Loyalty Management November 2011

Volume 3 Number 4
November 2011
Customer Intelligence Issue

-Securing C-Suite Buy-In -Social Customer Satisfaction -Maximize Actionable Insights
powered by Loyalty 360
Driving Loyalty in the B2B World

New Frontiers in Hotel Guest Loyalty
Inside Scoop: CVS Money Trasher Campaign
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This Month in
NOVEMBER 2011 VOLUME 3 NUMBER 4 WWW.LOYALTY360.ORG
DEPARTMENTS
6 Whats on Loyalty360.org 8 Letter from the Editor 10 Contributors
LOYALTY FORUM
12 Your Voice 14 Behind the Brand Shawn Bloom, Scene LP
14
pg
Go behind the scenes with Shawn Bloom

Behind the Brand: Shawn Bloom
16 360 Insights: The Challenge of Engagement: The Paradox of the "Golden Rule" Mark Johnson, Loyalty 360 18 Q & A: Ask the Experts We are looking to invest in a mobile strategy as part of our loyalty platform. Do I need both a mobile website and a mobile app? How do I determine which is best?
Secure your C-Suite buy-in

pg
30
FEATURES
20 The Loyalty Social Scene Robert Passikoff, Ph. D. & Amy Shea, Brand Keys 24 The Four Fundamental Pillars of a Voice of the Customer Program Lee Orr, Cvent 28 The Bright SIde of Negative Engagement Mike McDonnell, Affinion Loyalty Group 30 Jump-Start Your Customer Intelligence Initiative by Securing C-Suite Buy-in Connie Hill, VeraCentra
The Loyalty Social Scene

pg
20
3
Loyalty Management NOVEMBER 2011
This Month in
NOVEMBER 2011 VOLUME 3 NUMBER 4 WWW.LOYALTY360.ORG
TECHNOLOGY, TRENDS & REWARDS
Don't Expect Loyalty without Romance

pg
34 Loyalty Innovation 36 New Frontiers in Guest Loyalty Todd Hotaling, Lodging Hospitality Management 38 The Inside Scoop: The Westpac Group & Cyara Solutions Q&A with Sam Jackel, The Westpac Group & Alok Kulkarni, Cyara Solutions 40 The Next Generation of Customer Feedback is Social Customer Satisfaction Intelligence Ashish Gambhir, newBrandAnalytics
48
The Inside Scoop: CVS/pharmacy
(46)
BEST BUSINESS PRACTICES

42 By the Numbers
Loyalty Management Editorial & Production Team Erin Raese - Editor in Chief Mark Johnson - Contributing Editor Caitlin Schar - Editorial Director Kathleen Ostoich - Graphic Designer Crescent Printing Company - Print Production Loyalty 360 Team Mark Johnson - President & CEO Erin Raese - COO Caitlin Schar - VP Account Management Amanda Chasteen - Manager, Marketing Operations Kathleen Ostoich - Marketing Manager Jillian Hensley - Corporate Marketing Manager Lindsay Wagner - Sales Manager Contacts Article Submissions & Advertising: Erin Raese erinraese@loyalty360.org or 513.360.8680, ext. 210 To subscribe to Loyalty Management, visit loyalty360.org.
44 Achieving CEM Goals Customer Experience Competency Centers Drive Processes Sid Banerjee, Clarabridge 46 The Inside Scoop: CVS: Don't Be a Money Trasher" Campaign Q&A with Melissa Studzinski, CVS/pharmacy 48 Don't Expect Loyalty Without Romance Darin Rock, SolutionSet 50 Driving Loyalty in the B2B World Karen Posey, Geehan Group 52 How Customer Intelligence Can Help Deliver a Positive and Consistent Customer Experience Q&A with John Bastone & Wilson Raj, SAS 56 Loyalty Reads 58 Maximizing Actionable Insights through MultiChannel Listening Chris Cottle, Allegiance, Inc. 60 Behind the Brand Anita Emoff, Boost Rewards 62 Focusing on Key Customer Loyalty Metrics Karl Sharicz, Simplex Grinnell
2011 Loyalty 360, Inc. and/or its Affiliates. All Rights Reserved. Reproduction and distribution of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Loyalty 360 disclaims all warranties as to the accuracy, completeness or adequacy of such information. The opinions shared are those of the contributing authors and not necessarily reflective of Loyalty 360 and/or its affiliates. Loyalty 360 shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The opinions expressed herein are subject to change without notice.
LOYALTY 360 ON THE WEB
Mobile Loyalty Programs. Not only do cardless loyalty programs lessen the clutter of reward cards on your key chains and in your wallets, but theyre better for the environment as well.
NOW
Mobile Loyalty Programs
trending
"Liking." Many merchants will reward you with special coupons for a like of their page. Others reward all customers with a discount code once they hit a certain number of likes on their page. Others give their customers points each time they like the brands updates and then let them cash those points in for free products.
Fuel Rewards
"Liking"
Fuel Rewards. In addition to your frequent shopper savings, gas savings are available. At some stores, your earnings are reflected on your receipt, at others you need to ask. But ask! Some people are saving $.20+/gallon of gas thanks to their grocery shopping. BONUS! Get Gas for GiftsMany grocers now sell gift cards for a variety of retailers. If you purchase gift cards at the grocery store, often you can earn gas rewards on these "gifts."
ll series, The Pulse. of the findings from our weekly po Here's a snapshot of some
83%
report loyalty is jeopardized when a change in staff or visit to a different location results in not being recognized as a loyal customer
42%
are currently using QR Codes. 24% have plans in the works!
77%
shared that with added incentive, they would be somewhat likely to stick around when a service provider raises prices. Nearly 6% reported they are unlikely to defect, Loyal regardless of price
Loyalty 360 has had a packed schedule offering a variety of topics and insights.
LOYALTY 360 THOUGHT LEADERSHIP SERIES WEBINARS
DID YOU MISS A WEBINAR? Loyalty 360 members have exclusive access to full playback. Check the Loyalty 360 archives and catch up on what you missed. SAVE THE DATE! Check the winter schedule now and register for upcoming webniars at Loyalty360.org/webinars
NEW
Inside Scoop: AAdvantage - Destination Loyalty Loyalty 360 Q&A with American Airlines Charlie Sultan Employee Motivation: Non-Monetary Rewards Work Best by Tim Houlihan, BI Worldwide
what's
on LOYALTY360.ORG
Loyalty Management Online!

More articles, insights, best practice tips from your preferred trade publication. Loyalty Management is now available online at Loyalty360.org/ LoyaltyManagement. Share and comment on your favorite articles from this issue, and find additional web-only exclusive content every month!
Some of the Featured Articles found exclusively on Loyalty Management online:
Business BloggingA Companys First Line of Defense for Engaging Consumers by Melissa Fernandez, Destination Interactive Five Critical Points for Social Media and Unified Communications in the Contact Center by Bob Hockman, Empirix Customer Service, Engagement and Loyalty by Peter La Porta
Turning Customer Data into Action: A New Whitepaper from TSYS & Loyalty 360
Customer data is one of a companys greatest, yet often underutilized, assets. Learning about your customers and using that behavioral and transactional data to inform more relevant and meaningful customer interactions is the key to creating, building and maintaining strong customer relationshipsand gaining a distinct competitive advantage.
2011 Total System Services, Inc. All rights reserved worldwide. Total System Services, Inc., and TSYS are federally registered service marks of Total System Services, Inc., in the United States. Total System Services, Inc., and its affiliates own a number of service marks that are registered in the United States and in other countries. All other products and company names are trademarks of their respective companies. (08/11)
EXECUTIVE SUMMARY
T URN IN G CUSTOME R DATA IN TO ACTION

Mark Johnson, President, CEO, Loyalty 360 Erin Raese,COO, Loyalty 360
w ww.tsys.co m
New findings from Turning Customer Data Into Action, a survey sponsored by TSYS and conducted by Loyalty 360 The Loyalty Marketers Association, found while the vast majority of brands collect customer data they face myriad obstacles in using the data to drive strategic change. Marketers that are able to overcome these challenges, however, report that making the data actionable delivers bottom line results.
The full whitepaper is available now at tsys.com/GRSwhitepaper.
FROM THE EDITOR
The Issue of Customer Intelligence.

