Posts filed under ‘Loyalty’
Customer Journeys Revolving Around Loyalty and Price
The notion of treating the customer journey as an ongoing cycle resonates for me in Why Experience is Key to Customer Loyalty. The cycle puts wheels (oops sorry) on the notion of maintaining and building ongoing loyalty. The more times successfully around the journey cycle imbues a momentum of loyalty and that great human trait of habit can take hold. (By the way, I am not sure what Lego has to do with it.)
I have touched on the journey idea before in Mapping The Customer Journey.
It is interesting the concept of ‘fairness’ that is introduced by Valeria which is put in context in her linked post re: Lufthansa as “transparency”. This reminds me of an article Tim Baker of Baker Richards and The Pricing Institute recommended written by yet another Tim, Tim Hartford The Undercover Economist, Enough Whingeing About Price Gouging. Tim discussed the concept of dynamic pricing which is the darling of many an airline’s Revenue Management strategies. After mooting dynamic pricing as a way of better managing the finite supply of Easter Eggs to less garden watering bans to the need for a lottery to allocate Olympics tickets, one of the comments by a reader raised a very interesting extension of dynamic pricing that highlights the question of fairness. We are used to passengers paying very different prices for an airline seat depending when it was bought in response to demand and the finite supply. Just imagine the extension of dynamic pricing to the equally scarce commodity of storage for hand luggage, yes you can take on that hatbox madam, but it will cost you $100 extra. Whoohoo, that would cause some air rage (well ground rage ) and accusations of price gouging, before they got airborne. BUT it would help solve the problem of luggage locker hogs on planes and provide space for the rest.
Another poster, Joanna mentioned an application of dynamic pricing that was new to me, street parking in San Francisco. At peak times around special events parking charges on meters are raised in response to the increased demand and finite supply. The result is that if you want a car park you can find one … but you will pay a premium for the privilege. That reminds me of the car park outside a tax office somewhere in Scandinavia (I think) that wanted to ensure that the bays were only used for dropping off tax returns, not parking. Rather than higher charges and fines, they used the Nudge: you could park as long as you liked as long as your car lights were left on, otherwise you would be towed away. Guess what problem solved.
17 May, 2012 at 5:08 pm Tim Roberts ARTS Australia Leave a comment
Is CRM Really a Wolf in Sheep’s Clothing?
No I don’t necessarily think so, but to keep mixin’ up the metaphors it is not unlike Field of Dreams with the oft-used mantra “build it and they will come“. Just because you build or buy a CRM at great expense and turn it on does not mean that “… they will come”, let alone continue to come again, more often, with increasing loyalty across the various constituent lifecycles.
As many other suggest CRM is but infomation enabled Relationship Marketing that requires equal investments in strategy, people AND technology.
The reason for my initial question is a recent blog post from Lisa Baxter of The Experience Business Customer Relationship Management: Pulling the wool over our own eyes.
Lisa, I suspect you and I are singing from the same hymnsheet (oops analogy three and counting), but I worry about your vilification of CRM at the start or am I getting the wrong end of the stick (oh oh four).
I think an essential element of a CRM in assisting Audience Development is initiating and then building an ongoing relationship, but an important part of that is trust. Trust is based on mutual respect and organisational actions and tactics must align with that as part of a sustainable long term strategy. The tactics that you mentions may be useful components, but as you suggest, on their own with out the coordinated organisational committment that builds trust each and every contact, they are just cheap tricks (and are perceived as such).
CRM like marketing is about managing an exchange of value and that means providing value for both sides, the customer and the vendor. Lisa, the examples you give do seem to be framed to sound “predatory”, but the language does not include the value that such actions may have for the customer (whether prospective, first time, recent or frequent, lapsed or refused and so-on)
Maybe our perspectives are very similar, I agree with you that maybe it is the people and strategy components at fault. A selling orientation is increasingly out of place in this day and age and push marketing is limited by its short term perspective.
I don’t disagree with your ‘platitudes’ that Relationship Marketing may deliver via a CRM: gratitude, helpfulness & empathy, inform, delight, connect and value. In fact, they sound like worthwhile values to aspire to in any initiative.
