Kobie Quarterly Review: Restaurant and Retail Edition - 2014 - Learn More at Kobie.com

KOBIE QUARTERLY REVIEWJULY 2014

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21THE TRUTH ABOUT LOYALTY PROGRAMS & MOBILE APPS

18HOW RESTAURANTS ARE INTEGRATING LOYALTY PROGRAMS

08 RESTAURANT & RETAIL LOYALTY: WHAT’S HAPPENING IN 2014?

&

RESTAURANT &RETAIL EDITION

KOBIE QUARTERLY REVIEW 3

FEATURED CONTENTS

With change being the only con-

stant in business today, loyalty

08RESTAURANT & RETAIL LOYALTY:

WHAT’S HAPPENING IN 2014?

When it comes to developing true

customer loyalty, restaurant operators

and retailers must learn how to engage

with consumers beyond the discounts

and deals dichotomy. Counter to

popular thinking, it’s the relationship

building, not frequency, that’s vital for

loyalty.

18TABLE TALK: INDUSTRY IN-

SIGHTS INTO HOW RESTAU-

RANTS ARE INTEGRATING LOY-

ALTY PROGRAMS

Separate from other marketing initia-

tives, loyalty programs give restaurant

operators direct insight into what

guests think about their menu items,

staff and overall quality of service.

11THE SECRET SAUCE IN SUCCESS-

FUL RETAIL AND RESTAURANT

LOYALTY PROGRAMS

Loyalty programs have proven to be

a highly effective way for brands to

increase customer interaction, determine

purchasing preferences and show appre-

ciation to their loyal customer base.

21THE TRUTH ABOUT LOYALTY

PROGRAMS AND MOBILE APPS

If you still think that mobile devices are

just gadgets, think again. They have

become the center of consumers’ daily

lives and how they engage with the

world. And a critical channel for brands

to be a part of those lives, too.

14THE MILLENNIAL MINDSET

Millennials represent a growing eco-

nomic force for the restaurant and

retail sectors. They might be small in

terms of age, but their future spend-

ing power alone serves up a veritable

goldmine.

05LOYALTY TRENDS AND INNOVA-TIONS: IN PERSPECTIVE

With change being the only constant in

business today, loyalty programs (and

their IT teams and designers) are con-

tinuously challenged with adapting and

evolving their programs to anticipate

and keep up with consumer, commerce

and technology trends.

KOBIE QUARTERLY REVIEW4

Over the past decade, several major factors have significantly disrupted the retail and

restaurant industries: including the evolution of eCommerce, the rise of social media, and

most significantly, mobile devices and the broader mobile channel. All of these channels

– as well as the insights into consumer behaviors they provide – have influenced loyalty

marketers and the way they design their campaigns and programs.

Examining the restaurant and retail sectors specifically, two industries that were already

heavily social, these trends have created more opportunities for increased customer

engagement through social media channels, location-based messaging, gamification and

innovative rewards structures. And, with digital and mobile playing an integral part in

consumer purchasing decisions, omnichannel loyalty is shaping the consumer experience.

According to a recent report by MIT, 80% of shoppers check prices online before making a purchase, 1.1 trillion in-store

sales are influenced by the web, $12 billion in retail sales are made on mobile devices and $252 billion in revenue results

from online shopping.

Other key trends include Millennials, the generation of younger consumers whose lives are driven by technology. Spend-

ing a collective $600 billion in-store and online each year, marketers are using trends in technology to capture their

attention. With innovations like Google Glass and the SmartWatch becoming part of Millennials’ daily wardrobe, analysts

predict that wearable technology sales will reach 90 million units in 2014 and more than 485 million by 2018.

Looking back (and ahead), other technologies have taken what was once a predominately brick-and-mortar shopping or

dining experience and transformed them into a virtual experience heavily controlled by the consumer. A large factor in

this change is the mobile device, now ubiquitous across every demographic and consumer spending category. A recent

Forrester report predicts that more consumers will be using m-payments, or paying using their mobile device, in 2014.

These mobile payments are expected to grow by 43% each year, bringing in an anticipated $90 billion by 2018.

In this Kobie Quarterly Review: Restaurant and Retail Edition, our goal is to educate those responsible for developing

and running loyalty programs about the trends impacting loyalty today, with a focus on retail loyalty trends and the

innovations, challenges and opportunities facing restaurant customer loyalty and rewards programs. Within these two

industries, we highlight successful programs and the methodology behind them; looking at the impact of Millennial

shoppers and diners and how they are slowly creating a societal shift in loyalty and consumerism.

Taking all that we’ve seen and learned so far this year, as loyalty marketers, our collective goal should be to integrate the

most effective technologies, look closely at our program design and think deeply about how well we know our custom-

ers – and if we’re truly rewarding them.

As you read through this report, there is one ultimate truth we hope you take with you: With customer preferences

constantly in flux, and today’s technology becoming tomorrow’s news, loyalty marketers should understand that real

customer loyalty depends on how willing you are to adapt to the change.

How many changes will you make this year?

Let’s find out.

Michael Hemsey, President

Kobie Marketing

FROM OUR PRESIDENT


By Nancy Berg

Statistics show that existing customers spend 67% more on a brand than new cus-tomers. While this shouldn’t be a reason to ignore new customer acquisition, the importance of an evolving customer reten-tion strategy should not be underestimated, either.

With constant changes in the way business-es operate, loyalty program organizers are continually challenged with modifying their programs to keep with the trends while con-tinuing to drive value and engagement.

Here are some of the top loyalty program trends that we’re seeing across major indus-tries in 2014, and the brands who are apply-ing them most effectively:

RetailFor retail loyalty programs, 2014 is the year of the “seamless” transition between brick and mortar, online and mobile shopping. Today more than ever, advances in mobile and online technology make it possible for consumers to have a complete virtual shopping experience – one that includes fast and free shipping, re-turns and exchanges, and the ability to return online items to the nearest physical location. To stay ahead of the trends,

Looking at 2014 trends in the retail, financial, travel, telecommunications and entertainment sectors

LOYALTY TRENDS & INNOVATIONS

IN PERSPECTIVE


more retailers are hosting plat-

forms for mobile loyalty programs

to track customer purchases and

document preferences, facilitating

mobile payments, and using GPS

technology to send relevant offers

to shoppers’ mobile devices. When

tracking these purchases, smart re-

tailers are also using the data they

collect to learn more about individ-

ual customers, offer personalized

shopping recommendations and

ultimately connect with shoppers

in store. Most prevalent in custom-

er loyalty today is the integration

of social media. According to the

Walker Sands’ 2014 Future of Retail

study, 78% of modern consumers

interact with social media channels

like Facebook,

Pinterest and

Twitter to learn

more about

the brand, get

discounts and

special offers,

and read other

customer re-

views.

Success Story:

Amazon.com has mastered the

art of personalized recommenda-

tions with customized pages like

“Related to Items You’ve Viewed,”

“Inspired by Your Shopping Trends”

and “Recommendations for You.”

By doing so, Amazon is capitalizing

on the fact that users are more like-

ly to purchase products based on

relevant offers – a business practice

that has industry experts predicting

Amazon to bring in $100 billion in

revenue in 2014 alone.

