A recent article in Direct Marketing News offers an in-depth analysis of the typical obstacles that companies must overcome to build customer loyalty. If your business is not getting the most out of its customer loyalty program, it’s probably due to one of the following four reasons:

1. Difficulty in measuring and using data

Loyalty programs cannot be measured in traditional ways. In fact, three of the top five reported challenges are measurement related. Measurement needs to focus on these three metrics:

1. Specific changes in the customer value equation
2. Shifts in consumer value
3. Customer engagement and advocacy

Each metric needs a clear definition of success for now and the future. Measurement then becomes part of continuous loyalty loop, in which customer intelligence creates customer insights, which feed into the loyalty program and creates more customer data to start the loop again

2. Picking the right mix of rewards and benefits

Most loyalty rewards involve discounts, but this becomes difficult to execute as everyone has the same offerings and retailers have trained consumers to look for nothing but discounts. This is a delicate tightrope act: give rewards that are too expensive or popular and the budget gets blown. Starbucks, Virgin Airlines and National Car Rental offer just a few of the programs that earn rave reviews with customers, without breaking the bank to do it. The key to success is activating “soft benefits” that have high perceived value.

3.  Programs lack true innovation

The average customer is a member of more than 10 loyalty programs. As more and more retailers launch programs, making a splash with a new program isn't easy. Before loyalty programs, customers would stay with their favorite retailers based primarily on price or location. Loyalty broke this inertia, giving customers a reason to shop at another retailer. If faced with a choice between companies, loyalty broke the tie.

But, as more companies start programs, a new inertia has formed. Nearly 60% of consumers state they only participate in a few loyalty programs. Meanwhile, customers feel they are getting less out of programs. About 30% of consumers feel that there is little or no value in joining a program.

Offering differentiated benefits gives customers a reason to engage. Assess the competition and do customer research to find these benefits. Carefully test to pick the winners.

4. Marketing and operations are not on the same page

Customers can receive years of good interaction with a brand and program only to have it all ruined by one negative experience. Executing a program happens on two levels: systems to identify the customer and present them with the right reward/recognition, and store operations to carry out the needed tactics. System issues are frustrating but easy to explain, while in-store issues cause more frustration.

Soft benefits are ideal because customer benefit outweighs cost. Failed execution means customers will not trust the company in the future; operations need to deliver on marketing promises.

A recent article in Direct Marketing News offers an in-depth analysis of the typical obstacles that companies must overcome to build customer loyalty. If your business is not getting the most out of its customer loyalty program, it’s probably due to one of the following four reasons:

1. Difficulty in measuring and using data

Loyalty programs cannot be measured in traditional ways. In fact, three of the top five reported challenges are measurement related. Measurement needs to focus on these three metrics:

1. Specific changes in the customer value equation
2. Shifts in consumer value
3. Customer engagement and advocacy

Each metric needs a clear definition of success for now and the future. Measurement then becomes part of continuous loyalty loop, in which customer intelligence creates customer insights, which feed into the loyalty program and creates more customer data to start the loop again

2. Picking the right mix of rewards and benefits

Most loyalty rewards involve discounts, but this becomes difficult to execute as everyone has the same offerings and retailers have trained consumers to look for nothing but discounts. This is a delicate tightrope act: give rewards that are too expensive or popular and the budget gets blown. Starbucks, Virgin Airlines and National Car Rental offer just a few of the programs that earn rave reviews with customers, without breaking the bank to do it. The key to success is activating “soft benefits” that have high perceived value.

3.  Programs lack true innovation

The average customer is a member of more than 10 loyalty programs. As more and more retailers launch programs, making a splash with a new program isn't easy. Before loyalty programs, customers would stay with their favorite retailers based primarily on price or location. Loyalty broke this inertia, giving customers a reason to shop at another retailer. If faced with a choice between companies, loyalty broke the tie.

But, as more companies start programs, a new inertia has formed. Nearly 60% of consumers state they only participate in a few loyalty programs. Meanwhile, customers feel they are getting less out of programs. About 30% of consumers feel that there is little or no value in joining a program.

Offering differentiated benefits gives customers a reason to engage. Assess the competition and do customer research to find these benefits. Carefully test to pick the winners.

4. Marketing and operations are not on the same page

Customers can receive years of good interaction with a brand and program only to have it all ruined by one negative experience. Executing a program happens on two levels: systems to identify the customer and present them with the right reward/recognition, and store operations to carry out the needed tactics. System issues are frustrating but easy to explain, while in-store issues cause more frustration.

