Levering on partnerships and cost optimisation in loyalty programmes …& not only Direct Marketing Days 2011
<ul><li>Introduction  </li></ul><ul><li>Defining business challenges </li></ul><ul><li>Successful campaigns – models </li>...
<ul><li>Largest private postal group in Poland </li></ul><ul><ul><li>30% of unaddressed mail </li></ul></ul><ul><ul><li>10...
Less mail is being sent Social mail Transactional mail Direct Mail Parcels
To deliver the revenue we all need to  optimise loyalty programs’ concepts + 100 000 - 75 000 A cquisition C hurn Fill hol...
Well known wonder  of loyalty programs <ul><li>1.  PVD = Precived Value of Discount </li></ul><ul><li>Points based program...
P oints scheme: cost-efficient reward Leverage of Points  Example: Customer perceives 5% discount through the program, whi...
WIN ON SOMEONES  ELSE FIGHT
Let others pay for building loyalty to  your brand
Tesco financies the program through its partners
<ul><li>Do it right </li></ul>relevence ,  response ,  revenue
How much you need to spend to invite the customer to dance with you? Customer Profile Status:  Registered with T op  U p  ...
<ul><li>How to rationalise costs of retention further? </li></ul>
Perfect service for building extended loyalty EasyPack <ul><li>Cost saving pick-up point of program awards </li></ul><ul><...
420  machines in Poland <ul><li>Self-service pick-up points for collecting and sending parcels </li></ul><ul><li>SMS / ema...
easyPack  will be available  in Ukraine from August 2011 <ul><li>Starting from Kiev </li></ul>
<ul><li>591 billion euros  – world e-Retail spend in 2010 </li></ul><ul><li>> 2 billion  internet users </li></ul><ul><li>...
30% of revenues  to come  from non-mail Hybrid Mail E-invoicing and Mobile Payments MVNO – free access to internet via pho...
81% conversion rate The best member get member concept in social media <ul><li>InPost LOVE </li></ul><ul><ul><li>Sending „...
Paczkobranie – „Parcel-rooming” <ul><li>Paczkobranie – „Parcel-rooming” </li></ul><ul><li>Pick up the box and win the phys...
~ 200.000 fans on Facebook <ul><li>Paczkobranie – “Parcel- sweeping ” </li></ul><ul><li>Pick the right box and win a prize...
„ Parcel-rooming” – engaging partners
700% growth of  e asy P ack  24/7  delivery  –  over 600 participants <ul><ul><li>Results – Morele.net customers  soft rol...
Fanbook  – discount offers from partners <ul><li>57 offers from different  e-stores segments </li></ul><ul><li>Total value...
Reference LIVE  – use business partners to promote your service
EasyPack for customer in PL – case study –  3 months after roll out statistics
We are the only operator in the world that offers that service! View2surf technology We can push away  cost of building lo...
Free minutes for shopping <ul><li>Effective differentiator: a customer receives free minutes for shopping  exchengable  fo...
Ads co-financed by the suppliers Full-screen ads
<ul><li>Sms message  „visit the nearest store, and you’ll get a ….% discount” </li></ul><ul><li>Link to website  http://ww...
Results The results are based on „free minutes for shopping” model and v2s advertising <ul><li>15% bigger market basket wh...
Additional effects <ul><li>Increased customer loyalty – a cost effective and self-funding loyalty program supports Club Ca...
Benefits of  Better Customer Management Target Market  Segmentation Mass Market  Mass Customize Micro-Marketing Channel  O...
Thank you for your attention
Benchmarks and experiences with results  of points programs throughout Europe. Results <ul><li>Churn Reduction  :  -20% is...
<ul><ul><li>RFM analysis </li></ul></ul><ul><ul><li>recency, frequency, monetary value </li></ul></ul>
Rewards and benefits in Loyalty Program Bulid based on the best practices RATIONAL SURFACE (customer) EMOTIONAL SURFACE (c...
Rewards and benefits sheme First parcel sent bonus Early pick up bonus (>6h) Birthday sms greetings Member-gets-member bon...
Own partner marketing tools using program as ‘support’ Targeted Nowak family Newsletter Tracking response ROI Reporting OB...