Many thanks to all of you to joined us for the first annual Engagement Expo! With your support it was a huge success! A special thanks to all of our speakers: the knowledge we gained from your experiences will help us all as we work to enhance our engagement efforts and strategies. We ask our contributors to share what is topical and trending today. Our open platform allows us to share with you the most valuable and sought after information in the moment. Through no pre-planned agenda, this edition of Loyalty Management developed to become our customer intelligence issue. As a Voice of the Customer (VoC) organization we look to you for insights to ensure that we share what's important to you. We talk about about how cluttered the world is for our consumers; but as marketers we don't always realize how cluttered our world is. We're all collecting an enormous amount of data from a ton of sources and touch points. How do we intelligently and cost effectively use it to increase basket size, increase transactions and build long-term loyal customers and advocates? This issue is sure to answer a good deal of your questions. Cvent shares four fundamental pillars of a VoC program and insights from ProBuild Holdings; a group who has successfully instituted the fundamentals.
Welcome new Loyalty 360 Members:

Altair Microsoft TCS MotivAction Destination Interactive TruAxis BI Worldwide TIBCO Saepio Siegel + Gale
Lodging Hospitality Management shares their story of how they've integrated personal service based on CI through their 12 properties. On page 48, learn how CVS is tying social media strategies into its loyalty program to further engage and build stronger relationships with its best customers. Want to try some of these strategies yourself? Connie Hill from Vera Centra provides tips for educating and engendering support for your CI efforts with your upper management. Also, dont forget to mark your calendarsComing soon, Loyalty Expo 2012! March 18 - 20 at the Rosen Shingle Creek, Orlando, FL. For more information and to view the agenda visit www.loyatlyexpo.com. See you there! Enjoy the issue! Sincerely,
Erin Raese
Editor-in-Chief Loyalty Management erinraese@loyalty360.org
we're here to guide you along the way.
loyalty is a journey.
Looking to build your organization's engagement and loyalty strategies? Loyalty 360 makes it easy to find a partner with the capabilities to help you reach your goals. Want to be a part of the largest engagement and loyalty supplier directory? For only $2500/year, sign up to be listed with your own customizable member page. Find tools, tips, and connect with your peers to find the answers to your loyalty questions at loyalty360.org
CONTRIBUTORS
As CEO and Co-Founder of Clarabridge, Sid provides executive leadership and strategic direction and is a well-known expert in customer experience, business intelligence, and text mining.
Sid Banerjee Mark Johnson
Sid Banerjee
Mark Johnson
Mark is the President & CEO of Loyalty 360. He has significant experience in selling, designing and administering prepaid, loyalty/ CRM programs, as well as data-driven marketing communication programs.
Chris Cottle
Chris Cottle is an entrepreneur and 16-year B2B and B2C marketing vet. He leads the marketing and product management teams at Allegiance, a B2B software company specializing in Voice of Customer Intelligence solutions. Allegiance is an Inc. 500 company.
Chris Cottle
Mike McDonnell
As Vice President of Product Management & Client Solutions at Affinion Loyalty Group, Mike works to continuously find ways to grow the company. Mike focuses on optimizing the way ALG delivers merchandise to their clients, establishing a greater focus on product development and acting as a consultant to understand loyalty needs.
Mike McDonnell
Ashish Gambhir
Lee Orr
Ashish Gambhir
Ashish Gambhir is the Executive Vice President of newBrandAnalytics, the leading provider of social business intelligence solutions. newBrandAnalytics uses social media feedback to provide companies with an unparalleled level of insightful business intelligence.
Lee Orr
Lee Orr spearheads the strategic direction of Cvents Enterprise Feedback Management solution and is responsible for new business development, customer success, and professional services. Under his leadership, Cvent has helped hundreds of organizations run effective customer feedback programs.
Connie Hill
Ms. Connie Hill, President and Founder of VeraCentra, brings more than twenty five years experience delivering strategy and execution services to the marketing community, and is passionate about helping marketers manage the complexities of data driven, customer relevant programs and campaigns.
Connie Hill
Robert Passikoff, Ph. D.
Robert Passikoff, Brand Keys founder/ president, is a sought-after speaker and thought leader on engagement and loyalty. He has pioneered work in these areas, creating the Customer Loyalty Engagement Index and the Sports Fan Loyalty Index. New York Universitys communication school declared Dr. Passikoff the most-quoted brand consultant in the United States.
Robert Passikoff, Ph. D.
Todd Hotaling
Karen Posey
Todd Hotaling
Todd Hotaling is Corporate Director of Revenue at Lodging Hospitality Management. He began his career with Lodging Hospitality Management in 2008 after moving to St. Louis from Kansas City where he worked in Advertising and Public Relations for Harrah's Casino and Hotel.
Karen Posey is a Senior Consultant at the Geehan Group with an extensive background in executive engagement and facilitation, sales leadership, strategy, coaching, and the best practices that drive BEST (Better Engaged Selling Time).
Karen Posey
10
Darin Rock
Darin Rock
Darin brings over 25 years of experience and a heightened understanding of consumer empathy. Darins insight inspires development of innovative marketing communications programs tuned to the needs of todays consumer.
Amy Shea
Amy Shea
Amy Shea, EVP Global Director of Brand Keys Brand Development, has worked with brands for over 20 years, translating research-based insights into effective communications. Her work has been recognized with the David Ogilvy Excellence Award.
Karl Sharicz
Karl Sharicz is Manager, Customer Intelligence at SimplexGrinnell, a Tyco International Company. SimplexGrinnell is a leader in fire and life-safety systems and services, with one million customers and 150 local offices throughout the country.
Karl Sharicz
If you would like to contribute to a future issue of Loyalty Management please contact Erin Raese at (513) 360.8680, ext. 210 or email at erinraese@loyalty360.org.
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LOYALTY FORUM: YOUR VOICE
As a consumer, how do you feel about rewards with expiration dates? Does an expired reward affect your continued loyalty?
THE CONSUMER POINT OF VIEW
can speak for consumers in Canada, and I can say in certainty that we dislike programs with expiry rules. Not very long ago, a new law forbade the sale of gift cards with expiry dates. The same should apply to loyalty programs. How loyal would customers stay, when they find out the rewards they collected for a program have expired? Seta Elbekian
manage RelianceOne, the loyalty program at Reliance Retail, one of the biggest retailers in India. We recently dropped down the 'Points get Expired in two years' and changed it to 'Evergreen Points'. This has been taken very well with the customer and the Reward Points accumulation has increased by 20% in the very first month. Previously, the customer felt cheated when their points expired without their notice since we didnt intimate them. Now they can plan their shopping and redeem points as they like. Richa Tewari
don't dislike as much the expiry dates as the e-mailing/ newsletters sent by the program trying to sell you everything, but they never mention that you have an amount of miles or points that are going to expire soon. I would expect if they are sending me newsletters every month, that at least they show some interest in his customer and make a real effort in giving you a proper warning that the points, miles or whatever are going to expire soon.
Werner Haeberle
It definitely does affect loyalty (obviously); I understand the draw to enacting expiration dates on rewards, but adds inconvenience.
Chris Tarantino
T
12
ypically the reward points are accumulated in bits and spent in bulk. So, accumulation takes time and by the time the customer is ready for the spend he/she realize that the accumulated points have vanished due to expiration clause and thus poofs the dream. I have stopped shopping with a few retail stores who have short (1 year or less) expiration dates on points. Sanvir Singh Jham
MARKETERS' RESPONSE
here are lots of case studies demonstrating expiring points also expires the consumer loyalty. The best way to manage the points liability is sophisticated actuarial management using your consumers behavioral database-when a card is dormant for a period of time calculate the probability of it being reactivated...obviously the longer it is inactive the higher the probability it will never reactivate. You need to start by calculating this probability/time relationship. As you gain experience look at other key predictive variables like: balance, distance to store, owners vs renters, RFM, age... You can conservatively and scientifically adjust the reserve for the points in the pool of 'dead/dormant' accounts without expiring points. This way you never disappoint your loyal customers and the business lowers its program costs and reserve pools to what it actually needs to for redemptions. David Moxley
When companies lose sight of what is best for their client/ customer then they are on the slippery slope to losing clients.
Bill Hayward
s with any loyalty initiative the points liability needs to be carefully managed to ensure that the managing company does not run into trouble. Whilst 'points expiry' can have a very negative impact, especially for members who are saving towards a specific goal, 'account expiry' should definitely be implemented and points wiped off after a certain period (e.g. 1 year of no activity) which will help ensure the liability is not being inflated by 'dead' members.
Tim Wilcox
would say, customers don't hate the expiry but hate not being notified about the same. It pinches, when they kept collecting them and the points vanish all of a sudden. I appreciate that some companies are offering lifetime validity of their loyalty points; however, I feel it sometimes becomes a very costly proposition to do so. I suggest companies should have a points expiry policy while keeping few things in mind. Keep your customer informed; fine prints shouldn't be too fine Send notifications well in advance when the expiry date is nearing. Expiry period should be carefully chosen.
Why I thing expiry policy is important is because: Loyalty points are like cash, which the company owes to its customers. Now, if the redemption rate is low then unlimited point collection policy might lead to a big liability on the company in future. Unnecessary balance maintenance cost for dormant cards Mamta R.
Loyalty 360 Pulse
77%
that YES! their continued loyalty is affected when rewards expire.