Soft benefits are ideal because customer benefit outweighs cost. Failed execution means customers will not trust the company in the future; operations need to deliver on marketing promises.

        TechWeb, a division of United Business Media (UBM Tech) recently released a comprehensive white paper sponsored by IBM, titled, “The State of Customer Analytics: Taking a Proactive Approach to Loyalty & Retention”. The white paper explores how customer analytics can increase customer retention and minimize defections through optimally timed, personalized retention offers while significantly improving a company’s bottom line.

        Most companies have vast amounts of data about their customers, but have trouble sorting through it all to make meaningful decisions. New analytic tools are becoming available that make it possible to do this.

        By using customer analytics to create 360-degree consumer portraits, and then personalizing communications, companies can up-sell and cross-sell to those clients to maximize profitability and increase customer lifetime value. Businesses doing this are not only increasing revenue, but maintaining and developing crucial relationships with their customers.

        Customer loyalty & retention analysis enables companies to calculate customer value and to determine whether the retention effort for that specific client is worth the investment. Loyalty is not only concerned about rewarding customers with personalized offers through loyalty programs, but also with turning satisfied customers into successful brand advocates. Techniques such as social network analysis enable businesses to identify those customers with a significant sphere of influence among their peers. As customers’ trust in traditional marketing messages has been steadily decreasing, the ability to leverage peer recommendations by capitalizing on those active in social media is a powerful way to enforce brand loyalty.

        Retention analysis allows companies to identify early warning signs of defection. Companies can proactively approach the best customer to target based on their likelihood to accept an offer to stay and not stray to a competitor.

        An emerging area, social media analytics, unlocks the value of customer sentiment. It functions both as a listening tool and as a means for predicting consumer behavior and improving customer satisfaction. As business professionals assess the critical infrastructure necessary to cope with the Big Data onslaught, one component is key—comprehensive customer analytics adoption. From accessing rich social media data to increasing customer loyalty & retention, businesses today have a number of goals to focus on at once. A key question remains: How are business leaders viewing the role of technology in assisting them to accomplish their loyalty and retention tasks?

        By implementing proactive loyalty and retention initiatives, they can better understand who their satisfied customers are and turn those customers into successful brand advocates.

        MediaTrac has released several ebooks demonstrating how dealerships can boost sales with customer loyalty and retention programs. They are available to download for free at http://www.media-trac.com/resources/whitepapers.shtml

        TechWeb, a division of United Business Media (UBM Tech) recently released a comprehensive white paper sponsored by IBM, titled, “The State of Customer Analytics: Taking a Proactive Approach to Loyalty & Retention”. The white paper explores how customer analytics can increase customer retention and minimize defections through optimally timed, personalized retention offers while significantly improving a company’s bottom line.

        Most companies have vast amounts of data about their customers, but have trouble sorting through it all to make meaningful decisions. New analytic tools are becoming available that make it possible to do this.

        By using customer analytics to create 360-degree consumer portraits, and then personalizing communications, companies can up-sell and cross-sell to those clients to maximize profitability and increase customer lifetime value. Businesses doing this are not only increasing revenue, but maintaining and developing crucial relationships with their customers.

        Customer loyalty & retention analysis enables companies to calculate customer value and to determine whether the retention effort for that specific client is worth the investment. Loyalty is not only concerned about rewarding customers with personalized offers through loyalty programs, but also with turning satisfied customers into successful brand advocates. Techniques such as social network analysis enable businesses to identify those customers with a significant sphere of influence among their peers. As customers’ trust in traditional marketing messages has been steadily decreasing, the ability to leverage peer recommendations by capitalizing on those active in social media is a powerful way to enforce brand loyalty.

        Retention analysis allows companies to identify early warning signs of defection. Companies can proactively approach the best customer to target based on their likelihood to accept an offer to stay and not stray to a competitor.

        An emerging area, social media analytics, unlocks the value of customer sentiment. It functions both as a listening tool and as a means for predicting consumer behavior and improving customer satisfaction. As business professionals assess the critical infrastructure necessary to cope with the Big Data onslaught, one component is key—comprehensive customer analytics adoption. From accessing rich social media data to increasing customer loyalty & retention, businesses today have a number of goals to focus on at once. A key question remains: How are business leaders viewing the role of technology in assisting them to accomplish their loyalty and retention tasks?

        By implementing proactive loyalty and retention initiatives, they can better understand who their satisfied customers are and turn those customers into successful brand advocates.

