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Loyalty and the B2B Customer

B2B Loyalty Initiatives are fast gaining credibility
by Cindy Waxer

For a company that’s all about connecting people, telecom provider XO Communications was having a tough time connecting with its own business customers. But that all changed in May 2009 when the telco launched a B2B loyalty campaign.

Today the company sends 100,000 emails a month to its business customers, with content ranging from contest promotions to free white papers. By reaching out to its business customers with “feel-good messages” rather than product pitches, the company’s B2B loyalty program boasts an email open rate of nearly 20 percent and has contributed significantly to a reduction in customer churn, says Toni DeWitt, XO’s loyalty and retention marketing senior manager.

Too few B2B companies currently employ loyalty programs like XO’s. The B2C landscape, however, is awash in customer loyalty initiatives. And for good reason: The right programs can bring about impressive results, ranging from increased revenue and market share growth to upselling opportunities and enhanced customer spend. These benefits have caught the attention of an increasing number of B2B marketers, who recognize the potential value of B2B loyalty programs. “Employee loyalty, channel loyalty, and B2B-type loyalty programs are growing significantly,” says Mark Johnson, CEO of Loyalty 360.

Another reason for that growth: Today’s tough economy, off-patent products, and Web-based comparison shopping are forcing B2B organizations to rethink their retention and growth strategies. “If you want to retain and grow a customer, you’re going to have to do more than just sell them the product,” says Dan Carrothers, chief operating officer at Datacore Marketing.

From trinkets to tactics

However, that’s not to suggest that companies can simply repackage B2C strategies for the B2B playing field. “One of the principles of designing a B2B loyalty program is to avoid thinking of the classic, legacy consumer program where you earn points and receive gifts,” warns Howard Schneider, a partner with Metzner Schneider Associates. “You have to avoid the possible appearance of bribery or of unfairness in a business setting.”

That’s why, unlike B2C’s quid pro quo tactic of rewarding customer allegiance with “trinkets and trash,” Loyalty 360’s Johnson says, there’s a more strategic element to B2B loyalty that involves delving into consumer buying patterns and preferences. “Now, we’re seeing this big push towards understanding customer behavior,” he explains.

“Data is king,” says DeWitt of XO. By tracking customers’ historical buying patterns, churn risk scores, and contract end dates, DeWitt says XO has been able to fine-tune its B2B loyalty initiatives. “Whether it’s for our B2B upsell campaigns, our renewal-based campaigns, even for certain engagement campaigns, we use data to target our customers.”

It’s that attention to detail that’s required in a B2B setting. According to Datacore’s Carrothers, “B2B loyalty is much deeper than B2C. It can’t be about simply rewarding customers for buying your product. There has to be more to it, because if customers don’t believe that you have their best interests at heart, and that you are sincerely dedicated to helping them become successful, you shouldn’t expect their loyalty long term.”

In fact, the very nature of a B2B loyalty program entails moving beyond simple retention tactics and instead, incorporating strategies such as soliciting customer input, empathizing with customers’ day-to-day challenges, and rewarding top customers with extra service. For example, shortly after launching its B2B email campaign, XO added a feedback mechanism that allows customers to offer comments on everything from billing and service concerns to repair issues and new product features. The option has been “a big hit,” according to DeWitt, who adds that customer responses are closely monitored and routed to customer care representatives for redress.

Another example of a company using customer insight as part of B2B loyalty initiative is SAP. The B2B software provider’s loyalty strategy is focused on the overall customer experience and has as much to do with analytics as with pragmatism. “First, we go through a thorough process of defining all the customer touchpoints that we provide as a company,” says Marcus Starke, vice president of North America marketing for SAP. “Second, we define what the status quo is on the experience that we provide—and that can run from good to bad. Next, we work on a program to define what the experience should be and the gaps between what we have today and where we want to be.”

Customer loyalty redux

That step-by-step approach to creating a B2B loyalty initiative has culminated in some sweeping changes for SAP. In addition to revamping its website user interface, Starke says the company is also in the midst of restyling the language that it uses with its customers both online and in marketing materials. “As we broaden our audience from CIOs to line-of-business leaders, the tech talk that we traditionally speak has become more of a problem and incomprehensive,” says Starke. “So we really have changed the way we speak to customers and the language we use so that non-technical people can understand what we’re talking about.”

And nothing speaks louder than the data a company collects on factors such as website traffic, customer churn, and employee satisfaction. “Data is central to the efficacy of B2B loyalty programs,” says Johnson of Loyalty 360. “Having good data insight so that you can make actionable decisions is important and something we’re seeing more and more of in the B2B world.”

One more tip for creating an effective B2B loyalty program: Focus on existing customers. While many B2C loyalty programs are as much about chasing the ever-elusive consumer as they are about retaining current customers, a recent study from Loyalty 360 reveals that retention efforts are essential given that at least 20 percent of new sales come from existing customers—with nearly half (44.6 percent) of respondents reporting that at least 60 percent of new sales come from existing customers. “It’s much more cost-effective to keep a customer, keep him happy, increase that share of wallet, and increase that share of mind than to go out and acquire new customers,” Johnson says.

Challenges ahead

Along with the benefits, however, come some common mistakes that can hinder the results of a B2B loyalty initiative. One is “rewarding behavior in a material way when you don’t have to,” says Schneider of Metzner Schneider Associates. “People in a B2B setting are just as likely to be motivated by service, recognition, and thanks than they are by an additional discount.”

But according to Schneider, the greatest crime companies commit is regarding B2B loyalty programs as an after-thought. Instead, Schneider recommends that companies create a team of marketing executives dedicated to overseeing B2B loyalty initiatives, with an emphasis on enhancing customer experience and service.

Because, as more and more companies are discovering, when it comes to B2B loyalty programs, the emphasis should be on scoring points with customers—not doling them out as rewards.

Original document from 1to1 Media.

New ideas keep interest alive and prevent your loyal customers from looking for more excitement elsewhere.

by Jim Sullivan

When I dropped my iPhone recently, with cracked screen the only damage, I went online and scheduled a consultation at the “genius bar” at a local Apple Store for later that day.

