Future Economics of Loyalty US - Manu Sarna

LOYALTY
ECONOMICS
FOR RETAILERS
MOVING FROM OPAQUE COSTS
TO CLEAR PROFIT
Manu Sarna, Vice President,
Loyalty Strategy & Analytics
RETAIL
BRIEF

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Loyalty Economics for Retailers / 1
INTRODUCTION
2 Side by Side: Three Marketing Cost Categories
3 Evaluating Marketing Tactics
4 The New Data-Driven Dawn, a New Targeted Tomorrow
5 Benefits to Using Nanotargeting: A Weekend
Shopping Trip
6 Managing Retailer Confidence and Risk
8 Loyalty and Measuring ROI
9 Retail Dynamics Know No Border
10 Loyalty-Enabled Nanotargeting Takes Centre Stage
12 Conclusion: Data-Driven Loyalty is the Future of
Personalization and Retail Economic Success
13 About the Author
Table of Contents
Receiving deals on your smartphone.
Researching products on your
desktop and buying them via a
mobile app. Scanning a QR code
in the store, then checking online
reviews when you return home.
These examples certainly don’t
represent your Grandma’s shopping
journey: In her day, she waited until
her local store opened, then traveled
there, hoping what she needed
was on the shelf. Today, of course,
the path to purchase is radically
different. Consumers shop where
they want, how they want and when
they want, often with mobile device
firmly in hand. In fact, a recent
Catapult Marketing study found that
44 percent of surveyed shoppers
hold their smartphone while they
walk the aisles. And 37 percent
of customers use a PC/laptop,
smartphone or tablet to perform
shopping activities for pet, alcohol,
baby or grocery items.
The new empowered, distracted
shopper navigates a fragmented,
multi-channel universe where the
journey to checkout is complex
and winding. This has created a sea
change for marketers, who have been
forced to re-evaluate the money they
spend on traditional tools to win
consumers over, including
mass-distributed circulars and
one-size-fits-all discounts
and promotions.
At the same time, Canada’s retail
landscape has drastically shifted.
New entrants such as Nordstrom
have set up shop, and old names like
Shoppers Drug Mart and Safeway
have consolidated. As margins
shrink, retailers are combing their
books and eyeing their supply chain,
looking for every cost-saving measure
they can find. The fight for the
consumer’s share-of-wallet has never
been greater.
To meet the needs of shoppers and
stay ahead in a competitive landscape,
retailers realize they must present
shoppers with the right offer, at the
right time and in the right channel
— that is, nanotargeting, where
messages are customized and tailored
to meet a single consumer’s needs.
“Retailers are trying harder to
retain the customers they have,”
says Jennifer Steckel Elliott, a
Toronto-based marketing strategy
consultant. “They really need to be
doing analysis to be sure they target
the right customer segment with
the right offers.”
While the technology and skill sets
are still evolving thanks to the
intersection of smart data and
advanced loyalty programming, the
notion of the one-to-one marketing
of nanotargeting is finally becoming
a reality. Ultimately, we believe
nanotargeting will become the
cornerstone of future marketing
efforts and retailers will leave mass
promotional campaigns, such as
flyers, circulars and discounts, behind.
Enabled by well-analyzed loyalty
data, nanotargeting will become an
attractive alternative that increases
sales and improves ROI.
Several forward-thinking Canadian
retailers are hard at work figuring
out how to deliver this data-driven,
loyalty-boosting vision, but are
enjoying varying degrees of success
due to different capability levels
and the overall complexity of these
efforts — which, far from an IT project,
is a company-wide endeavour.
One challenge most companies
must immediately overcome is the
assumption that CRM and loyalty
are interchangeable. CRM, which
manages interactions with current
and future customers, is actually
just a small component of loyalty,
which uses currency and smart
data to have conversations with
customers and nudge individuals to
change their behaviour for a mutual
reward. To rev the full CRM engine,
companies leverage those customer
databases and combine them with
additional demographic and shopping
information to get a 360-degree view
of their consumer.
This is where the future economics
of loyalty marketing — and ultimately,
nanotargeting — comes in. With
shopper information gathered
through well-run loyalty programs,
retailers can implement better
targeting and glean important
insights that dramatically affect
their own bottom line.