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Эффективное партнерство и оптимизация затрат в программах лояльности

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Рафал Бжоска (Rafał Brzoska)
CEO, Integer.pl Group (Integer.pl, InPost Nowoczesna Poczta, InPost Finanse, InMobile, Paczkomaty 24/7, InFlavo, Integer.ua, InPost Logistyka), Польша

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  • Wszyscy na rynku zmagamy się z wyzwaniem utrzymania klienta. Możemy to osiągać poprzez innowację ale również poprzez optymalizację kosztów I wykorzystanie realacji z partnerami biznesowymi. CLM – customer lifecycle management
  • Optymalizację tą kilkanaście lat temu dały nam punktowe programy lojalnościowe (poits based loytaly prgrams) Dzięki tak zwanej postrzeganej wartości upustu. Klient sądzi więc, ze to co mu ofiarujemy w konkretnej nagrodzie jest warte wiecej niż naprawdę. To tak jak z tym pawiem ;-)
  • Lets imagine that the customer has purchased products or services from your company for amount of 1000 Euro (animacja) For each euro he got one point in loyalty program. (anim) For which he decided to recharge his mobile with 50 euro. (anim) What customer thinks he got is 5% perceived value of discount. (anim) The truth is that this 50 euro costs your company about 20 euro. (anim) The other beauty of points based loyalty programs is that not all the points are usually used (redeemed) by customers. And their expire. In single brand programs the level could be as low as 60%. (anim) And finally we end up with real cost of award at level of 12 eruo with equals 1,2% of that what customer has spent. Tu przykład postrzeganej wartościu upustu na przykładzie doładowania prepaid jako nagrody w programi loj. Operatora komórkowego. Myślimy że dostaje klient 5% a tak naprawdę tylko 1,2%
  • What other tools the companies running loytaly programs are using to push costs away? They involve sector competitors. Lets imagine coca-cola trying to win Pepsi drinkers. All they need is data who is actualy drinking Pepsi. But without sofisticated loyalty program we do not know who bought Pepsi in ... Lets say Tesco few moments ago. That’s how Tesco and ist loyalty program clubcard is making coca-cola pay the costs of awards to its members. Kolejnym krokiem jest stosowany już na masową skalę model wykorzystywania walki konkurentów w danych sektorach rynku by budować na tym lojalnośc np. wobec sieci supermarketów.
  • Na tych zasadach działa właśnie Tesco ClubCard jeden z najelpszych porgramów loj. Na świecie. Kupony rabatowe opierają się często na oferowaniu produktu konkurencyjnego do tego który faktycznie kupuje klient. Tak właśnie Pepsi finansuje Tesco by odbierać klientów Coca_coli. With dedicated, fully personalised loyalty program statements, which are being sent every 3 months to its customer, Tesco is able to reach additional sales uplift from 2% upto 5% after each mailing. Those cupons can attract pespi drinkers to try coca-cola...
  • Dzięki wprowadzeniu programu tesco przebiło największego konkurenta na rynku brytyjskim. Był jednak krótki moment zachwiania ich pozycji. To czerwiec 1995 kiedy to konkurent wprowadził na rynek swój program. Jednak szybko utracił przewagę gdyż nie umieli tak dobrze targetować ofert w oparciu o koszyk zakupowy klienta.
  • Bo punktem wyjścia w modelu musi być zawsze opieranie się na faktycznych potrzebach klientów. Tylko one, dzięki głębokiemu targetowaniu dynamicznemu, mogą przynieść zyski!
  • To lepjej jeśli wyjaśnię osobiście telefonicznie. Lub usunie Pan ten slajd jeśli stwierdzi Pan, że czasu jest zbyt mało po dodaniu inMobile’a Możemy również optymalizować na poziomie benefitów oferowanych klientom w zamian za konkretne zachowania. W tym wypadku zaprezentuję porównanie jak zmienia się poziom akceptacji oferty na doładowanie telefonu prepaid w zależności od wartości darmowego doładowania.
  • Czy można bardziej zoptymalizować koszty?
  • Kolejnym krokiem do optymalizacji moga być właśnie EasyPack.
  • Kolejnym krokiem do optymalizacji moga być właśnie EasyPack.
  • Jakie rezultaty może dać dalsza optymalizacja na poziomie wiedzy o kliencie? Each of us has reached different level of customer data collection (data gathering) and we have different tools to use that data. Most of companies are at the level of CRM and SFA (sales force autoimmunization). What benefits may give further Customer Management development you your companies has proven Aberdeen Group in 2009. The best in class companies reach 76% better customer retention.
  • Również w ramach EasyPack dysponujemy narzędziami budującymi lojalność.
