketWatch) — Consumers increasingly find themselves unhappy with the customer support they receive from their cell-phone company, banks, retailers and other service providers, but in an unusual shift in behavior, some are willing to keep doing business with them anyway.

For the first time in six years of studies, the Accenture Global Consumer Survey reported a decline, albeit a small one, in the number of consumers who switched service providers because of poor treatment, even as customer-satisfaction levels fell in all 11 categories of providers studied.

Protect your bank account

At a time when fraud involving debit cards is on the rise, consumers may not realize that some banks won’t pay consumers’ losses in debit-card fraud. James Van Dyke, founder of Javelin Strategy & Research, talks with MarketWatch’s Andrea Coombes about ways consumers can safeguard their money.

Some 64% of consumers said they dumped one service provider in favor of a new one in 2010, down from 69% the prior year. That’s still a high number, however, and up from a low of 49% in 2005.

“The most primal behavior of consumers is when they switch providers,” said Robert Wollan, global managing director of Accenture’s customer relationship management practice. “Until now we’ve only seen that trend go in one direction.”

Why the shift? Partly it’s because consumers are less likely to talk directly with customer-service agents; instead, we’re using technology like automated phone attendants, live Internet chats and website self-service options. Wait periods are shorter, there’s no being put on hold for what seems like hours and it’s rare that the same information has to be repeated to multiple service agents.

What’s more, consumers are being pickier about what providers they choose, relying more on word of mouth. Also, social-networking sites are gaining popularity. Seventy-six percent of all respondents said they listen more to their friends and acquaintances about their experiences before choosing providers, and one in four said they trust reviews and comments posted online by people they know.

“Word of mouth has always been an important motivator for consumers, but it’s been thrust into new levels of importance” as social networking proliferates, Wollan said.

Loyalty programs are working

But there’s another emerging trend in satisfaction surveys: loyalty programs. As the traditional levers of promotion and marketing are proving a less-than-stellar means for attracting and retaining customers, companies are using loyalty program, and their perks, as a lure.

Some 52% of respondents said they opted in to loyalty programs in 2010, compared with 45% in 2009. And the percentage of consumers who stayed with their loyalty program climbed to 54% from 49% among retail consumers, to 53% from 45% among those with wireless-service providers, and to 51% from 49% among people in hotel programs.

Loyalty programs, it turns out, generate loyalty. If you’ve been building miles on your credit card or accumulating points for a free hotel stay, you’re not likely to give that up because you have to deal with customer-service agents who can’t solve your problem, according to the Accenture study.

However, it could also mean that when you opted in, you unwittingly locked yourself into a longer relationship with the provider than you might have wanted.

But here’s the good news for consumers: loyalty programs are more tailored toward individual needs and wants than ever before. Companies realize customers are in fact individuals who want to be treated uniquely, Wollan said. “Loyalty and loyalty programs have emerged as something that companies can really look to leverage,” he said.

“Every consumer wants something different,” he said, “but every consumer wants something.”

Jennifer Waters is a MarketWatch reporter, based in Chicago

1. A system tied to transactions designed to gather customer data for relevant communication is becoming mandatory for survival. We live in a technology driven world which causes change at rapid levels. Business owners that don’t keep up with new solutions and communication tools will suffer substantial loss or go out of business.
2. Membership benefits or ‘soft rewards’ combined with ‘hard benefits’ or cash back rewards are the most successful. Points are often referred to as the default ‘hard benefit’ option since very few have the ability to issue cash back rewards. Don’t worry, cash back is superior to points in every aspect.
3. Simply blasting discounts to a database shows a lack of understanding, creates very little (if any) loyalty and is actually causing more damage than good will due to customers awareness of better ways to communicate.
4. Business synergy for redemption is an excellent idea. We just spoke with one bowling center which uses ‘Auction Dollars’ as a custom widget which we can track separately from gift, rewards, fundraising and other categories. Customers earn these ‘auction dollars’ based on how much they spend or visit along with a variety of contests which increases their bottom line. Once or twice per year, they go out and purchase some very nice gifts which can only be purchased by their customers with their ‘auction dollars.’ Kudos to this group, very forward thinking and when programs like this are combined with ‘hard’ rewards such as cash back to their business models, the customer will be loyal for life, spend more money and frequent much more often all without any advertising expense.

The authors write, “Some observers have argued that the recently passed Card Act and recent changes to overdraft access for debit cards in the United States would reduce the ability of issuers to extend rewards. While mandated reduction in cardholder fees and finance charges may potentially affect the level of rewards, we find that rewards have significant impact on credit card debt especially via substitution from another issuer’s credit card suggesting that rewards are an effective tool to steal customers from a financial institution’s competitors.”

The study shows that the rewards need not be significant to have strong impact on card use: “We find that consumers generally spend more and increase their debt when offered one percent cash-back rewards. The impact of a relatively small reward generates large spending and debt accumulation. On average, each cardholder receives $25 in cash-back rewards during our sample period. We find that average spending increases by $68 per month and average debt increases by over $115 per month in the first quarter after the cash-back reward program starts.”

This again shows that, as we’ve pointed out before, financial institutions can benefit from a broader range of rewards, and that they should “Reward more engagements with customers, not fewer.”

For additional perspective on the study, including information not included in the study itself, check out a PYMNTS.com audio interview with the study’s authors at “How Reward Programs Get Consumers to Switch Cards.”

Editor’s Note:  I know you think I wrote this article since we have been talking about these various issues for years!  Watch for our new whitepaper this weekend, the entire marketing and loyalty landscape is finally catching up and yours for the taking!  Our solutions are far ahead of the vast majority and small merchants are clueless (even the big boys are behind)  The time to capture market share is now, everyone needs what we have and they are now starting to realize they need it!  I guess Bill Gates had this problem when the P.C. was the size of a house, but last time I checked, Mr. Gates is doing just fine. 

With consumers being targeted by marketing communications from all directions at all times, and email inboxes being flooded not only by adverts but also by social media alerts, there is a huge amount of ‘noise’ that marketers must cut through before their message will be heard, according to Ryan Deutsch, vice president of strategic services for StrongMail.

Digital messaging is at the core of every brand’s marketing strategy and, despite the ongoing growth in SMS and social media, email still remains at the centre of the digital customer relationship. In fact, according to some industry analysts, almost three out of four consumers (73%) cite email as their preferred communication channel, and a recent poll of Windows Live Hotmail users found that shopping online, receiving statements and communicating with businesses were the top three reasons for using email. sschroeder This article is copyright 2011 TheWiseMarketer.com).

But, despite of a wealth of knowledge about how email is used by consumers, most studies find that some 90% of all email messages sent are unsolicited commercial messages, or ‘spam’. It therefore seems that, even after years of building email marketing programmes, marketers are still only just scratching the surface of email’s true potential.

As a result, 2011 may well be a year of changes and development when it comes to the use of email in the marketing sector, with the following being StrongMail’s top six predictions for the year:

1. Increasing Investment in Channel
   2011 is likely to be a year of highly sophisticated and intelligent email marketing and as such companies are expected to increase their investment in email marketing providers. There is a big requirement for smarter programmes that can run highly complex campaigns and provide ROI with brands are turning to the channel to deliver this.

   StrongMail’s recent research into marketing trends revealed that 93% of businesses plan to increase or maintain marketing spend in 2011, whilst 65% of businesses plan to increase marketing budgets for email alone. So clearly, brands are aware of what needs to be done and plan to make some big changes.

   It’s hardly surprising that many of them are turning to email marketing providers for support. The channel understands the ad avoidance and engagement problems that companies face and it has the expertise and knowledge to overcome these issues. It is highly likely that a large majority of 2011′s marketing investments will be seen in the adoption of sophisticated platforms to help brands to improve their email marketing campaigns.
    

2. Sophistication Gap
   During 2011 the gap between best in class marketers and those who are reluctant to embrace new techniques will continue to grow. Mass-market campaigns may have worked in the past but the consumer landscape has changed and users are no longer interested in receiving a generic email that doesn’t address their needs and has been sent to 50,000 other recipients. As such, it is increasingly important that marketers include preference-based segmentation, right-time email marketing and personalised messages in their campaigns.

   It is important to ensure that any new processes adopted, extend beyond implementation and include analysisng their success. Unfortunately, most companies are still only tracking basic values. Forrester’s Email Marketing Review (EMR) scores companies on their email tracking and found that across all industries, marketers understand basic, but not advanced, email marketing practices. Out of the 70 campaigns that Forrester reviewed, only two passed, indicating that there is still a long way to go.
    

3. Ad Avoidance
   Consumers have become savvy when it comes to identifying brand adverts that drop into their inboxes. So much so, in fact, that they are often deleted before even being opened. Up to 77% of all emails are not even read.

   This has given rise to new business models like group commerce or flash sales developing in the email channel. Instead of receiving 20 different brand emails, a consumer receives just one centralised email, which lists offers from a number of different brands. This method is proving particularly popular across the pond, where consumers are opting to receive and read these emails in return for big money savings. Many UK companies are also adopting this new way of thinking, especially in the restaurant sector where consumers are being sent vouchers for discounted meals via third party emails and websites.

   The great thing about these models is that, because they are subscriber based, they cut through the mass of irrelevant emails that fill our inboxes and this is a skill that marketers are going to have to perfect if they want to succeed in 2011. Switched-on brands are beginning to see increased value in these types of techniques versus more traditional advertising methods.
    

4. The Growth in Social CRM
   In 2011 brands will start to sit up and take notice of the wealth of unstructured data that social media can offer them. Consumers are engaging with brands, communities and peers all over the web, leaving a vast trail of customer information behind them that can be used by brands to intelligently target their communications.

   Social CRM is a relatively new term in the world of online marketing, but the concept behind it is based on age-old direct marketing principles. It’s about measuring how customers interact with their online communities, not just the brand itself. Companies now have the ability to combine data and intelligence from multiple channels and use it to anticipate a customers’ next move. Through social CRM, marketers can listen to the types of conversations that customers are having about their products and services, learn how they use the social web, engage with their best customers and influence and encourage sharing and brand advocacy.

   By analysing this unstructured data, brands can gain a wider understanding of their best customers and can begin to build strategies that drive lifetime value and improve campaign and marketing performance across all channels.
    

5. Integrated Marketing
   For most marketers, 2011 should be about switching their focus from a few short lived, labour intensive campaigns to a more ongoing and automated approach based on customer activity. Although accurately planning and monitoring the success of a campaign is still essential, brands should be ready to respond quickly to consumer behaviour and trends instead of spending weeks, maybe months, focusing on one pinnacle launch.

   By ensuring that every part of marketing communications is integrated, brands can make sure that customers are engaged and interacting on a regular basis. The focus should be on regular contact and offering the customer an improved brand experience. Integrated marketing communications will ensure consistency of your message, identify customer insights and help you to develop a strategy with the right channels to forge a stronger brand-consumer relationship.
    

6. Engagement
   Intelligent customer engagement is vital in a world of smarter inboxes. The introduction of Google’s Priority Inbox and similar applications, mean that emails no longer drop into a recipients inbox in order of delivery. Instead, they are ranked by importance, meaning that if you are not providing consumers with targeted information, your emails are unlikely to ever be read.

   This is just another example of why brands have to understand their customers. Emails must be targeted and tailored to suit individual preferences to make them feel more personal. The most efficient way of doing this is to combine preference-segmentation, right-time marketing and personal messages with social CRM.

   Frequency must also be addressed. Customers are demanding relevant and timely emails, instead of inboxes full of irrelevant content. Achieving this will become an integral part of email marketing this year to ensure emails rank highly on the scale of inbox importance.

Contrary to popular belief, instead of damaging the effectiveness of email, the rise of social media is actually increasing its use. Consumers still look for emails from the favourite brands alongside notifications of activity on their favourite social networks. Instead of competing, the two channels should work together to drive customer engagement.

As a result, Deutsch argues, investing in your email marketing efforts is now more important than ever, especially as the user-generated content on social networks increases expectations for relevancy, interaction and design.

Consumers are receiving more marketing messages than ever before, which ups the ante for email marketers to get their attention with the right combination of eye-catching layout and data-driven relevance. Investing in these standout trends doesn’t just increase your clicks and conversions; it deepens the customer connection, which ultimately improves interactions across all channels.

Leading brands must therefore learn to create this bond and to utilise the creativity and tools necessary to build relationships and drive brand advocacy. It is through leveraging the data and insights gained from marketing activities to build more relevant conversations, that results can be achieved.

Email has been at the centre of marketing campaigns for years and this trend looks set to continue. Techniques and practices are of course still evolving, but the winners in 2011 will be those brands that embrace changes and make investments to ensure they have the right tools for the job.

Fox Makes Super Bowl Ad History With ‘Rio’ Promo

Twentieth Century Fox will make Super Bowl history this Sunday when a 30-second spot for 3D ton Rio becomes the first ad to air during the game with an embedded code. Embed is tied to app Angry Birds.

our editor recommends

Fox Announces ‘Angry Birds’ Mobile Game Tied to 3D Toon ‘Rio’

Studios are back in force this year in terms of buying up time during the Super Bowl, the most watched event of the year. It’s the first time Fox has plugged a movie during the event since Jumper in 2008.