2 / Loyalty Economics for Retailers
SIDE BY SIDE: THREE MARKETING
COST CATEGORIES
Currently, most retailers typically
divide their marketing budget
into three cost-driver buckets:
Promotional discounts and
flyers/circulars receive the biggest
bucks, while loyalty programs come
in a distant third. But while all three
require some form of consumer
engagement and include hard costs,
CMOs often consider the first two,
while enormously expensive, to be
simply part of the cost of doing
business. Some companies even
hold the erroneous opinion that
flyers are profit centres and the
cost of discounts and promotions
are born by vendors, so loyalty
programs are the most expensive
of the three. Nothing could be
further from the truth.
For example, the costs associated
with flyers and promotions are
staggering — typically $15M to
$90M alone for an annual print run
of a national Canadian retail flyer
program (based on 2010 data of two
major Canadian general merchandise
retailers). And yet, many CMOs
consider them simply the cost of
doing business, a necessity they must
stick with because their competitors
also use a similar tool.
Certainly there are other large
marketing costs, including creative
and mass media — but we have
left these out of this discussion
since they are typically less than
0.2 percent of sales. Mass marketing
does play an essential role to
complement the three marketing
cost drivers listed above, as they
passively reach those consumers
who have zero percent share of
wallet with the retailer today.
These efforts build awareness and
consideration for non-shoppers
of a retailer. On the other hand,
discounts/promotions, flyers and
loyalty all require some current level
of engagement by the consumer
with the retailer.
But marketers must measure
the true cost of these three cost
categories. Some insist that vendors
fund discounts and promotions,
so therefore the cost is “theirs”
(the vendors) and not “ours” (the
retailers). Some go even further to
say that since vendors fund the cost
of the promotion and buy space in
the flyer, it is actually a profit centre.
This may be the most expensive,
mistaken claim in retail today.
Keep in mind, money spent on
flyers means profit is drained away
within the consumer-vendor-retailer
ecosystem. The point is, flyers are
not cost-effective and dollars are
being spent inefficiently.1
All of these
costs are potentially dilutive and
while there is some upside to each
of these levers, there is also a cost.
The obvious question: Will Canadian
retailers abandon costly, inefficient
flyer programs and shift more
marketing resources to loyalty?
Experts agree that many retailers will
try, but we are still a long time away
from replacing the mass-market flyer.
“Canadian consumers are very
conscious of price and value1
,” says
Ken Keelor, retail industry expert and
Chief Executive Officer at Calgary
Co-op, who says many Canadian
consumers are still devoted to their
flyers and retailers don’t want to
risk losing them. “The majority still
pore over their flyers every Thursday
evening, and it would take a lot of
courage and huge financial risk for a
retailer to cancel it,” he explains.
In addition, retailers don’t yet see
loyalty as a replaceable alternative to
flyers, according to Dave Mazzone,
who has held senior marketing
roles at Mark’s and Canadian Tire:
“Everybody talks about wanting to
kill their flyer programs,” he says.
“They’re hugely expensive, they’re a
huge time suck, and they take lots
of effort and lots of margin dollars
that you know are just being thrown
away.” But the reality, he adds, is
that companies get nervous about
stopping. “They don’t have a good
alternative to replace the sales they
get from the flyer sell-throughs,”
he says.
The Power of ROI
On the other hand, Mazzone adds,
there is a tremendous pressure to
be more competitive and meet the
challenge of price compression.
“Vendor dollars can’t be looked at
as free money anymore,” he says.
Perhaps that will play into loyalty’s
favour if vendors start balking at
costly flyer promotions, and loyalty
enthusiasts can persuade CMOs
that the ROI is there to justify
nanotargeting efforts. Let’s take
a look at the numbers:
Measuring net sales:
Clearly there are a number of
difficult-to-quantify downsides for
the three main marketing buckets.
What is easy to quantify is the total
cost for a given retailer. Take this
simplified profit and loss example
for a hypothetical national Canadian
chain — let’s call it National Arco:
Net sales $518M
Gross profit
(before all marketing costs) $212M
In-store discounts ($93M)
Flyer ($15M)
Loyalty program ($6M)
Gross profit
(after marketing expenses) $98M
The magnitude of the marketing
costs is clear, especially the
high costs of in-store discounts
and flyers. The question becomes:
given the potential upsides and
downsides of each cost category,
what can be done to grow sales and
reduce these potentially dilutive
marketing costs? We believe
the answer is data-informed,
loyalty-driven nanotargeting.
1
Kenric Tyghe, Raymond James, via The Globe and Mail

