This question turned out to be a very popular one as COLLOQUY and DMA co-presented a sold out webinar based on the results of research … asking this very question. COLLOQUY and DMA teamed this year to create a profile of U.S. marketers’ social media activities, with a focus on spending trends and metrics for success in building customer loyalty. The answer to the question is that U.S. companies that use social media primarily to deepen customer loyalty spend almost twice as much as competitors who use it for brand awareness, customer acquisition and other core marketing purposes. Specifically, the survey results show the average social media spend for marketers whose primary objective is to obtain customer loyalty was $88,000 last year, compared to $53,000 for brand awareness and $30,000 for customer acquisition, the objectives that attracted the next highest spending levels…and the spend is increasing…by nearly 300% over the last year.
You can read more about the survey here and you can purchase the entire survey here.
And, in a related topic, measuring the word-of-mouth activity among loyalty program members, read our white paper from 2009: TalkTalk: The New Champion Customers
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Call us old fashioned if you will, but when we read that Foursquare and MTV were going to reward people for visits to the STD clinic, we blanched just a little. We’re all for taking care of yourself, particularly the sexual health department, and we’re all for rewarding people for their good health behaviors (we were just thinking about eating a carrot) but do we need to be broadcasting it to the world? We’ve only just now gotten over Katie Couric getting a colonoscopy on live TV. Are you now going to follow your significant other to not only see where he/she is hanging out with his/her friends; where they are shopping; where they are eating but now which clinic they went to for their "problem"?
For more about rewarding healthy behaviors but less about sexually transmitted diseases, read our recent cover story: The Wellness Prescription. And, please…eat a carrot.
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The blazing hot dog days of August seem to have slid right into September and so we bring you the hottest stories from last week’s loyaty breaking news. First up a story about New Gift Card rules now in effect — new federal rules regulating fees and expiration dates for all gift cards have gone into effect, whether the cards are sold by a merchant, shopping center, credit union or bank. Second, the new Pass prepaid card from AmEx. American Express Co. has launched the Pass, a reloadable prepaid card designed for parents to give to their teenage children to manage help their allowances. Cardholders may use Pass cards anywhere AmEx is accepted. Next up, Mobile Banking gaining in popularity with the Underbanked — mobile banking is gaining more popularity with the underbanked than it is with conventional bank customers. Fourth, Hotels look to pay checked bag fees to increase business—some hotel companies are offering to pay for the checked-baggage fees charged by some U.S. airlines in an effort to increase business, including Klimpton Hotels and InterContinental Hotels Group. And the last of the top five: Capital One Canada and Delta Air Lines announce partnership — Capital One Canada and Delta Air Lines have announced a new partnership with the introduction of the Delta SkyMiles World MasterCard from Capital One and the Delta SkyMiles Gold MasterCard from Capital One to the Canadian rewards card marketplace. This is the first airline partnership for Capital One Canada and the first Canadian credit card partnership for Delta Air Lines.
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One of the biggest complaints from airline travelers is about the fees charged for checking bags. As someone who travels frequently, it seems to me that the reaction has been for travelers to try and pack more into one suitcase, which they then carry on board and try to squeeze into the overhead compartment…usually above my seat…just to save the $25. Or, they force me to keep my laptop case, which fits easily into the overhead bin, down by my feet just so they can store a bag the size of a small car over my head.
So, since the airlines don’t seem to be backing down on charging the fees, a few hotels have come to our rescue, at least for the weekend travelers. Klimpton Hotels, and hotels in the InterContinental Hotels Group are offering to pay the checked bag fee charged by many airlines. How about that for a surprise and delight customer experience? We love this. It’s a small promotional effort by the hotel to fill rooms that might go unoccupied over a weekend and probably less expensive than any marketing effort they might create themselves.
The specifics:
- InterContinental will pay the fees (up to $50 per party, per stay) on any airline to any destination for weekend stays between Sept. 1 and Dec. 30.. Customers must book two consecutive weekend nights at any IHG hotel worldwide and pay for the stay with a Visa credit card.