  • Narzędzia lojalnościowe segmentujemy z perspektywy firmy (cele strategiczne i taktyczne) oraz klienta (racjonalne, i emocjonalne)
  • Oto przykładowe narzędzia stosowane przez nas do zwiększania częstotliwości zamówień przez EasyPack.
  • Kolejnym sposobem w większaniu efektywności stały się multipartnerskie programy lojalnościowe. Zbiorcza wiedza z różnych branż daje jeszcze lepsze efekty w targetowaniu ofert.
  • Эффективное партнерство и оптимизация затрат в программах лояльности

    1. 1. Levering on partnerships and cost optimisation in loyalty programmes …& not only Direct Marketing Days 2011
    2. 2. <ul><li>Introduction </li></ul><ul><li>Defining business challenges </li></ul><ul><li>Successful campaigns – models </li></ul><ul><ul><li>Levering on partnerships and cost optimization </li></ul></ul><ul><li>Results </li></ul><ul><li>Cooperation possibilities in Ukraine </li></ul>Agenda
    3. 3. <ul><li>Largest private postal group in Poland </li></ul><ul><ul><li>30% of unaddressed mail </li></ul></ul><ul><ul><li>10.5% of addressed mail </li></ul></ul><ul><ul><li>entering e-commerce </li></ul></ul><ul><li>Part of Integer.pl Capital Group </li></ul><ul><li>Stock-listed on Warsaw Stock Exchange </li></ul><ul><li>WMA winner for Growth (2010), Innovation & e-comerce Category (2011) </li></ul><ul><li>141 mln addressed items compared to 74.84 mln in 2009 </li></ul>InPost – challengers from Poland 2011
    4. 4. Less mail is being sent Social mail Transactional mail Direct Mail Parcels
    5. 5. To deliver the revenue we all need to optimise loyalty programs’ concepts + 100 000 - 75 000 A cquisition C hurn Fill holes – remove reasons for leaving CLM - life time value Build loyalty – provide Incentives for staying Rationalise costs of retention Optimise payback on existing tools Source: Mobile Operator from EU, 2010 Involve partners to finance your efforts
    6. 6. Well known wonder of loyalty programs <ul><li>1. PVD = Precived Value of Discount </li></ul><ul><li>Points based program has that benefit obvious but all other „gifts” should create higher value too. </li></ul><ul><li>Create benefits that can not be purchased at all – those are the most appreciated. </li></ul>
    7. 7. P oints scheme: cost-efficient reward Leverage of Points Example: Customer perceives 5% discount through the program, while actual cost of the discount is not even 25% of that! 1000 Euro Real cost of award is 1.2% Points programs are cost-effective customer incentives through the leverage that they offer. In many cases, cost of the incentive is only 25% of the Perceived Value of Discount (PVD). PVD = 5%
    8. 8. WIN ON SOMEONES ELSE FIGHT
    9. 9. Let others pay for building loyalty to your brand
    10. 10. Tesco financies the program through its partners
    11. 11. <ul><li>Do it right </li></ul>relevence , response , revenue
    12. 12. How much you need to spend to invite the customer to dance with you? Customer Profile Status: Registered with T op U p D irect Segment: High value Gold & Platinum customers Tested: Va rying am oun ts to increase TUD usage the use of emotional bonding messages Top up by 20 € Top up by 20 € Top up by 10 € and get: Source: test campaign resutls executed in Western European mobile operator in 2009 Thank You Message Included response 10% back 31% 20% back 35% 50% back 39% 41% 52% 65% NO Thank You Message response 10% back 30% 20% back 49% 50% back 33% 60% 63% 60% Top up by 20 € and get: 10 20
    13. 13. <ul><li>How to rationalise costs of retention further? </li></ul>
    14. 14. Perfect service for building extended loyalty EasyPack <ul><li>Cost saving pick-up point of program awards </li></ul><ul><li>Additional opportunity for interaction with customer </li></ul><ul><ul><li>Collect customer data </li></ul></ul><ul><ul><li>Ask questions, get feedback </li></ul></ul><ul><ul><li>Execute member get member promotions </li></ul></ul>
    15. 15. 420 machines in Poland <ul><li>Self-service pick-up points for collecting and sending parcels </li></ul><ul><li>SMS / email notification about the parcel in the machine </li></ul><ul><li>800 machines in total in Poland </li></ul><ul><li>User and producer of the machines </li></ul><ul><li>Shortly new machines f o r Estonian Post </li></ul><ul><li>5 new countries in 2011 </li></ul>Size Number of boxes Max dimensions (in cm) Size A 32 8 x 38 x 64 c m Size B 32 19 x 38 x 64 c m Size C 12 41 x 38 x 64 cm