DRIVER OF
MARKETING
COSTS
APPROX.
COST AS %
OF SALES DETAILS
DISCOUNTS/
PROMOTIONS
Up to 28%2
Highly variable
by retailer, particularly
within hi/lo retailing
Discount is only
“activated” if a
purchase is made
(i.e. fully variable)
Proportion of
customers would
have paid full price
for discounted SKU
or competitive
SKU but then
switched
FLYERS 0.5%-1.6%2
National retailers
with between
20–52weeks
in time and between
4–20+pages
in length
Typically
1-5 products
required to drive
new traffic
Up to
50% of flyers
never read
As many as 80%
of flyer pages read
are not relevant
LOYALTY 0.3%-2.3% Dependent on
rewards issuance
(lowest in gas, highest
in pharma)
Loyalty is only
“activated” if
purchase is made
(i.e. fully variable)
Cost of loyalty
is fixed relative
to sales
Proportion of
customers would
have paid full price
for basket
SA
LE
EVALUATING MARKETING TACTICS
2
Corresponding annual sales from public records

THE NEW DATA-DRIVEN DAWN,
A NEW TARGETED TOMORROW
The next step towards nanotargeting
success will be for retailers to
explicitly generate store traffic
— not just reward towards driving
sales. Personalized offers and
rewards just for “checking in”
will mark the new dawn of loyalty
marketing. Rewarding shoppers
for simply showing up requires
confidence among store owners
that the retail experience once
the consumer enters — the store’s
ambience, item presentation,
layout, etc. — will drive sales.
And personalized offers offer the
opportunity for a multitude of
variables to drive the points offering,
from frequency of visits to seasonal
behaviour, distance from the store
and social network influence.
Today, retailers offer a variety of
incentives to come to their store,
usually on the condition of buying
and often in the form of flyers with
coupons. However, retailers should
consider what they would pay to have
a new customer visit the store once,
and what they would pay to have an
existing customer enter the store once
more than they originally planned?
Most retailers would answer, “It
depends on how much they spend.”
However, most retailers have a
good idea of how large a basket
an intermittent extra visit would
generate. According to an Aimia
interview with a major Canadian
grocer, often it is 30-60 percent of
the value of a regular customer’s
basket. For example, let’s take
our National Arco example: With
an average (regular) basket size
of $45 and a conversion rate of
approximately 30 percent
of customers, the value of an
incremental visit is clear (see Fig. A).
Keep in mind, this does not include a
lifetime value calculation; that would
overstate the impact of just one visit.
However, it does very simply illustrate
the break-even value up to which can
be given away to gain one extra visit
per person. So, there are significant
benefits to using nanotargeting by
encouraging mobile check-ins with
points to drive traffic compared to the
traditional flyer/coupon to drive traffic
only on the condition of a sale.
To be part of the consideration set
for a weekend shopping trip, points
to check-in should be delivered
both when competitor flyers are
read (typically Thursday night/Friday
morning) and when shoppers are
within physical proximity to your store
or your competitors. Segmentation
based on behaviour can be further
incorporated to optimize the
profitability based, in the case
of National Arco, up to $1.40.
The next phase of
nanotargeting will be
explicitly to generate
store traffic.
XX X =
Regular
basket
$45
Adjustment to regular
basket size
Value of
incremental visit
45%
Margin
23%
Conversion
30% $1.40
VALUE OF
INCREMENTAL
VISIT
Figure A

BENEFITS TO USING NANOTARGETING:
A WEEKEND SHOPPING TRIP
CONSIDERATION
SET FOR WEEKEND
SHOPPING TRIP
RETAILER VISITS
ON WEEKEND
INCREMENTAL
REPEAT VISITS
In Canada, data from 5.2 million active members of the Aeroplan program provide fruitful sources of
insight for Aeroplan partners. Whether your goal is to acquire, lift, shift, or retain, customer-centric
data allows you to design offers and campaigns that work.
PROOF POINT AROUND THE VALUE OF CUSTOMER-CENTRIC DATA
Partner 1 Partner 4
Source: Aimia client and coalition partner data
Partner 2 Partner 3
5.2MILLION
Active Aeroplan
members
Increase in
customer
acquisition
Lift in basket
spend vs.
non-members
Share-of-wallet
increase
Two-year increase
in retention
rates
6X +50% +56% +7.6%
SALE
SAL