        MediaTrac has released several ebooks demonstrating how dealerships can boost sales with customer loyalty and retention programs. They are available to download for free at http://www.media-trac.com/resources/whitepapers.shtml

A survey of more than 13,000 individuals conducted by Carnegie Mellon University reveals there are three types of buyers:

-Average/unconflicted: 61%

-Spendthrifts: 15%

-Tightwads: 24%

Each of these types responds differently to different marketing messages. So, how can you identify which is which, and how do you sell to them?

Tightwads tend to feel pain associated with buying; they tend to avoid spending money even in situations where most individuals would find the expense to be justified and of good value. Tightwads are differentiated from ‘frugal’ people, as frugal people don’t tend to feel pain at buying, they just enjoy saving more. Tightwads tend to carry little credit card debt and have more money in personal savings accounts than the “average” or “spendthrift” buyers.

To sell to tightwads, you want to minimize their buying pain. One way to do this is to appeal to the utilitarian or practical aspect of the purchase. For instance, if they need a pick-up, don’t try to sell them the luxury model; to a tightwad, paying extra for luxury features is unnecessary. Another way to minimize their buying pain is to watch how you use language: avoid saying things like “immediate payment in full,” or a “fee of $100.” Instead, say things like, “small down payment,” or “only a $100 fee.” Also, tightwads don’t like per-item pricing; bundling features together in package pricing works better.

Spendthrifts are three times as likely as tightwads to have credit card debt, and they are likely to have less in savings. This means that right up front, although they are willing to buy, financing will be more of an issue. Spendthrifts tend to derive great pleasure from buying; these are the types that respond to the “luxury” pitch, or the emotional satisfaction of immediately driving off the lot with a new car (unlike tightwads that don’t respond to that type of sales pitch). Spendthrifts want instant gratification.

“Average” buyers fall somewhere in the middle and are susceptible to both types of marketing messages and pitches.

Identifying what type of buyer is in front of you can be accomplished with casual conversation; ask a consumer about past purchases, and what they did or didn’t like about cars they have previously owned. Tailoring your marketing messages to different types of buyers can help boost sales and customer retention, especially to the 24% of the market identified as “tightwads” – but please don’t use that term in front of your customer!

Do you segment your customers into buying “types”? What have you found to be effective for selling to tightwads, spendthrifts and “average” folks?

A survey of more than 13,000 individuals conducted by Carnegie Mellon University reveals there are three types of buyers:

-Average/unconflicted: 61%

-Spendthrifts: 15%

-Tightwads: 24%

Each of these types responds differently to different marketing messages. So, how can you identify which is which, and how do you sell to them?

Tightwads tend to feel pain associated with buying; they tend to avoid spending money even in situations where most individuals would find the expense to be justified and of good value. Tightwads are differentiated from ‘frugal’ people, as frugal people don’t tend to feel pain at buying, they just enjoy saving more. Tightwads tend to carry little credit card debt and have more money in personal savings accounts than the “average” or “spendthrift” buyers.

To sell to tightwads, you want to minimize their buying pain. One way to do this is to appeal to the utilitarian or practical aspect of the purchase. For instance, if they need a pick-up, don’t try to sell them the luxury model; to a tightwad, paying extra for luxury features is unnecessary. Another way to minimize their buying pain is to watch how you use language: avoid saying things like “immediate payment in full,” or a “fee of $100.” Instead, say things like, “small down payment,” or “only a $100 fee.” Also, tightwads don’t like per-item pricing; bundling features together in package pricing works better.

Spendthrifts are three times as likely as tightwads to have credit card debt, and they are likely to have less in savings. This means that right up front, although they are willing to buy, financing will be more of an issue. Spendthrifts tend to derive great pleasure from buying; these are the types that respond to the “luxury” pitch, or the emotional satisfaction of immediately driving off the lot with a new car (unlike tightwads that don’t respond to that type of sales pitch). Spendthrifts want instant gratification.

“Average” buyers fall somewhere in the middle and are susceptible to both types of marketing messages and pitches.

Identifying what type of buyer is in front of you can be accomplished with casual conversation; ask a consumer about past purchases, and what they did or didn’t like about cars they have previously owned. Tailoring your marketing messages to different types of buyers can help boost sales and customer retention, especially to the 24% of the market identified as “tightwads” – but please don’t use that term in front of your customer!

Do you segment your customers into buying “types”? What have you found to be effective for selling to tightwads, spendthrifts and “average” folks?