Now, it’s a confident retailer that calls its front-line customer-service agents “geniuses,” and wants them to interact with customers face-to-face so everyone can see if they are or aren’t. Geniuses, that is. More than simply a confident retailer, however, it’s a retailer that loves its customers.

“Love?” you ask, “In business? It’s just not a proper business topic. Too ’warm and fuzzy’ for most corporate types.”

It’s too bad business people are so uncomfortable talking about the “L” word, because otherwise we might be able to see that many barriers to customer loyalty stem from a lack of it. I encountered no such barriers in the Apple Store, where I’d expected to hand over my iPhone to a lengthy and expensive repair despite the fact that it still worked fine. The technician behind the genius bar studied the out-of-warranty device, glanced at my account info on his hi-def flat-screen, smiled at me and said, “Mr. Sullivan, let’s just replace this one and get you on your way. No charge.”

As simple as that. Almost as quickly, he transferred data from the cracked iPhone to the new one and sent me “on my way” — except I didn’t leave just then. I asked the store manager why they were treating me so well. He laughed and explained that, while they can’t replace every broken device tossed at them, they have discretion to take actions to satisfy customers.

Very likely, they knew I was a loyal, high-value iNut. I also own an iPod, an iPad, a Mac mini, and a Macbook Pro notebook. That’s it. I think the Apple tech at the genius bar can confirm that, because the fullness of my account information told him all he needed to know to simply replace rather than repair the device. Apple is practicing what we at COLLOQUY call Enterprise Loyalty, using customer data to integrate marketing, merchandising, and pricing decisions across channels to deliver a superior experience. Because they love me.

When I speak of love in a business context, I mean cheerful service to others. One fascinating aspect of the service brand experience is that it rests on intangible and often emotional factors. Cues, clues, and their influence on our senses often determine the final consumer perception of quality as much or more than the tangible aspects of the delivered service. Also interesting is that the provider and the consumer of services must work together for the service to be delivered. The relationship, and the way it makes the customer feel, are of central importance to the overall experience. Talk about warm and fuzzy.

What can loyalty programs, which are pure services performed in conjunction with your best customers, learn from the “love lessons” Apple employs?

Insights: Best customers want you to make the first move, caring enough to take the time and the care to know who they are and what they do and don’t like, and to respond appropriately and considerately. Use that treasure trove of loyalty data to inform all actions to support your beloved customers and let them know you care.

Involvement: No one feels loved in a one-way relationship. If your only conversation with customers is telling them what you want them to do for you, a painful break-up surely looms. It’s a partnership—so shut up, open up, and bring your best customers in to share how they want to be treated. Let them in on your plans and dreams. Maybe they’d be more loyal if they felt a degree of ownership of your new ideas and innovations. Speaking of which…

Innovation: Woody Allen famously said in the movie Annie Hall, “A relationship, I think, is like a shark. You know? It has to constantly move forward or it dies. And I think what we got on our hands is a dead shark.” Keep propelling your program forward. New ideas keep interest alive and prevent your loyal customers from looking for more excitement elsewhere.

That’s what the business world needs now, as underscored by my recent lovefest at the Apple Store. Loyal before, and an advocate after.

Original document from Colloquy.

Brand positioning’s role in customer loyalty

Effective brand positioning has become critical in a competitively-packed market, according to Dave O’Hearns of UK-based Verve Brands, who explains not only the importance of positioning but how, why, where and for whom you do it.

Brand marketers must start, O’Hearns says, by reviewing their existing brand and what it stands for. In doing so you can get a clearer idea of its vision, values, promises, customer experiences (both functional and emotional) and philosophy. These things can change over time – as can consumers and their brand expectations – so some of this may need to be updated. egalipaud This article is copyright 2011 TheWiseMarketer.com).

Marketers who have not yet identified those facets of their brand should start doing so immediately, because they will have no idea whether or not their brand is positioned correctly, and therefore whether or not anything specific needs to change.

Be the customer
The next step is to think about your brand as a customer, and work out how they would like to experience the brand. Perhaps collect information from a sample of customers about their perceptions of each of your products or services to get a true reflection of how your business is perceived.

Determine the target market’s preferred combination of attributes and examine the fit between that ideal and your current brand. The difference might be alarming but it will help you to reposition your brand correctly if necessary. You will also need to review your PEST and SWOT analyses to make sure the information you have gathered so far will work in the market place now and in the future.

Once you have all this detail in place you can start to gauge how effectively your brand is positioned and what needs to be changed to attract the right customers and differentiate yourself from the competition.

Keep it together
A brand consists of a number of different elements so make sure that each is pulling in the same direction and creating the right vibe for your organisation. Break it down in to your logo, colours, typography, graphics, illustrations and / or images and tone of voice. Look at all of these areas to make sure they have togetherness and deliver on your values.

Look at the applications you use currently to attract, introduce, transact and retain customers, and what applications you could be using to talk to the right people and enhance your brand.

Customers tend to be smarter about brands and marketing than they were in the past, and they want to control the way they are communicated with – and when. Be aware of your target audience and understand their needs so you can communicate in the right way and at the right time. Allow your customers to have their say and interact with your brand; get them involved and get their feedback where possible. In other words, make them feel important.

Reward their loyalty
A customer is more likely to stay loyal if they buy in to your brand and share the values of your business. Loyalty should be rewarded. Look after your current clients as much and probably even more than the new ones. Existing customers currently receiving a great experience will only tell other people about how good you are. They will become a fan of your brand and act as a sales team for you.

But attracting the wrong type of customer can have an adverse affect on your business. You will need to review your current database to see which are your best customers, and attract similar-minded people. Getting this wrong can mean attracting customers who do not appreciate your brand and maybe find the product too expensive at the point of purchase, or who find it’s just not right for them. This will inevitably end up in your time being wasted, their time being wasted and a bad experience by all. These customers will obviously have the opposite effect to the good customers and tell other people how bad your brand is, just because your brand message was not concise enough and didn’t talk to the right people, at the right time, at the right place.

Rewarding good customers that either spend regularly, pay on time, have been with you for x amount of years, or who make referrals for you is paramount to further success. A gift for doing something correctly is always well-received – even more than a cash incentive.