Rio promo will air during the fourth quarter of the showdown between the Pittsburgh Steelers and Green Bay Packers, which airs on the Fox Broadcasting Network.

During the spot, viewers will be invited to find the frame with the code, which in turns directs them to a special level of Angry Birds, which has entered into a first-of-its kind partnership with Fox. The level will take Angry Birds players to a Rio sweepstakes.

The sweepstakes winner will attend Rio’s world premiere in Rio de Janeiro on March 22. That same day, Fox and Rovio launch the highly anticipated “Angry Birds Rio” app. Film opens April 15.

The Rio Super Bowl spot will be available across the web, including YouTube.

Paramount’s the big buyer this year in terms of the Super Bowl. During the game, it will air spots for J.J. Abrams‘ alien-invasion pic Super 8, the threequel Transformers: Dark of the Moon, Gore Verbinski‘s CGI film Rango and Marvel’s superhero pics Thor and Captain America: The First Avenger.

Disney has bought time during the game for Pirates of the Caribbean: On Stranger Tides, while Universal and DreamWorks’ will plug the Daniel Craig-Harrison Ford sci-fi western Cowboys & Aliens.

1.  The fragmented media to reach customers, it needs to be targeted and relevant.

2.  The shift in power of consumers in determining how and when to engage with companies which is related to #1

There are very few integrated loyalty solutions like ours in the marketplace and it’s a worldwide pursuit.   We will have a new whitepaper ready in the next day or two to help explain.  In the meantime, here you go

by COLLOQUY Staff

One only needed to look at the line-up of presenters to see the evidence. Leaders from PAYBACK, Groupe Aeroplan (owner of the Nectar coalitions in the U.K. and Italy) and LoyaltyOne (which owns AIR MILES in Canada and is a strategic investor in Dotz in Brazil) were all on the podium discussing a variety of trends that will shape the future of loyalty efforts in the Indian market.

In his presentation, Alex Rittweger, CEO of Loyalty Partner Solutions GmbH (owner of the PAYBACK coalitions in Germany and Poland), explored the consumer and sponsor benefits of the coalition model. Given PAYBACK’s investment in Indian coalition i-mint, attendees questioned Rittweger on the ability of the Indian marketplace to support more than one coalition. Rittweger replied, “Given the size and scope of the Indian market, I’m confident that it can support two—maybe even three—coalitions. I can tell you this: Our company intends to be one of them.”

That assessment is clearly shared by other loyalty leaders from developed countries. Stephanie Coyles, Chief Strategy Officer of LoyaltyOne, described how her team has been in dialogue with Indian consumers, Indian companies and other stakeholders for nearly 12 months. “In India, there is a distinct opportunity to leapfrog the start-and-stop efforts of loyalty practitioners in developed nations. Harnessing the power of partnerships is just the starting point. Indian companies can make real strides in leveraging the data and insights of customer loyalty programs—even in the formative stages of engaging the explosion of new middle-class consumers in India.”

Throughout the 4th India Loyalty Summit, other presenters echoed the role that partnerships can play in creating a meaningful value proposition for customers. Suzy Cox, SVP of Carlson Marketing Worldwide, discussed how several CPGs (consumer packaged goods companies) have leveraged partnerships to create profitable and winning programs in North America. On the other hand, ICICI described a different approach to building relationships with their small- and medium-sized business customers. Ms. Ronita Mitra, Head of the Corporate Brand Group for ICICI, described how they’ve leveraged a local network of consultants and subject matter experts to create a resource that their smaller business customers can access to grow their retail and service companies. “Through our CEO Knowledge Series and online SME Toolkit, companies in their formative stages can gain access to the expertise they need,” she said. “Whether that is accounting advice, strategies to manage tax expenses or financing help, ICICI is providing access to expert advice to help these companies take full advantage of the growth opportunities in India.”

According to COLLOQUY’s Hlavinka, companies are struggling with a sustainable way to drive profitable growth throughout the world. “While the exact reasons may vary a bit from region to region, there are two challenges we all share. The first is the fragmentation of media and communications channels to reach customers. The second is the shift in power to the consumer in determining how and when to engage with companies they do business with.” The implications, according to Hlavinka, are quite clear. Enterprise-wide deployment of customer insights in shaping tailored pricing strategies, optimizing merchandise assortments and refining store layouts will be the way that companies can balance revenue growth pressures with the need to ensure that growth is not eroding bottom-line margins.

FULL DISCLOSURE: COLLOQUY, like AIR MILES, is owned by LoyaltyOne, an Alliance Data company.

For more Summit information, consult “Winners of the 4th Annual India Loyalty Awards“—awards were presented Jan. 27, 2011.

BTW:  I have spoken to Qdoba about their program and they acknowledged these mistakes in their previous loyalty program which ran for years.  This is supposed to be the attempt to fix the problems.  If you represent our solutions, you know you are in a good space when we keep seeing Fortune 500 after Fortune 500 create loyalty programs as though their marketing department has yet to graduate from pre-school.   Think I am harsh?  There is no excuse for companies this size to ignore all the independent third party research I send to you which verifies the mistakes they make year after year.  This is supposed to be the fix to the problems which were in existence for years.  What you may not know is that these 100 points are not accumulated with every purchase, there are scores of purchases you can make where points don’t count or you don’t get the credit.  There are still redemption problems as well, you can’t see these mistakes from the article, you can only experience them first hand like I have when you become a member.  Forget the fact that over 80% of customers DON’T WANT points, there are many other issues.  Sure customers want something, that’s why they were happy with something since 90% of business owners offer NOTHING!  Do you think all these companies are clueless or do you think they are not aware of the proper solutions?  What do you think?

Here you go

Qdoba Mexican Grill, known for its wide variety of handcrafted, fresh and innovative Mexican cuisine options, rolled out Qdoba Rewards nationwide today, an enhanced electronic program that shows appreciation for Qdoba’s loyal guests by giving them greater flexibility and opportunities to redeem rewards.

Qdoba’s enhanced rewards program now gives guests the ability to flash a scanable card, key fob or a small sticker that can be placed on any commonly carried object — such as a driver’s license, a credit card or even a tube of lipstick at the register to earn points toward free meals. In addition, the program now allows guests to bank their rewards and use them at a time they choose — like if they decide to treat a group of friends.

“Our guest research found that approximately 73 percent of our current rewards members were happy with our program but wanted more flexibility with it — like being able to bank their points and use them later,” said Chris Bingel, marketing projects manager at Qdoba. “The new Qdoba Rewards gives customers greater choices in how to earn their rewards and greater control over when they can redeem them.”

For each entree purchased in most markets, guests will earn 100 reward points and once 1,000 points are earned, guests will receive one free entree. In addition, guests will receive free food and special offers once they register online on their birthday and on the anniversary of their registration. Guests can also select to sign up to receive additional special offers via e-mail through the program. In addition, guests can bank their rewards for redemption whenever they want.

Qdoba guests are invited to join the Qdoba Rewards program by visiting one of Qdoba’s more than 500 restaurants where they can pick up information and a scanable card, key fob and a small sticker that can be placed on any object. Then, guests need to go online at www.qdoba.com/rewards to complete a quick registration process and immediately begin earning points toward free food and special offers. To earn and redeem rewards, guests simply need to present one of hese items at the register to be scanned.

Rewards points can still be earned even if guests forget their card or sticker. Once guests tell the cashier that they forgot their card or sticker, the cashier will print a code at the bottom of their receipt. They can then enter that code online to redeem points (codes will expire 30 days after being issued).

Qdoba Rewards also incentivizes guests who purchase Qdoba catering. Customers earn one point for every pre-tax dollar spent. Guests can qualify to spend their points on free entrees, catering discounts or Hallmark gift certificates. Catering guests can also redeem points online and bank their rewards as well.

Source: Qdoba Mexican Grill

Papa John’s is one of seven businesses, which advertised during last year’s Super Bowl, but will not be returning this year. Which means, that they’ll be saving $3,000,000 dollars for every 30 seconds of advertising they don’t show during the many hours of Super Bowl TV coverage on February 6. Instead, Papa John’s has created a different form of marketing, which we think will work out better for them in the long run.

The company has a program, Papa Points, where customers can earn points towards free pizza with each online purchase. Once enrolled, customers earn one point for every $5 spent online; when customers accumulate 25 points, they receive a free pizza with their next online pizza purchase. For the Super Bowl, every person who registers at the company’s website and joins Papa Points is eligible to receive a free pizza should the football game between the Green Bay Packers and Pittsburgh Steelers go to overtime. In an article in USA Today, Andrew Varga, Papa John’s marketing chief says, “We’d rather give away millions in free pizzas than spend millions on a spot.”

The company estimates they could have to deliver 100,000 pizzas should the tie at the end of regulation happen.

There’s little downside to this for Papa John’s considering the very small chance of the game ending in a tie and the upside for is huge. Think of the publicity they’re getting from this marketing campaign, and think of the data they’ll gather from 100,000 new customers to whom they can begin to market on February 7. The question will of course be, are the people signing up going to become “loyal program members” or just “members of the loyalty program” hoping for that one in a million chance at a free pizza.

All we know is that this could lead the many people rooting for a tie (or, in the case of bitter Patriots fans everywhere, both teams to lose). There hasn’t been this much excitement since Taco Bell offered a free taco to America for the first stolen base in the World Series. Thanks Jacoby Ellsbury!

For more on the difference between freebies, gifts and rewards, read Bill Brohaugh’s article, “Free Associatation”, then please volunteer to do his dishes.

by Bryan Pearson

Email to a Friend
Groupon’s decision to turn down Google’s $6 billion acquisition offer was one of the more interesting business stories of 2010. It certainly raised many eyebrows and got folks wondering if the giant e-coupon company known for its daily deals could sustain its phenomenal growth particularly. with new competitors emerging every day.

This news got us, as operators of North America’s largest coalition loyalty program—the AIR MILES Reward Program—thinking about the social couponing model and the role loyalty marketing can play in ensuring the established players such as Groupon maintain and grow market share while helping the start-ups create a point of differentiation.

First consider Groupon’s story. They’ve stood apart by maintaining their vast database with such eloquence—and irreverence—that no single competitor has yet to serve as a serious threat. But with so many small social coupon companies emerging daily, expect consolidation—and with that will come scale and strength.

To continue to stand apart and foster loyalty, Groupon needs to do the following three things well:

      Woo Them: Groupon should continually recognize the consumer’s relationship with the service, and demonstrate that this engagement is as important to Groupon as its carefully selected offers are to consumers. Personalized thank-you notes go a long way, for instance.

      Wow Them: Groupon should lavish its loyal followers with the unexpected—a free Groupon “pass” for a Groupon offer, for example, or an accumulation of points that can be redeemed toward future Groupons.

      Win Them: Groupon has the data and it has the mass not only to identify its most profitable consumers, but also what motivates them. And Groupon is asking some members to fill out additional short surveys to get a better picture of each of them. These pictures can be used to better tailor offers, get more buy-in, and contribute to an added sense of a partnership.

Groupon has the advantage of already knowing much about us as consumers. It reportedly counts north of 40 million members in more than 300 markets globally. About 19 million of these subscribers live in North America, according to a recent report in Advertising Age, and Groupon knows the name, age and gender, residence, purchases preferences and payment methods of each. It also knows that all its members are highly desirable consumers—mostly college-educated, 18 to 34 years old, with two-thirds making $50,000 to $100,000 a year.

It only makes sense that Groupon is testing a loyalty plan. In the test, members automatically earn points, called “G’s,” which can be used toward free Groupon coupons. Top members, or frequent users, also can earn invitations to special events. (Separately, Groupon also offers $10 in “Groupon Bucks,” to members who refer a friend.)

By converting that consumer mileage into miles, or points, or some kind of reward, not only will Groupon benefit by learning more from its members, but they will also benefit by receiving richer, more relevant offers.

1. Issue cash back rewards instead of points. This is a no-brainer and we have written on this topic numerous times. The article references simplicity and it’s exactly what customers have requested. I just called United to find out about my points based mileage program and it took 30 minutes and one supervisor to try and figure it out and I still don’t know if I have a one way ticket to paradise or half a round trip to Tucson.
   
   
2. Partner with companies who service retail locations, let’s use Bowling Rewards as an illustration although the examples are numerous. Southwest could do this with any one bowling center to test ROI and customer response. Of course I have already surveyed 100s of customers and they have already indicated this type of strategy would be a key factor in choosing an airline, but they need to find this out for themselves. Either way, this strategy does not need to be industry wide, it can be with one bowling center, one restaurant, one retail outlet and it’s wide open for sponsorship.
   