Yes, retention is the way forward. Retention in all its guises from return attendance to frequency recency and monetary value to upselling, cross-selling and value adds and so-on. But it is a two-way exchange of value that ensures longer term success.
2 May, 2012 at 4:46 pm Tim Roberts ARTS Australia 2 comments
Super Subscribers: Saving the Day, Seeding a Loyalty Initiative
An instructive case study of soliciting donors from subscribers at 5th Avenue Theatre in Seattle from TRG Arts.
Facing a funding shortfall in 2009/10, 2010/11 subscriber were approached to become “Super Subscribers” and make a donation to “enhance their theatre-going experience“.
This is explained as follows: “Instead of requesting help for the organization, the letter invited patrons to enhance their theater experience with a tax-deductible gift that included experiential benefits: a backstage tour, a one-time guest pass to the major donor lounge, and a show poster of the subscriber’s choice from the upcoming season. Their gift would also support scholarships for the 5th‘s upcoming summer camps, but the primary focus of the ask was on the subscriber’s experience.“
40% of donations came in response to just the direct mail campaign without the need for any follow up calls.
The campaign brought in 453 gifts and a total of $51,189 at a 10% cost-of-sale and analysis by TRG was very interesting:
- “Most Super Subscribers were relatively new to subscribing. 65% included first timers, subscribers of five or fewer years, or patrons returning after letting their subscription lapse.
- Super Subscribers were primarily new donors. 70% had no previous giving history; 30% were lapsed donors.
- Super Subscribers were twice as generous. The campaign’s average gift size was $113, more than double 5th Avenue prior new gift average of $53.73.”
24 January, 2012 at 7:50 am Tim Roberts ARTS Australia Leave a comment
Audience Development may yet, not be, a “non-job”?
A colleague, Jerry Yoshitomi of MeaningMatters, put me on to this article. I find this quite exciting for the future of Audience Development and the development of meaningful consumer models – Voter data crucial to Romney’s victory
No, I am not going to bore you with a regurgitation of the seemingly endless US election process 
I am, however going to wax lyrical about the use of data to segment prospects and inform relationship marketing.
“A central factor in Mitt Romney’s impressive win in New Hampshire was a sophisticated and relentless voter contact program that locked in supporters early and turned them out to the polls.“
Romney’s team “mined reams of consumer information — from the number of purchases voters made at Williams-Sonoma to their range of financial investments — to build a model that would allow them to find and identify potential supporters.“
They used data to prioritise prospects and then implemented an ongoing structured program of communication developed a loyal core.
“Romney operatives expanded a list of 5,000 solid supporters in New Hampshire from his 2008 campaign to more than 25,000 whom they believed they could rely … while also turning out with friends, relatives and colleagues.“
Just imagine if we had audiences on which we could rely and they turned out with friends, relatives and colleagues. Although I am not sure that we would aspire to this approach in the arts?
“In the end, the Romney team credited its successes to persistence — finding those undecided voters leaning their way and just inundating them,” said Romney’s New Hampshire director, Jason McBride.
Let’s hope that the arts can learn from this constituent development and use similar data mining tools for substantive audience development. Maybe we can then put to bed the accusations of nay-sayers like the recalcitrant Eric Pickles who variously called audience development an “non-job” or a “pointless post”.
13 January, 2012 at 10:54 am Tim Roberts ARTS Australia Leave a comment
What do you reckon about the likely impact of these Marketing Trends on CRM in 2012?
Here are some more predictions of marketing trends that will impact CRM in 2012 according to Judith Aquino of CRM.COM in 5 Hot Marketing Trends (not surprisingly, mobile is at the top):
- Mobile Marketing
- QR Codes
- Voice Of Customer (VOC) Monitoring
- Social Media Marketing
- Video
Finally, she suggests an additional trend with the ‘news’ that Groupon and Daily Deals sites have fallen to earth and are no longer seen as the ‘answer’. Surely, you would have to suggest that they were only ever good for pissing of existing and loyal customers with unfocussed discounts in the guise of prospecting for new customers – BUT without gaining any personal details with which to build an ongoing relationship with those new prospects?
2 January, 2012 at 5:47 pm Tim Roberts ARTS Australia Leave a comment
OK, do we finally have a RoI for CRM?