    16. 16. easyPack will be available in Ukraine from August 2011 <ul><li>Starting from Kiev </li></ul>
    17. 17. <ul><li>591 billion euros – world e-Retail spend in 2010 </li></ul><ul><li>> 2 billion internet users </li></ul><ul><li>585 million Facebook users </li></ul><ul><li>50% of them logged in on any given day </li></ul><ul><li>28% check their Facebook on smartphone before getting out of bed </li></ul><ul><li>Brands are now thinking how to monetize Facebook </li></ul><ul><li>58% of Japanese used mobile phone to browse internet at least monthly </li></ul>Increasing role of e-, m- and f-commerce Source: IMR World, Socialbakers.com, Asia-Pacific Technographics Survey
    18. 18. 30% of revenues to come from non-mail Hybrid Mail E-invoicing and Mobile Payments MVNO – free access to internet via phone easyPack 24/7 E-shops on Facebook
    19. 19. 81% conversion rate The best member get member concept in social media <ul><li>InPost LOVE </li></ul><ul><ul><li>Sending „Love letter” using hybrid mail linked with Facebook </li></ul></ul><ul><ul><li>Pick up a friend to give a present </li></ul></ul><ul><ul><li>Friends to choose easyPack 24/7 for collecting their present </li></ul></ul><ul><li>15 .000 new users </li></ul>
    20. 20. Paczkobranie – „Parcel-rooming” <ul><li>Paczkobranie – „Parcel-rooming” </li></ul><ul><li>Pick up the box and win the physical award from our e-commerce partners </li></ul><ul><li>Award collection from Paczkomaty 24/7 </li></ul><ul><li>Interesting awards from our partners </li></ul>
    21. 21. ~ 200.000 fans on Facebook <ul><li>Paczkobranie – “Parcel- sweeping ” </li></ul><ul><li>Pick the right box and win a prize from one of our e-commerce partners </li></ul>Best social media campaign in 2010 in Poland Start 299 fans End of 11th edition 184 515 fans
    22. 22. „ Parcel-rooming” – engaging partners
    23. 23. 700% growth of e asy P ack 24/7 delivery – over 600 participants <ul><ul><li>Results – Morele.net customers soft roll out </li></ul></ul>Communication channels of sms competition: On-line activities: banners + subpage E-mailings Posts and graphics on facebook.pl E-mailing statistics: Database 75 245 Unique opens 9685 – 13% Unique click 1808 – 2,5 % Results: Over 600 participants received a special gift-device
    24. 24. Fanbook – discount offers from partners <ul><li>57 offers from different e-stores segments </li></ul><ul><li>Total value of discount 400 Euro </li></ul>
    25. 25. Reference LIVE – use business partners to promote your service
    26. 26. EasyPack for customer in PL – case study – 3 months after roll out statistics
    27. 27. We are the only operator in the world that offers that service! View2surf technology We can push away cost of building loyalty from your company!
    28. 28. Free minutes for shopping <ul><li>Effective differentiator: a customer receives free minutes for shopping exchengable for SMS </li></ul><ul><ul><li>Free minutes for the full shopping basket, </li></ul></ul><ul><ul><li>Free minutes for buying selected items, </li></ul></ul><ul><ul><li>Free minutes for buying products of the selected suppliers. </li></ul></ul>An innovative loyalty tool
    29. 29. Ads co-financed by the suppliers Full-screen ads
    30. 30. <ul><li>Sms message „visit the nearest store, and you’ll get a ….% discount” </li></ul><ul><li>Link to website http://www.promocje.pl </li></ul><ul><li>MMS message </li></ul><ul><li>photo/image with the link and reference to details </li></ul>Constant customer contact
    31. 31. Results The results are based on „free minutes for shopping” model and v2s advertising <ul><li>15% bigger market basket when using „free minutes for shopping” comparing to the average base (during the survey customers declare more than 50%), </li></ul><ul><li>10% - increase for selected products in targeted marketing promotions </li></ul><ul><li>over 100% higher rate of viewing mobile ads using view2surf technology, </li></ul><ul><li>a satisfaction rate for full-screen mobile ads is high </li></ul>