Financial Services Between 2006 and 2012, the finan-

cial services industry witnessed

an increase in loyalty program

membership by 130%. However, as

technology rapidly changes and

Millennials become the future of

this industry’s growth, more loyalty

program participants demand

products and services that coin-

cide with their lifestyle. An esti-

mated 83% of consumers believe

they should be rewarded for their

loyalty to the brand, and 93% want

banks to tailor rewards to their

individual circumstances. In line

with this changing lifestyle, experts

believe that financial services loy-

alty programs in 2014 will continue

to build an omnichannel approach

– integrating more mobile tech-

nology and social media – where

banks can em-

power program

members using

compelling en-

gagements and

personalized

messages sent

through multiple

channels of com-

munication. With

mobile and social

platforms mak-

ing it easy for users to access their

accounts, read member reviews

and deposit money quickly and

easily – and banks giving consum-

ers more incentives to grow their

rewards – banking has become

more practical and efficient than

ever before.

Success Story: The industry con-

tinues to compete aggressively for

new acquisitions—lots of different

sizes and flavors. The Chase Sap-

phire Preferred Card is incentivizing

consumers by giving away 40,000

bonus points for program members

who spend $3,000 on the card

during their first three months.

Chase’s Marriott Rewards Card

offers 1 FREE night plus 70,000

points for members that spend

$2,000 on the card in the first two

months. Citi’s American Airlines

Card offers 50,000 miles for

spending $3,000 in the first three

months. And, American Express is

trumping them all with a 100,000

mile incentive for spending $10,000

on the Business Platinum Card in

the first three months.

Travel According to recent studies, more

than 238 million U.S. travelers have

travel loyalty program member-

ships. Frequent Flyer programs

built the roadmap for formal loyalty

programs in the early 80’s. They

have a reputation for being some

of the largest and most popular

programs in the industry; and have

long been known for attracting

active and inactive members by

expanding the program with earn/

burn activities that go well beyond

airline trips only, However, only

44% of these consumers are

actively engaged with the program

– and 50% believe they are actually

limiting their value by enrolling in

memberships that only focus on

one airline alliance or hotel chain.

So how is 2014 responding to this

issue? With more Millennials making

up the bulk of travelers, 2014 has

witnessed new loyalty strategies

83% of

consumers believe they should be re-warded for their loyalty to a brand.

238 million U.S. Travelers have travel loyalty program memberships.


that incorporate social media,

mobile usage and digital behavior

to gain real insight on consumer

preferences and increase their level

of engagement beyond their flight

or hotel stay. On the burn side,

expanding rewards and promoting

miles/points + cash, such as ‘mix

and match’ rewards, and access to

once in a lifetime experiences con-

tinues to resonate well. And with

25% of airline and hotel program

members begging for rewards they

can actually redeem, 2014 travel

loyalty programs are opting for

flexible points options that keep

Millennials coming back for more.

Success Story: Recognized as a top

hotel program at the 2014 Flyer-

Talk Awards, Starwood’s Preferred

Guest program offers customers

flexibility by allowing members to

transfer rewards to different airlines

and combine points and cash to

book rooms.

Telecom Whereas restaurant patrons and

retail shoppers can benefit from

incentives that keep them coming

back frequently, telecommunica-

tions loyalty programs have a dif-

ferent challenge. Many customers

sign annual contracts and brands

have less opportunity to grow sales

through increased additional lines,

so programs had to think differ-

ently. Telecom brands have seen

significant success leveraging loyal

customers for referrals through

formal Refer-A-Friend programs.

They also are leveraging technolo-

gy advancements including mobile

integration, cloud computing and

sensing technologies to collect

important data about customers

to drive growth, while social media

outlets serve to connect potential

consumers with brands and offer

incentives to earn loyalty rewards.

Incenting incremental behaviors is

also a rising opportunity for tele-

com loyalty in 2014. As spectrum

constraints impact profitability,

incremental behaviors that drive

revenue and decrease expense,

such as getting the customers to

pay their bills on time or incenting

them to enroll in paperless billing,

has real im-

pact on the

bottom line.

Success

Story: The

popular mo-

bile phone

carrier,

Sprint, used

their Ninja

Ambassador

Program to train 3,000 employees

to reach out to customers through

various social media channels – like

Facebook, Twitter, LinkedIn, You-

Tube, community forums and more

– on pre-selected topics to facili-

tate customer engagement.

Entertainment For the entertainment industry,

where attendance is less regu-

lar, brand loyalty should focus on

expanding purchasing at the POS.

While many entertainment brands

have focused on new customer

acquisition, more recently they’ve

recognized the importance of

segmenting their customer base

and leveraging ways to retain their

most loyal customers. In 2014,

loyalty program organizers are

curbing these issues by finding

innovative ways to engage mem-

bers through multiple channels –

like mobile apps, smartphones and

gamification – and using collected

data from customer interactions

to gain customer insight. Using

modern technology to promote

benefits, these brands are devel-

oping more relevant offers to send

to program members that are both

attractive and valuable.

Success Story: Disney’s new “Magic

Bands,” computerized wristbands

containing Ra-

dio-frequency

identification

(RFID) technology,

allow team mem-

bers to identify

guest preferences

and personal infor-

mation by scan-

ning their band.

Through this same

technology, visitors

can collect Fastpasses for popular

rides, make payments, order park-

ing passes and access their resort

rooms – data that is all collected –

giving Disney team members more

flexibility to have meaningful inter-

actions with resort and park guests

throughout their stay.

Keeping these trends in mind,

loyalty marketers across all indus-

tries can gauge opportunities for

data collection that can lead to

meaningful customer interactions,

increased consumer trust and in-

fluence purchasing behaviors and

decisions.


As restaurants and retailers seek

out creative ways to deepen en-

gagement with new and existing

customers, the performance of

these brands’ loyalty programs

is being more closely monitored

than ever before. And whether the

goal is to entice patrons to return

to a restaurant or promote the

opening of a new store, for loyalty

programs to deliver on these per-

formance goals in 2014, market-

ers need to move beyond simple

behavior/reward models and strike

a balance between strategy and

the channels they engage custom-

ers on. Finding this balance will

require a deeper understanding of

what customers are looking for, as

well as a broader knowledge of the

loyalty landscape in the restaurant

and retail space.

Research has found that the top

three external marketing priorities

of Chief Marketing Officers in 2014

are customer acquisition, giving

customers a personal experience

and customer engagement. To-

day’s CMOs are also responsible

for revenue growth, adding anoth-

er “bottom-line” priority to their

growing list. And they have to work

more closely with CIOs in order to

ensure their loyalty programs are

seamlessly integrated into other

functions of the organization.

In other words, loyalty programs

are being held to a higher standard,

with technology innovations and

strategy being set as top priorities.

And as CMOs continue to stream-

line their loyalty programs in the

retail and restaurant industries,

there are four themes they should

focus on to increase loyalty growth:

personalization, omnichannel loyal-

ty, mobile integration and integrat-

ed multi-tender loyalty.

Here is a deeper look at some of

the key trends loyalty programs in

the restaurant and retail sector are

utilizing in 2014:

Personalization

While personalizing the loyalty

experience ultimately increases the

chance of driving a positive cus-

tomer response to a campaign or

promotional message, restaurants

and retailers need to make sure

they use personalization selectively.

Marketers need be careful to moni-

tor customer sentiment - especially

for emerging channels like mobile

and social media. Although the

messaging and incentives may be

personalized, excessive use of this

approach can overwhelm consum-

ers, and lose the “personal” experi-

ence that the message was meant

to communicate in the first place.

In 2014, for example, CMOs have

realized that personalization does

not need to be as far reaching as

planned, but only focus on reach-

ing consumers in a way they will

actually respond to. Think about

it. If marketers know a particular

consumer responds best to mobile

interaction, it would be pointless

to personalize their marketing

through direct mailings just be-

cause a similar group of consumers

may have, at one point, respond-

ed positively in that manner. The

challenge, therefore, is to find the

perfect balance between enticing

customers with a personalized

message through their preferred

channel while refraining from be-

coming too invasive.