of respondents polled confirmed
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LOYALTY FORUM: BEHIND THE BRAND
Shawn Bloom
General Manager, SCENE LP
Shawn Bloom has over 13 years of loyalty management experience in Financial Service, Retail and Entertainment. In his current at role as General Manager of SCENE LP, Shawn is responsible for program development and the overall performance of SCENE, the entertainment loyalty program from Cineplex Entertainment and Scotiabank. Since its launch in 2007, SCENE has become Canadas leading entertainment loyalty program, providing movie and entertainment rewards and benefits to over three million Canadians.
As a consumer, what inspires loyalty for you?

In a word, relevancy. It is great to see when businesses get this right. That they are using the information they collect through their loyalty programs or financial service products to develop offers, products and services that are relevant to my needs and served up through a channel I prefer. Businesses that understand my interests, and can translate this into relevant offers will win my loyalty each and every time.
the program, on new offers or partnerships has proven to be invaluable. In addition, these customers are some of our biggest advocates so having them tell their friends that they like SCENE and posting testimonials online about a positive experience with the Program they may have had is more authentic than any advertisement we could ever do.
In todays marketplace, what is your favorite communications channel for reaching loyal customers?
Facebook has been a phenomenal tool for businesses to create a dialogue with their customers. We currently have over 200,000 fans between our English and French Facebook pages and its really proven to be a very vibrant community of entertainment lovers. We did some research a while back to understand the make-up of our Facebook members and found that they are some of most loyal and active customers. So the ability to get instant feedback on changes we are making to
What do you personally appreciate most about Scene rewards program?

From a consumer standpoint it has to be how easy it is to get rewarded. Every tenth movie I see is free and I get 10% off of concessions on every visit! Plus, with the ability to earn more points at the concession stand, at Cineplexs online store and with a Scotiabank Visa and Debit card the rewards add up really quickly. From a loyalty marketers perspective it is the ability to get rich customer data and insights that we can use to make better business decisions and develop deeper relationships with our customers.
Businesses that understand my interests, and can translate this into relevant offers will win my loyalty each and every time.
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How are todays emerging trends impacting Scene and their plans for the future?
For us a priority right now is in enhancing our ability to reach and engage our membership through their mobile device as we see this as such an important communication platform going forward. For example, mobile has given SCENE the opportunity to overcome one of barriers to joining any loyalty program which is the necessity to add another card to ones wallet. Through our mobile app we are now offering our members the ability to store their card right on their mobile device. Mobile also gives us the opportunity to enroll members into the program wherever they are. We recently launched mobile enrolments and it has already proven to be extremely popular. Next for us in this space is to leverage mobile to further engage our members by pushing them relevant and timely information and offers.
We also asked Shawn some quick fire questions about some of his movie favorites
Favorite movie theater snack: Peanut M&M's. Favorite movie: The Shawshank Redemption Favorite actor? Will Ferrell (For his outlandish characters includingChazz Michael Micheals, Ron Burgundy and Ricky Bobby). Best quotable movie line? Why so serious? (Heath Ledger as The Joker, The Dark Knight) Hypothetically, what film character would you most like to be? James Bond. For the gadgets. Favorite movie type? Action, Suspense, Drama, Comedy Love a good laugh so have to go with comedy.
Words of advice for a novice loyalty marketer?

Your goal as a loyalty marketer should be to influence positive changes in customer behavior. So start with the customer. Leverage whatever tools are at your disposal to develop the capabilities to understand your customers better and closely measure your ability to lift, shift and retain. Do this well and your well on your way to a long career in loyalty marketing. L
Start with the customer. Leverage whatever tools are at your disposal to develop the capabilities to understand your customers better and closely measure your ability to lift, shift and retain.
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LOYALTY FORUM: 360 INSIGHTS
The Challenge of Engagement: The Paradox of the Golden Rule

