Posts filed under ‘Loyalty’
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.”
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”.
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?
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
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.
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
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.
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
Relationship Marketing: Old wine in a new bottle?
The article Relationship Marketing: Old wine in a new bottle? presents a very good discussion that starts with “Why is marketing not working?” and the need for organisations to allign themselves to ensure a customer focus in a changing environment and consumers.
It describes the evolutions from transaction to relationship marketing and from reactive to proactive and even collaborative marketing.
The increasing importance of CRM is put in context:
- “When you lose a customer, you lose his lifetime value.
- A 5% increase in customer loyalty will result in profit increase of more than 25%.
- In nearly every industry, 20% of customers account for 80% of the profit.
- Seven out of ten customers switch to competition due to poor services.
- It takes up to twelve good experiences to overcome one bad experience of a customer.“
“These made marketers realise the advantages of CRM – increased loyalty of consumers, decreased transaction cost, delivery of consistent, high quality customer experience, more repeat business, improved cost management and increase in profit.“
The essential organisational change management required is put in context, as is the role of technology and the fact that CRM is not panacea for ailments.
“CRM as an integrated business strategy that places customer at the centre of a business’s consciousness. The organisation should align all channels and business processes against target customers based on their value to the business and establish an enterprise-wide means for capturing, analysing and shaping customer behaviour. The business objective of CRM should be clearly understood and a consumer-centric culture should be fostered across the organisation. It should be understood that fundamental changes in the way customers are treated cannot happen by some reworking of the sales and marketing departments. The whole company- the way it’s organised and managed, the training imparted to the employees, evaluation and reward schemes for the employees – must be reworked.“
The conclusion summarises well:
“Relationship marketing has evolved from the age-old paradigm practised by the corner shops. The changing consumer behaviour made it imperative that the companies align their processes and practices with the consumer at the centre and not their products. CRM is thus a process to build profitable relationship with customers, thereby fostering repeat business. For successful implementation of CRM, the whole organisation culture – the way people think and behave – needs to be made consumer friendly. Any marketing paradigm, be it relationship or collaboration based, can prove effective only if marketing is seen as a philosophy cutting across the organisation and not as a functional silo performed by marketing department.“
Are the “new” ticketing models really new, let alone better?
The article GigsWiz Launches at Midem Providing Artists With New Revenue Stream reports that “the landscape of gig promotion is changing rapidly“. So why are the same old models being rolled out and trumpeted as new and innovative?
“By providing the artist a share of the ticket sales revenue, GigsWiz becomes a key factor in increasing ticket sales.” So let me know if I have this correct, the event owner is paying no booking fees and the ticket agent is sharing revenue with the artist. So it sounds like the artist is being paid a split of the additional outside fees charged to consumers to buy tickets.
GigsWiz does appear to assisting artists to go direct to consumers, but it is not cutting out the other middlemen. So you have to ask how efficient this new model is.
“Fans are increasingly linked to bands online and the traditional marketing methods used by promoters are increasingly inefficient at reaching fans.“
Surely the most efficient (and dare I say effective) model is for the artist or event owner to deal directly with the fan or consumer without the need for the interventions (and added margins) of others?
From that sort of foundation, real Customer Relationship Management is possible.