MANAGING RETAILER CONFIDENCE
AND RISK
How can retailers move away from
focusing solely on transactional
behaviour and towards loyalty-based
nanotargeting, which may include
giving points to customers just for
visiting the store? The challenge
for retailers is confidence. Most
will feel compelled to engage
in cost recovery, e.g., “visit this
weekend and get X points if you
spend Y dollars.”
We believe, however, that this is
a serious mistake: Not only will it
radically reduce potential traffic,
but it will skew towards self-selecting
those who were planning to purchase
anyway. Retailers must have the
confidence to believe that the store
layout, ambience, selection, service,
quality etc. will be enough to get
consumers to spend with them.
According to Ken Keelor, the stronger
your offer, your in-store experience
and your relationship with customers,
the more you can count on focusing
on loyalty rather than prospecting.
“Loyalty can increase the customer’s
basket size or encourage them to
come in more often,” he explains.
“Prospecting is important in bringing
in incremental customer traffic on a
weekly basis.”
On the other hand, rewarding
only for showing up at the store is
risky, he adds: “You are making an
assumption that by showing up they
will actually buy something. I think
consumers shop very item-specific
on a weekly basis.”
However, we believe this model can
work given the conversion formula
outlined above.
But it’s important for retailers to start
with simple traffic-driving loyalty
offers, and increase sophistication
over time. There are a multitude of
variables that can be used to establish
the right points offer for any given
potential consumer. These include:
Frequency of visits
(easy to segment)
Basket size and profitability
(easy to segment)
Distance from store
(easy to segment)
Seasonal behaviour
(medium to segment)
Social network influence
(difficult to segment)
It’s important to start simple —
for instance, with the value of an
incremental visit as per the example
above, with variables added over
time. The tradeoff for retailers will
be when the incremental complexity
of creating and managing a highly
complex traffic algorithm and
segments outweighs the incremental
profit optimization of altering the
number of loyalty points.
Loyalty on the other
hand is “the use of
currency and smart data to
nudge individuals to changing
their behavior for a
mutual reward.

Loyalty’s Economics for Retailers / 7
“Retailers
should no
longer view
loyalty programmes
as a quantitative in-house
currency; rather they could be
a qualitative tool to inﬂuence
customer behaviour, putting
the customer at the
centre of the
strategy”3
“66
percent
of American
companies stated
that they already have a
multichannel customer
experience
strategy in
place”4
“The retail
environment is
hugely competitive, and
brands who are generously
loyal to their customers will have
signiﬁcant advantages within their
markets. We already see big retailers like
Nike, Walgreens, Nordstrom, and Starbucks
doubling down on their loyalty building
goals by putting customers at
the center of their loyalty
programs, campaigns,
and rewards.”4
In an increasingly competitive and
changing retail landscape, Canadian
retailers will need to keep up with the
best tactics and strategies in order
to compete with their American
counterparts. This means having a
multichannel strategy and putting
customers in the centre of
loyalty programs.
3
The Future of Retail Loyalty, Capgemini Consulting
4
2014 Retail Trends & What They Mean for Loyalty, Big Door

