The Many Roles Social Media Plays in Loyalty
 

The Many Roles Social Media Plays in Loyalty

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How does Social Media align with Customer Loyalty? Check out our latest article on with best practices and key insights on how social media analytics can help your business engage customers and build ...

How does Social Media align with Customer Loyalty? Check out our latest article on with best practices and key insights on how social media analytics can help your business engage customers and build ROI into social campaigns.

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The Many Roles Social Media Plays in Loyalty The Many Roles Social Media Plays in Loyalty Document Transcript

  • Volume 4 Number 2Second Quarter 2012ENLIGHTENING ENLIGHTENINGINSIGHTS: INSIGHTS: Sierra Trading Sierra Trading PostSierra Trading PostPost T.G.I. Fridays FridaysT.G.I. Fridays MoneyGram MoneyGramMoneyGram Xerox XeroxBest Buy Best Buy BestBuyRug DoctorXerox Doctor Rug Doctor RugPure Romance Enterprise EnterpriseEnterprise Rent-A-Car Progressive ProgressiveProgressive Insurance Pure Romance Pure RomanceEXPERIENTIAL PROGRAMS: 4 STEPS TO GROW THE MANYREWARDING CUSTOMER & CULTIVATE ROLES SOCIALLOYALTY ONE YOUR LOYALTY MEDIA PLAYSUNFORGETTABLE PROGRAM IN LOYALTYEXPERIENCE AT A TIME
  • FEATURES THE MANY ROLES SOCIAL MEDIA PLAYS IN LOYALTY STEVEN J. RAMIREZ —Beyond the Arc “S ocial media” is the loyalty buzz phrase of the day. There is an endless stream of commentary and recommendations on how to best leverage social media in marketing. In fact, you can’t As is true with any business objective, measurement and analysis is also key. It is not enough to consider 5,000 followers or 1,000 likes the successful outcome of a social media campaign. Instead, throw a stone without hitting a social media expert. companies should be looking at the actual content of Tweets, Facebook status updates and YouTube comments. What do the With ALL the information available words mean? How can a company use social media data in a meaningful and valuable way that improves business practices and, on the topic, how do you sort out therefore, increases productivity and loyalty? what recommendations are best This article will examine how three companies going through a service break, special community event and the launch of a new campaign for you, your organization and the used social media monitoring as well as activity to overcome hurdles, meet business objectives and improve customer loyalty. customers and industry you serve? Analysis of Twitter & Facebook Data The biggest mistake we see made in social media is activity driven by March 2 -14, 2011 SOCIAL MEDIA marketing calendars—not business objectives. Too many marketing ANALYSIS ABOUT BANK OF AMERICA departments and firms are using Twitter, Facebook and YouTube to Total Comments: 41,000+ REVEALED THOUSANDS push out promotional company messages, measuring success with Unique Comments: 9,000+ OF COMMENTS ABOUT likes and re-tweets. Other companies discount social media SERVICE BREAKS & channels as venting and griping outlets only, preferring not to PURCHASE LIMIT engage negative commentary. Facebook RUMORS THAT PUT 12% THE BANK AT RISK OF Twitter LOSING CUSTOMERS. TYING SOCIAL MEDIA TO BUSINESS OBJECTIVES 88% We are not discounting social media as a valuable marketing and communications channel. We are, however, pointing out that Twitter, BANK OF AMERICA, MINT.COM MISS SIGNS Facebook and YouTube are also business channels that should be OF DISSATISFACTION closely aligned with and support three key business objectives: As the largest bank in the United States by assets (and more than 12 •  Enhancing customer and product acquisition percent of U.S. deposits), Bank of America has maximized its share •  Converting online engagement into commerce of deposits through acquisitions and may soon need to increase its •  Improving customer retention rates rate of organic growth. To us, this signals a strong need to concen- trate on the customer experience.20 Loyalty Management™ • SECOND QUARTER 2012
  • Unfortunately, an account linkage problem that occurred last year Start the conversation early. The Corporate Challenge inbetween Mint.com and Bank of America caused many customers Johannesburg was held on March 3, but JP Morgan Chase didn’textreme dissatisfaction, which they expressed through Twitter and post their first comment on Facebook until April 4. At that point,Facebook. Some threatened to leave the bank. Others claimed the only comments were from the bank. After April 4, when all theBank of America had told them the bank had severed global Facebook fan pages got rolling, the bank enhanced itsties with Mint.com, a mistaken rumor that was often repeated. communications strategy to maximize response. In the new andWhile the issue was fixed a week later, the dispelling of rumors and growing market of Johannesburg, however, the bank missed a keyinaccuracies came from Mint.com with Bank of America never opportunity to build buzz.responding to the surge of customer concern. Interestingly,complaints about Mint.com access through Bank of America Drive engagement. Across the Corporate Challenge fan pagesspurred a spike in negative comments overall for the bank with for most cities, the number of comments increased dramatically oncustomers commiserating on late tax forms, payments not posted on race day, representing an average of 22 percent of all comments. Intime, failures to send new debit cards and duplicate accounts. Chicago, almost 35 percent of comments were on race day; in Buffalo 28 percent. A large portion of comments on race daysThe monitoring and analysis of social media data would have helped reflects a high level of excitement, representing an opportunity forBank of America quickly identify customer concerns and track public JP Morgan Chase to engage those active participants over a longersentiment about the business. By categorizing large volumes of period to strengthen relationships, so the event and sponsor aren’tcomments to determine key themes and trends, text analytics could quickly forgotten.have translated social media data into actionable insights. Compa-nies that use customer feedback to drive service improvements Specifically on Chicago’s race day, JP Morgan Chase posted:retain customers and deliver a better customer experience. “Chicago, on your mark, get set and go....its race day! Who are you running with today?” In addition to