   We would brand every card with Southwest Airlines logo, block out all the other airlines by contract and let people earn Southwest Loyalty Dollars based on spending inside the bowling center. We might even create Southwest Airlines pins and have people earn $5.00 towards any Southwest Ticket when they throw a strike with a Southwest Airlines headpin. We might even have Pepsi add special rewards based on buying Pepsi and have the two companies work together to drive spending back and forth. 1000s of bowlers would end up having small balances such as $20.00 – $75.00 (maybe more based on spending) which can only be spent on Southwest Airlines. They might even run special promotions to redeem Bowling Dollars towards Southwest tickets and offer an incentive to certain areas, but the ideas like this are numerous, easy to implement and exclusive to Southwest. When selected PBA members with Southwest logos win tournaments, people earn balances towards tickets and we now have a fantasy Southwest bowling experience like the NFL. Throw in a fundraising component where local churches and schools would be funded based on Southwest purchases and they would move millions of people to their brand who would fell much better about flying and making a real difference.
   
   
   
3. Other partnerships can be developed, we can even create a Southwest Rewards Card which can be used inside of 1000s of locations for custom rewards to that location with our one card technology. I won’t go into all the details, but big companies who have millions of dollars vested in rewards and loyalty programs are virtually clueless as to how to structure the proper incentives and offers. When the biggest companies and the brightest minds struggle with loyalty implementation and capabilities, you can see the opportunities ahead of you when you represent our solutions with common sense offers backed by mounds of research.

The Fork in the Road

Filed Under (Airlines, Breaking News, Travel) by Randy Petersen Posted on 01-19-2011

The recent announcement of an updated frequent-flyer program from Southwest Airlines seems to be a bit like that proverbial fork in the road–which path to take?

Two key factors in the decision for this new program appear to have been:

• to design something that could resonate with the business traveler, a breed of traveler that while Southwest has its share in select markets, they haven’t been able to win over in the share of wallet
• given that Bags Fly Free, Southwest certainly understands that while they can move some business over from other carriers, it may not always equal what they might have gained by being like the others and taking a slice of the anticipated hundreds of millions of dollars that come from these sorts of ancillary fees.

So, where else are some revenue models that could aide in adding to ongoing financial success of Southwest Airlines? That’s right, the untapped model of frequent-flyer programs. In doing so, however, Southwest needed to break the current barrier of an inflexible currency—the credit system. Partners and even Southwest Airlines were unable to bundle credits in a form which could be nibbled up. By adapting to the new “points” system, they now have a currency that can be understood and sold as part of their brand. It’s immediately obvious that the single change that is most overlooked is that members will now be able to purchase points. The check-in counter for airlines certainly has a check-out line for point purchases and when Gary Kelly, the CEO of Southwest Airlines, proclaimed that this change could result in a growth of hundreds of millions of dollars of new revenue for Southwest Airlines, I understood that declaration better than most if not all the others.

But a funny thing happened on the way to the “forum.” In this new change for Southwest Airlines, they did something they’ve never done before, and that is they became unoriginal. Throughout most of the legend of Southwest Airlines, they’ve created a model like no other, introducing everything that is Southwest Airlines as original and during this time, became the most copied airline in the world. But no matter how the wizards at Love Field tried, there was no path for originality when it comes to creating Rapid Rewards 2.0. After nearly 30 years, the age-old observation of “been there, done that” is alarmingly true.

While the current program will certainly be compared to U.S. competitors JetBlue and Virgin America, both those programs now appear much simpler than the new Rapid Rewards, which is exactly what Southwest Airlines has always been. There is some irony that in fact Southwest Airlines has borrowed from the past and from one of their nemeses—America West FlightFUND. Remember the days when these two airlines were absolute in their direct competiveness as low-cost carriers? And there was reason for the name of America West’s frequent-flyer program at the time FlightFUND. It was because the entire program was fare-based and offered international awards as well. Members earned FlightFUND dollars based on three different fare classes: B or Y (like Business Select fares), K fares (like Anytime fares) and Q, M or V fares (like Wanna Get Away fares). Members could redeem their FlightFUND dollars on Pan Am or Singapore Airlines but could not earn FlightFUND dollars when flying those two airlines.

Twenty years ago, it was highly unlikely than anyone could have imagined the impact that FlightFUND has today. The idea of tying loyalty programs to revenue spent and redeemed was very foreign back then, and faced with the competiveness of mileage-based systems, America West opted to go and follow the main currency—miles. Today, programs far and wide like Air New Zealand, Virgin Blue, Virgin America, JetBlue and now Southwest Airlines have that frequent-flyer program to thank, at least for being different. And while FlightFUND did go on to be more alike than different, it’s really too early to tell right now if being as different as being fare-based is the right call. It makes sense for the airlines who have adopted the model, but there is no empirical research yet that shows it takes or builds market share from other mileage-based carriers.

So while the next firmly established elite levels for Rapid Rewards 2.0 are a positive start for this program in its quest for the business traveler, there’s still something that suggests that it’s going to take more than this to move that needle farther from empty to full. I have no doubt that this program will be successful with its financial goals for Southwest and that accounts for much in this new program. But there’s still plenty that will keep the elite business traveler glued to their elite perks, lifetime Gold and Platinum and London and Hawaii all in the same award chart from straying too far. And with the economy picking back up, it really is too bad that this program couldn’t have come at a better time—when the economy was tanking, rather than when it is improving. So, whether it is Rapid Rewards 1.0 or 2.0, it remains one of my favorite airlines and frequent-flyer programs to track, but I just wish that there was something more original in this new program that would have made it more than being new for Southwest Airlines—but as even Southwest Airlines have found, frequent flyer programs can be the tail that wags the dog.

COLLOQUY Editorial Advisory Board Member—Randy Petersen is Editor/Publisher of InsideFlyer magazine and Founder of FlyerTalk.com.

1. BR Blue River Dealership Sample Letter
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Others, however, have recognised that the real benefit of a loyalty programme is not necessarily felt first by the customer, and that it is the merchant that gains the necessary insight (from detailed analysis of its loyalty programme and transactional data, for example) to be able to improve the way it communicates with and deals with its customers. The customer is actually the secondary (but still the most important) recipient of the benefits of a true loyalty programme.

To say that a loyalty programme is not useful, or is a waste of marketing budget, is to have misunderstood the real purpose of the programme. Rather than offering a simplistic discount or rebate programme, a real loyalty programme offers the customer any number of incentives to allow the programme operator to collect accurate and useful data about their lifestyle, purchase choices, motivations, interests, circumstances, and in many cases even about their household and immediate family.

The reason for gathering this data is not – as a very small minority of consumers seem to fear – to create some kind of ‘Big Brother’ database of peoples’ personal habits, but to gain practical insights into ways in which the merchant could serve each customer more effectively, more easily, and more satisfyingly.

But should you adopt a single-operator model or a coalition model? There are arguments for both, but coalitions (multi-partner programmes) have many benefits, financially, operationally, and in terms of consumer perception.

With a coalition, the programme management is independent of any of the partners. The partners have contracts with the operators of the programme to issue and/or redeem the currency of the programme, and only have access to data harvested by the programme through its operator. Individual partners don’t have direct access to other partners’ data held in the programme, although the operators of the programme will usually market to other partners’ customers on behalf of another member. For example, a supermarket member could ask for mailings to be sent to the customers (or just certain segments of the customers) of a fuel retailer partner in an area where a new supermarket is being opened.

There are several essential goals that a coalition programme must achieve if it’s going to succeed, and why they’re so important. For example:

1. Rapid market penetration;

2. Delivery of attractive rewards;

3. Being the first in the market;

4. Building communication channels.

The advantages, disadvantages and structural needs of coalition programmes (compared to a non-partnered loyalty programme) are complex, and include:

· Greater interest in the programme;
· Members have fewer cards to carry;
· Members earn points more quickly;
· A greater variety of rewards;
· Concentrated, coherent promotions;
· Time saved in development;
· Lower costs of development;
· Database run by professionals;
· Sector exclusivity;
· Coalition marketing campaigns;
· Higher penetration rates;
· Real cost benefits of coalition.

Our latest report ‘The Loyalty Guide 4′ covers all of this in detail, with over 1,000 pages of solid loyalty marketing data, practice, and theory – everything you need to know in one global report. It explains customer loyalty and engagement, metrics, best practices, concepts, technologies, models and the latest tools and innovations. It’s packed with detailed case studies, research, market sizes, forecasts, models, charts, illustrations, and materials to support new initiatives, presentations and proposals.

Key marketing budget trends for 2011

Tuesday January 4, 2011

Half of businesses plan to increase their marketing budgets in 2011, and another 43% plan to maintain current levels, while only 7% plan to decrease marketing budgets, according to the ’2011 Marketing Trends’ survey by StrongMail.

Conducted in November 2010 and examining the marketing budget plans of 925 global business leaders, the survey’s respondents felt that “a lack of resources or staff” would be the biggest email marketing challenge for 2011, followed by “integration with customer data” and “email deliverability”. sschroeder This article is copyright 2011 TheWiseMarketer.com).

Email marketing (65%) and social media (57%) were reported to be the top areas of marketing investment for 2011, followed by online search (41%).

Direct mail (36%) and trade shows/events (33%) were the top targets for decreased spending, although this is still a marked improvement over the 2010 survey, which found marketers reducing spend in these areas by 42% and 44% respectively.

But the most important email marketing initiatives for 2011 were cited as:

1. Increasing subscriber engagement (52%);
    
2. Improving segmentation and targeting (49%);
    
3. Integrating social media and email marketing (43%). Interestingly, 71% have already integrated email and social marketing, or had plans to do so during 2011.

Among social media initiatives, Facebook was named as the biggest priority (35%), followed by viral/referral marketing programmes (22%). Marketing via Twitter and implementing social media management technology tied for third place (21%).

Awareness building (63%) has become the primary goal for social media marketing initiatives, followed by loyalty member acquisition (54%) and reaching new audiences (42%).

As is the case with any new channel, social media marketing is currently seen as being the least effective at generating new leads and revenue.

“As marketers head into 2011, they are focused on increasing subscriber engagement through increased relevance and automating lifecycle communications,” said Ryan Deutsch, vice president of strategic services for StrongMail.

The full details of the survey data have been made available for free download from StrongMail’s web site – click here (1.48Mb PDF document; no registration needed).

The Seven Biggest Mistakes that Independent Restaurant Owners Make

1. Trying To Become Branded… Let me be the first to tell you.. “Forget it!”…  You can’t take “branding” to the bank… only cash!  Second, you don’t have enough money in your budget!   Leave the branding to Coca-Cola, McDonald’s, Ford and all the other big boys.
2. Not Having A Customer List… Get everyone’s name, address, birthday and email address that walks into your restaurant!  No customer list – No way to contact them when you need an immediate influx of cash!
3. No System In Place…  that attracts and acquires new customers… not just a hit and miss marketing system.
4. Thinking That All Customers Are Created Equal… They’re not… believe it!  In fact, some should be black-balled from your restaurant!
5. Having Boring Marketing… or worse yet, just following what others are doing.  Do something DIFFERENT… stand out in the crowd!
6. Not Measuring How Effective Your Marketing Is… What’s your ROI (return on investment)?  What did it Cost you to bring that new customer through the door??
7. No Exit Strategy… Not knowing exactly how you will sell and get out of the business.  Big Hint…  You need a in-house customer list to make your business worth more.

1.  Business Synergy:  Bowling Centers, Restaurants, Car Washes, Cleaners (you name it) take their gift and rewards card loaded with free games of bowling, free appetizers, $5.00 in rewards, (any type of value) and offer their card to surrounding business owners to hand out to THEIR customers as a thank you for coming in.   Let other business owners do all the work for you and we have some added capabilities to track business synergy that other programs are unable to do.   No advertising, no discounting,

2009 Customer Loyalty Research Highlights

Research Articles:

1.   04/01/2009 TNS Consumer Credit Card Research Firm, Joe Hagan Senior V.P. of Financial Services and Data Research.
   
   Findings:
   1. Cash Back Rewards are preferred by over 70% of the population.
   2. Rewards Cards are ‘top of the wallet’ cards and are viewed very favorably by customers.
   3. Higher spending and increased frequency occurred across every demographic and every business model.   There was not one exception.  Poorly designed programs still offered significant ROI but when simplicity and flexibility were emphasized, the program performed far better.
   4. 77% of consumers indicated they are searching for ‘non-debt’ related rewards programs with personal offerings based on visitation and spending.  Cause marketing was a close second place with Green benefits third.  Green marketing is projected to increase substantially in 2010 but must be tied to the first two which are still paramount in customer’s minds.

    

2. Denny’s restaurant Super Bowl promotion as reported by Ad Age.
   
   Findings:
   1. Customer good will was much higher than expected.
   2. Customers requested more companies to offer similar benefits in return for increased loyalty
   3. 80% of customers indicated they would try and visit the brand more often
   4. Bigger benefits were verbalized by customer such as, ‘good for America’, ‘good for my family’ , ‘shows lack of corporate greed’.
3. 04/01/2009 UPromise press release with Bank of America – Restaurant Association 3/31/2009
   
   Findings:
   1. Business synergy strategies increased revenue for all parties involved. 
   2. One car wash simply handed out FREE APPETIZER gift cards (from a local restaurant) as a thank you to their customers which resulted in 53 new customers to the restaurant who had previously never visited that restaurant.  This same restaurant spent $1000s of dollars the previous year with traditional media advertising and could only account for 79 new customers the entire year.  Their business synergy model produced more in one month than almost the entire year’s budget previously. 