Neuromarketing is an interesting blog combining brain science and marketing. A recent post discusses the growing trend of using scent logos: and not just by large companies, but by small and medium-sized companies. So what is a scent logo and could it work in your business?

An olfactory logo, also called scent branding, is a custom scent that the brand creates to embody its unique brand characteristics. Much like a graphic logo, the olfactory logo is used wherever the brand is present. After repeated exposures to the logo, customers strongly associate the smell with the brand.

For example, Abercrombie & Fitch disperses their signature fragrance, Fierce, in all of their stores. Fierce is strong, edgy and appeals to young, upscale consumers. Fierce is also sold as a personal fragrance and is the number one selling fragrance for men in the U.S. and Europe. Abercrombie & Fitch customers claim they can identify authentic A&F jeans solely by their smell.

Most of the major hotel chains also use a scent logo. For example, the Westin uses a cool and relaxing white tea fragrance, and the St. Regis uses an elegant blend of rose, sweet pea and pipe tobacco. If you’ve walked into the Mandalay Casino in Las Vegas, you’ll recognize an exotic floral, coconut spice scent; and other casinos each have their signature scent too.

So would this work in a dealership? People are bombarded by an average of 5,000 marketing messages a day, and scent is a big differentiator. Smell creates a powerful emotional response and can boost brand identity as well as customer loyalty. Here are a few ideas for incorporating an olfactory logo into your dealership marketing:

1. Diffuse the scent throughout your dealership.
2. Instead of selling hanging car scent trees with other odors, get trees made with your own signature scent and hang one in every car you service and sell.
3. Include a scent strip on your postcard and brochure mailings to customers.
4. Sell the scent in your dealership, or give it away free with purchase.

What do you think? Is it crazy, or could scent logos work in your dealership? Think about the personality of your brand; is it relaxed or power charged? Is your target market young, middle-aged or older? Are they value or luxury buyers? Are you a rural dealership, in the woods, or do you have a hip, urban location? These characteristics can be matched with different fragrance elements to create a scent that embodies your brand characteristics.

So what would your scent logo be?

Neuromarketing is an interesting blog combining brain science and marketing. A recent post discusses the growing trend of using scent logos: and not just by large companies, but by small and medium-sized companies. So what is a scent logo and could it work in your business?

An olfactory logo, also called scent branding, is a custom scent that the brand creates to embody its unique brand characteristics. Much like a graphic logo, the olfactory logo is used wherever the brand is present. After repeated exposures to the logo, customers strongly associate the smell with the brand.

For example, Abercrombie & Fitch disperses their signature fragrance, Fierce, in all of their stores. Fierce is strong, edgy and appeals to young, upscale consumers. Fierce is also sold as a personal fragrance and is the number one selling fragrance for men in the U.S. and Europe. Abercrombie & Fitch customers claim they can identify authentic A&F jeans solely by their smell.

Most of the major hotel chains also use a scent logo. For example, the Westin uses a cool and relaxing white tea fragrance, and the St. Regis uses an elegant blend of rose, sweet pea and pipe tobacco. If you’ve walked into the Mandalay Casino in Las Vegas, you’ll recognize an exotic floral, coconut spice scent; and other casinos each have their signature scent too.

So would this work in a dealership? People are bombarded by an average of 5,000 marketing messages a day, and scent is a big differentiator. Smell creates a powerful emotional response and can boost brand identity as well as customer loyalty. Here are a few ideas for incorporating an olfactory logo into your dealership marketing:

1. Diffuse the scent throughout your dealership.
2. Instead of selling hanging car scent trees with other odors, get trees made with your own signature scent and hang one in every car you service and sell.
3. Include a scent strip on your postcard and brochure mailings to customers.
4. Sell the scent in your dealership, or give it away free with purchase.

What do you think? Is it crazy, or could scent logos work in your dealership? Think about the personality of your brand; is it relaxed or power charged? Is your target market young, middle-aged or older? Are they value or luxury buyers? Are you a rural dealership, in the woods, or do you have a hip, urban location? These characteristics can be matched with different fragrance elements to create a scent that embodies your brand characteristics.

So what would your scent logo be?

According to Google’s 2012 Our Mobile Planet Smartphone Research report, within the past two years, the number of Google searches on mobile devices has grown by 500 percent! As a result, tech and marketing pundits everywhere are touting 2013 as the “year of mobile”.

If you’re like most businesses, you’re probably researching and/or implementing methods for incorporating mobile into your search and marketing strategies. And, as you probably know, mobile marketing requires specific considerations. Consider the following statistics from Equation Research:

• Seventy-four percent of consumers will wait just 5 seconds for a Web page to load on their mobile device before abandoning the site.