Providing rewards which are one step away from money can work well and even seem more personal and friendly. It can make your customers feel that you really know them and this makes them feel special. This idea is similar to taking a bottle of wine to a friend that has invited you to dinner (which is seen as friendly) rather than simply handing over enough cash for a bottle (which would be seen as offensive). A gift with no known value often outweighs a money-based offering if you really want to build customer loyalty.

The bottom line
So, in order to nurture existing good customers, remove the “wrong types” of customers, and attract new ones with the same values as your good customers, you will need to examine where you want to position your brand, how you want it to look from the customer’s point of view, how it should behave, and how it should talk to people.

Positioning your brand correctly will help your business grow and allow you to command the price you want for your products and services compared to your competition in your chosen market place.

Ultimately, every company wants to achieve true brand loyalty so that, when you produce a new product or offer a new service, existing customers will be more likely to buy in to it because of their previous positive experiences with the brand. This creates a cycle of buyer confidence, as they now know what your brand stands for – and what it delivers for them time after time – ensuring repeat business and greater loyalty. Brand consistency is vital to success in any consumer market. In fact, even in an economic downturn people will still tend to buy the latest offering from their favourite brand rather than buy a cheaper alternative of unknown quality.

Original document from The Wise Marketer.

Instant Redemption Rewards Reach Customers Neglected by Traditional Loyalty Programs

by Denis Huré, CEO and Jill Goldworn
Instant Redemption Rewards Reach Customers Neglected by Traditional Loyalty Programs

There is no doubt that loyalty programs are on the rise today. In the U.S. alone, there are 1.8 billion individual memberships in loyalty programs, everything from airlines to convenience stores to movie theaters. In light of this huge number, the general perception is that consumers are happy to join loyalty programs, eager to enjoy the added rewards that come with loyalty programs. The reality, however, is that they’re not. Confirming this expectation gap, a recent survey by the Chief Marketing Officer Council found that some 32% of consumers surveyed felt that participation in loyalty programs holds “little to no value.” Ouch.

What has emerged as a result of this disconnect is a new direction in loyalty programs: instant reward redemptions. In the past, instant rewards have been limited to cash or discounts at the register; maybe a free item of very low value. Technology, thankfully, has given rise to this new breed of instantly redeemable rewards – the digital, downloadable kind. These instant rewards promise to finally eliminate some of the traditional problems associated with loyalty programs, like engagement and delivering value.

Problems with Traditional Programs
According The Journal of Retailing, “the rewards associated with loyalty programs provide a means to establish reciprocity between the customer and the company.” But problems that have plagued this interaction, or reciprocity, throughout the years and usually stemming from the delay between collection and redemption by loyalty program members. Whether a program’s threshold for redemption is too high, or the redemption process is too cumbersome (which often the case, ask any FFP member), traditional loyalty programs suffer from program inefficiency. And here’s where instant redemption provides instant relief, specifically in two areas:

Low-Threshold Consumers
In the past, a big problem has been the loss of “low-threshold” consumers. For these consumers, who maintain a low accumulation of points (or whatever program currency), the traditional loyalty program concept fails: if the point threshold is too high, the program has become irrelevant because the consumer feels the reward is not obtainable. In such cases, the loyalty program is actually hurting the brand. It suffers because the consumer disengages from the brand before they have received an added “reward” for membership.

Instant reward redemptions provide companies a very affordable alternative to offer these low-threshold consumers an easy way to burn low point accumulations. Loyalty program managers also benefit, as studies have shown that these “light buyers” represent a large increase in spending and purchase frequency post-redemption. In other words, they’re not a segment to be ignored.

Delayed Redemption
Another area of concern with loyalty programs is cumbersome redemption processes. Regardless of the delivery method, timing is of the essence in loyalty programs. In fact, the timing is (almost) everything. The longer the delay in collecting a reward, the less powerful the loyalty creation. Here, instant rewards reduce the delay between collection and redemption and, therefore, a larger chance for loyalty engagement success.

Digital Content: The Ultimate Instant Reward Redemption
Digital content, offering loyalty members downloadable content (such as the latest selection in music, movies, software, books, games, magazines), is emerging as the premier medium for the delivery of instant reward redemption. The sheer selection of digital content that is available, along with its monetization potential, makes it an excellent vehicle for instant reward redemption programs. Consumers want instant rewards, and digital content is the next logical step. Research from Mintel confirms this fact: 47% of consumers surveyed said their choice of loyalty program would be influenced by instant redemption options, such as cash or discounts. Jackpot!

So with this information acquired from recent surveys and obvious positive consumer sentiment, the next question seems to be: is digital content a good substitution for cash or discounts?

In a word, yes. According to Mintel’s study, 61% of respondents said that lower overall cost for merchandise they would have purchased anyway is an important attribute of a loyalty or rewards program. It’s feasible to assume then, that relevant contentcontent that the consumer is likely to purchase regardless, is a good substitute for cash or discounts. And considering that 65% of internet users have paid for intangible digital content, there is a huge market for relevant and engaging digital content waiting to be developed. In the UK, a recent YouGov survey showed that among those aged 18-34 who had engaged in digital activities, 22% spent more than £5 on digital books, the digital content category receiving the highest spend.

Digital content presents a win-win strategy
Digital content gives businesses the chance to burn points off their balance sheet, while offering the entire spectrum of loyalty program participants the opportunity to redeem points for merchandise in which they are interested or already purchasing on a regular basis.

In essence, instant digital rewards have bridged the gap between reality and perception. By making rewards instantly redeemable, businesses can give their customers the value that they seek: relevant rewards instantly and anywhere, loaded onto the devices they use in their everyday lives. Instant digital rewards, it seems, have created a new trend in loyalty programs: programs that work for everyone.

Loyalty: Looking Forward
Featuring latest statistics and defining characteristics of various industry loyalty programs presented by the first club™, “Loyalty: Looking Forward” can help program managers grasp emerging loyalty trends and their digitized, instant future.

