This year the AMA’s AGM concentrated on the idea of building loyalty with customers and how this applies to the arts. As loyalty schemes proliferate in the retail sector Wanda Goldwag, ex Executive Director of Air Miles outlined a broad view of loyalty schemes including global trends and issues relating to customer ownership.
Global Trends
- In recent years the marketing emphasis has changed from mass marketing to relationship, or ‘one-to-one’ marketing, although we rarely talk to customers as individuals, but rather as a segment of people who behave similarly. This is made possible by the increasing amounts of information we hold on our customers.
- We now live in a ’24 hour society’.
- New channels of communication are appearing and confidence is growing in their use, for example the Internet, and SMS technology
- Society, particularly in the West, often associates happiness with the instant ability to possess consumer goods. The “I want it now” culture uses large amounts of credit for instant gratification.
Customer Ownership
There is a battle being fought in the market place between the product/service owner and the retailer/intermediary over the subject of data. Who owns it? Are you loyal to the supermarket or the brands that you buy? The company that holds the data on you is the one who can influence your buying behaviour for example by offering coupons or other promotional offers.
Customer Expectations
Because we are prepared to allow retailers access to our data via loyalty cards our expectations of what they can do for us are increased. Why should we stay loyal to them? Customers expect to be recognised during dialogue whether face-to-face or by phone, they expect us to have knowledge of the relationship to date, for example sales history or complaints.
They also expect to be rewarded, not just in terms of a loyalty card in a supermarket but preferential treatment as a regular booker, such a priority booking, and to be kept in touch with information about the products and services they want.
Regardless of whether your customers have these expectations of your organisation at the moment, they will, as they learn this behaviour from their dealings with larger organisations such as supermarkets and petrol stations.
Loyalty schemes operate on the basis of a ‘virtuous circle, whereby personalised communications and the tracking of activity leads to segmentation analysis, treating target segments differently which enables enhanced communication and customer service (special offers, priority booking) and in turn encourages instant responses and activity tracking as a result of the personalised communications.
The key to loyalty schemes is to integrate all points of customer contact whether face to face, phone, Internet, interactive TV, WAP and whatever is developed next. And the key to successful loyalty schemes is the mechanism that binds your customer to you, such as credit cards or a loyalty card. They depend on a secure communication strategy that offers the same benefits at every point whatever the communication channel employed. This ensures that the customer knows they are getting the best deal however they contact you, and builds trust. And trust is vital for loyalty.
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