Loyalty360 Engagement Expo: The Loyalty Divide
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Presented by Kathy Hecht, VP Marketing at Acxiom at Loyalty360's Engagement & Experience Expo Oct 29, 2012. Download the full white paper here: http://bit.ly/acxm-loyaldiv
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Loyalty360 Engagement Expo: The Loyalty Divide
- 1. THE LOYALTY DIVIDE Brands Don‟t Offer Loyalty. Consumers Grant It. Kathy Hecht, VP Marketing, Acxiom Loyalty 360 Engagement & Experience Expo October 29, 2012 © 2012 Acxiom Corporation. All Rights Reserved.
- 2. 2
- 3. WHAT IS A MARKETER TO DO?? 3
- 4. THE LOYALTY DIVIDE Most marketers know what they But, they struggle to do it need to! As an organization I need to speak to my customer based on their needs and 66% expectations As a marketer, I'm hindered by a lack of information or accessibility to my 56% customers 4
- 5. CRM AND SOCIAL DATA DISCONNECT A majority of marketers are collecting outside customer data in their 68% marketing campaign efforts Yet, less than half integrate outside customer data into holistic CRM 47% programs 5
- 6. INFLUENCERS ARE BEING IGNORED 94% of marketers don’t use Influencer Score as part of segmentation and measurement… 6
- 7. NPS IS BEING UNDERUSED 89% of marketers don’t use Net Promoter Scores as part of segmentation and measurement… 7
- 8. HOLISTIC „CUSTOMER LTV‟ LAGS AS MEASURE Nearly half of marketers use But still, many marketers use purchase Customer LTV when segmenting history as the primary customer marketing offers…. measurement for messaging mix… Use CLTV when segmenting 47% offers Use purchase history as primary customer 42% measurement 8
- 9. AND, NEW CUSTOMERS DON‟T GET TREATED DIFFERENTLY 63% of marketers always or frequently treat new customers the same when choosing advertising media 9
- 10. SMALL NUMBER OF BRANDS HAVE DISCOUNT PRICING AT CORE 7% of marketers have “everyday low prices” as part of their core brand message… 10
- 11. YET, INDISCRIMINATE USE OF PRICING FOR MANY BRANDS But,40% of marketers always/frequently use pricing discounts for promotions… 11
- 12. HOW TO CLOSE THE LOYALTY DIVIDE > MULTIDIMENSIONAL INSIGHT • No one signal consistently describes or predicts consumer behavior • Refine across all relevant signals > INSIDE OUT • Activate and refine insights to know your best customers. • Spend more on cultivating relationships with them. • Use what you have learned to identify prospects who think, look, and act like your best customers. 12
- 13. HOW TO CLOSE THE LOYALTY DIVIDE > OUTSIDE IN • Collect online data about customers – touches from outside the brand. • Use it to optimize all media > TRUST & TRANSPARENCY • Just because you can, doesn’t mean you should. • Marketing should be for the customer not to the customers. • Long-term trust rather than short-term reward. 13
- 14. DELIGHTING CUSTOMERS PROMISES HIGH RETURNS Acxiom client experience 14
- 15. “THE LOYALTY DIVIDE” November, 2012 THE LOYALTY DIVIDE 15
- 16. THANK YOU acxiom.com/facebook acxiom.com/twitter acxiom.com/linkedin Discover more at acxiom.com. © 2012 Acxiom Corporation. All Rights Reserved.