Original Document from Hospitality Net.

the first club™ Gives Insight into the Future of Loyalty Programs in New Whitepaper, “Loyalty: Looking Forward”

loyalty looking forward
Give Loyalty Program Members What They Want, When They Want It with Digital Content

Los Angeles, February 09, 2011 – Airlines, Hotels, and Retailers take notice:  the popularity of loyalty programs is growing; but so is the dissatisfaction over program benefits and rewards when it comes to the high number of points or miles necessary for redemption, and rewards that consumers recognize to be valuable.

Brands must understand this new evolution of loyalty consumer demand, and a new whitepaper from the first club™Loyalty: Looking Forward: The State of the Loyalty Industry and its Digitized, Instant Future” provides insight into the next generation of loyalty programs.  “Loyalty: Looking Forward” focuses on the challenges of low motivation at the lower spectrum of loyalty program customers.  What can brands do to prevent flight of customers who maintain low accumulations of points?  The broad answer:  provide incremental rewards that are relevant to the consumer, easily attainable, and instantly available through digital content.

68% of consumers feel that a loyalty program can strengthen their relationship with a brand, and successful rewards programs will cater to this demand for relevant offerings by providing a wide array of instantly-available digital content. “Loyalty: Looking Forward” provides specific industry data for airlines, hotels, and retailers: information that is essential to the loyalty program manager striving to prepare for the digital reward evolution.

A look inside “Loyalty: Looking Forward”:

Digital Content
48% of consumers spend more with a company whose loyalty program offers content that is relevant to them personally.  65% have purchased digital content online.  It is imperative, therefore, that brands implement programs that offer a wide array of content that is available digitally and easily.

Airlines
The modernization of airline FFPs to include digital rewards will substantially decrease airlines’ exposure to financial liability (by encouraging the incremental redemption of miles), and will resonate with consumers who clearly desire more value from their airline loyalty program.

Hotels
In today’s online deal-shopping atmosphere, consumers are less responsive to in-hotel premium services.  The days of offering elite “status” or premium service for customer loyalty are eroding.  The new day requires an offer or promise of tangible added value: 47% of consumers are motivated to join programs that provide instant gratification.

Retailers
Offering direct discounts for loyalty program members gives retailers the ability to immediately impact consumer decisions; these discount incentives, however, are easily duplicated by competitors.  The result: price wars within the segment.  Instead, companies have market expansion opportunities via loyalty programs or promotions that engage consumers.

“Loyalty: Looking Forward” provides:

–    A look at what digital content consumers are demanding.
–    Explains how digital rewards provide hotels a cost effective opportunity to match these consumer demands.
–    Explains how cross-promoting across brands through digital rewards will expand a retailer’s market and increase margins.

Featuring latest statistics and defining characteristics of various industry loyalty programs presented by the first club™, “Loyalty: Looking Forward” will help program managers grasp emerging loyalty trends and their digitized, instant future.  To download a copy of the whitepaper, please visit the whitepaper registration page, or contact Vanessa Horwell at vanessa@thinkinkpr.com for more information.

Best Practices in Hotel Loyalty Programs for 2011

What hotel marketers and loyalty program managers need to learn to increase bookings from their most profitable guests: Repeat customers.

Denis Huré, CEO and Jill Goldworn

While most hotels have loyalty programs, they are definitely not living up to their potential. On average, only 20 to 40% of program members regularly accrue points toward award redemption. That means hotels are losing out on significant opportunities to encourage at least 60% of their customers to become repeat and loyal customers¹ and as repeat customers can be the most profitable ones, that means hotels are leaving a lot of money on the table.

Moreover, travel industry loyalty reward programs have seen a 31% decline in active participation since 2007, according to research from Colloquy. This decline is attributable to a decrease in business and leisure travel and cuts in corporate travel budgets, which only underscores the fact that hotels need more compelling loyalty initiatives to attract and retain frequent guests.

It’s worth mentioning that not every trend in these programs is negative. In fact, overall hotel loyalty program participation is actually up 19% this year², most likely owing to the recent recession and consumers’ heightened quest for the best deals when planning travel. As the economy rounds into recovery, however, consumer interest in loyalty programs may also start to fade, reducing the effectiveness of these programs once again.

Hotel loyalty programs – also known as frequent guest programs (FGPs) – of the past offered simple point accrual for nights stayed and preferred service as a benefit of membership. To survive through 2011 and beyond, however, they must offer more value and simpler reward redemption to remain attractive to today’s consumer. Ease of redemption is key; consumers can become more excited and loyal to a hotel or chain after their first redemption, facilitating their transition from “experimenters” dipping their toe in the loyalty program waters to profitable, consistent members who keep coming back.

So what do customers look for today in a hotel loyalty program? What rewards will be most popular for 2011? What should hotels do to make sure that their loyalty program appeals to the widest segment of travelers?

The answers to these pertinent questions can be found in some of 2011’s loyalty industry best practices, many of which are currently being implemented by forward-thinking hotel chains. These practices will be the cornerstones of many hotel loyalty programs in the coming year, as large chains and small hotel groups alike will seek to improve their offerings in a post-recession environment.

Emphasis on Value

Of course, just because the recession may officially be over doesn’t mean consumers will abandon their search for value. Though the emphasis on value this year may be less distinct among business travelers (and the corporations that pay for their lodging), this emphasis remains in the leisure market. Hotels primarily serving the more temporary, vacation and family segments should take special care to integrate value-oriented loyalty programs in 2011, as it is this aspect that consumers frequently cite as most appealing – 32% said the recession has made their participation in rewards programs more important, research from Colloquy has revealed.

Easier and Incremental Redemption

One of the ways hotels can demonstrate value within the scope of their loyalty programs is by making reward redemption more convenient. Hotel loyalty programs have historically relied on the improved or increased services that are offered as benefits of program membership. That is, a Marriott Rewards® member, for instance, enjoys a higher level of service than a one-time lodger simply by participating in the program.

While this type of reward can be effective in encouraging repeat business, the real motivator for multiple repeat stays is the accrual of loyalty points. As with airline loyalty programs, however, customers often become frustrated with the amount of commitment necessary to earn enough points for a free room night. A full 37% of respondents to a Chief Marketing Officer (CMO) Council survey indicated that they found individual points to hold little or no value, with another 38% citing “too many conditions or restrictions” among their top complaints about loyalty programs.