- Boutique-hotel chain Kimpton launched its "We Got Your Bag" promotion in April 2008. Guests who show their bag-fee receipt at check-in get a $25.
Our question, because we’re always thinking, which industry will step forward with reimbursements if Ryanair does decide to go through with charging to use the bathroom? We see a great opportunity for a plumbing supply company.
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The most read items from last week’s COLLOQUY Market Alert were heavy on the financial services, first up the news that Fewer issuers launching debit rewards programs – according to new data from Discover Financial Services’ Pulse electronic funds transfer network, most U.S. financial institutions continue to support debit card rewards programs, although significantly fewer plan this year to roll out new programs. Second, the new program from Valero, Valero launches Rewards Club. Third, a new program from Citi, Citi to deploy MasterCard inControl – Citi will be the first U.S. bank to deploy MasterCard’s inControl service to consumers. Next, some social networking news, Facebook launches Facebook Places, Facebook has announced the launch of Facebook Places, which will allow people to use the GPS on their mobile phones to let friends know exactly where they are and we’re sure eventually, to allow retailers to do some geographic targeted marketing. Next up in the most popular, New Macy’s American Express Card provides brand new privileges and benefits, Macy’s has announced the launch of the new Macy’s American Express Card, which will provide Macy’s American Express Cardholders attractive, in-store benefits when shopping at Macy’s.
For more breaking news, check here frequently or use our RSS feed.
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There’s a line in the Don Henley song “The Boys of Summer” in which the singer spots a Deadhead sticker on the bumper of a Cadillac. “Don’t look back, “ Henley sings, “You can never look back.” The point, I believe, was to juxtapose modern consumerism and the spirit of the Deadheads, as ardent fans of the Grateful Dead, one of the most successful counterculture bands of the ‘60s and decades following, are known.
Despite Mr. Henley’s advice, authors David Meerman Scott and Brian Halligan have looked back at the Grateful Dead and derived from their then-counterculture self-marketing techniques to come up with tips that today’s marketers can use to succeed well enough to afford Cadillacs and their ilk, and put whatever the heck they want on the bumpers. Their book is Marketing Lessons from the Grateful Dead: What Every Business Can Learn from the Most Iconic Band in History.
Many of the lessons addressed within were precursors of the sort of counterintuitive marketing that’s been forced by (or perhaps we should say “proven by”) social networking and other factors in these new-millennium years. While music companies fretted over rampant free-music sharing via the web in recent years, Scott and Halligan note that back then the Dead encouraged fans to create bootleg tapes of their shows—even setting up an area behind the sound board where bootleggers could get the best sound quality. The tapes were distributed from hand to hand, from fan to fan to potential fan. The result? Fan-driven publicity, new listeners, and more interest in paying for the polished (and profitable) studio recordings.
One of the book’s lessons that should ring true to loyalty marketers—and is somewhat the opposite of the free-music sharing—is the Dead’s control of ticket distribution. Through their self-owned ticketing company, they controlled who got the best seats—the best customers, of course, tracked by the band and offered first choice of tickets before the general sales began. Insider privilege. Retention over acquisition, because acquisition follows retention if done correctly. “While we’re all for growing a business, we don’t think it should come at the expense of annoying existing customers,” says Scott. “Always remember, your most passionate fans are also the people who tell your stories and spread your ideas.”
And my final note: despite Mr. Henley’s ironic juxtaposition (in a song that makes me crank up the speakers, by the by), I suspect that the Dead never minded if their fans drove to the shows in a Cadillac.
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It’s gotten big buzz thanks to a new partnership with Best Buy, and the New York Times has already shown an appetite for this app, but here at COLLOQUY we also get a kick out of Shopkick, the new smartphone application that gathers data on shoppers while they are in-store and targets them with relevant offers.
It’s a really great example of what we’ve talked about when it comes to the rise of mobile loyalty: How technology is enabling loyalty marketers to understand their customers better and provide them (with the appropriate opt-in, of course) with personalized and relevant offers as well as the opportunity to earn points (in the Shopkick case, they’re called kickbucks).