LOYALTY AND MEASURING ROI
A defining moment in successful
relationship-building happens when
a consumer, the “deal hunter,”
formerly in search of the greatest
bargain — fast becomes a deal
taker — and is presumably more
satisfied, shops faster and is quicker
to make decisions because of more
targeted offers. For retailers, this
means higher sales, higher market
share and a higher profit mix. For
instance, a Harvard Business Review
study revealed that personalized
offers have five to eight times
higher ROI than traditional offers.5
For retailers, trading loyalty points and
discounts for data and a more holistic
view of customer spend means:
> More multi-buys of existing
customer basket products, thereby
stealing share from competitors
> More incremental purchases from
relevant “adjacent” products
> More high-margin, premium
products substituted for
lower-margin products
To demonstrate this, we can examine
the National Arco profit and loss
example. Imagine smartphone
penetration is at 98 percent (today
it is more than 60%, according to
comScore). Imagine a mother of one
walks into National Arco, a place she
visits once every couple of months
if she’s passing by, but definitely a
second favourite to its competitor in
her eyes. She walks into a beautifully
crisp store — clearly labeled aisles
with no discount shelf-barkers
and barely a shopper in sight. As
she enters the store her large-screen
smartphone buzzes with nine offers,
three of which come up on the
home screen:
> Buy a second XXXX and get
150 bonus points
> Try YYYY with a 50 percent
discount today and 50 bonus points
> Buy ZZZZ “best” and get $2.50 off
and 75 bonus points
Immediately, she engages with her
phone and is interested in the second
and third promotions (she still has
a little of the first product-offer left
over from the last time she visited, but
might get it anyway). As she walks
the aisles, she knows the prices are
very good — perhaps not the very
lowest, but close enough. Today,
she earns only one point for every
$10 spent, but the bonuses are the
compelling piece. When she used to
come to National Arco many years
ago, she earned 10 points for every
$10 spent on everything she bought.
There were extra points on certain
items, but often they weren’t of
interest to her.
The biggest change for this shopper?
The feeling that she is no longer
a “deal hunter,” but a “deal taker.”
Consequently, she has a more
satisfied feeling and is able to shop
quicker — in addition, she even buys
more items and spends more because
her emotions spring from getting
a deal on things that matter to her.
After all, paying less for things you
don’t care about is not a deal.
The curious
thing is that the
consumer views herself
as a ‘deal taker,’ while
buying more items and
spending more.
5
Know Your Customers Wherever They Are, via Harvard Business Review Blog Network

RETAIL DYNAMICS KNOW NO BORDER
Aimia’s 2014 Loyalty Lens research surveyed over 16,000 consumers in 10 markets worldwide, including the US and
Canada, to explore trends around consumer loyalty, engagement with technology and attitudes towards data privacy.
The results reveal that these issues for Canadian consumers are not that different from those of their neighbours across
the border.
55% 60%
42% 42%
42% 21%
28% 33%
45% 48%
Loyalty card penetration varies across sectors. Consumers comfort level with companies handling their
personal data also varies across sectors. (1 being the
sector you feel least comfortable with and 10 being the
sector you feel most comfortable with)
6.7
7.1
6.2
6.3
5.7
5.7
4.9
5.5
CANADA US
Consumers are more willing to share certain pieces of personal information with companies than others.
42% 52% 23% 33% 14% 20%
The majority of consumers are unlikely to use a digital
wallet. Those who are unlikely to use a digital wallet:
Consumers are more likely to download coupons on their
mobile device when they are at home. Of those who
download coupons on their mobile device, the location
where they are likely to do so:
69%74%
81%
68%
14%
23%
4%
8%
Supermarkets
and Grocery
Pharmacy and
Beauty
Fuel
Department
Stores
Credit card
providers
Supermarkets
and Grocery
Telecoms/
Mobile
Loyalty
Programs
Online Retail
Home
In-Store
On-the-move
Email Address Mobile phone
number