It is reasonable, therefore, to say that hotels should be moving in a direction that reduces limitations on reward redemption – a strategy that includes an evolution away from the “free room night” as the sole reward for loyal behavior, and instead encourages guests with rewards that are attainable from just a single stay. These rewards are redeemable at any time and bring the guest right back to the brand’s site – after he or she has left the property to re-engage with the hotel brand once again.

Digital Rewards

This is where digital rewards content – such as instantly-downloadable music, movies, video games, eBooks, software, magazines and so on. – have become increasingly attractive and effective. This is because the value of a loyalty reward has as much to do with its relevance to consumers as to how easy it is to earn enough points in order to redeem these. In much simpler terms, loyalty program members want useful prizes and digital rewards at any easily attainable (read: lower) level.

This makes good sense – consumers are increasingly interested in digital rewards, and tend to perceive them as valuable. Gearing a loyalty program more toward relevant, immediately-redeemable digital gifts like MP3 tracks, eBooks, and downloadable movies shifts the emphasis from long-range point accrual (for a free room night, for instance) to a higher-interaction, incremental redemption process.

This results in more interaction between the consumer and the hotel brand through the loyalty program, not only encouraging repeat business but also improving members’ relationship with the brand.

Digital-centric loyalty programs align directly with prevailing consumer trends. Digital content consumption is moving from an ownership to an access model, with typically “owned” media types like DVDs on the decline, and access to streaming content on the rise. Providing access to digital content as a reward puts a hotel’s loyalty program squarely at the front of consumer preference and profitability.

And there is a huge upside to digital rewards for hotels and loyalty marketers: because digital rewards are redeemed more often, they reduce the burden of unclaimed loyalty points on hotels. Unclaimed points become financial liabilities for the hotels offering the programs, as they’re effectively benefits owed that go unused. Loyalty programs that offer easily redeemable, digital rewards increase the redemption rate and cut down on these kinds of liabilities, making a hotel’s finances cleaner and more straightforward.

Loyalty in 2011

These three best practices are quite simple to implement, but carry great potential for both sophistication and efficacy in their execution. Emphasis on value implies presenting consumers with a loyalty-based bargain, but actually represents a comprehensive approach to loyalty programs overall. Offering multiple levels of redemption options is a strategy that has proven effective again and again at increasing consumer engagement and loyalty. New technologies, increasingly sophisticated mobile devices, and the growing rate of consumer adoption of digital content across all aspects of their lives – from iPods to mobile apps – have all supported the growth in popularity of digital rewards, which offers attainable, instant rewards that consumers will actually want to redeem their points for.

By following these loyalty program best practices, hotels across the globe can move their loyalty programs forward into the new decade, and grow their bottom lines in 2011.

So what are you waiting for? It’s time for your loyalty program to go digital.

¹Loyalty Traveler blog

² Colloquy

the first club™ is the first global solutions provider to present a new, better, and more effective way to offer rewards and build loyalty by delivering relevant, digital content that is instantly gratifying to today’s consumers. the first club™ integrated digital solution can enhance loyalty programs, promotions, incentives and any type of rewards programs by offering the latest in premium content that will engage consumers worldwide. Consumers can access the very latest in digital content including millions of mp3 tracks, mobile phone apps, games, eBooks, audio books, and soon casual games, digital magazines, movies and TV series, in up to 12 languages, to engage with their favorite brands. Using cloud-based technology, the first club™ solutions are easily integrated into existing programs, are cost-efficient and scalable to capture more of the burn budget, and can even create additional revenues. As the co-founders of the first club™ and with more than 30 years of combined experience in the loyalty and digital licensing industry, Jill Goldworn and Denis Huré have been long-time advocates for the importance of providing rewards to increase loyalty program participation across all industries.

Original Document from Hospitality Net.

Analysis Of Unredeemed Loyalty Points Offers Customer, Marketing Insight

There is information in inaction, if marketers know how to analyze it: Segmenting and examining customers based on their activity and unused loyalty program currency can offer insight into communicating with them and building their value. It can also help stimulate redemption.

This is a double bonus: Not only do customers interact with the marketer, building affinity, but it helps with the books: Loyalty program points are often kept on corporate accounting sheets as liabilities.

What are the keys to looking at unused program currency? “The first question marketers should be asking is why their members are keeping the points,” says Jill Goldworn, president of the first club™, which offers low-point redemption alternatives for companies running loyalty schemes.

“Are they waiting for the big redemption, [for] a big trip or a big-screen TV?” she continues. “Or are they mindlessly collecting without a true connection to the brand?”

A few database queries regarding purchase patterns can offer the first clues regarding approaching these participants. If they are one-time enrollees, or if they make purchases only on an annual basis, they can be urged to make immediate, low-cost (to the marketer) redemptions which reinforce brand devotion.

“They are not likely candidates for upgrades to the next level or ancillary revenue,” says Goldworn. “But if they are actives users, such as someone who has a co-branded credit card or who flies the same airline regularly, go back to the first question: Are they a collector, or is there nothing of value [in the program] to redeem for?”

Points collectors represent an opportunity for increased activity, especially if they are close to an award threshold and can be incented to increase their interaction to achieve that threshold. But this assumes marketers have captured the amount of loyalty currency accumulated through direct interaction with the brand, as opposed to through ancillary activity. Marketers that don’t record, on a participant-by-participant basis, the activities through which loyalty currency is earned are missing a key analytic component, she adds.

There are benefits to social media as well. Segmenting customers into those who frequently engage with the brand and its core activities allows marketers to identify brand advocates – individuals who are more likely to talk about program features and benefits, and therefore may be more receptive to messaging suggesting they serve as advocates in social media and other forums.

Surveys of enrollee preferences, when linked with a specific individual, can also help shape rewards and increase redemption and engagement, says Goldworn. Airline or hospitality program participants can be sent sweepstakes opportunities for tailored vacation prizes, for instance, with points redeemable for chances to win. Those who use their program currency to purchase books can have their preferences captured, and can later be offered chances to meet a favorite author.