 

4. 03/24/2009 Word of Mouth Customer Research Dr. Laura Brooks, V.P. of Consulting for Satmetrix Customer Data Research Firm.
   
   Findings:
   1. Word of Mouth ‘promoters’ of a business was worth $1700.00 per each customer and accounted for over 50% of new customer acquisitions for the retail industry on average.
   2. Retailers with a rewards program showed W.O.M. promoters were 70% more likely to refer a business than one without a rewards program.
   3. A company’s ability to produce more word of mouth referrals will have a substantial impact on their bottom line.
5. /16/2009 Wise Marketer Press Release on data findings by Torex Inc.
   
   Findings:
   1. The future of customer loyalty will involve cash back rewards, email and SMS solutions in a unified and organized fashion.
   2. Only 16% of businesses indicated they are using data and email as effectively as they should
   3. Only 8% of business indicated they are using text messaging to deliver value
   4. Over 71% of consumers indicated a willingness to receive text messages from retailers if cash back rewards or free offers were a result.
   5. Over 89% of customers said they preferred to be notified by permission based email or SMS about special offers or balance inquiries of their rewards.
   6. Rewards programs were seen as the #1 reason to increase frequency as long as they contained personalized value and simple redemption options. 
   7. Permission based email produced the highest ROI with the lowest cost of any form of advertising by a substantial margin.  (see below)
6. 3/10/2009 Epsilon Inc. Research Firm…Permission Based Email
   
   Findings:
   1. 56% of customers said they were more likely to purchase from a company who utilized permission based email to keep them abreast of offers and specials.
   2. 52% of customers had a ‘more favorable’ view of the brand if the utilized permission based email.
   3. 48% of customers said they would be more loyal to a brand using permission based email.
   4. 87% prefer to learn about specials and offerings via permission based email.
   5. 63% want personal content based on spending and visitation.
   6. 88% have downloaded coupons from permission based campaigns.
   7. 79% have ‘clicked through’ to a website to learn more.
   8. 75% have purchased a product or visited a retailer as the sole result of permission based email.
   9. 60% tried a product or offering for the FIRST time.
   10. 55% forwarded the email or shared the offering with a friend.
   11. 33% saved the URL in their favorites section.

    
   ** Texting options combined with email or in lieu of email are expected to have even greater results.

7. 02/21/2009 Harris Poll Interactive Research Firm
   
   Findings:
   1. 87% of U.S. adults would find a recognition and rewards program ‘very appealing’ with 79% of the 87% indicating they preferred cash back rewards as the option of choice.
8. Business Week 02/02/2009
   
   Findings:
   1. Tax advantages of rewards programs are outstanding for any size business
   2. Certain States allow non-redeemed rewards to be expensed and deducted.
   3. Redeemed rewards an expense and donated rewards can often be deducted by the consumer or the business owner.
   4. The more flexible the rewards program, the MORE tax advantages.
   5. Properly executed rewards programs are the single most important program for a business to implement.
9. Packaged Facts Inc. (White Paper) African Americans – Credit, Debit, and Pre-Paid card users – Overlooked and Under Valued.
   
   Findings:
   1. African Americans have been tremendously overlooked in regards to rewards programs resulting in a huge opportunity for small business to benefit.
   2. African American incomes are the fastest rising demographic.
   3. The aggregate income of the top 25% is 116 billion.
   4. African American home ownership increased by over 1/3 during the last decade.
   5. African American’s carry fewer cards in their wallet than any other ethnic group.  They strongly prefer non-debt or non-credit card solutions rewards programs but have been completely overlooked.
   6. Customize or personalized offers to this demographic with cause marketing strategies could result in brand dominance for years to come.
10.  London, England – Business Economic Loyalty Summit of 2009 – Compilation of Fortune 500 companies and top executives from around the world.
    
    Findings: 

    Top 5 Most Important Aspects of a Customer Loyalty Program – Over 80% of CEO’s indicated their top objective for 2010 and beyond was a properly executed data and rewards program tied to SMS and permission based email. 

    1. A unique and relevant reward that’s EASILY attained with every visit or purchase.
    2. A rewards currency that is EASILY understood.
    3. Several EASY ways to earn additional rewards beyond higher spending
    4. No restrictions, expiration dates, or fees tied to rewards.
    5. A simple, fast, and flexible redemption process at the point of sale.

 

11. Digital Media Consulting Firm Brothers Einstein on Brand Advertising
    
    Findings:
    1. Brand awareness and advertising strategies are ‘upside down’.  Brands must tie in emotional events at the time of the transaction to develop relevant awareness and value.
    2. The brand must ‘intrude’ on the customer’s life and purchase behavior in some fashion.
    3. ROI must be quantified.

 

12. CitiGroup 2005-2009 Decade in Review – 5 year study as reported by Source Media in their white paper, ATM – DEBIT – & Pre-paid forum in Chandler, AZ.
    
    Findings:
    1. Customer attrition was reduced 50% by implementing a thank you based rewards program tied to every credit or debit transaction. 

 

13. Smart Money Research – National Retail Foundation study headed up by Chairman James Fisher – Marketing Professor, St. Louis University.
    
    Findings:

    “Compared to the expense required to attract new customers with advertisements or discounting, loyalty programs have shown to be a life saver for business owners across every market segment.  Rewards programs are not only inexpensive to initiate, but they produce far greater results than their more expensive alternatives.  The lifetime value of a customer is in the $1000s of dollars for even a low ticket retailer such as Pizza Hut or Dominoes.  Developing a customer loyalty strategy is paramount for success in this highly competitive retail environment.”

14. Shaju Nair, Director of Global Customer Research IBS International.  How to Recession Proof a Loyalty Program.
    
    Findings:
    1. Paper forms or subscription fees are huge deterrents to participation.
    2. Extra incentives and higher rewards are paramount during a recession.
    3. Waiting for a reward is perceived by most consumers as the ‘the most aggravating’ part of a loyalty program, they despise it!  Keeping track of transactions, daily reviewing of balances, constant calculations of points and what they mean, turns a loyalty program into a NEGATIVE!
    4. Benefits must be INSTANT, flexible and simple.
    5. Two way communications via email or text as a reminder of balances is ideal.
    6. A system must be in place to reward more loyal customers more-so than casual customers.

     

Important Concepts to Communicate:

7 Highly Successful Habits of Business Owners

1. Must reward customers for spending money with cash back being most preferred.
2. Never allow any customer to leave without a full color ad in their wallet with a balance.
3. Build a database without paper forms.
4. Thank customers for coming in and remind them of their balance and cementing benefits.
5. Acquire new customers with W.O.M. strategies.
6. Communicate with customers back and forth with SMS and email.
7. Develop a fundraising or ‘cause’ marketing strategy tied to every transaction.

Research Statistics

1. 67% of customers would be influenced to visit more often if they received 10% cash back on their bill.
2. Big store chains have seen visits increase by 93% with 65% increase in incremental sales.
3. A working database nearly doubles the value of a business.
4. Repeat customers average 33% more spending and are 2x more likely to refer new customers.
5. Loyal customers shield a business from competitive and economic assault.
6. 82% of rewards customers have referred new customers.
7. 90% of customers said they would be influenced to switch brands which offered a rewards program.
8. 75% want instant cash back to spend on anything within the business.

 
Key Thoughts for Business Owners

Mr. Business Owner:   How would it feel to be married and yet your spouse never listened to you?  In addition to never listening he/she would

1. Forget your name and if and when you came home on certain days.
2. Forgot your birthday and other important days like anniversary.
3. He/she never initiated any type of conversation on top of not listening when conversation was started.
4. Whenever a point needed to be made he/she took out an ad in a paper rather than talk to you direct and the ad was in a paper you did not even read.

 
How long would you stay married?  As silly as the illustration above sounds, this is the way most business owners are treating their customers.  Customers have spoken with the research above but many business owners are not listening, fail to communicate, and still use traditional advertising to initiate interaction.

How much better and stronger would the relationship be if we simply listened and implemented what customers are asking for?  The above research is literally a letter from our customers asking us to listen to their concerns so they can frequent our business more often, spend more money, and refer others.

Which is worse?

A.  Knowing the contents of this letter and not listening?

B   Not knowing the contents of this letter?

Increased business and profitability (with lower costs) is as simple as finding the proper loyalty and rewards program which fulfills the needs and requests of the boss, that being your customer.

 Entertainment Center General Overview

Gift Card Bonus #1 http://screencast.com/t/3TPUfTBNqSYj

Gift Card Bonus #2 http://screencast.com/t/tm6owgMca7

Gift Card Bonus #3 http://screencast.com/t/wI1bjEqmfm

72% of gift card users become regular customers Monday December 27, 2010 For the 2010 holiday shopping season, business owners had the benefit of knowing that every gift card sold represented not only one future sale, but a potential lifetime customer as well, according to research by Harris Interactive, commissioned by Givex. When surveyed, more than two out of five American consumers (41%) said they had tried a retail store, restaurant or hotel for the first time because they received a branded gift card. Furthermore, many of these first-time customers had also become repeat customers as a result, with 72% of them saying they had returned to the same business afterward. sschroeder This article is copyright 2010 TheWiseMarketer.com). The study evaluated consumers’ responses to many of the strategies employed by businesses to retain them. For example, once a new customer is acquired, the journey to customer retention requires building a relationship with them with relevant communication and appealing rewards. But different customers demand different treatment. For example, many merchants are discovering that discounts do not have the universal appeal they had hoped for. While consumers aged 35-64 overwhelmingly preferred discounts as a reward (46%), Americans in the 18-34 category were more divided between discounts (32%), small instant rewards (17%) and large rewards, such as free trips (18%). Consequently, the most successful rewards programmes could be said to be those that recognise the different needs of customers. During the recent tough economic climate, many businesses saw the benefits of having previously invested in gift card and loyalty reward programmes, having already built up a larger customer base to communicate with and to encourage repeat business. However, they also realised, as the survey showed, the importance of customizing these incentives, and personalising communications to truly maximise their effect. In other words, Givex argues, the more that marketers focus on how they are acquiring new customers and learning about their specific needs, the stronger they are during slow economic periods and the faster they can grow under normal trading conditions. For additional information: ·  Visit Givex at http://www.givex.com ·  Visit Harris Interactive at http://www.harrisinteractive.com

better than the below with our solutions.  

1.  Instead of discounting she issues gift certificates instead 2.  She makes people join her restaurant to use the rewards 3.  She pays attention to customer service 4.  Only people who have activated their account (or joined the egghead club, same thing) get to use their rewards

5   One month they offered triple points to their Platinum club members to

use during slower time periods.  (We once told the governing body of bowling with 3 million members how to do this with their membership program and they could not grasp it)  The results were overwhelming and business boomed during normally slower periods.  We have a proprietary tiered membership program we can share with you upon request.

These people are considered brilliant marketers for simply employing the basics and a points based program is not nearly as effective as cash back.

For all of you representing our solutions to retailers like restaurants, use this story below and show them a much superior method we have been teaching for years.

================================================================
From RestaurantOwner.com – December 28, 2010
================================================================

Marketing Prowess Isn’t An Option Any More

One trend we’ve noticed over the past several years is that our most successful RO.com members are not only highly competent operators, they have also become very skilled marketers.

During a time when many restaurants have been scaling back or even shutting down, Misty Young’s SqueezeIn is about to triple in size from one restaurant to three. The original SqueezeIn in Truckee, CA is not quite 5 feet wide and 62 feet deep (hence, the name “SqueezeIn”). With just 13 indoor tables they manage to serve over 65,000 meals a year, breakfast and lunch only.

Misty is super passionate about operations and customer service but these days she spends most of her time on marketing and business is booming because of it.

Here’s a brilliant marketing tip that I learned while talking to Misty a few weeks ago. Whenever they offer some type of coupon or special deal they ONLY make it available to members of their Egghead Club.

For example, one month they offered triple dining points to their very best customers, they call their “Platinum” members. The offer was limited to weekdays only and the response was overwhelming.

Their customers got a good deal and the restaurant was super busy on typically slower days.

At SqueezeIn they never use the word “coupon,” it’s a GIFT CERTIFICATE. Slightly different words but huge difference in perceived value. Another valuable point, whenever SqueezeIn gives out gift certificates, the person MUST join their Egghead Club to use it.

SqueezeIn currently has over 14,000 Egghead Club members and it’s the foundation of most of their marketing efforts.

I had the opportunity to meet Misty and her husband, Gary, at a Marketing Boot Camp a few years ago. To learn many of the same marketing concepts that Misty uses at SqueezeIn, plan on attending the upcoming Marketing Webinar discussed below.

================================================================

Celebrate The New Year With A Sales And Profit Explosion!

The industry’s leading marketing consultant is going to join us on a webinar January 11 and 12th to share Proven Restaurant Marketing Strategies that are working during these challenging economic times. He’ll present real case studies of what successful RO.com members have done recently to dramatically increase their sales and profit and update us on what online strategies are working as well. 

Register at https://www2.gotomeeting.com/register/320025394.