Omnichannel Loyalty

Personalization goes hand-in-

hand with omnichannel loyalty.

With advancements in technology

powering the way brands connect

with their customers, the expecta-

tions of those shoppers and diners

have also become higher as they

demand relevant information – on

relevant channels. Knowing this,

and recognizing trends in how con-

sumers operate, restaurants and

retailers agree that omnichannel

loyalty gives them a way to reach

consumers in a way that will really

resonate.

Omnichannel loyalty can help to

drive:

• More Connections with Consum-ers: Today more than ever, customer shopping and dining has become a tech-driven experience. Research, recommendations, reviews and brand

RESTAURANT AND RETAIL LOYALTY TRENDS:WHAT’S HAPPENING IN 2014?


RESTAURANT AND RETAIL LOYALTY TRENDS:WHAT’S HAPPENING IN 2014?

interactions can happen digitally, be-fore consumers even enter a store, and ultimately affect purchasing decisions. Modern consumers are technological-ly savvy shoppers and diners – due, in part, to the prevalence of smart-phones, social media, gamification, GPS technology and big data. • Real-Time Program Feedback: Through omnichannel marketing, restaurant and retailers can capture data in real-time and use this infor-mation to entice individual customers through communication channels they prefer. By doing so, loyalty program organizers can tailor messaging to impact consumers and increase their chances of gaining a response. • Smarter Methods for Smarter Cus-tomer Retention: Omnichannel loyalty provides customer insights that allows marketers to leverage real-time data and in turn build custom rewards programs that are both timely and

relevant.

Mobile Integration

Mobile continues to be an inte-

gral part of restaurant and retail

loyalty programs and marketing

campaigns – and if the rate of cus-

tomer adoption is any indication,

the importance of mobile strate-

gy shows no sign of diminishing

anytime soon. For loyalty programs

in the restaurant and retail space,

mobile technology is essential to

maintaining an engaged and active

customer base, giving CMOs one of

the most direct channels in which

to interact with their customers

and gain real-time insights.

In recent years, the prevalence

of mobile devices has paved the

way for mobile wallets. Allowing

customers to make secure in store

payments, without needing a credit

or debit card, mobile wallets are

making consumer purchasing eas-

ier and more convenient than ever

before. For loyalty programs, this

puts all of a customer’s information

at their fingertips – like rewards

statistics, payment information and

credit card data – using nothing

more than the consumer’s personal

smartphone. According to recent

studies, 43% of all smartphone

users, nearly 113 million consum-

ers, will use mobile wallets

by 2017. If they don’t

fit already, current

loyalty programs are

being formatted to

be able to integrate

with mobile payment

platforms for future

customers.

Due to the rise of interactive mo-

bile technology, gamification has

become a popular way for busi-

nesses to keep consumers actively

engaged and entertained. Giving

customers the opportunity to earn

points and redeem rewards for

purchases or free items, gamifica-

tion is all about making the most of

modern technology. It adds a level

of competitiveness to the loyalty

experience and by embedding

games into the loyalty program,

gamification creates a loyalty envi-

ronment where members are chal-

lenged, incentivized and engaged

in a way that brings a level of fun

and entertainment to a program.

Integrated Multi- Tender Loyalty (IMTL)

As today’s CMOs are increasingly

more responsible for the revenues

of a brand, integrated multi-tender

loyalty (IMTL) presents an ideal

opportunity to bring together a

retailer’s credit card and loyalty

program; which oftentimes existed

in parallels or competed with each

other.

Historically, loyalty

programs and retail

credit programs were

executed as sepa-

rate customer-facing

programs, with little

to no integration. Many

retailers struggled with a

lack of unified loyalty branding

and seamless integration between

multi-tender and credit programs,

often resulting in confusion among

associates and customers...and

lower engagement levels. IMTL

brings an integrated approach that

delivers one seamless experience

to engage all customers - regard-

less if it’s through credit.

By Mary Falleson

43%

of smartphone users will use mobile wallet

by 2017


Furthermore, it provides retailers

with a new way of getting to know

their customers better and building

stronger and more profitable long-

term relationships by combining

multiple CRM, credit and loyalty

program platforms into a single

integrated data warehouse. This

means that decisions on all tenders

(payment types) are reflected in

one place.

With customization and personal-

ization being critical to the success

of today’s loyalty programs, ITML’s

approach provides retailers with

more information about the wants

and needs of all customers. This

creates value for members by using

data to deliver personalized offers

that create the right emotional

connection, leading to more op-

portunities for those customers to

earn and redeem in an omnichannel

manner.

With a renewed focus on ROI and

revenues, CMOs who capitalize on

these trends will be the differenti-

ator for a high preforming loyalty

program in 2014. There are more

consumers enrolling in loyalty

programs today than ever before

and the retail sector owns 39% of

those memberships. CMOs that

embrace the advancements in per-

sonalization, omnichannel loyalty,

mobile integration and integrated

multi-tender loyalty are ensuring

a deeper level of engagement and

an enriched member experience

for years to come.


THE SECRET SAUCE: SUCCESSFUL RETAIL AND RESTAURANT LOYALTY PROGRAMSTwo case studies that demonstrate how loyalty programs can be used to influence customer behaviors

By BramHechtkopf

For decades, loyalty programs have been a very effective tool for retailers to encourage new business and

grow their customer relationships. Loyalty in restaurants, on the other hand, is a concept that some marketers

have overlooked. Yet loyalty strategies in both sectors have quite a lot in common, and are a primary way for

restaurants and retailers alike to boost customer interaction with their brands, determine purchasing preferenc-

es and demonstrate their appreciation for their customer base.

Following are two loyalty programs - one retail and one restaurant - that have demonstrated effective ways to

influence consumers’ behaviors, increase their engagement with the brand and grow their programs:

Red Robin Royalty ProgramWith more than 30% of its patrons under the age of

18, Red Robin is strong in the family category – and

has targeted its Red Robin Royalty program to include

benefits and rewards suitable to diners of all ages.

First tested in 2011 in 75% of the restaurant’s loca-

tions across the United States, this customer rewards

program currently stands at 2.7 million members and

climbing. The program continues to attract new cus-

tomers with the right incentives and rewards existing

members with redeemable for free gifts and special

deals throughout the year, for example:

• A one-time, instant free appetizer for registering

• A free gourmet burger in the diner’s birthday

month

• After ordering nine items, a tenth item free

Various “surprise and delight” offers throughout the

year

Why Does Red Robin’s Royalty

Program Attract Members?

Using omnichannel marketing to reach a diverse

customer base across all the channels their members

use, Red Robin has found ways to drive dine-in traffic

through interactive social media initiatives, mobile

marketing and targeted online messaging. Further-

more, by swiping the customer’s Red Robin Royal-

ty card, team members get immediate access to a

customer’s rewards status so they can redeem those

rewards accordingly.

What Can Restaurants Learn from Red Robin?

Capitalizing on the idea that dining frequency, prefer-

ences and interactions constantly change, Red Rob-

in Royalty’s road to redemption centers around its

adaptability and ability to heed customer feedback

and react accordingly. One of the most popular na-

tional casual dining chains today, Red Robin’s loyalty

program continues to grow: in 2013, the chain wit-

nessed a 4.1% revenue increase to $1 billion annually.

Following this trend in 2014, Red Robin expects sales

to increase exponentially as 25 additional locations

open, boosting the number of potential Royalty par-

ticipants at restaurants nationwide.