• Seventy-one percent of mobile browsers expect Web pages to load almost as quickly or faster as Web pages on their desktop computers.

• The majority of mobile Web users are only willing to retry a website (78 percent) or application (80 percent) two times or less if it does not work initially. One third will go to a competitor’s website instead.

Obviously, patience is not a virtue with mobile customers. Engaging them and keeping them engaged presents a challenge, but like every challenge, includes an opportunity. If you can incorporate the following best practices into your mobile marketing strategies, you can create a following of loyal mobile customers—who then become real, purchasing customers and refer you to their friends. Here are some tips on how to make that happen:

1)  Establish a Presence on Mobile Third-Party and Review Sites.

Mobile marketing is more than just creating a mobile-friendly website. Establishing a presence on other sites is just as important. Mobile customers may not always come to you directly if they have questions. They may find it easier to do a Web search for answers and information. Make sure you are there, not just to provide support, but to reach new customers who are searching for and comparing product and service information to make a purchasing decision.

2. Respect Your Customers’ Time.

Simplify content and keep it brief so that customers do not have to continuously scroll up, down, left and right; bold the most important content; and ensure text accompanies images and video.

3. Ensure Ease of Customer Service. Provide an application to empower your customers with convenient mobile account management, support, click-to-call features and the ability to submit support related photos via their smartphone or tablet. As a best practice, no more than three keystrokes should be needed to access the majority of options. Make load time, ease of use and speed a priority in your mobile customer service efforts.

4. Convey meaningful mobile content. Use SMS alerts and emails sparingly to alert customers about offers, potential or current service problems before complaints go social and to thank customers. Also, recognize personal milestones such as birthdays, purchase anniversaries or other special occasions. This type of proactive communication has been shown to increase customer loyalty, satisfaction, retention and enhance brand reputation.

How are you getting ready for the mobile tsunami? Which best practices will you incorporate into your mobile marketing strategy in 2013?

According to Google’s 2012 Our Mobile Planet Smartphone Research report, within the past two years, the number of Google searches on mobile devices has grown by 500 percent! As a result, tech and marketing pundits everywhere are touting 2013 as the “year of mobile”.

If you’re like most businesses, you’re probably researching and/or implementing methods for incorporating mobile into your search and marketing strategies. And, as you probably know, mobile marketing requires specific considerations. Consider the following statistics from Equation Research:

• Seventy-four percent of consumers will wait just 5 seconds for a Web page to load on their mobile device before abandoning the site.

• Seventy-one percent of mobile browsers expect Web pages to load almost as quickly or faster as Web pages on their desktop computers.

• The majority of mobile Web users are only willing to retry a website (78 percent) or application (80 percent) two times or less if it does not work initially. One third will go to a competitor’s website instead.

Obviously, patience is not a virtue with mobile customers. Engaging them and keeping them engaged presents a challenge, but like every challenge, includes an opportunity. If you can incorporate the following best practices into your mobile marketing strategies, you can create a following of loyal mobile customers—who then become real, purchasing customers and refer you to their friends. Here are some tips on how to make that happen:

1)  Establish a Presence on Mobile Third-Party and Review Sites.

Mobile marketing is more than just creating a mobile-friendly website. Establishing a presence on other sites is just as important. Mobile customers may not always come to you directly if they have questions. They may find it easier to do a Web search for answers and information. Make sure you are there, not just to provide support, but to reach new customers who are searching for and comparing product and service information to make a purchasing decision.

2. Respect Your Customers’ Time.

Simplify content and keep it brief so that customers do not have to continuously scroll up, down, left and right; bold the most important content; and ensure text accompanies images and video.

3. Ensure Ease of Customer Service. Provide an application to empower your customers with convenient mobile account management, support, click-to-call features and the ability to submit support related photos via their smartphone or tablet. As a best practice, no more than three keystrokes should be needed to access the majority of options. Make load time, ease of use and speed a priority in your mobile customer service efforts.

4. Convey meaningful mobile content. Use SMS alerts and emails sparingly to alert customers about offers, potential or current service problems before complaints go social and to thank customers. Also, recognize personal milestones such as birthdays, purchase anniversaries or other special occasions. This type of proactive communication has been shown to increase customer loyalty, satisfaction, retention and enhance brand reputation.

How are you getting ready for the mobile tsunami? Which best practices will you incorporate into your mobile marketing strategy in 2013?