by Mark Johnson, Loyalty 360
t the recent inaugural Engagement Expo, the refrain from marketers (although more inquisitive and loquacious) remained the same: brand engagement and loyalty in this economic environment continues to be a challenge.
Theyre striving to determine: How do we most effectively manage in this era of brand malaise? How do we make our communications programs and marketing messages work most effectively? In the midst of a challenging economic environment, we as consumers want the brands (much like our family and friends) with which we engage to show us a modicum of responsiveness and respect. Yet, most brands just do not get it. Their lack of mutuality continues to confuse us. Engagement is and should always be simple and rational, yet marketers make it so complexconfounding the most astute marketing and intellection minds. When one thinks of engagement, the Golden Rule should come to mind. Do unto others as you would have done to you. Marketing purists realize the tremendous opportunities that exist when a brand, merchant or bank engages in best practices around true engagement and loyalty. To partake in and execute a voice of the customer response tool creates great interactivity and reciprocity, and drives significant behavioral and financial results. So why do marketers forlorn the opportunity?
"Beyond Loyalty: Meeting the Challenge of Customer Engagement, a report from the Economist Intelligence Unit, illustrates the bottom-line impact of decreased levels of customer engagement. Among the surveys key findings: Nearly 90% of all respondents stated that customer relationships are either very or extremely important to the success of their business. In addition, they believe more customer engagement would translate into: Improved customer loyalty (80%); Increased revenue (76%); Increased profits (75%)
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Recently, for example, Bain researchers stated that while 90 percent of brands feel they are engaged with consumer, only a mere nine percent of consumers feel that way. This clear dissonance between what a brand hears and what their customers are saying is a huge dichotomy. Adding to this conundrum, in a recent study conducted by Economist Intelligence Unit, 86 percent of the survey respondents (comprised of 311 executives) believed insufficient engagement from their organization costs between 25 to 75 percent of sales. Yet 43 percent of these same respondents stated that engagement strategies can get side tracked because of other priorities. Being a small business owner myself, to forsake 25-75 percent of my sales due to a lack of customer engagement would be a formula for failure. To put this into perspective: Focusing on other priorities aside from loyalty and engagement is akin to the chain smoker who has emphysema partaking in one more cigarette. Or, the diabetic who continues to the defy the doctors warning for a more healthy diet and lifestyle as they sit on the couch watching their favorite football team while eating a bag of chips and imbibing the next six diet Cokes. Its just not rational. The recent global IBM study of mid-market CMOs revealed that building and sustaining brand loyalty is the top concern for today's mid-market CMOs, yet 72 percent do not feel sufficiently prepared to effectively build this loyalty. Today's CMOs need to be prepared to deal with an empowered consumer who is impacting brands instantly on Twitter, Facebook and other social channels. 61 percent of mid-market CMOs are struggling with how to manage the impact that social media will have on their marketing function, reveals the IBM study. So what should marketers do when the Golden Rule is broken? Acknowledge the mistake, admit you (the brand) were in error, apologize and rectify. The simplicity of this process should
Bain researchers stated that while 90 percent of brands feel they are engaged with consumer, only a mere nine percent of consumers feel that way.
not be understated, as it will create more brand engagement and loyalty than doing nothing. Yet in an environment that allows for greater interaction with brands, one has to wonder why brands dont take the opportunity to listen to, engage with and respond to their most loyal fans. Why would they not embrace a chance to make these bonds stronger? We now read that customer satisfaction is not equal to customer loyalty. More than 60 percent of defecting customers indicated they are satisfied right before they leave (Business Week) and 40 percent of satisfied customers switch suppliers without hesitation (Forum Corp). How can this be true in the age of increased data insight, comprehensive brand analytics, and media that allows for real time interactivity, response and communication? Simple: these metrics are short term. Data doesnt always equal actionable insight, and brands dont effectively take advantage of all media. Most brands forsake the numerous interactions (both past and present) and the customer considerations (both positive and negative) that have had an impact on the user. Its like the first grade student that raises his hand 20 times, never to be called on. Like the student, that brand participant will eventually quit raising his hand. The only difference, however, is the participant is free and willing to leave (and they will), while the first grader is bound to stay for the remainder of the term! Brands continue to disregard engagement and voice of the customer driven strategies for short term couponing and price matching in the hopes that one additional sale will create that brand advocate for which they and their competitors are vying. For every 100 Reed Hastings there is only one Steve Jobs; for every 100 Yahoos there is only one Amazon; and for every 100 websites focused on temporal gains there are few mystarbucks.com. But rememberyou, too, can be an Amazon or a mystarbucks. com. The opportunity of fulfilling a brand promise remains for all.
L
Its like the first grade student that raises his hand 20 times, never to be called on. Like the student, that brand participant will eventually quit raising his hand. The only difference, however, is the participant is free and willing to leave (and they will).
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LOYALTY FORUM: Q&A
Q&A
If youre looking to strengthen a relationship with your membership base, and can offer them content or functionality that they will want to access on a regular basis, a mobile app can deliver the best experience. It can offer a much richer and more interactive experience, and can overcome barriers that a plastic card and a website are not able to. You want to make sure that there is a reason for members to come back to your app again (and again). The stickiest actions are functionala card-on-phone, a location-based searchor entertaininga new way for members to engage and have fun with your brand. Chances are good that your members want to engage with you on mobile. They may even expect it. How you enable them to do that is up to you. L
Ask the Experts
Q: We are looking to invest in a mobile strategy as part of our

loyalty platform. Do I need both a mobile website and a mobile app? How do I determine which is best?
The short answer is: it depends. The best place to start is with your overall business objectives. Define what members are looking for from your program, and what you want to enable them to do, then look at how you can make that experience more convenient or more engaging on a mobile device. If youre looking to acquire new members through mobile, to initiate and build a new relationship, a mobile website is a great destination. If you plan to do mobile advertising, or to create mobile versions of your emails, you want to have a mobile-optimized website where you can drive members and prospects. If someone starts an action on mobile, you want to make sure they can complete it on mobile. But building a mobile website doesnt mean you have to duplicate your entire website for mobile devices. Look at the top actions and transactions your members are doing from mobile on your website today, and start by building or optimizing those first.
A:
Look at the top actions and transactions your members are doing from mobile on your website today, and start by building or optimizing those first.
Lindsay Norton
Senior Marketing Manager, Member Engagement, SCENE
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A:
Each Company really needs to evaluate and assess mobile solutions and platforms that are best for them it and most importantly, ones that fit their customers needs. Ensuring that you launch the right product and platform for your customers, which also meet your goals as a company, these really are the keys to success with any mobile strategy, no matter if you decide to go with a mobile app, a mobile websiteor both. At Best Western, we chose both. We launched a brand app and a brand mobile site, as well as a mobile site for our rewards program, as research has shown that more customers are prone to go to a companys mobile site first and transact there. We first launched our brand mobile site to ensure that we were one of the first in market, the we launched our brand app, Best Western To Go followed by our Best Western Rewards mobile site. Ensuring that we were one of the first to have a mobile version of our brand website provided our customers with hotel availability no matter where they were and, no matter which device they were using. We also have an app because it helps us build brand awareness and engagement. It also offers our customers an enhanced experience on our mobile app, keeping our brand top of mind. L
Ensuring that you launch the right product and platform for your customers, which also meet your goals as a company, these really are the keys to success with any mobile strategy, no matter if you decide to go with a mobile app, a mobile websiteor both.
Tammy Lucas
Best Western
A:
When determining any mobile marketing strategy it is important to not only measure your Return On Investment but also your Return On Engagement. How will you provide a memorable, user-friendly mobile experience that rewards the customer for frequently engaging with you? How will your mobile campaign assimilate into your target audiences world and become equally impactful in the lives of their friends and family? Lets examine both strategies keeping in mind that neither solution alone is perfect to reach all of your customers and the answer comes from carefully listening to your customers. A recent IBM Global CMO strategy, stated seventy percent of the marketers surveyed said they feel incapable of analyzing and responding to the glut of data available about their consumers. An alarming statistic, but an important insight to take note of. How can you build out any marketing strategy without understanding the needs and wants of your customers? Your data holds the key for creatively experimenting with interactive mediums based on the insights it provides. A mobile website will certainly allow consumers to shop on-the-go, access product reviews, etc. but an app can heighten the user experience for loyal customers. An app is an excellent way to
reach loyal customers who want to interact with you on a regular basis and a fuller experience than just a mobile website. For
An app is an excellent way to reach loyal customers who want to interact with you on a regular basis and a fuller experience than just a mobile website.
instance, the app can allow consumer to earn points by checking in, sharing an experience on social networks such as Facebook, Twitter, foursquare and Google, identify local stores, neighborhood events, and local dining areas, pick up products in-store, have them delivered anywhere and deliver rich media content to highlight seasonal trends, promotions, downloadable rewards catalog, add
an item into their shopping cart by shaking their phone, etc. The retailer could take the idea one step further and add a gaming component rewarding consumers with points through scavenger hunts. Some marketers worry that a customers interaction with an app may take a tumble after the customers first experience with the app or even after a month, so how will you re-engage customers and find new ways to heighten their senses? The answer lies in push notifications. Push notifications are sent out to your users with a short message providing relevant messages and key reminders of why your app peaked their interest in the first place. The best part about push notifications is that the user controls how often they are notified and which notifications they would like to receive. Loyal customers will provide you with valuable and actionable insights you need to develop marketing strategies that increase ROI and ROE. Your loyal customers are your brand advocates and expect to you to provide a rich experience that moves beyond a basic mobile website. The search should not be for the silver bullet in mobile marketing which will leave you with overspent budgets and frustrating returns. The search should be how do you deliver intrinsic value that begs your customers to ask for more. L
Melissa Fernandez
Sr. Advisor, Destination Interactive