One of the more attractive elements of sweepstakes is that loyalty currency for chances to win can be redeemed for relatively few points, which means such a premium is attractive to all levels of participants. “Most companies focus on the top 20% or 30% of their members – to the detriment of the bottom line,” says Goldworn. “They don’t market to the rest of them.

“The reason only 20% are engaged is because the rest have orphan points,” she continues, referring to the members of a loyalty program’s file who haven’t accumulated enough currency for a reward. “The reason there are 700 billion orphan points is that participants don’t have enough to redeem for something useful. Airlines offer magazine subscriptions when points are about to expire. That is not brand engagement, that’s throwing away a relationship. That is a goodbye gift.”

This is exactly the wrong time for a marketer to start querying its database and trying to determine what will engage participants. Ideally, Goldworn says, marketers should be asking questions upon enrollment (or shortly thereafter) which indicate how serious a participant an individual is likely to be. These questions could include the number of related loyalty programs the enrollee is in, which can offer clues regarding the share of their wallet.

Goldworn’s final suggestion regarding populating information in a loyalty participant database is one for the beginning of the program. “Marketers don’t ask forward-thinking questions, like what is next? They should be asking and designing [data fields] based on where they want their customers to end up, not where they will be when they start.”

Original Document from Chief Marketer.

Why loyalty programs need consumable content

With loyalty clubs in high demand, businesses are looking for better ways to offer rewards to consumers so that they remain not only club members but engaged club members. In the beginning, loyalty clubs used big-ticket items – frequent flyer miles, free meals, free hotel stays. The problem? Many of these incentives go unused and consumers lose interest.
by Kristina Knight

The answer – and one new trend in loyalty marketing – is to offer consumers more relevant items. Rewards such as books, music downloads, software and games are making an impact with retailers and consumers alike.

According to a recent AdGenesis poll 11% of consumers joined six or more loyalty/rewards programs in 2010, and 61% joined between one and five rewards programs during the year.

“[Consumers] want more value from every dollar they spend, and when it comes to loyalty and incentive programs, they also want value and rewards they can use – immediately. the first club™ solution helps airline, hotel and retail brands build more value into their programs by offering instant and relevant rewards, through an exciting catalog of downloadable digital content to suit all tastes, cultures and lifestyles,” said Jill Goldworn, President and co-founder of the first club™.

From music to games and ebooks, the first club™ gives brands the chance to connect with consumers through content the consumer chooses – and important factor.

How big are ebooks? Barnes & Noble, one of the largest book dealers in the US, is reporting larger than expected growth for Q4 2010 and is attributing that growth to digital book sales and B&N’s Nook reader. The company is reporting revenue of $1.32 billion, up from estimates of $1.28 billion reported earlier in 2010.

Original Document from BizReport.

Innovation in Loyalty, the first club™ Launches eBook and Audio Book Digital Rewards to Engage Consumers and Encourage Higher Brand Interaction

Los Angeles, 11 January 2011. With almost two billion loyalty memberships in North America, how can brands differentiate their programs while providing exciting, relevant and usable rewards? the first club™ has just expanded its digital rewards platform to help airline, hotel and retail loyalty programs do just that by adding eBooks and audio books to its expansive digital rewards catalog.

The launch of the first club™ eBook and audio book digital catalogs is perfectly timed to coincide with the massive increase in eBook sales, which almost doubled during 2010 and now make up 9% of consumer book sales in the United States – compared to 3.31% in 2009.

The catalogs launch with over 100,000 titles including latest releases from best-selling authors such Stieg Larsson, Stephen Hawking, Barack Obama, David Baldacci, Elizabeth Gilbert – and more than a dozen genres. The eBooks work on most eReader formats and are available in English – with French, German and Spanish added in early 2011. Audio books are available in English and German, with more languages coming in 2011.

Launched in 2009, the first club™ is the first global digital loyalty, incentive and promotions solution of its kind, offering instant, usable rewards: consumers can download the latest in premium digital content including over 34 million choices of mp3 tracks, mobile phone apps, games, eBooks, audio books and software to engage with their favorite brands. Unlike other digital content sites, the first club™ is the only digital platform that is culturally relevant, offering international and local content based on the user’s location, available in 12 languages. And because the first club™ is fully customizable and can be branded according to any company’s needs, brands are in full control of their loyalty program and their customers.

Loyalty challenge

One of the biggest hurdles for loyalty programs is reward redemption and the number of points needed for the lowest reward levels. Take frequent flyer programs: there are over 120 million people enrolled in these programs, and trillions of miles that never get used. In many cases, consumers lose motivation to remain loyal to a brand’s program as they feel the rewards are not attainable. the first club™ solution removes this barrier by giving consumers the opportunity to redeem meaningful rewards in all areas of their life: music, games, mobile content and now eBooks and audio books, with content starting as low as 10 points or $1.

“Today’s consumers are sophisticated and demanding. They want more value from every dollar they spend, and when it comes to loyalty and incentive programs, they also want value and rewards they can use – immediately. the first club™ solution helps airline, hotel and retail brands build more value into their programs by offering instant and relevant rewards, through an exciting catalog of downloadable digital content to suit all tastes, cultures and lifestyles. Consumers can access and redeem their points online or via mobile, and use their rewards wherever they are. And with the explosive growth in eBook sales, our newly released eBooks reinforces the need for providing relevant, useful and meaningful rewards to customers or employees,” says Jill Goldworn, President and co-founder of the first club™.

The result? Higher brand interaction and increased loyalty. What loyalty manager would say no to that?

For more information about the first club™ or to experience the first club™ digital rewards solution, please visit www.thefirstclub.net.

A revolutionary ‘reward and loyalty service’ launched

thefirstclub.com the first club™ is revolutionising the reward and loyalty industry by being the first worldwide solution offering a fresh approach to instant rewards for customers and employees. Focused on loyalty programmes, incentive schemes, sales promotion and corporate rewards, it is designed to help companies boost existing reward and loyalty schemes by creating a gateway to the entertainment world.

Recent studies have shown that reward programmes, which deliver ‘personalised content’ and effectively address consumer’s changing lifestyles and personal tastes are more effective (Loyalty marketing publication, Colloquy). By providing millions of choices of the latest premium downloadable content, including titles from mp3 music tracks, PC games and software, to e-books and mobile phone content, the first club™ is at the forefront of this movement.