Bloomingdale’s Loyallist Rewards ProgramBloomingdale’s Loyallist strategy is simple: reward

consumers for every dollar spent, through any form

of payment, at any time. Whether program members

shop in-store, online or at the outlet stores – or use

cash, credit, or the Loyallist card – they earn Loyallist

points. At certain times throughout the year, these

“Loyallists” can earn double, triple and quadruple

points, and the more they earn, the more benefits they

receive – like free shipping and “Power Points” shop-

ping. For every 5,000 points earned, members receive

a $25 Bloomingdale’s gift card, regardless of their

status in the program.

While Bloomingdale’s traditionally focused on an

older audience, marketing executives have recog-

nized the rise of the Millennial shopper. Tailoring their

rewards towards this demographic, they have incor-

porated mobile and Bluetooth technology into their

marketing initiatives, and have eliminated the need for

a credit card – giving younger shoppers the ability to

join the program without eliminating their eligibility to

join without credit.

Why Does Bloomingdale’s Loyallist

Program Attract Shoppers?

Capitalizing on mobile trends and store locations to

drive in-store traffic, Bloomingdale’s is leveraging

Bluetooth technology to promote the Loyallist pro-

gram to mall shoppers in real-time and in-location

- offering potential customers incentives to join the

Loyallist program and earn rewards points for every

dollar they spend on their Bloomingdale’s card. Using

localized technology (geofencing and proximity)

designed to scan for Bluetooth devices throughout

the mall, the retailer’s marketers are able to send

special “opt in” prompts – only one per customer, per

mall visit – related to a pre-selected brand or prod-

uct carried at Bloomingdale’s. If these mobile users

agree to opt in to the messaging, they can download

content related to that brand or product; or in some

cases, a high definition video explaining how they can

become Loyallist program members and save. Outside

of this initiative, Bloomingdale’s marketing team has

also invested heavily in different mobile applications

that give their customers the ability to access Loyallist

cards, balances and rewards through their personal

smartphones, regardless of location, thus easing the

purchasing process overall.

What Can Retailers Learn from Bloomingdale’s?

Bloomingdale’s Loyallist program is successful be-

cause it focuses on the one goal all loyalty programs

should strive for: giving members relevant rewards

they can actually use. When Loyallist cardholders

spend money – any kind of money – they are reward-

ed with points they can later convert to payment;

which encourages these shoppers to return to the

store and spend even more on future purchases. By

rewarding loyal customers with tiered points’ earnings,

this program demonstrates Bloomingdale’s commit-

ment to their customers; and in turn, makes custom-

ers more committed to the brand. Finally, it offers a

straightforward and distinctive program that attracts

new customers – emphasizing the notion that the key

elements of any successful loyalty program are sim-

plicity, attainable rewards and a collection of points

that customers can identify with and actually use.

What do these loyalty programs have in common?

They demonstrate brands that have tailored their loy-

alty programs based on what benefits their custom-

ers use the most; factoring in technology, marketing

initiatives, rewards and the constant push to better

understand their customer base.

The Bottom Line: Brands who invest in their dining or

in-store/venue experience with timely incentives that

add value and are relevant to consumers stand to

gain from increased membership, greater customer

engagement and bottom line growth.

5000 points = $25 Rewards Card

Bloomingdale’s loyallist strategy rewards consumers for every dollar they spend, through any form of payment, at any time

The program’s rewards & benefits are suitable for members of all ages, including

- A one-time free appetizer for registration- A free birthday gourmet burger- After ordering nine items, the tenth is free- Various “surprise and delight” offers throughout the year

Rewards are tailored for different demographics, and with bluetooth and mobile technology the program has eliminated the need for members to have credit

30% of the restaurant’s patrons are under 18 During select times

of the year loyallists can earn double, triple, & quadruple points

Red Robin uses omnichannel marketing toreach a diversecustomer base

Traffic is driven through social, mobile & onlinemessaging

Team members have immediateaccess to memberdata at POS

BOTH HAVE TAILORED THEIR LOYALTY PROGRAMS BASED ON WHAT BENEFITS THEIR CUSTOMERS USE THE MOST BY FACTORING IN TECHNOLOGY, MARKETING INITIATIVES, REWARDS AND THE CONSTANT PUSH TO BETTER UNDERSTAND THEIR CUSTOMER BASE.

Bloomingdale’s sends promotions in real-time based on location, offering incentives to join the program

Members can access their account directly through Bloomingdale’s Big Brown Bagmobile app or the mobile site

The Red Robin Royalty program consists of over 2.7 million members and is growing

Red Robin rOYALTY pROGRAMRed Robin

rOYALTY pROGRAMBl mingdale’s

loyallist Rewards program


5000 points = $25 Rewards Card

Bloomingdale’s loyallist strategy rewards consumers for every dollar they spend, through any form of payment, at any time

The program’s rewards & benefits are suitable for members of all ages, including

- A one-time free appetizer for registration- A free birthday gourmet burger- After ordering nine items, the tenth is free- Various “surprise and delight” offers throughout the year

Rewards are tailored for different demographics, and with bluetooth and mobile technology the program has eliminated the need for members to have credit

30% of the restaurant’s patrons are under 18 During select times

of the year loyallists can earn double, triple, & quadruple points

Red Robin uses omnichannel marketing toreach a diversecustomer base

Traffic is driven through social, mobile & onlinemessaging

Team members have immediateaccess to memberdata at POS

BOTH HAVE TAILORED THEIR LOYALTY PROGRAMS BASED ON WHAT BENEFITS THEIR CUSTOMERS USE THE MOST BY FACTORING IN TECHNOLOGY, MARKETING INITIATIVES, REWARDS AND THE CONSTANT PUSH TO BETTER UNDERSTAND THEIR CUSTOMER BASE.

Bloomingdale’s sends promotions in real-time based on location, offering incentives to join the program

Members can access their account directly through Bloomingdale’s Big Brown Bagmobile app or the mobile site

The Red Robin Royalty program consists of over 2.7 million members and is growing

Red Robin rOYALTY pROGRAMRed Robin

rOYALTY pROGRAMBl mingdale’s

loyallist Rewards program


THEMILLENNIALMINDSETBy Matt Stein

Millennials are a contradictory generation. They’re

young, but they’re highly motivated. Their finances are

limited, but they’re developing some of the most cut-

ting edge technology, mobile applications and social

platforms on the market today. They may buck tradi-

tion when it comes to the workplace, but are fiercely

passionate about causes that are making social impact

and brands they feel a connection with. Oxymorons

aside, this ‘army’ of 79 million young college students,

workers, entrepreneurs, and consumers – all between

the ages of 18 and 33 – make up America’s largest

generation in history. Collectively, they spend $600

billion annually, and by the year 2020, are expected to

account for 30% of all retail transactions in the United

States.

In short, Millennials represent a growing economic

force for the restaurant and retail sectors. Their future

spending power alone serves up a veritable goldmine

for the brands that can understand the motivators be-

hind this generation’s purchasing behaviors and cater

to their evolving lifestyles and needs.

What Matters Most to Millennials?

While younger Millennials have not amassed much

wealth yet (their median income at age 30 hovers

around $42K), they have fully embraced the entrepre-

neurial and startup culture. In fact, more than 14% of

Millennials are already earning more than $2 million

annually. But as the most distrustful generation in

recent history, the industries courting Millennials need

to quickly understand those brand loyalty triggers to

secure their trust – and future spending – before their

loyalties become aligned elsewhere.

For the Millennial generation, brand loyalty (and their

spending) amounts to a lot more than comparing

restaurant menus or a store’s inventory. It’s about com-

bining a brand’s products and offerings with a compel-

ling mission they can identify with and trust. According

to an academic analysis of their behavior and demo-

graphics, Millennials want the abundance of choice

and freedom of selection they have known since birth.

