Moving Beyond Loyalty Programs

TOWARDS REAL LOYALTY

2

LOYALTY IS AN EMOTION

…SO WHY DO WE TREAT IT LIKE A TRANSACTION?

WE HAVE BECOME VICTIMS OF HISTORY AND HABIT

1700sCOPPER TOKENS

1800sCOUPONS

1930s - 70sTRADING STAMPS

1980sDEREGULATION

1990sDIGITIZATION

2000sMOBILE TOOLS

-1% revenue growth

DONE WRONG =RISK MARGINS

-10% lower

EBITDA

ONE SIZE DOES NOT FIT ALL

DOING THE SAME AS OTHERS LEADS TO FAILING IN THE SAME WAY

Customerengagement

ROI over time

SO.. WHAT COULD BE DIFFERENT?

HOW TO SHAPE YOUR FUTURE?

WHERE DID IT GO WRONG?

A NEW APPROACH: “WHOLE BRAIN” UNDERSTANDING OF LOYALTY

TRUST HABITAFFINITY

CONSISTENCY BUILDS TRUST

ANTICIPATETEST DELIVER RETEST REINFORCE DELIGHT

EXPERIENCES BUILD AFFINITY

Focused on tasks

Focused on experiences

FEW PROGRAMS CROSS THIS LINE

MEANINGFUL

PLEASURABLE

CONVENIENT

USABLE

RELIABLE

FUNCTIONAL

PATTERNS BUILD HABIT

Action

Reward

Trigger

MOVING BEYOND THE TRADITIONAL APPROACH

TransparentRelevant

Contextual

HumanCentered

Connected

CONTEXTUAL

PLACEPURPOSE

IDENTIFY CATALYSTS FOR NEW HABIT BUILDING

TIME

DEG

REE

OF

COM

MIT

MEN

T

Traditional programs

Experimentation Moments of delight

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TRANSPARENT

HOW DO YOU USE WHAT YOU KNOW

ABOUT ME?

EXPERIENCESCHOICESAVINGS PRESTIGEADVICEAUTONOMY

RELEVANT

54%More spend

2xMore referrals

83%More Engaged

CONNECTED

LOYALTY IS AN EMOTIONA crowd is a tribe without a leader.

A crowd is a tribe without communication. Most organisations spend their time marketing the crowd.

Smart organisations assemble the tribe.SETH GODIN

27

InsightEngage

Anywhere/ Everywhere

Respond at moment of impact

Big Data Mobility

Cloud

Insight Engagement

Responsiveness

SO.. WHAT COULD BE DIFFERENT?

HOW TO SHAPE YOUR FUTURE?

WHERE DID IT GO WRONG?

Customer Experience

OrganizationalCapability

Standard, static program

Long cycles, then relaunch

BEYOND “ONE AND DONE” PROGRAMS

Traditional Approach

IDEASTREAMS

INNOVATION CAPABILITY

BUILD, TEST & LEARN

GO

STOP

PIVOT

Continuous Loyalty

CREATE THE PLATFORM FOR EXPERIMENTATION AND GROWTH

Concept Ideas and prototypes

Explore with customers

Pilot Few segments/

sites

Continue learning

Scale up Refine and

expand

Manage capacity

Rollout Loyal, free and paid

Mainstream

Evolve Becomes

commodity

Change the game

34

ALIGNING THE DIMENSIONS IS LIKE TETRIS

Organizational CapabilitiesCustomer experience

Customer experience

ALIGNING THE DIMENSIONS IS LIKE TETRIS: STEP 1

37

75 HAMBURGERS A SECOND

38

VALUE IS CREATED BY OUTCOMES

DOUBLE DIAMOND

understand define explore create

FIND SOLVE

40

FIND THE NEED

EXPERIENCESCHOICESAVINGS PRESTIGEADVICEAUTONOMY

RELEVANT

DOUBLE DIAMOND

understand define explore create

FIND SOLVE

DESIGN EXPERIENCES FOR OUTCOMES

44

CREATE A SOLUTION HYPOTHESIS

45

BUILD - MEASURE - LEARN

46

CONTINUITY

ALIGNING THE DIMENSIONS IS LIKE TETRIS

Organizational Capabilities

Organizational Design

ITCustomer

Experience

AND THERE ARE MORE THAN 2 PIECES

YOU NEVER KNOW WHAT IS GOING TO HIT YOU NEXT

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A KATA FOR EVERY PIECE

IMPROVEMENT KATA BY TOYOTA

THE PATH TO CONTINUOUS LOYALTY

Baking innovation into the mindset

and culture of your brand and people

Creating a capability that

evolves with your customers over

timeITERATE

• Not all customers are created equal. Avoid over-investing by being all things to all people

• Value is variable. Customers value more than money. Successful programs depend on understanding the right levers

• Experience matters. Moments of connection and relevance create habits that drive repeat behavior

• Test, learn, repeat. Design for iterative tests and take advantage of test data for continuous delivery and refinement

TAKE-AWAYS

THANK YOU

Dianne Inniss @dianne_tweets

dinniss@thoughtworks.com