Working with major publishers such as, Warner Bros., Sony, Paramount, Roxio and Electronic Arts, the first club™ is able to offer to the end-user a large and varied catalogue that is reflective of each country’s content and culture, with the service currently available in 14 languages. The result is the ultimate international entertainment catalogue of premium content.

Denis Huré, C.E.O and co-founder of the first club™, comments: “Every year millions of reward points remain unredeemed, these “orphan points” are terribly costly for companies and unsatisfying for their customers. By having the cost saving alternative option of instantly redeeming reward points via a download rewards scheme, the first club™ is meeting the demand of today’s savvy consumer and forward thinking brands”.

Solely in the U.K. £5.2billion worth of unused loyalty card points are not being redeemed. The typical consumer has numerous loyalty cards, but often doesn’t know how to benefit from the loyalty scheme. Each time consumers don’t redeem their points, it’s a missed opportunity (Daily Mail, 01.06.10). the first club™ gives consumers the possibility to redeem their points immediately by downloading content to their mobile phones, eReaders or laptops for instant use and the ability to own it to use again in the future.

the first club™ offers flexibility to companies by providing three different levels of membership, enabling a brand to choose their own level of online visibility according to their requirements and the needs of their target audience. Companies are afforded the ability to customise and individually brand the website using their own corporate brand and content, which allows them to adapt the services to its customer’s preferences. Prestigious companies such as; Accor Services (now trading as Eden Red), Arvato Services, Lightspeed (part of WPP Group), Sapphire Technology and Corporate Rewards are just some of the organisations that have embraced the first club™ to date.

the first club™ announces today that it is extending its business offering by launching a new corporate website to address the growing needs of the rewards and loyalty industry and further strengthen communications with customers and business partners. The new corporate website provides key information on its range of services, including its profile, a presentation of the different programmes and their benefits, a portfolio section, corporate news and press releases.

More information on the first club™ services can be found by visiting
www.thefirstclub.net.

Redeem Points With Instant Rewards

the first club™ today announced the launch of its new global site and plans to revolutionize the reward and loyalty industry by being the first worldwide solution offering a fresh approach to instant rewards for customers and employees.  Focused on loyalty programs, incentive campaigns, sales promotion and corporate rewards, it is designed to help companies boost existing reward and loyalty campaigns by creating a gateway to the entertainment world.

Solely in the U.S. there are $700 billion worth of unused loyalty card points that are not redeemed.The typical consumer has numerous loyalty cards, but often doesn’t know how to benefit from loyalty programs. the first club™ gives consumers the possibility to redeem  their points immediately by downloading premium content, including mp3 music tracks, PC games, software and e-books to their mobile phones, eReaders or laptops for instant use and own it to use again in the future.

Working with major publishers such as, Warner Bros., Sony, Paramount, Roxio and Electronic Arts, the first club™ is also able to offer to the end-user a catalog that is reflective of each country’s content and culture, with the service currently available in 14 languages. The result is the ultimate international entertainment catalog of premium content.

Jill Goldworn, President and Co-Founder of the first club™, comments: “Every year millions of reward points remain unredeemed, these “orphan points” are terribly costly for companies and unsatisfying for their customers. By having the cost saving alternative option of instantly redeeming reward points via a download rewards program, the first club™ is meeting the demand of today’s savvy consumer and forward thinking brands”. 

With the launch of its new sitethe first club™ has also made a powerful move to address the growing needs of the rewards and loyalty industry and further strengthen communications with customers and business partners. The new corporate website provides key information on its range of services, presentation of the different programs and their benefits.

the first club™ offers flexibility to companies by providing three different levels of membership, enabling a brand to choose their own level of online visibility according to their requirements and the needs of their target audience.  Companies are afforded the ability to customize and individually brand the website using their own corporate content, which allows them to adapt the services to its customers’ preferences. Prestigious companies such as Accor Services (now trading as Eden Red), Arvato Services, Lightspeed (part of WPP Group), Sapphire Technology and Corporate Rewards are just some of the organizations that have embraced the first club™ to date.

More information on the first club™ services can be found by visiting the first club.net.

Original Document from Connecting Women Media.

the first club™ Launches Revolutionary ‘Reward and Loyalty Service’

LOS ANGELES, October 1, 2010. the first club™ today announced the launch of its new global site and plans to revolutionize the reward and loyalty industry by being the first worldwide solution offering a fresh approach to instant rewards for customers and employees. Focused on loyalty programs, incentive campaigns, sales promotion and corporate rewards, it is designed to help companies boost existing reward and loyalty campaigns by creating a gateway to the entertainment world.

Solely in the U.S. there are $700 billion* worth of unused loyalty card points that are not redeemed. The typical consumer has numerous loyalty cards, but often doesn’t know how to benefit from loyalty programs. Each time consumers fail to redeem their points, it’s a missed opportunity. the first club™ gives consumers the possibility to redeem their points immediately by downloading content to their mobile phones, eReaders or laptops for instant use and own it to use again in the future.

Working with major publishers such as Warner Bros., Sony, Paramount, Roxio and Electronic Arts, the first club™ is also able to offer to the end-user a catalog that is reflective of each country’s content and culture, with the service currently available in 14 languages. The result is the ultimate international entertainment catalog of premium content.

Jill Goldworn, President and Co-Founder of the first club™, comments: “Every year millions of reward points remain unredeemed; these ‘orphan points’ are terribly costly for companies and unsatisfying for their customers. By having the cost saving alternative option of instantly redeeming reward points via a download rewards program, the first club™ is meeting the demand of today’s savvy consumer and forward thinking brands.”

With the launch of its new site the first club™ has also made a powerful move to address the growing needs of the rewards and loyalty industry and further strengthen communications with customers and business partners. The new corporate website provides key information on its range of services, presentation of the different programs and their benefits.

More information on the first club™ services can be found by visiting thefirstclub.net.

SAPPHIRE Select Club members rewarded with TheFirstClub.com vouchers

SAPPHIRE Technology Ltd. has joined forces with TheFirstClub.com to offer music, PC games, software and mobile content to its Sapphire Select Club (SSC) Gold members.