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Featured Articles & Resources at RestaurantOwner.com
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DOWNLOAD: #Foursquare Restaurant 2.0 Edition

Do you need to pay attention to the social media buzz, or is it just a passing fad? It’s catching on phenomenally among the ”

plugged in”, especially the new wave of tech-savvy phone users.

Check out potential customers “checking-in” on Foursquare, the new localized social media platform people in the know are calling “the next Twitter” and see what it could do for your restaurant.

Click here to access:

<http://www.restaurantowner.com/public/1384.cfm>

================================================================

DOWNLOAD: Annual Restaurant Budget Worksheets

How will your restaurant perform in 2011? Studies show that companies who prepare annual operating budgets are more successful than those who don’t. Use this budget worksheet to quickly prepare your annual financial plan to give you and your staff specific, measurable goals throughout the coming year.

Click here to access:

<http://www.restaurantowner.com/public/1032.cfm>

================================================================

SCREENCAST: Marketing Best Practice – Scratch Ticket Promotion

Listen as veteran operator Peter Troutman describes, his variation of the ‘secret envelope’ promotion that’s resulted in a 30%+ year to year sales increase in one of his slowest months.

Learn in detail what he does, his results, costs, prizes, changes he’s made over the years, and more.

Click here to access:

<http://www.restaurantowner.com/members/1070.cfm> ================================================================

Have a profitable week!

Jim Laube & Joe Erickson

If you’re wondering what it’s like to be a RestaurantOwner.com member, see what our members are saying . . .

http://www.restaurantowner.com/member-comments.htm

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1. Communicating a value prop when the customer is near or inside of a location where the product is being sold is considered the #1 attraction to Pepsi. Ten blocks or closer is considered outstanding, if the customer were inside a facility where the brand can be purchased, that would be the holy grail.

2. If the brand can use a loyalty strategy to get customers from one location (not connected to their brand) to another location (where the brand is sold) and then track the success of whether the incentive worked is a huge value prop to a brand.

3. Immediate feedback or real time tracking of what customers are doing is considered invaluable.

4. If there is any way to track customer demographics such as age and gender of campaigns or what age group or gender purchased more of a brand within a selected retailer, this is invaluable data to a brand.

5. Data gathered which can show the top 100 types of customers who purchase the brand, who is responding to the offer and how often and how much do they spend associated with the activity is why brands are paying millions to companies like Foursquare.

6. Here is another direct quote from the article “Imagine the amount of data we now have in order to make better marketing decisions, in order to make loyalty decisions, about our customers, as opposed to the paper punch cards we had before that didn’t do anything for us,” said B. J. Emerson, social technology officer for Tasti-D-Lite.

   Striking a deal direct with the customer is another huge opportunity, here is the direct quote The location-based opportunity is particularly big for consumer packaged goods brands like Pepsi. Those brands market their product heavily, but they depend on drugstores or restaurants to actually get consumers into stores. With Foursquare and apps that track consumers’ locations, Pepsi can strike a deal directly with the consumer.

   Programs that work with customers who visit a selected store or retailer multiple times is especially desirous in tracking their purchase behavior, here is a direct quote.. “The next generation of that is potentially understanding a little bit more about loyalty as well,” Mr. Walker said. “We’re driving people to different stores. What about people who visit the same store over and over?”

   Programs that offer incentives from the participating location or retailer to entice brand purchases is especially appealing, here is the direct quote.. The app shows the participating Pepsi-serving restaurants on a map, includes menus for them, and allows consumers to sign in to those locations (that sign-in is done separately from a Foursquare check-in). Once they do, they accumulate points toward song downloads. The restaurants can layer in offers, too — Shakey’s is giving $3 off a large pizza for people who show the Pepsi Loot app, for instance.

7. Last but not least, a program which offers relevant rewards to increase frequency and drive purchases to the brand is considered the holy grail by many brands such as Pepsi.

   Linking Customer Loyalty With Social Networking

   By STEPHANIE CLIFFORD

   Published: April 28, 2010Close

   1. Linkedin
   2. Digg
   3. Facebook
   4. Mixx
   5. MySpace
   6. Yahoo! Buzz
   7. Permalink

   PEPSICO wants to sell its customers sodas whether they are near a grocery store, a restaurant or a gas station. With a new partnership that weaves its loyalty program into the location-based network Foursquare, PepsiCo gets a live notification when its customers are close to those sites, and can present offers that get them into the stores.

   Enlarge This Image

   <image001.jpg>

   The Pepsi Loot app for the iPhone is intended to drive traffic to restaurants that serve Pepsi products.

   Related

   · Times Topic: Cellphones

   “Being able to drive foot traffic into our restaurant partners and our retail partners is a huge opportunity, because that’s where our product is sold,” said B. Bonin Bough, director of social and emerging media for PepsiCo. “Ten blocks mean a lot.”

   Through smartphones that signal someone’s location, stores and brands like Starbucks, Tasti-D-Lite, Macy’s and Pepsi are getting live information about when and where people are shopping. Some companies are turning Foursquare into a virtual loyalty-card program, while others are creating their own location applications, offering customers discounts or other rewards for shopping.

   “It gives us immediate feedback for what’s going on in the marketplace,” said Margery Schelling, chief marketing officer of PepsiCo Foodservice. “That’s invaluable.”

   A phone is a simple replacement for a wallet stuffed with loyalty cards, but the real appeal for stores is in the location information provided by Foursquare and other location-based applications. Retailers can track when customers actually enter their stores. Such data can be used to learn things about store traffic, such as when men visit versus women. And it’s easier to note when the most loyal customers visit.

   “If you check into work, then you leave work, you check into a bank and then you check into a store, that’s a behavior that, in aggregate, we might use to transform the way we market to you in the offline world,” Mr. Bough said. “We might see dayparts that are more likely for you to check out of some place and go to the store, and we might do advertising during that specific daypart in that specific place.”

   Because consumers are electing to broadcast their location and signing up for these services, the privacy concerns aren’t enormous, another plus for marketers.

   While Foursquare has a relatively small user base of about one million, the tactics companies are experimenting with could be extended to customers with a GPS-enabled smartphone, the companies say. Pepsi, in addition to beginning a Foursquare program, is also introducing a location-based iPhone application called Pepsi Loot through which customers can collect points toward free music downloads.

   “We believe it’s a real, new opportunity to transform loyalty programs in a way that we haven’t done before,” Mr. Bough said.

   Foursquare is sort of a social application meets game. Its members press a button upon arriving at various locations to “check in,” letting them accumulate points — they compete to be “mayor” of a certain site, or the person with the most check-ins at that site, and can unlock badges for completing certain activities. The designer Marc Jacobs, for instance, gave tickets to his fashion show to four people who unlocked a Marc Jacobs shopping badge. Members can also direct Foursquare to list nearby restaurants, banks or grocery stores, and see where their Foursquare pals are at that moment.

   In March, Foursquare introduced a tool that lets businesses see who is checking into their locations. It lists data like the total number of check-ins, the male-to-female ratio, the top days and times Foursquare visitors come, and the top visitors.

   “Foursquare hopes to tell them a little bit more about their loyal customer — who checks in when, where they go before and after,” said Tristan Walker, director of business development for Foursquare.

   Tasti-D-Lite wove Foursquare into its loyalty-card program this year. When someone registers the card online or visits the loyalty Web site, she can click to connect the card with her Foursquare account (along with Twitter or Facebook). Whenever the card is swiped after that, the customer accumulates Foursquare check-in points and Tasti-D-Lite loyalty points at once.

   “Imagine the amount of data we now have in order to make better marketing decisions, in order to make loyalty decisions, about our customers, as opposed to the paper punch cards we had before that didn’t do anything for us,” said B. J. Emerson, social technology officer for Tasti-D-Lite.

   Starbucks has been offering Foursquare badges when people visit a certain number of stores.

   “The next generation of that is potentially understanding a little bit more about loyalty as well,” Mr. Walker said. “We’re driving people to different stores. What about people who visit the same store over and over?”

   The location-based opportunity is particularly big for consumer packaged goods brands like Pepsi. Those brands market their product heavily, but they depend on drugstores or restaurants to actually get consumers into stores. With Foursquare and apps that track consumers’ locations, Pepsi can strike a deal directly with the consumer.

   Pepsi’s Foursquare program will begin running in June. While the company is still working out details, Mr. Bough said that he expects that when a Foursquare user is near a Pepsi retailer, an offer to enroll the person in a Pepsi rewards system will appear. Once people are enrolled, whenever they check in at a grocery store or drugstore selling Pepsi, they will accumulate rewards points or badges that they can redeem for products or offers or donate toward charities.

   Separately, Pepsi Loot, to be introduced in mid-May, focuses on restaurants; about 200,000, including chains like Taco Bell, are participating.

   The app shows the participating Pepsi-serving restaurants on a map, includes menus for them, and allows consumers to sign in to those locations (that sign-in is done separately from a Foursquare check-in). Once they do, they accumulate points toward song downloads. The restaurants can layer in offers, too — Shakey’s is giving $3 off a large pizza for people who show the Pepsi Loot app, for instance.

   Macy’s, too, has announced that it will use an app from a company called Shopkick to send customers offers when they are in or near the department store.

   Rewards will be critical for getting more people to use Foursquare and similar applications, said Amy Manus, director of media at Nurun, a digital marketing firm that did not work on the campaign. “Offering something that is beneficial for consumers is going to be essential in mass adoption,” she said.

1.  The future of loyalty is all about transparency, accountability, trustability, relevance, and cause marketing. 
2. Blasting text messages or email messages without a query capability of the database will soon start causing customers to default and leave the brand.  Actually, it’s already happening and is a shock to many business owners who don’t realize they are doing more harm than good by not understanding what customers want and how to target them specifically.
3. By 2013 more people will access the web via mobile device than computer so the time to develop killer mobile apps is this year and the solutions need to be better than the simple ability to send text messages.  We are working on this now for early 2011 stay tuned for a cutting edge mobile application.  Our delay has been caused due to our pursuit of excellence and the need to provide what customers want, not what looks cool today.  We already know future problems and issues and are working on having those resolved before others even know they exist.  Mobile will be too important to make mistakes and companies may only have one chance with the consumer to get it right or be blacklisted from communication.

Post-recession shopping behaviour shifts

Friday December 3, 2010

The new post-recession American shopper can be described as ‘high maintenance and promiscuous’ and demands an innovative and engaging experience both in-store and online, according to a study by Leo Burnett’s marketing services arm, Arc Worldwide.

The recession has changed consumers’ mindset about shopping, and most people have already developed new rules for the retailers with which they choose to deal. As a result, retailers need a greater understanding of the changed roles they play in consumers’ lives in order to meet those expectations and maintain customer loyalty. sschroeder This article is copyright 2010 TheWiseMarketer.com).

The study, entitled ‘Re-Imagining The Retail Store’, identified five key findings that retailers should consumer when implementing new strategies:

1. Don’t let technology undermine the shopping experience
   Retailers tend to view in-store technologies as a better way to connect with their customers, but customers don’t agree. While people do want to experience a seamless transition between the physical and virtual store by using technology, they also want educated and friendly service when visiting the physical store. Technology is not a suitable substitute and this practice can damage an already fragile relationship.
2. Shoppers are promiscuous
   Consumers tend to shop around, and their loyalty is hard earned. The recession has taken a toll on consumer confidence and people’s perceptions of retail business. Customer loyalty has to be earned by understanding in detail the expectations of the shopper and delivering every time.
3. Price is attractive, but it’s not the whole story
   Consumers will not accept a trade-off involving low price versus quality experiences and merchandise. Today, people are more than happy not to spend their money if they feel that retailers do not give them a sufficient reason to purchase.
4. Breaking the rules
   If you’re not winning by following the rules, break them. There are two clear ways to win in store-based retailing – excel within your store archetype or take a radical path to greatness and create a new store format that breaks out of category conventions and delivers a unique experience.
5. The basics are still powerful
   It may not be exciting, but there is work to do and profit to be made from making the basics of retail even better. Retailers are struggling to get the basics right and people are visibly frustrated. Going back to basics can help to improve customer appeal, retention and, ultimately, profitability.

According to Dr Alan Treadgold, head of retail strategy for Leo Burnett Worldwide, “The retail landscape continues to evolve and move further away from being just a place to purchase a product. It’s an experience. As retailers listen to their customers and understand their behaviors, they can create an experience that people come back to time and time again.”

A white paper detailing the study’s findings and conclusions has been made available for free download from the Leo Burnett web site – click here (Google Docs web-based document; no registration needed).

Irish town launches local loyalty scheme

Wednesday December 8, 2010

The Irish town of Macroom in County Cork has launched a new town-wide loyalty programme called LocalRewards, offering locals a card that be used to earn points from local independent businesses.

The programme was set up and developed by Cork-based company MyRewardCard.ie, aiming to help loyal local customers get the maximum benefits while supporting local companies and workers. sschroeder This article is copyright 2010 TheWiseMarketer.com).

Customers can pick up a Macrooom LocalRewards card and immediately start collecting points in any participating business in the town. The more they shop with participating businesses, the more points they earn, and the greater the range of rewards available to them.