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FEATURES
The Loyalty Social Scene

by Robert Passikoff, Ph.D. & Amy Shea, Brand Keys, Inc.
ts no surprise that loyalty marketers have taken digital and made it part and parcel of loyalty offerings. Or tried to. Why not? Social media marketing and the various connecting tools and social platforms can be extraordinarily useful in creating connections between brands and customers. But for real loyalty to be created, outreach must be more than just connection and more than just communication or outreach,and far more than a new form of coupon, or freebie, or, excuse me, value add. However, lets be clear about the distinction that must be made: engagement with social media and consumer-generated content forums should not ever be mistaken for engagement with the brand or loyalty-building. And, yes, that goes for when engagement with those platforms resulted in the delivery of an entertaining brand message, that in turn received a quippy consumer comment, gave out a coupon, or provided the chance for that consumer to add their name to a list of 432,621 other close friends of the brand. One can easily see the attractionand potentialof using social media when it comes to loyalty efforts. But these tools should never be mistaken for the brand mission. Like any great conversation, it can be a part of growing a relationship, but it's the relationship itself that matters. Which is where understanding brand loyalty and loyalty to a Social Network comes into play. Social Media usage, or visitation, or friendings have
become the 21st century version of last centurys awareness paradigm. We know the argument: no, its not just awareness; its engagement, because consumers are not passive, but actually doing something on the social network. But lets be real: that something is just clicking a button that means, okay, I will give you enough attention to let you talk to me. Until I dont; until you disappoint me by asking me to be your friend but not giving me one good reason why I would want to be. The edit friends feature is just another content filter, but likely more decisive than the TV remote. This may be a good time to remind you, dear reader, that simply offering coupons are not the answer. They are readily available on the internet, and you dont have to get annoyed by a brands FB status updates in the process. Just saying. Its not enough to be known. In fact, most of the brands playing in the social media space today are already known to this generations grandparents. You have to be known for something meaningful to hold hands with consumers on that coveted loyalty road. And its that critical truth that so often gets overlooked as brands create a new colored siren and bigger balloons to attract consumer attention. Its what is at the destination that matters, not simply the social media stunt that gets you there. A brand can create a kind of perfect storm when it comes to loyalty, where the power of brand and platform meet where the brand understands and is delivering on whats
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driving engagement in its category, and is shaping social media tactics to deliver against whats driving engagement on the social media platforms themselves. When a brand has that, its delivering brand meaning in a meaningful way. According to the 2011 Brand Keys Customer Loyalty Engagement Index (46,000 consumers, Male/Female, 18-65 years of age, drawn from the 9 US census regions, self-selecting for participation in the social media space) loyalty to Social Networking Sites can be described via four critical category drivers: 1. User Self-Image, 2. Ease of Connection, 3. Security and Control, and 4. Brand Value & Content Connection Twentieth century-mode was to talk about time spent figures or sputter about number of visits or number of friends, or the number of e-coupons collected over a 24hour time period. But take a moment, and looking through the lens of these consumer-generated drivers (we did nothing to create or rank themconsumers did that), does the site you are using, or thinking of using, deliver against these expectations? Or might you just be collecting names, entertaining the masses, or, even worse, actually degrading the brands value-for-dollar proposition? Loyalty rankings arent based on awareness levels, but on the ability for the social network platform to meet expectations consumers hold for the Ideal in the categorythat is, delivering against those drivers listed above. Heres how the six Social Networking Sites included in our Brand Keys Customer Loyalty Engagement Index ranked when we conducted the survey in January of 2011. For those of you shackled to awareness, it should be pointed out that Friendster had higher awareness levels (according to the number of unaided customer mentions) than Flickr at the time of the survey: 1. Facebook 2. MySpace 3. LinkedIn 4. Flickr 5. Twitter 6. Friendster But as we are talking about loyalty here and not awareness it should be pointed out that seven months later, in August 2011, in our Brand Keys Loyalty Leaders List, Friendster ranked #522 of 528 brands when it came to loyalty. So much for correlating awareness and loyalty. Friendster ended up erasing all the remaining photos, blogs, and testimonials on their platform and reinvented itself as a music and games site. All thats left are the original basic profiles and friend lists, i.e., an outdated list of people you currently friend on Facebook. To add real insult to virtual injury, theyll be using Facebook Connect. How do you think those actions and interactions affect loyalty? How fast do you think it took disloyalty to set in? Social media marketing for brand and loyalty building, once the refuge for very small or very young or very quirky brands, has become a commonplace element in the evergrowing toolbox of more established brands. And those established brands should have long-ago learned that the platform is a delivery system. Its a relevant message, customized to that platform, which will deliver the best results. Transferred to the social media space, that still makes sense.
Theres a reason brands dont take their print ads and stick them up on television, but use the power of the media to maximize their messages. The same holds true for social media. That means not stopping at expecting loyalty using platforms and programs alone. It means trying to create real engagement with the brandand understanding how those platforms themselves drive loyalty.
Engagement with social media and consumergenerated content forums should not ever be mistaken for engagement with the brand or loyalty-building.
Brand Keys defines loyalty and engagement as the result of effortssocial and otherwisethat cause the consumer to see the brand as better meeting or exceeding her or his expectations for the category Ideal. This consequence-based definition is one we stick to, as most brands get very touchy about making entertaining advertising that makes viewers laugh but does nothing to ring the register. But all tools traditional, digital, and those still coming down the road should be able to provide some measure of Loyalty Return-On-Investment, otherwise why do them at all? Okay, its true that for some brands looking to leverage loyalty, playing in the social media arena is just a matter of not wanting to be lagging behind what seems to be really cool, high-tech marketing, although that classification is fading quickly in this rapidly changing digital age. Or they just dont want to be left behind competitors. That never changes. Or for some brands, having only recently discovered that the newest member of the Brand Group is their CFO, it all seems a more cost-effective very-trackable expenditure, certainly more so than traditional marketing platforms, and seemingly provides some easier form of ROI. But for most brands, largely its the fact that social media has grown at a pace and has become a driving force as to how brands of all sizes and typesnew, small, medium, and large, B2B, B2C, for bricks, clicks and clicks-and-mortar brands are trying to create and build more emotional, loyalty links between themselves and consumers. For brands it turns out that social media has become not only a useful augment to traditional tactics, but for many its become an indispensable, 21st century brand management tool. Happily, a surrogate form of ROI can be observed on the basis of advocacy levels attained, the numbers of new, informed insights gleaned, and actual cost reductions achieved. Guaranteeing some degree of branding success has always been reliant upon a brand establishing an emotional bond between itself and the customer. That need has only increased. So, done correctly, social media marketing can produce a greater emotional bond between the consumer and
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The Loyalty Social Scene (continued)
Social media loyalty programs have now becomeor should becomeexercises to delight the consumer and create higher levels of involvement with the brand.
the brand. Done correctly, customers and prospects, able to interact with brands in more active and personal and emotional ways, can lead to connections that create higher levels of brand engagement, and higher levels of brand loyalty, which actually does correlate with sales and profitability. So, from an advocacy perspective, brands have found social media an incredibly useful way to socially interact withand, at the same time, monitortheir most-loyal customers and create a word-of-mouth forum for loyalists who can advocate on the part of the brand, and exert a powerful influence on others in the brand engagement process also leading to insights. Done appropriately, brand involvement in social media can also significantly change the traditional brand-marketing paradigm. That used to be reach and frequency-based to create a some level of awareness, to develop some degree of consumer interest, in the hope that the marketing program generated a reasonable level of desire, and, ultimately, activated the consumer I.e., got them to go out and buy the brand. Social media loyalty programs have now becomeor should becomeexercises to delight the consumer and create higher levels of involvement with the brand. It can engender some social interaction by means of communications, and create activities that are sufficiently resonant and relevant and of real utility to the consumer. Enough so that social conversations via electronic round tables, where opinions can actually be shared, might be regarded as a more emotional experience by consumers than, say, having a coupon emailed to them because they visited a social network site and/or clicked a link. More and more social media brand conversations have to do with far more involving expressions of what consumers really expect. Comments regarding recommendations for brand improvements, discussions of category specifics, and
true consumer confessions to which brands might not otherwise be privy can be of real value in crafting loyalty. Collected and culled, these insights can be used to inform a brands loyalty positioning, strategic options, and tactical market activities. And, because it was the consumer who was actively involved with all this, marketers also likely to see increased levels of brand engagement. And brand loyalty. Finally, brands can look to certain social media activities to help reduce costs. Social media networks like Facebook and other online communities can act as surrogate support services. Just take a look at how many actual social media interactions and conversations have to do with getting help, answering problems, seeking ratings and recommendations, or just learning how to do something for/with/about the brand. It shouldnt be too hard to understand that such social media self-diagnostics and user-generated contributions can help to alleviate some of the stress on service cost centers. Oh, and loyal customers actually enjoy participating in the interaction. Theyre six times more likely to do so than the average consumer. And the traditional, word-of-mouth, aka a friends recommendation or a conversation with a friend, is still alive and well and making a high percent-contribution to loyalty, engagement and profitabilityonly these days its also being conducted via tweets and on smarter-and-smarter smartphones via text messages. And thats only going to increase. The poet Ralph Waldo Emerson noted, Conversation is an art in which man has all mankind for competitors. Brands already acknowledge that a larger consumer discussion is being conducted, a good deal of it over via Social Networking Sites. Brands that want more loyal customers will be listening for, measuring properly, and capitalizing upon those changesif they want to successfully be part of that social scene. L
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FEATURES
The Four Fundamental Pillars of a Voice of the Customer Program

