Monthly Archives: February 2013

Customer Loyalty Programs that Work

Customers today are the savviest we’ve ever dealt with. They comparison shop, not just for cheaper prices, but for quickest rewards, best service, and greatest value as well. So it makes perfect sense they would shop for customer loyalty programs that really work.
In fact, a big debate is happening among retailers whether loyalty programs work or just provide customers the opportunity to game the system. According to LoyaltyOne’s research, the average American household belongs to 18 customer loyalty programs but participates in only 8. Why don’t they participate in all of them actively? It’s a matter of value and ease of use.

So how do we engage the savvy customer?

It’s more than the dollars back

Reward programs are as ubiquitous as airbags in a car. They are quickly taken for granted or forgotten about. All programs offer a discount or an accumulated freebie. Savvy loyalty programs go beyond pricing to offer perks. Perks such as complimentary wi-fi, a loyalty line (for quicker ordering), or an opportunity to preview new items have an impact on customers beyond just getting something a bit cheaper.

Make levels attainable

When I speak on goal setting, I always recommend having goals with reach but within reach. The same goes for customer loyalty programs. In other words, the advanced levels have to be attainable or the customer will lose interest. If you require 20 purchases to get the “freebie,” on all but the most loyal customers of your products, the desired impact will be lost. One restaurant with which I am familiar has a graduated loyalty program to keep customers interested. On the fourth purchase you receive this reward, on the eighth something bigger, on the 12th a bigger item, and on the 16th purchase you get the top reward. It keeps the customer involved along the way, and it then becomes a mission to reach the top level like a video game. Do you know the right pacing for your reward levels?

Have cross-promotional partners

What is the business in town that is complementary for your customers? For example, grocery stores share rewards and promotions with gas stations. Customers in these cross-promotional programs quickly realize by gaining more points faster they can create bigger rewards in these businesses.  Cross-promotions can work for fellow small businesses, retailers located in close proximity, or as a thank you to another business, such as a bank giving away free tickets to an amusement park that is a business client. The loyal consumer benefits, the financial client benefits, and the bank has a loyalty program with some buzz.

Appeal to your customers’ technology level

My mother was a green stamp collector and coupon clipper in the prime of her purchasing power. I still remember as a kid pasting green stamps into books for purchasing products at the redemption centers. She still gets a newspaper and clips coupons. That is her preferred level of technology.

Many of today’s consumers want to have an app and the ability to track their points online. I am able to do this with my US Airways status and frequent flyer miles I get from my flights and loyalty program credit card.

What is the technology comfort level of your customers? If you are offering stamp cards to customers who want electronic loyalty programs, they will not be very well engaged. By the same token, if you are trying to convince my mother’s generation to get an app on a phone she only uses for emergencies, that program will not be effective. Know your customers’ technological comfort zone and deliver your loyalty program at their level for maximum effectiveness and ease of use.



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Are You Ready for Your Agile Advantage?

The world is becoming smaller and more interconnected, intelligent, and technology-driven, bringing challenges and opportunities alive to businesses and those who work in them. Customer demand for personalized services, mobile access, and open and ongoing communication will only grow. The speed with which the pace of business is accelerating requires rapid change and increased agility.

A car with a wobbly tire may be able to move down the road at 20 miles per hour; however, the vehicle can’t function properly with the same wobbly tire at 90. Businesses are also learning that with greater speed comes greater complexity and greater demand for maximum performance. Small business leaders are being forced to ask themselves whether their organizations have the agility to turn these challenges into opportunities.

Technology, Talent, Tenacity

Recognizing and adapting rapidly to market changes is always difficult. At the speed of change in today’s new economy, having the ability to manage change is not optional if the organization is going to succeed and grow. Companies embracing the changes and eager to embrace the new economy are leveraging technology, talent, and tenacity to increase business agility through the new model of business leadership designed for continuously improved processes and systems.

The Agile Business by design is capable of fluid, effective working relationships with employees, customers, and suppliers. It relies upon repeatable, rapid, and reliable systems throughout the organization. Agile Businesses have the versatility to allow employees to make process improvements to respond quickly to change without having to rely on the command-and-control managerial hierarchy approval process that impedes the speed of change.

By being agile enough to manage change, leaders in an Agile Business can capitalize on new opportunities and beat competitors in the tight profit margins of the new economy. By innovating with top talent and ever-improving technologies, with the Agile Advantage, a business can achieve incredible levels of market dominance.

I’m sure it’s no surprise to you that customers are disappointed with limited options. Technology is already changing customer control of options, much to the consternation of those typically in command and control. For example, television programming is still decided by the networks. They make the choice what shows get on, when they will run, and who gets to see those shows. With Digital Video Recording devices and websites such as, customers are taking away some of that control as they record and watch shows when they want to with the added ability to fast forward through unwanted ads. This is changing how advertising functions, how networks charge for ad space, and how marketing philosophy is shifting from interruption marketing to permission marketing.

Your Agile Advantage

To create your agile advantage for your organization, develop the following characteristics for your organization:

  • Create a culture that allows for agility to stay in front of customer demands
  • Maximize the potential of your top talent by letting them make decisions
  • Conduct on-going training to develop better decision making as close to the customer as possible.

Think of the changes you are seeing in your customers. How are they locating you? What do they know about your competition? How are you reaching them with your marketing strategies? All of this is changing in the new economy. Agile businesses know how to stay in front of these changes. Ole school businesses always feel as if they are catching up. Which best describes your business?

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