Because small businesses provide the majority of employment in Ireland, it is important that they retain customers if towns are to survive as viable business communities. But, while Macroom is not the first town to try to encourage people to shop locally, most towns that have introduced ‘shop local’ programmes offer simple discount cards, in which consumers buy a card and then get a discount with every visit to a participating business.

In contrast, the points-based Macroom LocalRewards card allows customers to build up points over multiple visits and therefore allows businesses to give greater rewards to their most loyal customers.

The practical operation of the programme is simple: a customer collects their free card from a participating business, then shows this card whenever they shop at participating outlets. Once the customer has gained enough points, they can redeem them for a reward of their choice, ranging from discounts to free gifts (depending on the merchant).

However, rather than being a coalition-style programme, each effectively business runs its own rewards programme – simply using the same town-wide card as a customer identifier – and the points earned from a specific business are valid only for rewards from that business.

“I had seen research showing the popularity of loyalty cards but, because there are so few cost-effective solutions available to independent businesses, most have only been able to offer stamped cards which customers lose or accidentally put througth the washing machine,” explained chief executive, Brian O’Connell. “So we built a platform that would allow even the smallest business afford a loyalty points programme without worrying about IT issues.”

The same town loyalty platform is now powering the LocalRewards programme in Macroom and Carrigaline, and it will soon be operating in Clonakilty as well.

The LocalRewards platform also offers the benefit of community-wide promotions. For example, the town of Carrigaline introduced the card in August 2010, and a recent promotion rewarded cardholders for shopping in more than 2 businesses in September. Since then, nearly 3,000 consumers have taken and used the Carrigaline card.

The Macroom localrewards card can intially be picked up by customers at four businesses: Macroom Bookshop, Papa Martinos Restaurant, Minihanes Shoes and Murphys Pharmacy. More businesses are preparing to join the programme in the near future, and cards will also be made available through each new partner.

7 Little Words That Sum Up the Entire Marketing Machine
posted by: John Jantsch
Tue Dec 07, 2010

Marketing is essentially getting someone that has a need to know, like and trust you. Of course then you must turn that know, like, and trust into try, buy, repeat and refer.

That my friends is the entire practice of marketing summed up in seven little words that make up what I call The Marketing Hourglass.^TM

The idea behind the hourglass is that you look at each of the seven stages and intentionally plan products, services, processes and touches that logically move prospects along to the point where they become customers and then receive such a remarkable customer experience they become repeat customers and referral advocates. I talk a great deal about building your hourglass in my book The Referral Engine.

If you do nothing but spend the time to fill in the blanks in each of the stages in the infographic below you will be miles ahead in your thinking about a simple, yet powerful approach to your marketing. Feel free to print, share and use the graphic to help build your marketing hourglass

Click on the image to enlarge and get a bird’s eye view of your entire marketing machine.

Cash Back Instant Redemption Cited by over 83% of Consumers

Wednesday December 1, 2010

While loyalty programmes are powerful marketing tools for credit card companies, supermarkets and restaurants, it is the idea of ‘instant redemption’ that entices almost half of consumers to favour one rewards programme above another, according to research from Mintel.

In examining the driving factors behind consumers’ choices of which loyalty programmes to actively participate in, Mintel found that instant redemption opportunities (such as cash back at the check-out) were cited by 47% has potentially swaying them to use one particular loyalty programme more than others. sschroeder This article is copyright 2010 TheWiseMarketer.com).

Consumers are similarly attracted to relatively generous cash back opportunities – an option that would be the deciding factor for 36% of respondents.

However, consumers were somewhat disenchanted with airline miles, as only 7% said that a programme that offers airline miles would be an effective incentive for their choice of loyalty programme – although it is noteworthy that these consumers tended to be from higher income groups.

“In any sector that uses loyalty marketing, loyalty programmes are fast becoming a very important part of the relationship with the customer,” explained Susan Menke, vice president and behavioral economist for Mintel Comperemedia. “It seems that now is the time to focus on adding or improving loyalty programmes to help engage customers and maintain and even grow their relationship with the post-recession consumer.”

After the consumer has chosen a favourite rewards programme, the study asked what they want to see more of, with 61% citing “lower overall costs for merchandise that they would have purchased anyway”. At the same time, “getting merchandise, or taking trips that they wouldn’t normally be able to take” was deemed important by 25% of those surveyed.

“Loyalty programme members are quite often the most profitable customers for marketers, and those who make regular use of loyalty programmes tend to be more brand loyal,” said Menke. “By personalising redemption opportunities and offering easier-to-redeem savings, marketers can potentially lure and retain more customers.”

Eleven key loyalty trends forecast for 2011

Monday November 29, 2010

It is possible that 2011 may well be remembered as ‘the year of customer loyalty’, according to Mark Johnson, CEO for loyalty marketer’s association, Loyalty 360.

In today’s crowded marketplace, creating loyal, engaged customers is more important and more challenging than ever before. As a result, Johnson has compiled what Loyalty 360 believes will be the eleven key customer loyalty marketing trends for 2011 and beyond, including:

1. Going beyond the points programme
   Marketers will increasingly understand that loyalty is not just a programme. In fact, it is a journey and a strategic business goal. While points programmes have been around for a while, from a strategic marketing perspective building true loyalty based on a total customer experience is still relatively new and a burgeoning area most brands. Loyalty initiatives will focus on engagement and building long-term relationships.
    
2. Focus on emotions, not just incentives
   Loyalty will focus more on emotions than on rational, incentive-based initiatives. Behavioral economists tell us that economic decision-making is 70% emotional and 30% rational. Which is why incentive-based loyalty programmes that tend to be rational do not work well. It’s the emotional side of the decision making process that creates connected, passionate, engaged customers.
    
3. Engagement and loyalty come together
   Companies will increasingly look at how customer engagement and employee engagement work together to drive bottom line results. A 2009 Gallup quantified the impact of customer and employee engagement. They found that those in the upper half on customer engagement and the lower half on employee engagement, or vice versa, get a 70% boost in bottom-line results; those in the upper half on both customer and employee engagement get a 240% boost.
    
4. The voice of the customer gains importance
   Voice of the customer (VOC) programmes are an important strategy for brands and we expect to see greater focus on them in 2011. A recent IBM study with over 1,500 CEOs from across 60 countries and 33 industries discovered that “getting closer to the customer” is a top business strategy and area of focus for these CEOs over the next 5 years. In fact, 88% of the CEOs surveyed said this was a key area of focus, followed by 76% saying that “insight and intelligence” is also a key area.
    
5. Relevancy drives more loyalty
   Relevancy will be a key driving force of customer loyalty, engagement. Today’s customers want loyalty programmes to be “about me” – that is, individual, relevant, and meaningful. Personally relevant deals are the second most frequently chosen reason for spending more with a company, mentioned by 48% of people, according to new research by Ipsos Mori and The Logic Group. Data collection and usage is extremely important in building relevancy. Brands need to use the information they collect strategically to show customers they’re listening and give them what they’re asking for.
    
6. Involving all the touchpoints
   Marketers will take a more strategic look at in-the-moment marketing, looking at how best to use all the customer touchpoints including mobile. ABI Research reports that businesses are poised to spend some US$1.8 billion on location-based advertising in 2015 as part of their overall mobile marketing budgets. However, with Congress looking to regulate net neutrality and cell phone marketing, marketers are going to have to take a more strategic, generational look at how they can most effectively use moment marketing including mobile. This is certainly not a one-size-fits-all communication channel. The most successful loyalty initiatives will be those that are relevant in terms of both messaging and communication.
    
7. Loyalty schemes designed to support engagement
   The main goal of customer loyalty initiatives will be to engage customers. Marketers now realise that although spend and number of transactions are important, customer engagement is the holy grail for loyalty initiatives. Because with engagement comes loyalty, advocacy, trust, and passion – the soft side of the customer relationship that directly impacts the bottom line.
    
8. Cause related marketing finds its place
   Cause-related marketing/corporate social responsibility programmes that are aligned with strategic corporate goals will effectively drive loyalty, especially with Millennials. According to a recent survey by Cone, while interest in cause-related marketing grew among the general population between 2008 and 2010, social and environmental causes had a significantly greater influence on the purchase decisions of millennials than other generations. If marketers are looking for 18-34 year olds’ receptiveness to branding, social and green issues are a good place to start, with 85% saying they would switch brands because of such marketing and 73% saying they would try a new brand.
    
9. Restaurants look seriously at loyalty schemes
   The restaurant industry will be investing more in loyalty initiatives. Just-released research conducted by the National Restaurant Association in partnership with Loyalty 360 and rDialgue found that 84% of respondents plan to invest more in their loyalty initiatives because of their proven ability to drive business growth.
    

10.  Debit rewards programmes set to develop
The future of debit rewards is going to change. The demise of the debit card loyalty programme has been greatly exaggerated and the entire loyalty model is going to be dynamic and changing rapidly over the next few years. Expect to see growth in partnership programmes and a greater focus on the coalition model. The key to making any of these programmes successful is creating a currency that works.
 

11.  Social gaming spreads into loyalty offerings
Marketers will integrate social gaming into their loyalty initiatives. Social gaming has become a widespread activity across practically all demographics, with AllFacebook.com reporting that there are now 200 million people playing games on Facebook every month, and 24 games have more than 10 million users per month. Traditional incentive-based marketing does not drive the level of consumer participation that can be achieved via gaming, and it’s this sought-after participation that builds lasting relationships, engagement, brand affinity, and brand loyalty.

1.  Reward  your customers for visiting a different business.  Let’s say you’re a bowling center, offer a 10% reward if they purchase a car wash at Jims Car Wash down the street.  The customer brings in their receipt and you load the rewards with a custom category Jims Car Wash they can use at the center.  After a while show Jims Car Wash how you have driven business to his location and arrange payment for staying away from Bob’s Car Wash across the street.
2. RESTAURANT:  Give your customers a FREE PEPSI for just stopping in, no purchase necessary!  You might even charge $10.00 per year for this, but it gets customers I the habit of visiting your restaurant even when they are not dining out..  Inform Pepsi and have them pay for the promotion which can all be tracked.
3. Run prizes and sweepstakes for every person who just swipes their card on a daily basis NO PURCHASE NECESSARY,   We have one new center which just secured a new Toyota free of charge.  Customers come by and swipe their card no purchase necessary a maximum of 2 times per day to earn an entry into the drawing for the free car.  They can take their card to the dealership and swipe it at the dealership for 5 free entries to win the car.   Since we can run all kinds of additional promotions, prizes, email, text, rewards, fundraising and more to those who participate, our client earned a FREE CAR to build his business.  We can do the same for you.

More evidence of rewards just for stopping by

Filed Under (Airlines) by Sharon Goldman  Posted on 11-16-2010

“Checking in” at a retailer or service provider is getting more valuable than ever, with more companies rewarding customers who do no more than simply walk inside a particular location.

Most recently, Mashable reported that Virgin America is the first airline to offer frequent-flyer points in exchange for checking into the airline’s airport terminals or baggage claims, courtesy of Topguest, which is a start-up platform tied to Facebook Places and Foursquare.

This follows on the heels of an application called Shopkick, which offers customers points called “kickbucks” for entering a store or making purchases, which can then be used to redeem for gift cards, music downloads, or credits towards Facebook games. Retailer Target recently signed with Shopkick, which already has Best Buy and Macy’s on board.

A third startup, Checkpoints, recently partnered with Kmart to offer a similar concept — customers can earn points for check-ins as well as when product barcodes are scanned at checkout. The mobile app is currently only available on the iPhone but an Android version is apparently in the works.

The question is, is this just a fad being offered to draw attention as a “forward-thinking” loyalty provider? Or is it a rewards model that has legs? Only time will tell whether location-sharing can truly be tied to loyalty or whether customers will simply boost dummy check-ins to try and beat the system — and whether companies will be able to keep up with customers who try to “work” the rewards. Still, this is a trend worth watching, as it ties into trends we see as key moving forward into the new decades, including the “localism” aspect of check-ins as well as customers who demand rewards for relating to companies on this hyper-local level.

 
COLLOQUY RESEARCH ARTICLE WHITE PAPER AVAILABLE UPON REQUEST

The experts said that any loyalty program that doesn’t have some aspect of cause-related marketing is behind the times, but cautioned that any cause program must align with the sponsoring business and be useful to customers. The panelists shared their belief that cause marketing must be at the core of what brands are doing and must recognize that customers want brands to do more than just sell products.

And then, of course, Cause marketing—thinking about how we can integrate causes that are crucial to our customers into the strategies that we deploy to cultivate deeper loyalty among our customers. After three decades of learning how we can influence customers purchasing decisions and reward and recognize them for making one more visit to our store or flying our airline one more time or making that extra purchase, loyalty marketers are now figuring out how that same discipline can be applied to affecting ethically and socially responsible behaviors to make the world a better place through relationships with loyal customers.

Those behaviors might be green—environmentally responsible actions. Or they might be pink—supporting breast cancer research and awareness. Whatever the color, whatever the cause, the trend toward cause marketing will become even more important as the time demands on consumers become even more intense and as the Importance of local communities increases for those customers.