by Lee Orr, Cvent
rganizations have been collecting feedback from customers forever. However, over the last several years, the need for a deep understanding of customer needs has increased tremendously. With the popularity of the internet and the ease of publishing thoughts, opinions, ideas and reviews, customers have been given a new voice. If an organization doesnt proactively collect feedback from customers, chances are, theyll never hear from an unhappy customer until its too late. Voice of the Customer (VOC) is a complete, well-defined customer feedback program that encompasses the entire customer lifecycle. The overarching purpose of a VOC program is to gain deep customer knowledge and use it to grow the business, regardless of whether your specific program goals are to increase customer renewals, grow market share, arm your sales team with an understanding of customer requirements, or something else entirely. The knowledge obtained from a VOC program is often a springboard for innovation. Successful VOC programs are not a single customer survey, but an ongoing investment to collect actionable feedback.
When done correctly, large organizations see revenue returns in the hundreds of millions. Regardless of the size of the organization, there are four fundamental pillars in the customer feedback loop: Listen. Listen broadly to what customers are saying they need or want, but also keep your ears open for their frustrations. There should be clear mechanisms for capturing feedback on specific interactions and overall perceptions whether they be good or bad. Interpret. Understand what customer feedback means for the organization. Are customers commenting on the symptom of a bigger issue? What are the key takeaways? React. Take action based on what youve learned. Establish a process to ensure customer insights are being used when making business decisions. Monitor. After making changes, dont forget to monitor the results by continuing to gather customer feedback and mapping changes to business results.
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Within each of these pillars, there are common roadblocks an organization can face. Lets dive into these challenges and how you can effectively overcome them.
Listening Hurdles
Effectively gathering feedback from customers is the foundation of an effective VOC program. Similar to constructing a building, its critical to pour the foundation correctly, otherwise youll develop cracks as the program matures. There are several problems that occur in this part of the feedback loop; below are two of the most common: A Lack of Goals: Establishing clear goals is critical in obtaining buy-in from senior executives and setting program expectations. Without goals, you risk ending up with the wrong information, finding inaccurate insights, and not being able to prove program value and ROI. A Narrow Scope: Think broadly about how customers interact with your organization. All too often companies only collect feedback after interactions, such as service calls. In actuality, you should collect it before a customer signs on, throughout the entire lifecycle, and if a customer decides to stop using your product or service.
customer feedback, it gives additional context. For example, someone who has been a customer for years is different than one starting implementation. A 360-degree customer feedback program can only be achieved by bringing in these other sources of customer data. Once youve combined the various feedback flows, the best way to avoid paralysis is to lay out a plan that answers specific questions, such as: What are the key performance indicators (KPIs) your C-suite wants to see? Is it Net Promoter Score, Customer Satisfaction Index, or one of the other many loyalty and satisfaction metrics? Youre moving towards being able to share and act upon your findings. KPIs are easy for the organization to rally around with analysis supporting the reasons behind those scores.
Reacting Failures
This is the most important VOC pillar. Unfortunately, many organizations come to a standstill when interpreting feedback. You can do all of the research and analysis you want, but if its not acted upon, the impact will be small. This happens for a number of reasons, the most common being that findings and insights arent shared throughout the organization. Findings wont be internalized by simply distributing a single 60-page report. Various groups within the organization need to see different informationfor example, the CEOs requirements may differ from a project managers. The best approach is to consider the specific needs of each audience separately and then tailor the presentations accordingly. When done effectively, every employee will be more customer-focused in their day-to-day activities. Finding the best way to share customer feedback is a journey that evolves over time. Read more about how one company tackled this feat below.
Interpretation Hang-ups
The best VOC programs incorporate data from one project with internal data sources. But, oftentimes, organizations will feel paralyzed with the sheer volume of information, so they simply zero in on the collected feedback from the project at-hand and neglect the additional insights. However, companies should look at this extra data as a valuable resource. You already have a lot of customer information from internal sources, such as your CRM system: when they first purchased, the last time they called support, general demographics about who they are, etc. Its common to forget about this data and simply focus on what the customers said but, when combined with
Establishing clear goals is critical in obtaining buy-in from senior executives and setting program expectations. Without goals, you risk finding inaccurate insights, and not being able to prove program value and ROI.
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The Four Fundamental Pillars of a Voice of the Customer Program (continued)

How ProBuild Holdings Manages its VOC Program
ProBuild Holdings Inc., supplier of professional building materials, brought its market research in-house one and a half years ago. Prior to that, the organization was limited in its research capabilities and typically engaged one-off projects conducted in conjunction with third party research vendors to obtain primary and secondary data. With separately commissioned studies from disparate groups and decentralized ownership, the company found that it had a series of project-based studies that each had a discrete hard stop. This made it difficult to efficiently address follow-up questions, understand what data already existed, and integrate data from separate projects into one cohesive understanding of their customers. ProBuild quickly realized there would be great benefit to having the resources in house to conduct ongoing longitudinal studies, rather than continuing to contract out a series of projects. Research is an integral part to building a strategic marketing organization and is the backbone of enabling a culture of using data to understand our customers needs, said Lisa Peterson, vice president of Marketing and Communications for ProBuild. Given the strategic significance, it is a function that we feel is important to own and manage internally, versus outsourcing. While third party research vendors are still utilized as supplemental resources, we feel that being intimately involved in the data collection and analysis gives us the opportunity to slice and dice the data in ways that can be meaningful to our operators.
Bringing a VOC Program In-House

ProBuild views its VOC program as a continuous customer feedback loop, with no real beginning or end. The company starts with defining what it wants to know, then identifies the best method to collect that information. After that, it implements the appropriate research methodologies, analyzes the feedback and shares the findings internally. Then, the continuous customer feedback loop starts over, with ProBuild asking: knowing what we know now, what do we want to know next? For ProBuild, the quantitative values that codify customer satisfaction are just the beginning. The company also strives to determine the why behind the customers ratings. For example, in a satisfaction survey, anytime a customer is dissatisfied, the company asks how it can improve. This way, ProBuild can implement the appropriate changes, rather than making changes based on guesswork.
Communicating the Findings

ProBuild rarely just distributes an internal report of its findings. Instead, the company presents the findings through one-on-one meetings, small group presentations, or video conferencing applications. ProBuild has found that this fosters more in-depth discussions on the why behind the reports data
Beyond the like: SocIal loyalt y

Is your brand a good friend? Apply traditional loyalty techniques to strengthen your social media performance. Well help elevate your status in your consumers personal space.
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and uncovers more meaningful insights. They believe the true value of the research comes not just from the report per se, but rather in the discussions that follow.
The End Result