Today’s loyalty marketers want to reward potential customers right where they are — particularly when they are shopping right in the store. It’s been a long time coming, but some of that potential finally seems to be paying off. Best Buy, for example, is preparing to test the Shopkick system in 257 stores. It will be interesting to see how the program plays out — will customers appreciate this latest high-tech tactic, or will concerns about privacy prevail?
We believe that as long as there is an appropriate and well-communicated opt-in system in place, and customer trust is not in jeopardy, this kind of in-store loyalty play may kick mobile to the next level.
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In last weeks Market Alert, there were five breaking news items from the world of loyalty marketing that rose to the top of the list including: Restaurants offering perks for diners which detailed efforts by Outback, Red Lobster, Panera, T.G.I. Fridays, PF Changs…and discounted coffee beans. Second most read story: Metro declaring its trial successful and expanding its loyalty program, Metro & Me, to the rest of Quebec. Third, Delta launches social media Ticket Window … the industry’s first social media Ticket Window enabling bookings directly from Delta’s Facebook page and other social media sites. Fourth, Qantas raises goal for Frequent Flyer members setting a new goal of 8 million members after beating by 200,000 its previous target of 7 million members and lastly, in Germany, Danisches Bettenlager has agreed to long-term cooperation with Payback, extending its partnership with Payback by three years.
And just a reminder, if you’re interested in attending the COLLOQUY Loyalty Marketing Summit in Phoenix next month, we still have spots open and the cut off date to register is August 31st. More information here.
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NBC’s Fan It, a network-wide affinity program provides rewards for NBC fans who promote and discuss the Peacock Networks’ new programs for 2010-2011 as well as their current shows. The program is using social media platforms such as Facebook, Foursquare, MySpace and Twitter. So, if you’re a Foursquare fan, you can not only let people know that you’re the Mayor of your favorite watering hole, but what exactly the Mayor is watching while munching on pretzels.
Fans earn points by engaging in activities such as watching videos on NBC.com, posting messages on Twitter and "Liking" shows on Facebook. More points will be earned if your friends and followers click on the NBC-related links that Fan It members post. Points earned can be redeemed for exclusive access to early previews of shows, NBC merchandise, discounts at the NBC store, show-themed stuff and sweepstake entries.
Pardon me if I start to tear up a little. My entire life I’ve been waiting for someone to reward me for sitting on the couch and watching TV. While this isn’t quite that level of inactivity, it’s pretty close. I can earn points for watching reruns of the original A-Team or Emergency…or even the Bionic Woman. Now that’s my kind of TV. The point of course is to increase the social network activity for the most popular shows, building up shows that may be critically acclaimed but suffering from low ratings and making sure that the juggernauts are all anyone can talk about.
As a non-TV watcher — unless it’s sports or a Law & Order marathon — I’ll happily earn a few points here and there watching Johnny Gage and Roy DeSoto saving lives on Emergency. I may not watch the popular shows but if I can find other fans who loved that episode of the A-Team when they fired hundreds of bullets at point blank range and never hit one person, I’ll gladly talk to him on Facebook or Twitter. Wait, that was every episode? We’ll, I’d better get a’Twitterin’. And for those of you following me on Twitter, you know exactly where to find me watching 30-year old reruns of TV show and chatting with others about them on Facebook…in my parents’ basement.
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Last week in loyalty marketing…the most popular breaking news item from the COLLOQUY Market Alert was: My Coke Rewards is saying thank you to its 15 million members through the launch of its Million Point Giveaway promotion in August and September. Coming in second, American Airlines now offering AAdvantage members the opportunity to book award travel within the United States and Canada for fewer miles, with the company’s "Short-Hop" awards. Third was Starplex Cinemas Stadium 14 now offers the Star Rewards loyalty program … the Star Rewards loyalty program provides guests with incentives for purchasing both tickets and concessions. Fourth, Points International, owner and operator of Points.com, launched a new, enhanced Points.com boasting a more user-friendly look and feel. And last, Speedy Rewards members can now turn their loyalty card into a debit card by visiting www.speedyrewards.com and linking their Speedy Rewards card to their checking account.
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