LOYALTY-ENABLED NANOTARGETING
TAKES CENTRE STAGE
The loyalty times are definitely
changing: Loblaw — Canada’s
largest grocer — launched a
personalized loyalty program
and has publicly stated that in the
future they hope to eliminate all of
their paper flyers. Base loyalty points
become the reason to collect data
on consumer purchases, and retailers
are launching multiple loyalty
programs to gather more data,
including Esso Extra and Aeroplan,
and Loblaw’s PC Plus and
Shopper’s Optimum.
On the retailer’s end, there are
obviously lower labour costs and
lower inventory management costs,
since discount price shelf-barkers
and power-aisle busting promotions
become less necessary. There are also
higher sales, higher market share, and
a higher profit mix.
The financial model below shows
the difference between retailing
today and retailing with
loyalty-enabled nanotargeting:
Net sales $555M
Gross profit
(before all marketing costs) $227M
Loyalty driven discounts ($42M)
Gross profit after
marketing expenses $185M
Not only has the top line increased
by seven percent, but also the bottom
line has increased by an eye-popping
90 percent. ROI has increased
five-fold, since marketing costs have
been reduced to $42 million from
$124 million (a two-thirds reduction)
and profit has nearly doubled.
But retailers still face many challenges
before they can declare loyalty-driven
nanotargeting success. First, are
retailers prepared for the data
onslaught that is necessary to drive
an effective loyalty program that
can drive personalized campaigns?
And, can they effectively drive
nanotargeting to the SKU level?
According to Steckel Elliott,
personalized offers drilled down
to the individual customer are
effective — as long as it is the right
item or right reward — but it takes
a tremendous effort to do it right.
“Not everyone is taking the time to
do the appropriate analysis, asking
the right questions for the right
insight, and driving true business
recommendations for results,”
Steckel Elliott notes. “You really
have to spend the time up front.”
Retailers should make sure not to
get caught up in drilling down
to a granular level to personalize to
prospects, experts warn. “You have
to look at how many variables make
sense,” says Steckel Elliott. “You
have to think about all your teams
— from operations to strategizing,
marketing, communications — and
make sure not to confuse them as
well as your customer.”
“Personalized offers
have five to eight
times higher ROI than
traditional offers.”5
5
Know Your Customers Wherever They Are, via Harvard Business Review Blog Network
LOYALTY
ELEMENT
LOYALTY TODAY
IN RETAIL
NANOTARGETING
IN RETAIL
BASE POINTS
EARN RATE
> High earn rate
(up to 2.3% value)
> General reason to
visit retailer
> Vendor-funded for
specific SKUs
> Consumer-agnostic
> Low earn rate
(<0.5% value)
> Reason to collect data
> Retailer-funded for
specific SKUs
> Consumer-specific

CONCLUSION: DATA-DRIVEN LOYALTY IS THE
FUTURE OF PERSONALIZATION AND RETAIL
ECONOMIC SUCCESS
Retailers have more access to
customer information than ever
before. But to turn that data into
dollar-driven insights that help
prepare for the new marketing
world of personalized offers, they
need to have a solid foundation of
detailed demographic information
about each individual as well as a
currency proposition that triggers
an emotional connection for
consumers. That is the power of
data-driven loyalty programs that
go far beyond simple CRM.
Today’s smartphone-carrying,
omnichannel consumers offer
tremendous opportunities for
retailers, who can take the explosion
of Big Data and turn it into valuable
insights that make offers more
targeted and relevant. But a CRM
database is not enough to make this
happen. For example, many national
Canadian retailers have a database of
between 10,000 and 850,000 email
addresses and believe that if they
can just grow this to a million or so,
that they will have what it takes to
deliver great offers to most of their
customer base, according to an Aimia
interview with a major Canadian DIY
chain. However, email is just the very
beginning of nanotargeting. And
loyalty cannot be easily evolved out of
that kind of old-school CRM strategy.
Today, those retailers sitting on their
email databases are facing several
fundamental hurdles:
> How do I acquire more insight to
who this person is? Their age, their
gender, their income, their latest
address, etc.?
> How do I ensure more consumers
are subscribing to hear from me
than are unsubscribing or labeling
me as spam?
> How do I have a meaningful enough
number of core and marginal
customers that I can communicate
with to move the needle in sales?
> How do I motivate consumers
beyond just price discounts,
which are easy to replicate
and expensive?
The bottom line is that the future
economics of loyalty in retail depend
on a variety of factors: allocating the
right budget to fuel a forward-thinking
program; looking beyond
across-the-board discounts and
promotions towards personalized
offers and rewards simply for
checking-in; going beyond
transactional data towards
gathering appropriate drilled-down
demographic information; and
providing a value proposition that
drives repeat visits and a long-term
relationship with today’s consumers.
To focus your efforts, consider rallying
around these simple principles:
> Place all your data efforts in service
of customers. If you live by this
principle, customers will reward
you for it. Serving customers with
your data efforts means seeking
permission, using data transparently,
and rewarding them for voluntarily
sharing personal information. Even
the largest social and search giants
will live or die on their willingness to
serve their customers, rather than
abuse their trust.
> Start with transactions; add
interactions. If you’re unsure where
to start your data journey, begin
with the transaction. Connecting a
purchase to an individual customer
opens up tangible and immediate
beneﬁts — you can devise offers
that increase lift, gain wallet share,
and reduce churn, and you can
measure the impact of each one.
As your analytical ability grows,
start connecting the dots from the
transaction to interactions through
social, mobile, or web channels to
build a robust view of customer
value and potential.
> Build relationships based on trust,
commitment, and reciprocity.
Information is useful only if
it provides insight that helps
you strengthen relationship
value. Customers are ﬁckle and
promiscuous, but they are loyal
to brands that build trust through
transparency, demonstrate
commitment through recognition,
and deliver reciprocity through
rewards. Data collected in service of
relationships will pay dividends on
the investment.
> Treat data as a renewable resource.
Data has been called “the new oil,”
but leveraging data to create
long-term enterprise value means
thinking of data less as a fossil fuel
to be extracted and consumed,
and more as a sustainable, renewal
resource. Treat your data as a
capital asset rather than as a
marketing expense, and use that
asset to collaborate with partners
who possess the expertise to help
you build real relationships with
your best customers.
If we rally around these principles
as marketers, we will ensure a
bright future in which technology,
data collection, and marketing
communications serve their proper
place in building a future of
real relationships.