With this abundance and freedom, comes a desire for

flexibility in schedule and items and orders personal-

ized to their individual preferences – and they want

them all now. Millennials are collaborative, and they

learn through hands-on and social interactions. Yet

despite this collaboration, they recognize themselves

as individuals, and they don’t feel the need to conform

to mainstream ideals.

So what do Millennial consumers look for

in brands when aligning their loyalty?

• Social Impact. As a philanthropic generation, Millennials want to know that their actions, and those of the companies they align with, effect meaningful change.

• Innovation. Millennials are a product of technological advancement. They also champion disruptors.

• Leadership. Millennials don’t just want to make an impact; they want to lead the charge.

• Opportunity. Millennials are the most educated generation – they are driven, motivated and always looking for the next big thing.

Technology Drives Loyalty

Greatly influenced by the latest mobile, social and

disruptive technologies, Millennials expect that all their

interactions with brands and service providers, whether

it’s in the physical or digital world be immediate, effi-

cient, relevant and rewarding. A recent Forbes article

about Millennials as customers sums this up well:

“Customers expect you to be as good as the best of

what they’ve encountered online and in self-service

solutions.”

While older generations might question or feel uncom-

fortable with these tactics, Millennials have only ever

known a technologically-connected world; one where

instant gratification is only a tap, click or swipe away.

Tapping into the Triggers that Lead to Long-term Loyalty


Here’s a brief timeline of how they grew up:

• In 1989, the Internet, which just turned 25 (the age of the av-erage Millennial) become known to the masses. Just a decade later, while most Millennials were still in elementary school in 1998, Larry Page and Sergey Brin launched Google.

• In 1999, the very first wireless handheld device known as the Blackberry came out, heralding the birth of the smartphone era.

• In 2004, social networking site Facebook launches (orig-inally launched as “The Facebook”) by a 23 year-old Mark Zuckerberg.

• In 2007, the first iPhone was released. Three years later, the first iPad hit store shelves.

• In 2011, Spotify entered the American music scene, and for better or worse, “selfie” was officially added to the Oxford

English Dictionary in 2013.

With their short history firmly rooted in technology, it’s

hardly surprising that Millennials are hyper connected,

technologically savvy and constantly on the go.76%

own a smartphone, 45% access coupons via email on

mobile devices and 63% are more likely to buy some-

thing if they receive a coupon on their mobile device

while near a store. And while Millennials may not be

readily handing out their loyalty, one thing they are

giving away is data. Many Millennials freely share their

personal information with companies having few, if any,

invasion of privacy reservations. For loyalty marketers,

this creates a perfect opportunity to build one of the

most complete customer profiles for any segment,

utilizing real-time data to tailor offerings to match Mil-

lennials’ fast-paced and mobile-centric lifestyle.

Social Dependency

More importantly, as Millennials continue to offer data,

marketers need to gather and analyze it. By using data

gleaned from CRM and social channels to understand

behaviors, restaurants and retailers can ensure they’re

sending well executed and targeted campaigns to

give these consumers what they’re actually asking for.

By analyzing their data, loyalty marketers can evalu-

ate their campaigns and gain real insight into what’s

working with millennial engagement, what’s not - and

what they can do next. Millennials want retailers and

restaurants they frequent, and their employees, to be a

real-life representation of the easy and effective virtual

experience they have always grown up with. They de-

mand control over their loyalty wallets and programs,

they want to shop and eat without the interference of

store associates and waiters, and they want retail and

restaurant employees to know all of the same informa-

tion about their shopping and dining preferences that

logging into their online account would give them.

It’s this kind of seamless experience that will drive

Millennial loyalty far beyond the loyalty program itself –

and companies who don’t create this experience could

fail as a result. Take the popular fast food chain McDon-

ald’s – which ranked number one amongst American

consumers, but doesn’t even make the top ten list for

Millennials’ favorite restaurant chains. Why is this? Un-

like Subway, Wendy’s and Pizza Hut, all in the Millenni-

als’ top five, McDonald’s hasn’t offered Millennials the

opportunity to customize, or control their food order-

ing. Furthermore, as Millennials subscribe to healthier,

more sustainable food chains, they look for quality over

quantity even with smaller average incomes. They want

to know the food they’re consuming is grown sustain-

ably, and that the brand they’re aligning with is not

harming them – or the environment. This comes back

to an emotional component of their generation: trust.

The brand-consumer relationship is pivotal for Millen-

nials, the socially-dependent generation, and they align

brand loyalty beyond what they see in store.

Sowing the Seeds by Roasting the Beans (for the Digital Natives) One rewards program that has successfully cap-

tured the Millennial mindset (and their wallets) is My

Starbucks Rewards, powered by what is currently

the largest coffeehouse chain on the planet. Having

survived the push for local business, this global cof-

feehouse-cum-retailer continues to engage Millennials

through various social media channels, mobile technol-

ogy and sustainable efforts. By offering smartphone

applications and mobile payment options, and reward-

ing consumers for engaging with the brand through

social media channels, My Starbucks Rewards isn’t only

making life easier for its younger customers – it’s as if

the program was designed specifically with the Millen-

nial in mind.

And that’s what keeps the coffee-loving generation

coming back: the program is built around motivators

that cater to the Millennial lifestyle including music

downloads, mobile games and free beverages. The

program’s tiered approach lets members earn “Stars”

so they can move up to different levels.


cards and consumers have the option to pay using a

mobile wallet through the program’s smartphone appli-

cation. Starbucks also updated its iPhone application (in

March 2014) to incorporate tipping and a special “shake

to pay” function that will help boost the store’s trend

towards “next-generation” retail, digital and mobile pay-

ments.

In fact, recent studies reported that nearly 10 million con-

sumers pay for their coffee drinks through the app, making

more than 5 million mobile transactions per week. And

since we know Millennials look for sustainable brands that

value social impact, their mobile wallets also give them

avenues to donate to help fund jobs in America through

Starbucks’ Create Jobs for U.S.A. Program.

To keep these young consumers loyal to the brand,

Starbucks’ marketing team used an omnichannel ap-

proach to ensure their brand and communications were

accessible and everywhere their customers were. A

simple to use and interactive rewards structure, com-

bined with clear and concise messaging really grabbed

the attention of Millennials. By combining an innovative

mobile application with forward thinking and an oppor-

tunity to contribute to the greater good in the world,

My Starbucks Rewards appeals to Millennials by lever-

aging advances in technology and encouraging social

engagement and smart spending.

What We’ve Learned about Millennials and Loyalty

As contradictory as they are, what we do know about

Millennials is this:

• Millennials want control over their shopping and dining experience.

• Millennials need to trust the brands they are loyal to.

• Millennials thrive off social interaction and engagement, whether through personalized messaging, in store communi-cation or social media outlets. Millennials want to know their impact – and align with brands that identify with a greater purpose than increasing revenue.

Between their spending habits and dining and shop-

ping preferences, this generation – the largest and

most culturally diverse since the Baby Boomers – is

changing the way restaurants and retailers develop

customer loyalty programs. By mining CRM and social

data to identify preferences and trends, and utilizing

predictive and behavioral analytics to understand what

triggers brand love and loyalty among this set, these

brands will create and seize opportunities to nurture

long-lasting relationships as the generation matures

and flourishes financially.


76% own a Smartphone

18

TABLE TALK: INDUSTRY INSIGHTS ON HOW RESTAURANTS ARE INTEGRATING LOYALTY PROGRAMS INTO OVERALL MARKETING PLANS BY PAMELA SULLINS

For restaurant operators and their marketing exec-

utives, a well-designed and well-executed loyalty

program does more than drive customer engagement

and frequency of return visits – it forms an essential

part of the company’s overall marketing strategy and

can be a significant contributor to the company’s

bottom line growth.