By bringing its market research in-house, ProBuild now spends more time listening to customer feedback and truly understanding their needs, and less time educating third-party research vendors on industry vocabulary and nuances. The marketing department is now better able to combine information from one customer research project and relate it to insights from other projects. The result? A holistic view of the customer base, and a clearer understanding of the voice of ProBuilds customer.
value and customer churn rate. You dont need to track every KPI, but its important to be able to tie insights to decisions to business results. Without it, its difficult to maintain internal buy-in. Stagnant Goals: It can be overwhelming to start a VOC program if you try to tackle everything at once. Instead, break it up into smaller, more manageable phases so you can prove ROI. As your program matures, reevaluate the goals you set in the beginning. Are you still listening to the right things, conducting the right analysis and taking the right actions? Without reexamining the goals throughout the programs evolution, the potential may be stunted, and the organization will miss growth opportunities. There are a lot of pieces that come together to make up a successful customer feedback program, and getting started can be intimidating. However, when you come up against pushback, point out the many benefits: improved process efficiency, increased customer lifetime value, and the ability to identify new market opportunities. In todays hypercompetitive economy, the most successful organizations are that the ones living and breathing customer feedback, constantly asking themselves, with what we know now, what do we do next? L
Monitoring Breakdowns
Simply taking action doesnt mean youre done; customer feedback is a continuous journey. If youve avoided the other pillars major pitfalls, your organization will continue to want more insights and the loop will continue. Companies love newly-gained customer knowledge and use it when making business decisions, but what impact do those decisions have on the organization? Its important to monitor successes, as well as failures, to inform future decisions. Untracked Results: Monitoring results involves both a customer and business perspective when selecting metrics. Common key performance indicators include the customer satisfaction index, Net Promoter Score, customer lifetime
Engage your world

Engage your employees Engage your channel Engage your consumers
A new generationsocially connected, tech-savvy, global and multiculturalis changing the rules and making a world of difference. To connect with your sales channel, employees and customers in this new world, you need to understand the new rules of engagement. Thats where we come in. At BI WorldWIde we can help you play by the new rules to benefit your brand. To learn more, visit BIWorldWIde.com/engage.
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FEATURES
The Bright Side of Negative Engagement

Recognition and Personalization Rated the Most Useful Strategy for Astonishing Customers
by Mike McDonnell, Affinion Loyalty Group
iven the technological evolution of social media, discussions about customer engagement are ubiquitous. From retail to travel to banking and industries in between, companies understand the need to engage customers in a positive manner. Sometimes, though, even the best companies fall short of customers expectations. Dissatisfied customers are unhappy, even angry with a company, but they are engaged nonetheless. And the 2010 Customer Experience Report by Harris Interactive revealed that 82 percent of consumers have stopped doing business with a company as a result of a negative experience.
Instead of dreading these negative engagements, companies can learn to recognize the opportunity inherent in engaging a disappointed customer. A company that correctly handles a negative engagement can convert a dissatisfied customer who never wants to do business with them again into a positively engaged customerone who genuinely desires to interact. The Customer Experience Report shows that 58 percent of respondents would like the company to respond if they left a comment on a social networking site like Facebook or Twitter. However, only 22 percent of those who left a comment on a social networking site actually received a response. Your customers are having conversations, whether you are listening or not. With social media, you can hear those conversations and participate. During a recent Loyalty 360 webinar entitled The Bright Side of Negative Engagement, 58 percent of respondents noted that they have a strategy in place for listening to customers.
Give customers a platform to be heard
These companies understand the importance of listening and the impact that it can have to your bottom line. After all, the Customer Experience Report notes that 85 percent of consumers would be willing to pay moreup to 25 percent moreto ensure a superior customer experience.
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A company that correctly handles a negative engagement can convert a dissatisfied customer who never wants to do business with them again into a positively engaged customer.
Recognize and evaluate their feedback
Often, recognizing a complaint goes a long way to diffusing, or even reversing, the negative situation. However, evaluate the feedback first. Not all complaints are created equal. Look at the motives behind the feedback and respond accordingly.
When it comes to astonishment, 32 percent of webinar respondents are in development with their strategy and an equal number noted that its on their radar screen to develop one. Nearly 60 percent felt that the most useful strategy for astonishing customers employed recognition and personalization. Dominos certainly employed recognition and personalization when they had their pizza makers sign their pizzas and then displayed customer comments on the JumboTron. Talk about astonishment.
Build trust
In his book Enchantment, Guy Kawasaki devotes an entire chapter to achieving trustworthiness. He urges, If you want people to trust you, you have to trust them. Consider what you have to look forward to: When people trust each other, they stop playing games, they look beyond temporary problems, and they expose themselves with less hesitation Get this right: The first step is to trust othersas Zappos trusted its customers not to abuse the ability to return shoes with free shipping.
Make them look good
Social media and engagement expert Clay Hebert coined a great saying, Carpe Defect. Seize the defect, clean it up, make it better and create life-long fans. Through a nationwide advertisement, Dominos Pizza turned a customer-submitted photo of a poorly delivered pizza into a rallying point for improved customer service. They even took it one step further by broadcasting customer ratings of their food on the Times Square JumboTron.
Be accountable, remove obstacles, and astonish them
And, finally, establish that emotional connection with customers. Understand who they are, what they are interested in and what their goals are. Whether its looking smart, cool, funny or philanthropic, know what appeals to your customer and help her achieve it. The payoff? If you focus on engaging customers in a way that resonates with them on a personal level, you can convert them into loyal, long-term fans of your brand. Fans often are less sensitive to price, more understanding of service issues, provide meaningful input for product development and become genuine wordof-mouth advocates for your brand. L
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FEATURES
Jump-Start Your Customer Intelligence Initiative by Securing C-Suite Buy-in

by Connie Hill, VeraCentra
arketers are feeling the pressure to ramp up their contributions to the top and bottom line. They can do so by taking advantage of the customer intelligence needed to execute on a customer-focused strategy. Savvy marketers know that by implementing a customer-intelligence solution they can aggregate and leverage data collected throughout the organization to improve profitability. Yet many marketers struggle to get a solution implemented within their company because they fail to get buy-in at the executive level. To successfully take a customer-intelligence initiative from vision to reality, marketers need to connect with executives on issues that are top of mind. By applying the guidance shared here, marketers can articulate their business case in language that resonates with the executive team and gain support for the technology needed to produce customer intelligence.
However, until CEOs get on board with a solution that helps their organizations tap into their customer data, this customer-centric vision will remain out of reach. While many CEOs have supported investments in CRM and other customer-related systems, theyre likely unaware of the missed opportunities to fully take advantage of the data exploding across their organizations.
What is Customer Intelligence? According to Forrester Research, customer intelligence is the management and analysis of customer data from all sources, used to drive marketing performance and business strategy.
A Customer Intelligence Platform is Key to Harnessing Customer Data

Convincing the CEO to invest in a customer intelligence solution hinges on explaining how this helps marketers maximize customer profitability while improving the customer experience. Uniting multiple data sources from multiple applications throughout the organization leads to more effective analysis, deeper customer insights, and the development of a successful customer strategy. Optimizing the use of customer data to create relevant customer messaging improves the customer experience, creates true loyalty, and increases profitability per customer over time.
Winning Over the Corner Office

More and more CEOs are defining their visions to establish a customer-centric culture.
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Tip: Understand your organizations business strategy and your CEOs agendaand align your purchase of customer intelligence with the top initiatives.
Clarify the Options
Marketers must also lay out solution choices: leveraging internal business intelligence tools, developing an in-house solution, or opting for an outsourced solution. Though developing an in-house solution can appear to be the most cost-effective option, the tradeoff is time. Because marketing initiatives are frequently waitlisted while other projects get priority, in-house customer-intelligence solutions can take up to 24 months to develop and implement, even if companies are leveraging an existing business intelligence tool. With customer centricity as the new competitive advantage, time is of the essence. Ambitious organizations opt for outsourced solutions that leverage cloud or on-demand platforms specifically designed to support customer marketing, from a provider with combined marketing and technical know-how and analytic expertise.
On-Demand Customer Intelligence Delivers Rapid ROI