With that in mind, COLLOQUY gathered four leading loyalty- and cause-marketing experts who have figured out how to determine the cause that’s right for their brands, and integrated it with their loyalty programs.

Panelists included:

• Morley Ivers, Corporate Advisor (formerly Chief Rewards Officer) at RecycleBank and Chief Operating Officer at  DailyFeats, a company that focuses on applying a rewards model to incent people to “Do Good and Check It In”
• Erin DeRuggiero, Co-Founder & CMO of Social Reality, a digital cause-marketing consultancy, participating on behalf of her client Seventh Generation;
• Asha Patel, Manager of Dividend Miles Partnerships at US Airways;
• Candice  Troupe, Senior Director of Marketing for LoyaltyOne and the AIR MILES Reward Program, Canada’s premier coalition loyalty program.

The experts said that any loyalty program that doesn’t have some aspect of cause-related marketing is behind the times, but cautioned that any cause program must align with the sponsoring business and be useful to customers. The panelists shared their belief that cause marketing must be at the core of what brands are doing and must recognize that customers want brands to do more than just sell products.

Some other highlights from the DMA panel discussion:

• RecycleBank, the green rewards program that motivates people to take environmental actions, serves more than 100 communities in the United States and five boroughs in the United Kingdom;
• My Planet—AIR MILES Reward Program’s cause-marketing initiative—analyzed data to identify millions of members with strong devotion to green, to tailor education, purchases and redemption options for them.
• Through Miles of Hope, US Airways frequent-flyer members have donated over 700,000,000 miles to worthy causes such as the American Red Cross and Make-A-Wish Foundation. The miles equal more than 15,000 flights; 
• Around 25,000 influential Seventh Generation Nation members, signed on to create “virtual crawlers” through the company’s Million Baby Crawl program to raise awareness for tougher legislation around toxicity in household products;
•  DailyFeats has more than 150 daily tasks for people to take positive actions and to learn about different ways to better themselves, their world and the lives of people in their social networks.

“We’re at an inflection point where it’s more important than ever to have some element of cause marketing invested with our very best customers,” said COLLOQUY Managing Partner Kelly Hlavinka, who chaired the DMA panel discussion. “The importance of local communities and personal relationships are ever-increasing and cause marketing is a great way to align your brand with the values of your customers.

Just received my email notice from Starbucks and wanted to point out the basic marketing mistakes which continue to cost Starbucks millions of dollars in lost revenue.  These updates show the importance of understanding marketing and how to utilize customer loyalty solutions.   Scroll down and notice the offer to purchase Starbucks Cards.  Also notice there is no incentive to purchase a Starbucks Card, here is a sample of what this email should have given me. 

1.  See the new Christmas Blend Coffee advertised below?  I should have received ½ lb of coffee for every $25.00 Starbucks Card I purchase for a friend or loaded for myself.  If I purchased 4 of these cards, then I would earn 2lbs. of the Christmas Blend.
2. The orders for cards would skyrocket.  How do I know?  Around 10 years ago when the Starbucks card launched, they used a promotion like this and it was so successful it helped launch the Starbucks brand as we know it today.
3. There are many other things Starbucks could do like local fundraising which would pull millions of dollars away from McDonalds and Dunkin Donuts.  But, a simple effective solution we should always remember when promoting gift cards, is to NEVER run the promotion without an incentive given to the purchaser to increase engagement and average dollar purchase. 

At AmeriCardGold we are industry experts and have written articles and research as contributing editors for the loyalty guide below for years. We know loyalty like very few firms in the world and provide solutions based on this marketing expertise. There is so much important information below, it’s hard to comment any further. If your business is ready to take the next step and implement solutions which can do everything below in a simple and easy manner, let me know. You must understand that the mounds of research which are highlighted below is not a matter of opinion. Implementing the proper loyalty strategy is the #1 way for a business to thrive, there is not even a close second place.

Read, enjoy and learn.

The 15 business benefits of a loyalty initiative

Many of the so-called loyalty programmes in operation today are not really loyalty programmes at all. Frequent customer is a more accurate term. To be loyal to a business is one thing, to use it frequently is another – it could be a result of circumstances that there is no other choice. Clearly, if another choice becomes available, then the distinction becomes critical. This means that most prudent businesses aim to create loyal customers, not just frequent customers.

Of course, not all customers are potentially loyal customers, for a variety of reasons. So the ideal loyalty programme would be one in which already loyal and potentially loyal customers benefited, but other customers didn’t.

This means that the customers have first to be sorted into groups, and different approaches have to be made to each group. Or, more likely, a programme has to be designed so that it will appeal to the desired group more than to the other group.

to grow and maintain a successful business, three simple rules should be followed:

1. Acquire customers that are likely to repurchase – even though this may be at the expense of initial raw response;
   1. Recognise which customers are unlikely to repurchase and limit your marketing spend for this segment accordingly;
   2. Focus the marketing budget on those who exhibit the same profile as existing repurchasers but have yet to buy a second time.

The fifteen biggest business benefits that every loyalty programme operator should expect to reap – and use to justify continuing and expanded investment in the programme – are as follows:

1. Retain existing customers
   The effect of the customer retention rate on actual, bottom-line customer numbers cannot be over-estimated. In five years, a firm with a 70% customer retention rate will have lost two to three times as many customers as a firm with a 90% retention rate.

Not only does a loyalty programme provide a practical, hard reason for continuing to buy (the accumulation of points toward a reward, or higher levels of service) but it also provides information about the customers that allows their needs to be met more efficiently and effectively. This in turn makes them more likely to remain customers. In addition, loyalty programme operators often report that, once a customer starts redeeming rewards, enthusiasm and engagement both increase.

In addition to simply retaining customers, the data from a loyalty programme can be used to better cater for their varying needs. Companies typically use this data to segment their customers for the purposes of marketing, sales and customer services. But customers are more complex than that. Their needs and desires differ from time to time, from occasion to occasion, and depending on the reason for the transaction. In other words, the customer is ‘divisible’. Thus marketing can go deeper than one-to-one; it can identify customers’ changing needs and then provide perceived benefit venue-by-venue and situation-by-situation.

1. Acquire new customers
   A loyalty programme should attract new customers to the business; how effectively will depend on how exciting and how valuable the rewards seem to be to the target audience. Acquiring customers is no doubt essential to any business, but it can be expensive if compared to nurturing existing good customers. It should not be the central focus of a loyalty programme; there are cheaper and more effective ways of acquiring customers. However, it is generally far more profitable to retain and up-sell existing customers than to attract new ones.

Using a four-year profile of new customer behaviour from a leading retailer, loyalty expert Brian Woolf has shown that, one year after becoming a customer, only two out of each thousand new customers (0.2%) were in the top customer segment and only twelve (1.2%) were in the second segment. Over half were inactive. Between 95% and 96% of the new arrivals were either in the lowest segment or had left by the end of the year. However, quality of new customers acquired can be raised by careful use of the existing data of a loyalty programme. This can be used to establish the demographic particulars of existing best customers, and then to target prospective customers with similar demographics in acquisition campaigns.

1. Move customers up-segment
   By grading rewards (for example, offering extra points for exceeding a specified spend threshold in a time period), customers can be moved up from one spend level to the next. A good example of this is The Continuity Company (TCC), a provider of best customer marketing programmes, which skews its rewards to encourage lower spending customers to move up through the spend segments. In one of the company’s recent case studies, the top spending band’s contribution to sales increased by 41%, the next band down increased its contribution to sales by 45% and the lowest spend band decreased its contribution to sales by some 7%.
   1. Deselect unprofitable customers
      It can be more profitable to lose bad customers than to gain new ones. Cherry pickers (who buy only your discounted lines and nothing else) cost you money, as does any low-spending customer. They cost more money to service than they generate. Designing a loyalty programme that rewards better customers without rewarding this segment at all gives them less reason to stay.

Gary Hawkins, CEO for US-based Green Hills Supermarket, has found that only around three in ten customers actually generate enough profit to cover the cost of servicing them. What about the other seven? Does it make sense to keep them as customers? To a certain extent it does: if they can be identified through a loyalty programme, efforts can be made to move them up through the segments and hopefully they will become more profitable customers. Moreover, while possibly not generating profit directly, they are contributing to the size of the business and also contributing to fixed operating costs (rent, rates, utilities etc.).

However, the ‘worst of the worst’ could probably be profitably lost. So far, it seems that only financial institutions have gone as far as actually closing unprofitable customers’ accounts. The generally adopted approach by other businesses is simply not to reward them in any way and hope that they will leave.

1. Win-back defected & churned customers
   Customer win-back expert Michael Lowenstein says that the success rate in approaching ‘lost’ customers can be three to four times as high as it is when prospecting for new customers. For example, the rate for converting prospects might typically be 5%, while that for reactivating inactive customers might be as high as 15-20%.

In the book ‘Customer Winback’, the authors point out that there are several reasons why customer win-back has a greater chance of success than acquisition. You have advantages with lost customers that you don’t have with prospects, including information about their past purchase history, where and how to reach them, and their preferred communication channel.

1. Increase Customer Lifetime Value
   Customer Lifetime Value (CLV or CLTV) is increasingly being recognised as one of the most important measures of the worth of a customer. It takes into account not only the customer’s value now but the expected value over their projected lifetime as a customer. It is arguably the best way a marketer can demonstrate unequivocally that a programme is working: the CLV of targeted customers must increase.
   1. Best customer marketing
      Simply put, best customer marketing (BCM) involves spending more time, effort, and money on your best customers in order to maximise the return on marketing investment.

The strategy has been honed to a fine art by leading marketers such as Brian Woolf and Gary Hawkins, and has become the driving force behind the leading loyalty programmes in the world today.

1. Build relationships
   Building relationships is crucially important but not always as straight-forward as it might seem. It has been said that relationship marketing is powerful in theory but troubled in practice – an unpalatable concept but probably one with which many marketers could identify. If ever there has been an example of “many a slip ‘tween cup and lip”, counting on the building of relationships with all and sundry in order to generate profits must be somewhere near the top of the list.

Building a relationship with customers leads to improved behavioural loyalty and thus to increased bottom-line profits. That’s obvious, isn’t it? Well, no. In fact it doesn’t always work like that. It has been argued that attempting to partner with all customers, regardless of their characteristics, might not always be the best way forward.

There are factors that alter the importance of the relationship/behaviour/profits equation quite significantly. Age is just one of these factors. Studies carried out in the UK in the 1990s concluded that customers under 45 were most loyal and those over 65 were least loyal. Yet other studies found no clear relationship between age and loyalty. It used to be thought that older customers were more loyal to brands than younger customers but even that is changing, with some studies finding no clear relationship.

1. Create brand advocates
   Advocacy is one of the highest forms of loyalty that a customer can show. Advocates are so satisfied and pleased with your offering that they tell their friends and associates.

To most people, a personal recommendation is far more convincing than any amount of promotional material they receive – even if they already trust the brand.

1. Adjust pricing levels
   A loyalty programme can also help to formulate pricing structure. If enough best customers are happy to buy a product at a particular price there seems little point in reducing that price simply to attract cherry-pickers.

But aside from helping to decide what pricing changes should be made, the after-effects of changing prices can also be studied by segmenting and testing offers on the loyalty database – for example, which customer segments buy significantly more or less when prices change, either gradually or suddenly.

1. Responding to competitive challenges
   A good loyalty programme’s ability to tie purchases to individual customers allows quick and accurate identification of customers who defect when new competition opens nearby. They can then be enticed back with customer-specific special offers or even direct contact.

For example, one small store had to face up to a competitor opening a much bigger store on the same parking lot. In anticipation, the small store was extensively remodelled, causing considerable disruption. Over the period of remodelling (a matter of several weeks) turnover dropped by 40%. However, a loyalty programme enabled management to identify regular shoppers and mail them a letter thanking them for their patience and enclosing some special offers. All but 183 customers returned to the store. The store management team then sent handwritten invitations and a US$10 gift certificate to those 183 customers. All but three returned.

After the new competitor opened, the smaller store’s whole customer database was mailed an offer containing US$5-off coupons for US$50 orders in each of the following twelve weeks. Any customer using all twelve received an extra US$10 certificate. The result was that sales actually rose by between 6% and 7% over the months following the new opening. The competitor’s store (which was approximately twice the size) achieved less than half the sales of the remodelled store. This shows the power of knowing who your customers are.

1. Select stock lines effectively
   Knowing what best customers buy frequently helps choose which lines to stock and which lines to expand on. By way of example, the owner of a small UK-based suburban supermarket had twelve months’ notice that a large national supermarket was opening right over the road from him. He realised that without major changes he would not survive. What he did was simple but clever. The suburb in which he was situated was mixed, having mainly low-cost housing but also a very exclusive area. Many of his customers were low earners who bought their basic requirements every day or two from him – in essence, what they could carry home in a couple of bags. He knew that they would migrate to the lower prices and bigger ranges of the big chain.

However, a considerable number of the more wealthy people would call in on their way home from work to pick up bread and milk and a few odds and ends. He started noting what they bought, and what they never bought. Over the months, he stopped ordering products that they never bought, and increased his range of things that they did buy. Over the year, his store slowly changed from a small supermarket to a very big delicatessen. His wealthy customers told their friends and the composition of his customer base changed from mainly low earners to mainly high earners. When the supermarket opened over the road, his low earners did migrate, but he hardly noticed the difference.