    32. 32. Additional effects <ul><li>Increased customer loyalty – a cost effective and self-funding loyalty program supports Club Card </li></ul><ul><li>A simple communication tool that can be used in FMCG products sales. </li></ul><ul><li>An efficient customer communication tool when using geo-location technology. </li></ul>
    33. 33. Benefits of Better Customer Management Target Market Segmentation Mass Market Mass Customize Micro-Marketing Channel Optimized 51% 76% 49% 36% 60% 45% 39% 45% 37% Return on Marketing Investment Customer Retention Rate Customer Acqusition Rate Multi Channel Optimized Rules-based Campaign Execution Spread-sheet Data-marts CRM/SFA Front/Back Integration Business Intelligence Real-time Integration Percent Co’s Reporting > 15% Performance by Benchmark Grouping Technology Enablers Lagging Norm Best in Class Source: Aberdeen Group, US Market 2009
    34. 34. Thank you for your attention
    35. 35. Benchmarks and experiences with results of points programs throughout Europe. Results <ul><li>Churn Reduction : -20% is realistic </li></ul><ul><ul><li>Proximus (B): -25% </li></ul></ul><ul><ul><li>T-Mobile (NL): -20% </li></ul></ul><ul><ul><li>Plus GSM (PL): -25% </li></ul></ul><ul><ul><li>Orange (PL): -20% (postpaid), -60% (prepaid) </li></ul></ul><ul><li>Cross- and Up-selling : +5% is feasible </li></ul><ul><ul><li>Proximus (B): +7% </li></ul></ul><ul><ul><li>T-Mobile (NL): +4% </li></ul></ul><ul><ul><li>Plus GSM (PL): +4% </li></ul></ul><ul><ul><li>Orange (PL): 25%-35% higher ARPU </li></ul></ul><ul><li>Cost efficient client behaviour : </li></ul><ul><ul><li>T-Mobile : members use online-billing more frequently </li></ul></ul><ul><ul><li>Plus GSM : members opt for direct debit twice as often </li></ul></ul><ul><ul><li>Orenge Profit : members use direct debit 3x as often as non-members </li></ul></ul>
    36. 36. <ul><ul><li>RFM analysis </li></ul></ul><ul><ul><li>recency, frequency, monetary value </li></ul></ul>
    37. 37. Rewards and benefits in Loyalty Program Bulid based on the best practices RATIONAL SURFACE (customer) EMOTIONAL SURFACE (customer) TA C T IC GOALS STRATEGIC GOALS
    38. 38. Rewards and benefits sheme First parcel sent bonus Early pick up bonus (>6h) Birthday sms greetings Member-gets-member bonus Birthday email bonus Suprise&delight competitions 5th order bonus Welcome bonus for joining RATIONAL SURFACE (customer) EMOTIONAL SURFACE (customer) TA C T IC GOALS STRATEGIC GOALS 2
    39. 39. Own partner marketing tools using program as ‘support’ Targeted Nowak family Newsletter Tracking response ROI Reporting OBJECTIVE Promote new Neostrada package TIMING Jan-Mar OFFER Free Installation 500 Bonus points TARGET Families with children having high dial-up volume. X-sell OBJECTIVE Retain churn-sensitive Customers TIMING Ongoing OFFER Renew your contract and get 500 Bonus points TARGET High value customer that are 2 months before end of contract. Retention OBJECTIVE Win customers for new store TIMING May OFFER Double points during May opening month TARGET All members living within 5 km from new store location. Acquisition OBJECTIVE Win back lapsers TIMING Ongoing OFFER Free oil change on your first (re-)visit to BP + survey WHY? TARGET All members who had high freq. & value for BP, but have not visited BP for more than 3 months Win-back recency frequency monetary value OBJECTIVE Increase life insurance premiums TIMING Jul OFFER Triple points on increase in life insurance premiums TARGET High income, middle aged existing policy holders with low/avg current premiums Upsell income Age policy value OBJECTIVE Promote internet banking TIMING Sept OFFER 250 points for switching to internet banking TARGET Existing Lukas customers who do not use internet banking yet but have Neostrada Steer behavior Lukas customers Neostrada users recency frequency monetary value Communication preferences Value Profile History … PROGRAM COMMUNICATION CALENDAR PROGRAM TOOLS Points Promo Coupons Events ALL <ul><li>Free oil change @ BP </li></ul><ul><li>Double points @ Carrefour </li></ul><ul><li>Coupon 3 months trial internet </li></ul><ul><li>Contract renewal bonus from mobile op. </li></ul>Partner Business objectives Win back Retention Acquisition Cross-sell Up-sell Create needs Educate

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