Editor's Notes
- What drives loyalty?There are 4 main drivers of loyalty: Familiarity, Comfort, SafetyTrustLoyalty 360 and Acxiom set out to explore what seemed to be a wide gap between marketers and customers perceptions of loyalty. Survey:130+ respondentsA balanced distribution of small to >$1 B rev companiesA diverse set of industry marketing experience (14 Industries)Across mostly C-level, VP, Directors with Marketing, Loyalty and Analytics titles
- What drives loyalty?There are 4 main drivers of loyalty: Familiarity, Comfort, SafetyTrustLoyalty 360 and Acxiom set out to explore what seemed to be a wide gap between marketers and customers perceptions of loyalty. Survey:130+ respondentsA balanced distribution of small to >$1 B rev companiesA diverse set of industry marketing experience (14 Industries)Across mostly C-level, VP, Directors with Marketing, Loyalty and Analytics titles
- What we found: Marketers recognize the importance and value of speaking to customer based on their needs and expectation but they’re not getting it done at most organizations.There are 3 big areas that create the divide between loyalty as a holistic, customer-centric enterprise approach and loyalty as an afterthought.Many marketers don’t have dataMarketers are collecting data but aren’t leveraging/integratingMarketers are collecting incorrect data and are using substitute proxies (which are not complete)
- Many marketers are using outside data in their marketing efforts, which means the data is being collected. That’s good news!But interestingly, when we asked how this data was being integrated into broader CRM strategies and systems a whopping 53% of marketers do not integrate this data into broader CRM programs.Compounding the problem: Social data is being collected but it’s not being used within the marketing mix. Over 55% of marketers collect social data – again, good newsBut over 70% are NOT collecting data from complimentary brands. And, something like 98% of your customers activities fall outside of your specific brand touch-pointAnd, 75% had a hard time integrating and accessing it to activate all mediaKey takeaway: Causes a message disconnect which reinforces brands don’t know them. If you don’t them how can there be: Familiarity,Comfort,Safety and Trust?
- When you’re ignoring influencers (you don’t take it into account) you’re making an inaccurate assessment of how loyal a customer is. You just don’t really know how loyal they are. You just don’t know your customer so how can you market to them?
- Same as Influencer. Not using all the data gives an incomplete picture.
- If you don’t know who your most profitable customers are how you can spend more time cultivating relationships with your them?How can you invest and ask questions which will yield new stats which will pop out as to what you’re are doing right, wrong or too timidly.Key takeaway: Marketers are using substitute proxies like purchase history, which are not complete. Collect the right data and you can have better measurements.
- The end result? The opposite of Familiarity,Comfort,Safety and TrustA majority of marketers – 65%! – said they treated all new customers the same. If everyone is treated the same how can a consumer ‘grant’ loyalty? (Remember the comic - “whatever store this is”)
- While discounting and “special deals” are a common tactic to “offer” loyalty, the issue of trust between the consumer and brand is often secondary. Key takeaway: No authenticity. Creates “discount addiction” and “loyalty” becomes about lowest price vs intimacy. This causes pressure on the brand premium. Dataanalysis yields the deep segmentation and audience targeting necessary to recognize valuable behaviors, rewarding them with discount targeted offers creates ‘discount addiction’ rather than brand intimacy. Start by explaining there is a wide variety in the price sensitivity across the American consumer. There are things they’ll pay a premium for because it meshes well with them. On other items, they won’t budge on price. There is a wide variety of attitudes, preferences and the like that reveal opportunities for brands to understand and act upon differences in price elasticity.
- If you believe your objectives are…Familiarity,Comfort, Safety,TrustThen….To maximize revenue, minimize marketing expense and avoid the low-price trap, a marketer can close that gap by : Work Inside Out: To drive customer value, a marketer should start with the customers it already has -- the “inside” people – and spend more on cultivating relationships with its most profitable customers. Then the marketer can find high-potential prospects who think, look, and act like its best customers.Work Outside In: The data a marketer collects about its customers’ online behavior can be used to optimize all media, not just digital advertising. We call this working from the “outside in.” Customer centric programs powered by marketing or customer service organizations should be enterprise-wide and totally consistent in terms of customer relevance, consistency, engagement or results. Marketers, regardless of channel, should seeing the entire “big picture” of how to create the level of intimacy necessary to delight customer so much that they’ll never leave you, often regardless of price. Delegate budgets and strategy based on a focus on customer centricity and be sure it followed by the entire organization.Marketers should define compelling customer value at each stage of the customer life cycle and get top management buy-in to activate all departments around the brand loyalty strategy goals. As new channels are added to engage customers, similarly, they’ll measure new spend with improved customer satisfaction. Invest as such…certain questions will yield new stats which will pop out as to what marketers are doing right, wrong or too timidly.Marketers should reach consumers with more precise marketing instruments and recalibrateLeaders should refine their tactics while remaining consistent to a strategic, customer centricity approach for success.