Separate from other marketing initiatives, loyalty

programs can also give restaurant operators direct

insight into what guests think about their menu items,

staff and overall quality of service before, during

and after the dining experience. In other words, how

their customers experience their brand. And from

this collected data, executives can evaluate compa-

ny performance against key performance indicators

to determine how their loyalty program impacts the

restaurant’s reputation and encourages customer

referrals, repeat purchases and renewals.

In today’s intensely competitive loyalty landscape, it’s

critical for marketing departments to contribute to the

profitability of any business – and demonstrate this

contribution through measured and proven results.

How? Through a customer loyalty program.

While a well designed loyalty program is one facet

of a comprehensive marketing plan, it should also be

a central component. When it comes to profitability,

many marketers forget that new customer acquisition

is more expensive, and less lucrative, than customer

retention. And as a result, they often silo their loyalty

programs instead of integrating them into the overall

marketing strategy. When it comes down to it, loyalty

programs reflect what marketing campaigns aim to

achieve: increased brand interactions, increased spend

and more profitable customers.

Ten Restaurant Loyalty Programs Tips:

For restaurants, customer loyalty programs are an effective way to turn new customers into regulars,

increase the frequency of customer visits, gain more insight into the restaurant’s

customer base, attract new members and increase revenue.

By following these best practices and avoiding the bad ones, restaurant operators and their

marketing executives can incorporate customer rewards programs into annual marketing cam-

paigns that drive member engagement exponen-tially and boost customer loyalty year-round.

TABLE TALK: INDUSTRY INSIGHTS ON HOW RESTAURANTS ARE INTEGRATING LOYALTY PROGRAMS INTO OVERALL MARKETING PLANS BY PAMELA SULLINS By: Pamela Sullins

Send guests a relevant “come-back” promotion or offer. Today’s consumers are inundated with dozens of marketing messag-es daily, delivered through every channel. To keep your restaurant’s promotion or program call-to-action from adding to the digital chaos, marketers should strive for meaningful loyalty interactions and intelligent messaging that really resonates with consumers. Rel-evancy is key. You want them to come back because they received a genuine experience; so instead of sending guests irrelevant informa-tion or offers, use the knowledge gleaned from your CRM and trans-actional data sets to send messag-es that are timely and personalized and offer both a reason and a request.

Use relevant marketing channels. Understanding the demographics of your patrons and the market-ing channels they prefer is crucial to knowing how you can reach and impact them effectively. To promote your restaurant pro-gram effectively, deliver messag-ing through those channels you know your guests prefer and that illustrate your knowledge of the individual. Don’t use marketing tactics that past data has proven won’t generate a response. Estab-lish a presence on all communica-tion channels that are relevant to your customer base – from direct mailings and personalized emails or geo-targeted alerts, to user-friend-

ly, mobile optimized websites and applications – and keep your target audience in mind.

Break down silos. Whether your goal is to increase traffic, promote new menu items or introduce new dine-in or out ser-vices, this information needs to be communicated through your loyal-ty program. Your loyalty program should be viewed as an extension of all other marketing initiatives (advertising, POP materials, etc.) and therefore used to reinforce a desired behavior. As your most loyal patrons make up your pro-gram, consider providing them with expanded or specialized content and rewards that reflect overall marketing campaigns, as this can deepen the engagement levels and accelerate goal achievement.

Encourage “Word of Mouth” advertising. Just as restaurants know the value of Word of Mouth for good re-views and to drive traffic, so too can it drive loyalty participation – especially in the restaurant and retail sector, two industries that are social by nature. In fact, recent studies show that Word of Mouth is embraced by Millennials – who view it as a leading purchase influencer. For marketers, “social” influence needs to go beyond traditional social media channels and aim for ROI-driven marketing initiatives with measurable sales impact. With the development of Big Data, researchers can use data-driven

Word of Mouth to evaluate pur-chase influence, and as a result, use their findings to boost the ROI of any company marketing campaign. Using the power of Word of Mouth advertising, good loyalty programs will be shared organically.

Segment members to identify and give special treatment to your high-value members. Make sure you distinguish be-tween high-value and infrequent customers, and distribute rewards by segmenting them into good, better and best customers. While 63% of company marketers focus their attention on new customer acquisition, smart companies know that 20% of shoppers constitute their loyal customer base – and it’s this same 20% that drives 80% of restaurant and retail revenue.

Consider this: loyal customers spend ten times more than new customers, they are 60-70% more likely to purchase additional items at the point of sale, and they are 70% more likely to advertise your company. Every customer likes to receive the VIP treatment – it’s important to send them special promotions and rewards oppor-tunities to offer an impression of exclusivity.



Test messaging strategies to see what works. The old adage, “What’s good for the goose is good for the gander” can be especially true when it comes to loyalty. As your loyalty program’s membership is made up

of a cross-sec-tion of your patrons, utilize your mem-bership base to test (and retest) market-ing messaging, campaigns and even promo-tions to your various cus-

tomer segments. This controlled environment can provide action-able insights that can be received in real-time and then disseminated to a wider audience later.

Empower your employees. For restaurant owners, employees are the front lines of all business operations and the face of the brand to your customer base. Within this role, employees often directly influence a customer’s dining experience and can signifi-cantly impact whether or not they will return to your restaurant. For those reasons, it is critical to ensure that all staff members (servers, hostesses, bartenders, etc.) are fully trained on all aspects of your restaurant loyalty program so they are adequately prepared to engage potential new members. Make it as fun and easy as possible. Give store clerks a script they can read that contains the program’s standard messaging, explains the value to the customer and extends an invitation for them to enroll. Train employees on how to use the loy-alty program software to register customers and process rewards. Finally, come up with creative ways

to encourage employees to pro-mote your rewards program – like contests and prizes – just as you would to encourage your custom-ers to join.

Promote your loyalty program. Promoting restaurant loyalty programs is not about facilitating outreach to the general public; it’s about getting to the right customer in a way that will really resonate. Today’s business culture is driven by innovative technology, op-posing customer opinions, and a never-ending search for “the next new thing.” In this environment, restaurants can ensure they reach targeted customers by marketing through omnichannel and engaging consumers through channel-opti-mized loyalty program marketing campaigns that are “right timed” to deliver messages at every touch point relevant to customers on their own level. Unlike traditional rewards programs, omnichannel loyalty gives marketers a way to reach consumers with the right message at the right time, in a way that is organic, intuitive, individ-ualized, engaging and fun, and represents the brand appropriately.

Engage with customers, especially after their dining experience. Consumer feedback is crucial to restaurant success – and those who listen to this feedback and make changes accordingly stand out from the rest. Customer reviews allow you to analyze your current business practices and evaluate what might be negatively affecting

your success. If there is negative feedback, consider the following questions: What is the root cause of the problem? Is it a communi-cation issue? How can we correct it? How will this affect the overall customer experience? Customers are the backbone of any operation. By using their concerns to improve the dining experience, you are not only securing their return, but you are creating opportunities for these diners to use positive Word of Mouth to engage additional consum-ers and boost your restaurant’s ROI.

Keep the data flowing. Today’s technology has businesses in every sector analyzing data to change the way they operate. Just as these businesses use loyalty data to influence marketing deci-sions, they use other forms of data, too – from transactional to social intelligence – to ensure operational success. For example, through data collection and analysis, restaurants can identify critical facts and fig-ures about what diners prefer, what they’re purchasing - or not, which rewards they like and those they’re not taking advantage of on a daily basis – all in real time. Factor in so-cial media, and these same restau-rants can use comments, “likes” and retweets to gauge customer opinions, better understand diner trends, and leverage data to put their loyalty marketing dollars to work where it actually counts.