ABOUT THE AUTHOR
About Aimia
Aimia Inc. (TSX: AIM) is a data-driven marketing and loyalty analytics company. We
provide our clients with the customer insights they need to make smarter business
decisions and build relevant, rewarding and long-term one-to-one relationships,
evolving the value exchange to the mutual benefit of both our clients and consumers.
With close to 4,000 employees in 20 countries, Aimia partners with groups of
companies (coalitions) and individual companies to help generate, collect and analyze
customer data and build actionable insights.
We do this through our own coalition loyalty programs such as Aeroplan in Canada
and Nectar in the UK, and through provision of loyalty strategy, program development,
implementation and management services underpinned by leading products and
technology platforms such as the Aimia Loyalty Platform and SmartButton, and
through our analytics and insights business, including Intelligent Shopper Solutions.
In other markets, we own stakes in loyalty programs, such as Club Premier in Mexico,
Air Miles Middle East and Think Big, a partnership with Air Asia and Tune Group. Our
clients are diverse, and we have industry-leading expertise in the fast-moving consumer
goods, retail, financial services, and travel and airline industries globally to deliver against
their unique needs.
For a full list of our partnerships and investments, and more information about Aimia,
visit aimia.com.
Manu Sarna, Vice President,
Loyalty Strategy & Analytics
Manu Sarna leads the US Loyalty Strategy &
Analytics group. In 2014 alone his team has
designed loyalty programs for an airline, a
hotel/gaming company, a specialty retailer,
a healthcare company, a personal wellness
company and more. He brings over a decade
of consulting experience, having worked
extensively with both Walmart and Tesco in
the UK on sales and category optimization. He
learned his strategic consulting craft with The
Boston Consulting Group, which he left to build
a large retail analytics consulting firm before
joining Aimia in 2011 to lead the Canadian
retail loyalty business for Aeroplan,
Aimia’s coalition.

YOUR DATA
OUR INSIGHTS
RETAIL
CONNECTIONS
aimia.com
With more than 4,300 talented professionals in 20 countries, we can deliver results
for your business using our loyalty insights. We see relationships differently.
To see how our loyalty insights can deliver results for your business, visit us at aimia.com.

The Aimia Institute creates forums and experiences centred on loyalty thought leadership for global
marketers and business leaders. And we want your opinions. Powering dialogue and debate on business
topics relevant to your business, let us be your resource for hearing from both industry and Aimia’s experts
on how to place the customer at the core and build real relationships with beneﬁt.
INTERESTED?
GO TO aimiainstitute.com
JOIN THE CONVERSATION
SHOWROOMING AND
THE RISE OF THE
MOBILE-ASSISTED
SHOPPER
SEPTEMBER 2013
Matthew Quint and David Rogers
Columbia Business School
Rick Ferguson
Aimia
FEATURED
WHITEPAPER
SHOWROOMING AND
THE RISE OF THE MOBILE-
ASSISTED SHOPPER
What causes consumers to
walk into a store >>>
CONTENT
Perspective on
current business issues
through a loyalty lens
COMMUNITY
Established to generate
credible and
diverse dialogue

Future Economics of Loyalty US - Manu Sarna

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