With most examples and case studies shared online citing in-store purchase experiences for specialty retail, marketers could be lulled into thinking that focusing training, operations, and incentives on this front-end customer interaction is enough to trigger longer-term loyalty.
Not so. As best practices in this 30 year old loyalty marketing industry shift from aiming towards specific objectives (e.g. retention) to encouraging a suite of behaviors across a customer lifecycle, our expectations for customer experience delivery has to evolve as well.
Think about the oft-cited loyalty marketing value chain that starts with Awareness and leads to Trial, Program Enrollment, Purchase, Repeat Purchase, Redemption, and – we hope – multiple redemptions. We can be successful in moving people through the pipeline, but if the value proposition offered is weak and earning velocity is low, redemption either won’t occur or won’t occur soon enough to maintain customer engagement. Make someone wait 12 months for a $5 cash back coupon and your program is in trouble.
A study of Australian frequent flyer co-brand credit cards by WhistleOut illustrates this point. Of 29 cards analyzed in the study (published on AdNews.com), only 9 earned the traveler a one-way flight to London within 3 years. Some cards (based on industry standard spending figures) took up to 9 years to earn the same free flight.
Armed with Twitter and Facebook apps on their Smartphones, consumers will trash loyalty programs in general upon reading this news. It is the headline that sells the story, after all. We know this one study does not tell the story of the entire industry and note there are some generous offers in the market that will earn the savvy traveler free flight in acceptable time frames.
The lesson here is to remind us of the holistic nature of customer loyalty. It must be nurtured across each step of the customer lifecycle and we need to realize that our customers will evaluate our campaigns based on an accumulated opinion of customer experience as delivered over time.
Purchase transactions, web site visitation, call center interactions, and reward redemptions are all opportunities to reinforce our brand promise. We should execute programs with these goals in mind.