1. Plan merchandising more intelligently
   Basket analysis can identify what lines are bought at the same time, particularly by best customers, and planograms can be planned accordingly to encourage cross-purchasing.

The apocryphal story of a retailer (usually said to be Wal-Mart) discovering from basket analysis that men who buy baby nappies also buy beer (the refined version on the internet includes “on Friday evenings”) may be true or not – there is a whole web site devoted to discussing its veracity. But this story, regardless of its origin, does illustrate the potential of the principle in its own bizarre way.

Data similar to this is used widely to plan planograms for store merchandising. Of course, on one level, plain basket analysis without a loyalty programme is enough for this purpose. But add the dimension of knowing who the customer is, how much they spend, and where they live and you can confidently decide whether it is worth putting a display of nappies in the beer aisle on Friday evenings or not!

1. Reduce promotional and advertising costs
   Because advertising based on segmentation of a loyalty database can be highly targeted instead of untargeted, significant savings can be made. There is no need to send out thousands of flyers that will be thrown away unread, or take pages of newspaper space that is irrelevant to many of the readers.

Targeted advertising works measurably. The more sophisticated type of loyalty programme – such as the UK’s Tesco Clubcard – can not only target advertising material almost individually to its many millions of members but it can accurately measure the response rates to those advertisements. If Mrs Smith is sent a coupon for money off Whitesmile toothpaste, the system knows whether or not she redeems that coupon. That information is valuable not only to Tesco, but to the makers of Whitesmile toothpaste. Not only does this form of advertising save Tesco money; it actually earns Tesco money. While national UK magazines are reported to charge between £5,000 and £7,000 per page for advertising, Tesco is said to charge up to £37,000 for an A5 page (roughly half the size of a standard A4 magazine) – and brands pay those kind of rates because it works. Buying space in the magazine is an accountable investment toward measurable sales; one particular toilet tissue brand saw a 27% increase in sales after advertising in this way.

1. Selecting new trading sites
   Selecting a site for a new store is no longer a case of sticking a pin in a map, or choosing a site on a hunch. The loyalty card enables you to profile the demographics of best customers and – because it is often likely that the best prospective customers will have similar demographics – choose new locations much more accurately.

In addition, if the addresses of existing customers are known, they can be plotted geographically and sites can be chosen where there are outlying pockets of customers or gaps in coverage.

Where to find more detail…
The Loyalty Guide, our comprehensive guide to customer loyalty, explains every aspect of loyalty programmes, best practices, concepts, models and innovations, all backed up with case studies, original research, illustrations, charts, graphs, tables, and presentation material. Find out about the principles, practicalities, metrics, analysis, and bottom-line effects of loyalty, and gain the expert guidance of dozens of loyalty and relationship marketing thought-leaders, worldwide.

It shows you exactly how to use customer data to increase profits, reduce churn, and increase frequency, spend, and share of wallet. See how and why others have already succeeded, what works, and – more importantly – what doesn’t work. The report’s full executive summary, table of contents, downloadable samplers, and pricing/ordering are all available online – click here.

That’s because the study found that nearly 60% of consumers who receive a marketing email are more likely to make an in-store purchase. The even better news: only a small number of consumers indicated that they’d be less likely to make an in-store purchase because of a marketing email.

According to the study, intent does often lead to sales. In China, a whopping 75% of respondents indicated that they had made an in-store or phone purchase after receiving a marketing email. In the US, just over half indicated that an email had driven an in-store or phone purchase. That number drops to a still-respectable 43% in the UK.

Interestingly, the interaction between the online world and the offline world isn’t a one-way street. Lightspeed Research found that a third of respondents worldwide were willing to provide their email addresses to salespeople and clerks in a store.

These findings, of course, aren’t really surprising. The fact that consumers are increasingly active across channels isn’t news. But the key for retailers looking to maximize it to their benefit is making sure that there is integration and tracking across channels. When retailers know when and how their marketing emails are driving in-store sales, for instance, they can craft more effective campaigns, better segment their email lists and identify new marketing opportunities.

The good news is that with established techniques such as couponing and loyalty programs, linking what takes place online to sales that happen offline doesn’t require rocket science. It simply requires will, some investment and the recognition that cross-channel commerce is the rule, not an exception.

Loyal Patron Fundraising Slideshow

Loyal Patron Integration of Customer Loyalty Suite

Steve Schroeder – VP Marketing
562-201-2580 – Cell
800.978.1338 – Office

1.  Notice I have 185 points, what the heck does that mean?  I also have 0 in rewards certificates, what does that mean?  I think it means when I reach a certain number of points (maybe 500, although I am not sure how I earn these points) I get a $5.00 rewards certificate mailed to me in 4-6 weeks L  I might be able to print this coupon online and get it faster, but why make customers jump through all these hoops and difficult to understand loyalty programs.  Why not offer 5% cash back rewards loaded instantly on my Rewards Zone card and get rid of the paper and confusion!  Tell me why they don’t do this for extra credit.
2. Notice how I need to spend $25.00 to get $10.00 in rewards certificates?  When do I get this certificate and can I spend $25.00 on ANYTHING?  Let me know and if your answer is correct you will earn additional credits.
3. Ok, here is the best part of the email and Best Buy should be commended for thinking like this, they just don’t have the technology or marketing know how to do it properly.  Notice all their new food partners in Colorado at the bottom of the email?  I am not sure how this works exactly since the wording is very confusing, here is what I mean
1. Do I need to spend $25.00 at the restaurant or $25.00 at Best Buy to earn special rewards?
2. How do I join at a particular restaurant, do you think I simply swipe my Best Buy card when I arrive?  (THAT’s A HINT on improvement)
3. What does it mean when points are offered?  Are points a good thing or a bad thing and WHEN are they offered?  Do you mean sometimes they are and sometimes they are not L
4. THREE rewards points earned for every dollar I spend including tax and tip!  Are these rewards points good for Best Buy?  Can I use them at the restaurant?  How much does this compute too?  Find out for extra credit and explain how this can be improved using Loyal Patron.
5. Don’t you just love the last statement!  Enjoy a generous serving of POINTS!  Wow, I would love a generous serving of points if I just had a calculus degree and an attorney to figure out when and where I can use them and how much they are worth! 

Is this program better than nothing?  I guess, but can you see how much easier our solutions with Loyal Patron would be?  Not only simpler, but much more powerful and easy to track along with many other advantages we would like for you to breakdown and send to us for extra credit.

Stay thirsty my Piglets, and enjoy the most interesting degree in the world!

Story

In the second half of 2009, 19.9% such emails never reached consumer inboxes in the United States and Canada — representing only a slight improvement over the first half of the year when 20.7% such emails missed their target.

By contrast, European inbox placement rates fared markedly better with just 15% of requested, permissioned emails never reaching consumer inboxes.

In the United States and Canada, 3.5% of commercial, permissioned emails were delivered to a “junk” or “bulk” email folder, while 16.3% were missing or not delivered at all — with no hard bounce message or other notification of non-delivery.

“Many senders believe that their email campaigns are achieving a 95% to 98% delivery rate,” said George Bilbrey, co-founder and president of Return Path. However, “senders still do not have the correct data to accurately determine true ROI.”

“If senders and ESPs count only their hard bounces as emails that failed to reach consumers, they’re not getting an accurate metric as to how many emails actually made it into subscriber inboxes,” Bilbrey added. “Ultimately, only emails that reach a subscriber’s inbox can be opened, clicked and converted into a loyal and active customer. Remember, sent minus bounce does not equal delivered.”

Also of note, ISPs vary in terms of how many permissioned emails successfully reach consumer inboxes.

Stateside, BellSouth and Google’s Gmail were the toughest on permissioned marketers, as 21% of emails sent to Gmail addresses failed to reach users’ inboxes.

Before the first half and second half of last year, BellSouth had a notable increase in non-delivery rates. The phone company increased its non-delivered rates to inboxes from just 14% in the first half of 2009 to 22% in the July to December time period.

“The reason non-delivered rates vary is because each ISP has their own criteria for inbox placement,” said Bilbrey.

 Relevance Remains a Challenge for E-Mail Marketers

June – 2010

It might seem obvious that marketers must send relevant messages if they want to be noticed and appreciated by consumers. But the CMO Council and InfoPrint Solutions Company’s “Why Relevance Drives Response and Relationships” report indicates that they have a problem being faithful to audience preferences.

US Internet users deluged with mass e-mails have little time for irrelevant promotions and newsletters, and they have enough experience to know how to unsubscribe. More than nine in 10 respondents to the CMO Council survey had unsubscribed from an e-mail newsletter at some point. Relevance—or lack thereof—was the No. 1 reason.

Promotional e-mails were the most common thing for respondents to find in their inbox, with 60% saying they received such e-mails most. E-newsletters were the next-most-common type of messages.

But it was the least common messages that were most likely to be opened—monthly bills and bank statements. Only about four in 10 recipients said they “always” opened promotional offers or newsletters.

By Gail Goodman   |   June 9th, 2010

Most entrepreneurs would agree–2009 was a wild ride.

The economic roller coaster made everybody woozy; and a new president took office with promises of hope around the bend. Businesses scrambled to hold on to customers, all while unemployment soared higher and consumer spending got tighter.

During all this uncertainty, social media exploded–creating excitement, opportunity, and confusion. Organizations hired social media “gurus” to help them turn Twitter followers and Facebook fans into customers, clients, and members.

No wonder it was a challenging year for anyone trying to market a small business, franchise, or nonprofit. But as stressed out as everyone was, I saw extraordinary acts of compassion throughout the year. People went the extra mile to help out their neighbors and stayed loyal to businesses that had done right by them in the past.

That’s why the most important lesson I took away from last year is that loyalty matters. No matter what tools you’re using to market your business, building loyal customer relationships is still the No. 1 way to grow your business–in good times and in tough times, too.

With that in mind, here are four other important lessons we learned in 2009; and resolutions to jump-start your chances for business success in 2010.

Lesson No. 1: E-mail Marketing Is Still the King of Relationship Building
The tsunami-sized rise of social media in 2009 left some people wondering, “Is e-mail marketing still relevant?” My answer is yes, now more than ever. Here’s why:

• E-mail creates a quiet, dedicated moment with your customers. Consumers are pickier about which e-mail lists they subscribe to. When your customer opens your e-mail, you have their attention for one precious moment. In internet time, that moment is priceless.
• When it comes to ROI, e-mail kicks butt. The Direct Marketing Association recently reported that “commercial e-mail returned a whopping $43.62 for every dollar spent on it in 2009.” That’s because e-mail enables you to inexpensively and effectively create a quality over quantity mailing list of loyal customers and qualified prospects.
• E-mail is still the primary form of professional business communication. Business people use e-mail to communicate with each other, not Tweets or Facebook wall posts. E-mail is personal. It’s professional. It’s not going anywhere.

Your e-mail newsletter is a solid piece of quality content that you can archive on your website. Both B2B and B2C operations can boost their brand image and credibility by publishing and archiving a body of expertise through their e-mail newsletter articles, and inviting reader participation. Business people love to talk shop. Ask for their input in your e-mail communications and get a dialogue–and some relationships–going.

Lesson No. 2: E-mail Marketing Complements Social Media Marketing
According to a recent Nielsen report, heavy users of Facebook and Twitter use e-mail more than casual users. That means your audience is probably in multiple places–using e-mail and visiting social networking websites. But it’s not about tweeting 10 times a day and posting random messages on your Facebook page just to be part of the social media movement.

Remember: Quality content trumps frequency of postings. Your e-mail newsletter should remain the centerpiece of your online communications, offering practical advice and meaningful insights that resonate with your audience. Social media is used to spot customer trends, mine ideas for future newsletter articles, respond to customer concerns, and find new mailing list subscribers.

Lesson No. 3: Two-Way Communication Is the Key to Survival
Great business communications is more than talking about your products and services. It’s listening to your audience and inviting them to talk back to you. It’s all about keeping a beat on your customers. Smart businesses regularly survey or poll their readers in their e-mail marketing communications, and use that intelligence to make adjustments to their businesses.

2009 was a year of change: changing economic environments, changing customer needs, changing perceptions. The businesses who listened to their customers and changed with the times survived.

Lesson No. 4: The Personal Touch Is Timeless … and Effective
The business survivors of 2009 made genuine connections with their customers. They learned to communicate in a conversational voice when they wrote their e-mail newsletters–it helped customers to feel like people, not just “subscribers.”

Some businesses even invited customers, employees, business partners, and community members to share their personal stories related to the businesses’ products or services. The best ones were featured in an issue of the e-mail newsletter. This put a personal spin on sometimes impersonal topics.

The valuable lessons learned in 2009 can help all of us make more lasting customer connections in 2010. Happy New Year!

Gail F. Goodman is the e-mail marketing coach at Entrepreneur.com and is CEO of Constant Contact, a web-based e-mail marketing service for small businesses. She’s also a recognized small-business expert and speaker.