SAPPHIRE is one of the leading ATI Graphics Boards Suppliers worldwide and the first one to offer TheFirstClub.com vouchers as part of its loyalty program. SSC is a membership program for owners and fans of SAPPHIRE products worldwide.

Members have access to five promotions per calendar year, from which they were recently able to select vouchers worth 25-200 Club Coins each at TheFirstClub.com.

”The vouchers from TheFirstClub.com proved incredibly popular with our SSC members”, Adrian Thompson, Vice-President of Marketing, at SAPPHIRE, says: ”They were available as part of our Free Promotions portion of the program, where SSC Gold members can access free software, games, and online content. TheFirstClub.com was a perfect fit for us as it allows our members to choose what type of content they want to receive as a reward.”

Part of The Licensing Agency’s group of services, TheFirstClub.com is an online instant rewards and incentive service dedicated to sales promotions, loyalty programs, and corporate rewards and incentives, offering consumers worldwide the opportunity to download millions of choices of the latest digital content including music tracks, PC games and software and mobile content.

Jill Goldworn, President of The Licensing Agency (TLA), states: “TLA has been working with SAPPHIRE for a number of years providing added value content to their quality line of graphic cards and we are very proud to provide them with our latest loyalty program solution. We believe digital content is a perfect way to instantly reward a global audience, giving an enormous choice of content suited to the widest variety of personal tastes. It is also a perfect match for SSC’s members who are highly interested in high technology and digital products and demand the latest innovation.”

TheFirstClub supports ALL4ONE in the Louis Vuitton Trophy

London, 11 June 2010. ALL4ONE will now carry the colours of TheFirstClub.com on its spinnaker in the Louis Vuitton Trophy. “We are really proud to welcome this company and all its team on board ALL4ONE. TheFirstClub.com’s philosophy perfectly fits with our international values”, announced today Stephane Kandler, French-German team ALL4ONE’s CEO.

TheFirstClub.com is an online instant rewards and incentive service especially dedicated to sales promotions, loyalty programmes, and corporate rewards and incentives, offering consumers the opportunity to download millions of choices of the latest digital content including music tracks, PC games and software and mobile content. Whether you choose to offer TheFirstClub.com gift vouchers or have a bespoke branded version of the service, TheFirstClub.com is the perfect tool to enhance your loyalty programmes, sales promotions and corporate rewards program.

TheFirstClub.com is the only rewards site of its kind, available worldwide. In an effort to continually enhance our offering, shortly movie blockbusters and TV series, audio books, eBooks and digital magazines will be available for download and unique promotions.

Denis Huré, C.E.O. of TFC International Ltd. states: “Denis Huré, C.E.O. of TFC International Ltd. states: “TheFirstClub.com (TFC) is very proud and excited to support the All4One team for the Louis Vuitton Trophy. At TFC we strongly believe in new challenges and we were seduced by the All4One spirit that is in perfect match with our own philosophy: the search for excellence, performance and innovation, the maximization of a remarkable international team spirit and experience that enhances our company at any level. We wish the All4One team the best of luck and are pleased to share this unique sailing experience with them.”

More information on TheFirstClub.com can be found by visiting www.thefirstclub.net.

Innovation in Loyalty, the first club™ Launches eBook and Audio Book Digital Rewards to Engage Consumers and Encourage Higher Brand Interaction

Los Angeles, 11 January 2011. With almost two billion loyalty memberships in North America, how can brands differentiate their programs while providing exciting, relevant and usable rewards? the first club™ has just expanded its digital rewards platform to help airline, hotel and retail loyalty programs do just that by adding eBooks and audio books to its expansive digital rewards catalog.

The launch of the first club™ eBook and audio book digital catalogs is perfectly timed to coincide with the massive increase in eBook sales, which almost doubled during 2010 and now make up 9% of consumer book sales in the United States – compared to 3.31% in 2009.

The catalogs launch with over 100,000 titles including latest releases from best-selling authors such Stieg Larsson, Stephen Hawking, Barack Obama, David Baldacci, Elizabeth Gilbert – and more than a dozen genres. The eBooks work on most eReader formats and are available in English – with French, German and Spanish added in early 2011. Audio books are available in English and German, with more languages coming in 2011.

Launched in 2009, the first club™ is the first global digital loyalty, incentive and promotions solution of its kind, offering instant, usable rewards: consumers can download the latest in premium digital content including over 34 million choices of mp3 tracks, mobile phone apps, games, eBooks, audio books and software to engage with their favorite brands. Unlike other digital content sites, the first club™ is the only digital platform that is culturally relevant, offering international and local content based on the user’s location, available in 12 languages. And because the first club™ is fully customizable and can be branded according to any company’s needs, brands are in full control of their loyalty program and their customers.

Loyalty challenge

One of the biggest hurdles for loyalty programs is reward redemption and the number of points needed for the lowest reward levels. Take frequent flyer programs: there are over 120 million people enrolled in these programs, and trillions of miles that never get used. In many cases, consumers lose motivation to remain loyal to a brand’s program as they feel the rewards are not attainable. the first club™ solution removes this barrier by giving consumers the opportunity to redeem meaningful rewards in all areas of their life: music, games, mobile content and now eBooks and audio books, with content starting as low as 10 points or $1.

“Today’s consumers are sophisticated and demanding. They want more value from every dollar they spend, and when it comes to loyalty and incentive programs, they also want value and rewards they can use – immediately. the first club™ solution helps airline, hotel and retail brands build more value into their programs by offering instant and relevant rewards, through an exciting catalog of downloadable digital content to suit all tastes, cultures and lifestyles. Consumers can access and redeem their points online or via mobile, and use their rewards wherever they are. And with the explosive growth in eBook sales, our newly released eBooks reinforces the need for providing relevant, useful and meaningful rewards to customers or employees,” says Jill Goldworn, President and co-founder of the first club™.

The result? Higher brand interaction and increased loyalty. What loyalty manager would say no to that?

For more information about the first club™ or to experience the first club™ digital rewards solution, please contact Vanessa Horwell at +305.749.5342 x 232 or Vanessa@thinkinkpr.com or visit http://www.thefirstclub.net.