generating engagement, thisJP MORGAN CHASE INCREASES THE VALUE OF SPONSORSHIP question also targeted two of the strongest features of the Corporate Challenge—team building and company pride.For the past 35 years, JP Morgan Chase has hosted the CorporateChallenge, a series of 3.5 mile footraces in cities across the globe In Buffalo, JP Morgan Chase used social media to quickly respondthat raise money for local non-profit organizations. By September to participant concerns. When runners worried the race might be2011, more than 226,000 people had participated in the year’s canceled due to a thunderstorm, the bank was quick to post on theevents, which were being held in 12 cities and 6 countries. fan page that the event was still on.Sponsorships can be an effective strategy for increasing customerloyalty and enhancing brand recognition in a community, but how Maximize afterglow. One of the most important goals of acan social media play a part in a successful strategy? sponsorship event is to maximize “afterglow”—the feeling of identification with the event after it has passed. In this case, JP Morgan Chase adopted an excellent strategy to keep people buzzing about the race. Teams were encouraged to participate in a t-shirt contest by designing a shirt with the Challenge’s logo to be worn on race day by the entire team. After the race, participants could go to the bank’s website to vote on their favorite shirt. The two winning teams each won $1,000 for their charities of choice. Not only did the t-shirt contest drive people to the JP Morgan Chase website, but it also dominated the conversation on the fan pages after the race day. In fact, except for the race itself, the most popular topic on each page was t-shirts. Participants urged others to vote for their shirts or applauded the other teams’ creative designs. This type of engagement, begun by the bank and taken up by participants, is the ideal goal of any social media campaign as it generates a strong sense of community and association with the brand. Data analytics help at every step. Worth noting is that data analytics uncovered comments about confusion on how to vote in the contest, which indicates that JP Morgan Chase needs to improve its voting process in the future. American Express Maximizes Facebook Fan Engagement Build it and they will come is NOT true for Facebook fan pages. In fact, fan pages are all about active engagement. The tactical goal is to quickly move through a 3-stage process: building your fan base, getting them to read your posts, and motivating them to actively BUFFALO, CHICAGO, LONDON AND NEW YORK ALL HAD THE MOST INTERACTIVE FAN PAGES, WITH ABOUT 80% participate in the conversation. OF CONTENT COMING FROM PARTICIPANTS. continued on next page » Loyalty Management™ • SECOND QUARTER 2012 21
  • The Many Roles Social Media Plays In Loyalty (continued) Over a month, 5,288 comments were posted to American Express’ Facebook Wall. The post that received the highest number of comments per day and likes per day invited customers to share their weekend plans. It is easy for people to fill in the blank, and describ- LESSONS FROM ing their weekend is fun to do. As long as the topic is of interest, AMERICAN EXPRESS’ fill-in-the-blank, true/false and multiple choice questions or statements could all be effective ways to drive engagement on Facebook fan pages. LINK, LIKE, LOVE Two other highly engaging posts on the Amex Facebook Wall were: INCLUDE: “Goodbye summer, hello fall— 1: Design your social media presence with the customer in mind. Create a seamless Where will your Amex Card user experience that drives conversion. be spotted this season?” 2: Design your program to exploit features unique to social media, such as social   “Paris, France…for the holidays” networks, viral advocacy, and scalability. “Home Depot” 3: Tailor your approach for the target customer. Customized methods can yield COMMENTS PER DAY: 26.1 greater engagement and use of goods   LIKES PER DAY: 46 and services. “What summer memories customers. Described as “Groupon without the Coupon”, did your Amex Card make American Express’ Link, Like, Love lets cardholders link their American Express card to a Facebook account. Then American possible?” Express delivers deals and offers based on Facebook activity, pages likes and shares as well as the activities of Facebook friends. “Celebrating our 50th anniversary” As we examined the data on Link, Like, Love, we gained insights on the customer experience from acquisition to retention as well as “Margarita Beach …Caribbean!!” brand advocacy. From these insights, we assembled a picture of the customer experience at each major stage of the program—aware- COMMENTS PER DAY: 28.4 ness, registration, initial usage, repeat usage and advocacy. LIKES PER DAY: 24.1 SOCIAL MEDIA IS MORE THAN… Social media is more than a way your customers pass time during These posts succeeded due to the topics –summer vacation the day. It is more than a marketing channel for promotions. It is and favorite memories– which were cleverly tied to the product, more than a venting playground for gripers to gripe and moaners to the American Express card. moan. Social media is—and should always be viewed as—a business channel. A different type of fan page post proved engaging too, “Join people from around the world & let’s show Japan our continued support— Monitoring, actively participating in and analyzing data on Twitter, we’ll donate $1 to earthquake relief efforts for every ‘Message of Hope’ Facebook and YouTube can enable your company to better engage its posted!” This type of post appeals to people’s aspirations and the “self” customers and industry, turn interaction into commerce and acquire they want to portray online. Disaster relief, community activities, other new customers. L fund raisers, and travel can be engaging for similar reasons. REWARDS PROGRAMS HINGE ON SOCIAL MEDIA In the area of unique rewards programs that differentiate a brand, attract and retain customers, American Express is a best practice yet again with social media emerging as a key vehicle to engage Steven J. Ramirez is CEO of Beyond the Arc, Inc., a management consulting firm that combines strategy consulting with advanced analytics to help clients identify opportunities to differentiate themselves in the marketplace. The company’s social media data mining helps clients improve their customer experience across products, channels, and touch points.22 Loyalty Management™ • SECOND QUARTER 2012