Success Story: Take the Italian favorite Maggiano’s Little Italy, for example. Known for their large portions of authentic Italian dinners, they tested a smaller menu, with more controlled portions, in select restaurant locations to try and attract a larger lunch crowd. Upon realizing its success, the smaller menu was adopted by all locations nationwide.

Success Story: The popular chain Saladworks created the website www.SaladworksListens.com to gain customer feedback in real time, and had a staff on hand to respond to that feedback im-mediately – including feedback received after hours and on weekends.

Success Story: The Colora-do-based chain, Larkburger, pro-moted its new loyalty program by creating a contest that asked customers to suggest the name of the program. The result was increased customer engagement and a $50 Larkburger gift certifi-cate for the winner.


THE TRUTH ABOUT LOYALTY PROGRAMS AND MOBILE APPS

By Michael Hemsey

How retailers and restaurants can use mobile technology and social media to increase member engagement

Over the past decade, a number

of major factors have significantly

disrupted the retail and restaurant

industries, including the evolu-

tion of eCommerce, the rise of

social media and the emergence

of Millennials as a customer base.

None of these, however, have been

as disruptive as the mobile device

– and the broader mobile channel

itself.

According to MIT, 80% of store

shoppers check prices online,

and the web influences $1.1 tril-

lion in store sales. A 2013 study

also found that 81% of consumers

have searched for a restaurant on

a mobile app, and 75% said they

often choose a restaurant based on

those search results. These chang-

es in consumer behaviors have

forced traditional brick-and-mortar

businesses to adapt to the new

mobile world or get left behind.

Retailers and restaurants have

responded to the challenge with

omnichannel strategies that create

a seamless experience between

brick-and-mortar and mobile, and

the results are clear — according

to one study, companies with the

strongest omnichannel customer

engagement strategies retain 89%

of their customers, compared with

33% for companies with weak om-

nichannel strategies.

Mobile devices are not just gad-

gets. They have become the center

of users’ daily lives and how they

engage with the world. If brands

want to engage customers, they

have to go through a mobile device

first. The mobile channel, therefore,

must become central to brands’

lives, too.

The Consumer’s Center of

Universe: The Smartphone

With mobile retail payments

expected to reach $707 billion by

2018 and restaurants already the

most searched industry on mobile

apps and browsers, smartphones

have become the center of the

‘new consumer experience,’ and

brands have to unify their strate-

gies and tactics around this center

if they want to remain part of con-

sumers’ lives.

Advances in mobile technology

have paved the way for restaurant

and retail loyalty programs to em-

ploy strategies that move “beyond

the discount.” By delivering timely

messaging and offers that focus on

increasing member engagement

and are relevant in real-time and

in-location, marketers can ensure

a consistent brand experience that

nevertheless personalizes engage-

ment for each channel and each

program member.

Retailers and restaurants have be-

gun to recognize this omnichannel

approach as more than just a trend

or buzzword – it’s the new normal.

Omnichannel marketing opens up

more sophisticated ways for brands

to create program awareness, im-

prove the shopping/dining experi-

ence, and ultimately, drive loyalty

and customer retention.


Mobile Tech Trends Make Loyalty

Marketing Easy and Entertaining

Geo-location features like GPS al-

low retailers and restaurants to tar-

get customers where they are and

create real-time and relevant offers

and messaging that keep brand

awareness alive, attract brick-

and-mortar traffic and incentivize

ongoing spending. This fits into

the omnichannel goal of managing

the entire customer experience

before, during and after shopping

or dining.

In line with this goal, Taco Bell

and McDonald’s are also introduc-

ing mobile ordering, a trend that

reflects the growing importance

of omnichannel marketing in the

restaurant industry. As Taco Bell’s

mobile lead put it, “Mobile is the

biggest shift in QSR since the drive

thru. If you can get 10 million peo-

ple to download your app, you’re

putting a portal to Taco Bell in 10

million pockets.”

Marketing aside,

mobile devices as

a whole are also

changing in-store

interactions for

retailers and restau-

rants industry wide.

New POS and mobile

payment systems, for

example, are helping streamline

the payment process by allowing

diners to pay with their mobile

device, therefore making service

more efficient for staff and adding

value to the transaction. Many

retailers and restaurants are also

implementing tablet strategies and

equipping locations with these

devices to help customers browse,

order, customize, pay – or even play

games to keep them engaged with

the brand.

Pizza Hut, for example, recently

announced plans to implement its

own digital signage tabletop where

diners can customize their orders

– from the size, toppings and crust

of their pizza, to side dishes, wings,

pastas and desserts – and even

play games while they wait. This

kind of in-store technology helps

create a brand experience that

simultaneously improves retail and

restaurant operations – like staff

efficiency, reduced wait times and

increased spending. According to

Ziosk, tablet menus increase tips

by 15% on average, and at Chili’s,

they increased dessert sales by

about 20%.

Some restaurants have taken gam-

ification to the next level with mo-

bile apps that create brand aware-

ness and let customers play games

to win free products and impact

the local community. The sandwich

chain Blimpie’s, for example, de-

veloped “Blimpie’s Run,” a mobile

game that randomly selects

participants to win free

subs for an entire year.

Chipotle, on the other

hand, uses mobile

apps to get customers

on board with their

company philosophy. Its

“Scarecrow Game” teaches

consumers of all ages about

the importance of pro-sustainable

farming efforts, a standard oper-

ating procedure for the healthy

Mexican food chain.

Ultimately, the goal of omnichannel

and mobile marketing is to help

drive lasting customer loyalty, and

for retailers and restaurants in par-

ticular, mobile devices have to be

loyalty drivers. JiWire’s recent Mo-

bile Audience Insights Report has

some interesting stats on diners:

39% of consumers use mobile apps

over other methods to find infor-

mation on QSR and casual dining

establishments.

Restaurant review apps are second

only to Word of Mouth advertising

for determining where to eat.

83% of consumers rely on their

mobile device for dining decisions

while traveling, compared to 65%

while in their home market.

Loyalty programs have to adapt to

the new environment where mobile

devices drive consumer decisions

in real time. Mobile loyalty apps

should, at the very least, make

it easy for program members to

manage their account, earn points

and redeem rewards with a swipe

of their touchscreens. Pouch, an ex-

perimental new loyalty app, is try-

ing to consolidate cards, vouchers,

content and other loyalty features

into one convenient platform, while

also using Bluetooth beacons to

target mobile users when they are

near a retail or restaurant location.

Once they have a solid manage-

ment platform in place, retailers

and restaurants can focus on

creative and effective tactics to

drive loyalty among mobile us-

ers. Fashion retailer GUESS rolled

out a new mobile app earlier this

year, providing points earning

opportunities, personal customer

service, fashion updates, photos

and videos of merchandise and

the ability to cross-sell and up-sell.

That is the omnichannel range of

mobile devices, consolidating the

entire brand experience into one

platform, creating new opportuni-

ties for spending and engagement,

and ultimately, tying everything

into customer loyalty programs to

39%

of consumers use mobile to

find dining information


MOBILEIS PAVING THE WAY

for

OMNICHANNELEXPERIENCES

An Interview with Don Hughes

THE FINANCIAL SERVICES LOYALTY PROGRAM LANDSCAPE:Where Are We Today?

create lasting value for both brands

and consumers.

The Wrap:

Six Reasons Why Brands Can

Benefit from Applying a Mobile

Mindset to Their Loyalty Programs

Given advancements in mobile

technology, research shows there are

six ways that companies can benefit

from integrating their loyalty pro-

grams with a mobile platform.