No, I am not having an annoying acronym attack, maybe a bit of alliteration though
This is the headline that got my attention: CRM Returns $5.60 for Every Dollar Invested.
With “an average benefit of $5.60 returned for every dollar spent” investing in CRM as they say is a “no-brainer”.
They also suggest that if other capabilities like social, analytics and mobile access are added there is a further multiplier and sustainability.
The full RESEARCH NOTE is available online CRM PAYS BACK $5.60 FOR EVERY DOLLAR SPENT
29 November, 2011 at 6:00 pm Tim Roberts ARTS Australia Leave a comment
How do you assess loyalty? What is loyal?
How do you assess what is working in a loyalty program?
Of course, the first thing to decide is how you measure success.
It is often suggested that a loyalty program is working if it accomplishes at least one of two objectives:
- clients are either holding onto their customers longer or,
- are getting them to spend more with the brand.
Kobie Marketing believes that there is only one variable for measuring loyalty – engagement.
“Engagement is a minimum threshold variable that can measure individual member’s contributions to the program’s bottom line. In other words, if a member has an actively engaged relationship with the brand and program, we should measure their contribution. If the relationship is passive, we say don’t include them in positive performance metrics.“
McKinsey in The Consumer Decision Journey discusses these different kinds of loyalty – active and passive:
“Of consumers who profess loyalty to a brand, some are active loyalists, who not only stick with it but also recommend it. Others are passive loyalists who, whether from laziness or confusion caused by the dizzying array of choices, stay with a brand without being committed to it. Despite their claims of allegiance, passive consumers are open to messages from competitors who give them a reason to switch.“
This suggests that we may need the reality of a harsher measure of loyalty in the arts and entertainment to move beyond the false expectations of a fickle passive loyalty. Much of the shadow audience can only be considered passively loyal and the audience attracted to one of your shows only when it is a hit is at best – passively loyal. Actively loyal supporters are more valuable as they will support the challenging rather than just the easy or safe bets.
I have seen it quoted we should measure audiences not by tickets, but by customers. The view above adds another qualifier to measuring audience loyalty to only actually counting those actively engaged.
14 October, 2011 at 1:06 pm Tim Roberts ARTS Australia Leave a comment
So simple, but this could be a great use of transaction data to quantify RFM
This may well be old news to some, but I just loved the simplicity and the subsequent actionability (is that a word?).
I want a ticketing system that offers such a simple KPI of engagement. Gotta copyright that! BUT, you have to start with data that can identify individual customers and build a history of transactions.
Hmmmm, I gotta try this out. Let me know if you do before I do.
Is Recency the Most Important Factor to Drive Engagement?
Oh, I like his name of the source too, Email Yogi: your guide to multi-channel enlightenment
20 September, 2011 at 11:16 am Tim Roberts ARTS Australia Leave a comment
The CRM Challenge: How do you explain to a traditional advertiser that it is over?
An amusing scene of exactly that challenge posted by a colleague from Madrid, Álvaro Sarmiento, on the blog AFORO COMPLETO
“It’s not me it’s you” Del marketing relacional al CRM
It is in English with Spanish subtitles.
22 August, 2011 at 11:22 am Tim Roberts ARTS Australia Leave a comment
Bribery = Loyalty … NOT!
A nice reminder as to what loyalty is and what really encourages it, from Kathy Sierra on Hugh MacLeod’s GapingVoid.
Your customer won’t take a bullet for you
Some other thoughts on the subject of loyalty:
“Repeat business or behavior can be bribed. Loyalty has to be earned.” – Janet Robinson
“You don’t earn loyalty in a day. You earn loyalty day-by-day.” – Jeffrey Gitomer
And on the other hand, from the man who brought you the Net Promoter Score:
“Loyalty is dead, the experts proclaim, and the statistics seem to bear them out. On average, U.S. corporations now lose half their customers in five years, half their employees in four, and half their investors in less than one. We seem to face a future in which the only business relationships will be opportunistic transactions between virtual strangers.” – Frederick F. Reichheld The Loyalty Effect
16 August, 2011 at 3:13 pm Tim Roberts ARTS Australia Leave a comment