- If you believe your objectives are…FamiliarityComfortSafetyTrustThen….To maximize revenue, minimize marketing expense and avoid the low-price trap, a marketer must adhere to these five requirements: Establish Multidimensional Insight: Too see the big picture of its customers and prospects, a marketer must have access to everything it knows about its customers across all relevant data points. Work Inside Out: To drive customer value, a marketer should start with the customers it already has -- the “inside” people – and spend more on cultivating relationships with its most profitable customers. Then the marketer can find high-potential prospects who think, look, and act like its best customers.Work Outside In: The data a marketer collects about its customers’ online behavior can be used to optimize all media, not just digital advertising. We call this working from the “outside in.” Link All Insights: Companies know their own customers best, and they’ve collected a wealth of current customer behavioral data and primary research. But they often stop short of using all their customer relationship data to plan advertising and make marketing decisions. They don’t tap into the economic power of their own data.Trust: A note of caution is in order. A marketer must create long-term trust, not just short-term results. Marketing should be for, not to customers. Acxiom is a marketer’s privacy partner.Customer centric programs powered by marketing or customer service organizations should be enterprise-wide and totally consistent in terms of customer relevance, consistency, engagement or results. Marketers, regardless of channel, should seeing the entire “big picture” of how to create the level of intimacy necessary to delight customer so much that they’ll never leave you, often regardless of price. Delegate budgets and strategy based on a focus on customer centricity and be sure it followed by the entire organization.Marketers should define compelling customer value at each stage of the customer life cycle and get top management buy-in to activate all departments around the brand loyalty strategy goals. As new channels are added to engage customers, similarly, they’ll measure new spend with improved customer satisfaction. Invest as such…certain questions will yield new stats which will pop out as to what marketers are doing right, wrong or too timidly.Marketers should reach consumers with more precise marketing instruments and recalibrateLeaders should refine their tactics while remaining consistent to a strategic, customer centricity approach for success.
- Marketing ROI - +15-30% marketing performance. Clearly value each touch point. This is where the client owns their own proprietary data asset, which is a mashup of client, Acxiom and 3rd party data.Increase targeting efficiency & better attribute results to spend.Better influence & sense consumer behavior.Improve marketing results with trusted partners.Recapture value from ad tech intermediaries.Improve test & learn performance.Integrate & rationalize systems to reduce cost.Real-time personalized offers.Customer Profitability - +10-15% customer portfolio value. Disproportionately invest in valuable customers. This is where you’ll want to concentrate investment on your most profitable relationships and reduce focus on lower value relationships. This requires customer recognition and unique insight applied when the customer is about to engage.Improve health and breadth of insight about customers.Acquire & extend more profitable relationships. Redirect less profitable relationships.Establish CLV-oriented KPIs to guide decision-making.Optimize customer segments & multichannel contact strategies.Increase number of recognizable consumers.Increase ability to recognize consumers across channelsPricing Power +5-7% pricing power. Focus on those with likely brand affinity. Be smarter about price as an incentive. Consumer can find out anything they want and as a result, brand values and the premiums they carry are under assault - every Brand metric is in decline. Drive the right demand that appreciates and results will pay for your brand value. React more nimbly to seemingly anonymous visits via recognition and then link to premium content
- You will all be emailed a copy of our latest report in mid-NovemberUse it to convince your enterprise to consider a new pathBe the heroGet help from Acxiom and Loyalty360