Mobile Loyalty Programs:

1. Drive activity and increase ROI. Smartphones drive the way consum-ers interact with brands today. Mobile loyalty programs give customers another reason to stop by (physically or digitally) and make a purchase.

2. Are easy to administer. Instead of printing out punch cards or replacing lost loyalty rewards cards, mobile programs need only a smartphone (which most consumers always have with them) and most can be changed, as needed, from the app dashboard. In short, they are clean, elegant and cost-effective for restaurants and retailers to manage.

3. Reduce churn and im-prove loyalty. Having a mo-bile platform that consumers can easily access is another incentive for them to choose one program over another.

4. Are a solution to loyalty program fatigue. Consumers like carrying loyalty cards less and less. Mobile loyalty programs make it really easy for consumers with a tap, click or swipe.

5. Improve customer satisfaction. Mobile loyalty programs provide a way for brands to remain connected

with their members at all times and offer a vehicle for instant feedback and dialogue, just like social media.

6. Track customer activity. Mobile loyalty programs provide data that allows retailers and restaurants to see what rewards are motivating, how fast members redeem and what items they frequently purchase. This data is key to knowing what to offer customers and how programs can be improved

incrementally and continually.

More than any other industry, the

retail and restaurant industries

– which are both very social by

nature – have tremendous oppor-

tunities to capitalize on custom-

er loyalty through the mobile

channel and the most intimate

marketing tool, the mobile device.

Leaving traditional marketing

tactics behind, mobile technology

has paved the way for a loyalty

marketing landscape that centers

on the omnichannel experience

and garners success by reaching

consumers wherever they are.


1 Mobile apps drive activity and ROI 2 They’re easy to

administer

3 Mobile programsreduce churn 4 They solve

program fatigue

6They improve customer satisfaction 5 Mobile programs

track activity

6 Ways that brands can benefit from mobile

GEO-LOCAtiONfeatures allow retailers and restaurants totarget customers on the spot and attractbrick-and-mortar tra�c

Gamification TacticsAre being used to drive engagementand create brand awareness among members

Mobile is changing in-storeinteractions with new POS mobile payment systems,making services more e�cient

Advances in mobile tech have paved the way for industries to employ strategies

Beyond the Discount

Mobile technology has paved the way for a loyalty marketing landscape that centers on the omnichannel experience and reaches customers wherever they are

increase member engagEmentthrough mobile technology

80%

use mobileuse mobileuse mobileuse mobileapps to �nd info on QSR & other dinersapps to �nd info on QSR & other dinersapps to �nd info on QSR & other dinersapps to �nd info on QSR & other diners

39%39%39%39%

of store shoppers check prices online

81% have looked for a restaurant on an app


Michael Hemsey, President As President of Kobie Marketing, Michael is responsible for leading all facets of the loyalty marketing organiza-tion including business development, IT initiatives, client services, as well as the overall direction of the Kobie brand. For 20 years, Michael has cultivated a rich background in client services, product development, market-ing, technology and operations through several key posts. Prior to Kobie Marketing, Michael was Executive Vice President of TSYS Loyalty (formerly ESC Loyalty) and led the loyalty marketing implementation and relation-ship management teams serving the world’s largest issuers and retailers.

Bram Hechtkopf, Vice President of Business Development and Marketing Bram leads the “marketing of Kobie Marketing”. He consults with current and prospective clients on new busi-ness opportunities, helping to develop customer retention and loyalty marketing strategies and solutions that drive increased retention and spend. Following in the footsteps of his father, Kobie’s founder, Bram is eager to continue Kobie’s vision of technology and data analytics as enablers of leading-edge marketing executions for world-class customer loyalty initiatives. Bram has consulted with a wide array of leading brands including AMC Entertainment, TGI Friday’s, BJ’s Restaurants, Verizon, Bank of America, RBC, Flagstar Bank, JPMC, Sagicor, Coca Cola, Cox Enterprises, Ruby Tuesday, Hawaiian Airlines, and Royal Caribbean Cruise Lines.

Nancy Berg, VP of Client Services and Partnerships Nancy is responsible for leading Kobie’s Client Services team and Partnership Marketing practice, where she is responsible for all aspects of Account Management and building strategic and tactical marketing partnerships that differentiate Kobie’s client programs. Nancy takes great pride in delivering against Kobie’s mantra that we will never sacrifice an existing client for a new business opportunity, and that we will do what we say we will do each and every day. She is a strong and trusted leader, that has nearly 20 years’ experience in Customer Loyal-ty Marketing working in several industry verticals with top brands including Verizon, RBC Bank, AMC Theatres, Hawaiian Airlines, Bank of America, Northwest Airlines, US Bank, Westin Hotels and others.

Matt Stein, Creative Director Matt serves as the head of Kobie’s Creative & Marketing Services capabilities. With over 13 years of experience in senior creative leadership roles, he drives industry-leading loyalty engagement solutions that span the online, mobile, social, print and broadcast media channels as well as the full customer journey from digital channels to physical locations.

Pamela Sullins, Senior Director of Client Services Pamela Sullins has more than twenty years’ experience as a senior sales and marketing executive with a suc-cessful career of consultative sales, product/service marketing, channel marketing and client relationship man-agement for technology and healthcare organizations. Ignited by her training in coalition building at Harvard, Pamela has volunteered and worked to promote social enterprise and social marketing for community-based non-profit organizations. She is an alumna of the Center for Creative Leadership and brings proven leadership, business acumen and innovative solutions to all of her endeavors.

Mary Falleson, Account Director Mary’s background includes building brand value in the consumer, healthcare, retail, entertainment, and finance sectors through insight-based solutions that engage customers in unique and relevant ways. Her method to achieving big picture success for her clients is by inspiring loyalty and holistic engagement and making every single program work, where it counts, at the point-of-purchase.

ABOUT THE AUTHORS

1 Mobile apps drive activity and ROI 2 They’re easy to

administer

3 Mobile programsreduce churn 4 They solve

program fatigue

6They improve customer satisfaction 5 Mobile programs

track activity

6 Ways that brands can benefit from mobile

GEO-LOCAtiONfeatures allow retailers and restaurants totarget customers on the spot and attractbrick-and-mortar tra�c

Gamification TacticsAre being used to drive engagementand create brand awareness among members

Mobile is changing in-storeinteractions with new POS mobile payment systems,making services more e�cient

Advances in mobile tech have paved the way for industries to employ strategies

Beyond the Discount

Mobile technology has paved the way for a loyalty marketing landscape that centers on the omnichannel experience and reaches customers wherever they are

increase member engagEmentthrough mobile technology

80%

use mobileuse mobileuse mobileuse mobileapps to �nd info on QSR & other dinersapps to �nd info on QSR & other dinersapps to �nd info on QSR & other dinersapps to �nd info on QSR & other diners

39%39%39%39%

of store shoppers check prices online

81% have looked for a restaurant on an app

Kobie Marketing is a diverse team of loyalty

enthusiasts who are passionate and dedicated

to the day-to-day management and long-term

success of your loyalty program. We deliver

quantifiable ROI and real customer experience to

increase customer retention.

Kobie Marketing is a global leader in loyalty

marketing and an industry pioneer, delivering

end-to-end strategy, technology and program

management solutions. Kobie drives results and

ROI through Kobie Alchemy®, a best-in-class

loyalty marketing technology platform.

Find out more at [email protected]

WE ARE KOBIE

Kobie Quarterly Review: Restaurant and Retail Edition - 2014 - Learn More at Kobie.com

Retail

Transcript of Kobie Quarterly Review: Restaurant and Retail Edition - 2014 - Learn More at Kobie.com