The CFO will appreciate marketings newfound ability to measure customer value and improve the ROI of marketing spend on existing customer programs. In fact, the CFO can be a valuable ally when evaluating solutions. CFOs value a fast return on investment, and long, drawn-out internal implementations of up to 24 months can hurt the bottom line. By hiring an outside provider that understands data, business intelligence and marketing, an organization can have an on-demand solution up and running in 90 days for a fast return. Plus, an on-demand solution is a low-risk investment. Because the company wont incur expenses for infrastructure, the initial and ongoing outlay is in line with the CFOs push to drive down costs. To achieve even greater CFO buy-in, marketers can collaborate with their CFOs to establish metrics around incremental customer value based on customer retention, growth in the number of repeat customers, longer customer tenure, and higher profits.
How Customer Intelligence Aligns with the CEO Perspective According to Forrester Research Vice President and Practice Leader of Customer Intelligence Suresh Vittal and researcher Emily Murphy, customer intelligence supercharges loyalty, making it possible to design and sustain loyalty programs that stand out due to advanced segmentation and highly relevant targeting that delivers an enriched customer experience.
Customer Focus Starts with the CEO

Savvy CEOs should be fully behind any investment that provides a foundation for a customer-centric strategy and empowers the organization to manage and track all related initiatives to overarching corporate goals. Such an investment will help transform the organization into one that realizes long-term financial benefits.
Tip: Share quantifiable metrics with your CFO both showing what the solution providers customers have achieved and what your organization can expect to realize in terms of ROI.
Real-world Returns from On-Demand Customer Intelligence
One company improved the top line by working with an outside customer intelligence provider, VeraCentra. COIT Services, started in 1950, is one of the largest specialty cleaning and restoration companies in the world. Concerned about the growing costs to acquire new customers, COIT used the ondemand customer-intelligence solution from VeraCentra to analyze its customer buying patterns and trends. It found that new customers were less likely to place a second service order, but those that did place a second order within a certain time frame tended toward long-term loyalty. COIT then created a
Speaking the CFOs Language

To gain the support of the CFO, marketers should explain the pressing need to gain better customer insight and how that insight will translate into increased profits. With this keen understanding of the customer base, marketers can segment based on customer behavior, lifecycle stages and the overall profit potential of each customer. By explaining how they can use customer intelligence to increase share of wallet, convert occasional buyers into high-value customers, increase the frequency and value of transactions, or increase the profit of customers over a longer period if time, marketers gain the CFOs attention.
continued on next page Loyalty Management NOVEMBER 2011
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Jump-Start Your Customer Intelligence Initiative (continued)

strategy to improve the customers first-time experience and secure that valuable second purchase. The results? An increase of 34% in repeat purchases, leading to a 25% lift in incremental revenue per customer and performing 66% over the established ROI goal. solutions are designed for business users, alleviating the IT group of the need to run time-consuming and bothersome queries and reports. At the same time, these solutions place minimal demands on IT. Help the CIO understand that, while ITs involvement may be needed for initial integration, the time commitment can be measured in days, not the months or years needed for software installation or in-house development. In fact, IT can connect the companys data sources to cloud-based customer-intelligence solutions using application programming interfaces and other connectors that enable quick linkage. Moreover, a cloud-based solution scales to support a companys growing needs without the need for additional capital investments. In other words, it will handle growing data volumes while obviating IT of the need to deploy additional hardware.
Making the CIO Your Champion

To secure the CIOs buy-in for an on-demand customer-intelligence solution, focus on three points: Leveraging ITs expertise in evaluating a solution Ensuring the organizations data is secure Expressing appreciation for the competing priorities the IT group is constantly balancing
Leverage ITs Expertise

Because CIOs must ensure non-stop operations and scalability, the solution being considered must be a good fit with the companys technology approach and strategy. Engage a member of the technology team early on to explore this issue. By doing soand demonstrating respect for ITs perspectivemarketers can ultimately gain a champion for their initiative.
Fear of Losing Control

Some CIOs resist an outsourced solution, fearing the worst when data leaves the corporate firewall. Yet, corporate data leaves the company every day, via emails, portal exchanges, faxes, and phone calls. Moreover, with companies increasingly relying on the Internet to conduct business and compete in a global marketplace, they face a growing number of security threats. The reality is that sensitive company data is at risk within the corporate network, whether due to hacking attempts or unintentional oversights or mistakes by employees. THINKstrategies has found that SaaS and cloud computing vendors, and the solutions they offer, can actually help organizations better protect their private data because they are focused entirely on storing and processing mission-critical corporate data in a secure fashion. Again, by asking IT about their concerns and including them in the solution evaluation process, marketers can address and allay these concerns.
Tip: Share the solution providers independent certification with your IT team to show it has achieved SAS70 certification and meets the minimum requirements for a Sarbanes-Oxley Act audit.
Put Forth a Compelling Business Case
At the heart of successful customercentric strategies is customer-intelligence solutions that unite and help marketers tap into the silos of rich customer data found throughout their organizations. Empowered in this way, organizations can create a viable customer-focused strategy backed by well-defined market segmentations, compelling messages and offers, and measurable improvement in incremental customer profit. Tap into these best practices for building a business case to secure Csuite support for deploying an on-demand customer-intelligence solution. L
Offload the IT Group

Oftentimes, marketers are a burden on technology groups due to constant requests for customer lists, data queries and reports. Todays on-demand customer-intelligence
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ADVANCING LOYALTY
ADVANCING COMMERCE
Give your customers a superiority complex.
Offer the exclusive rewards and benefits that keep cardholders happy and loyal.
Provide your customers with exceptional service experiences wherever they go, with comprehensive cardholder solutions from MasterCard. Our benefits and reward programs can help you increase customer spending confidence, usage, and loyalty. And your customers can enjoy exclusive access to superior global service when they need it most. Its the kind of treatment that leaves everyone feeling a little more important.
Learn more at mastercard.com/loyalty. MeaningfulRewards_Ad_Layout 1 10/7/11 11:45 AM Page 1 MasterCard and the MasterCard Brand Mark are trademarks of MasterCard International Incorporated.
2011 MasterCard.
One Size Doesnt Fit All: Inspire People with Meaningful Rewards
People come in all shapes and sizes with many different interests and hobbies. So when it comes to choosing which rewards motivate and inuence behavior, the task becomes increasingly difcult. And, while you already have a successful program in place, you might not have the time or the desire to manage multiple reward vendors. At Maritz, our rewards specialists have already strategically selected rewards that are meaningful and motivating to your audience resulting in inspired employees, customers and partners that can help you achieve your business goals. For more information about our reward options, email info@maritz.com or call 1-877-4MARITZ.
Loyalty Innovation
PRODUCTS, ADVANCEMENTS, & TECHNOLOGIES GoRebate Mobile
GoRebate mobile apps, launched by the leader in rebates, provides consumers and businesses a valuable shopping tool
Parago (www.parago.com), a leading provider of innovative reward programs that drive behavior and promote brand loyalty with consumers launched GoRebate Mobile, the first mobile shopping applications for iPhone and Android focused on rebates that allow marketers to deliver rebates directly into the hands of value-seeking consumers. GoRebate Mobile, which launched in the iTunes App Store and Android Market is free to download, utilizes an intuitive and userfriendly design and allows users to: Be presented with available rebates based on their current location Browse for rebates in their area either by retailer or product category Access rebate terms and conditions Share specific rebate promotions with others via text, email, Facebook or Twitter, or tag them for a reminder at a later date Track submitted rebates to see where they are in the redemption process Track the card balance of their rebates paid out on prepaid cards issued by Parago Set alerts for rebates by proximity and frequency
Until now retailers had to actively do something to market rebate promotions to the public or they had to hope that consumers would notice them in their stores.
GoRebate Mobile was designed to be a practical tool for value-seeking consumers that are likely to use rebates, and deliver highvalue content to people seeking savings. The progressive technology behind GoRebate allows it to seamlessly integrate into consumers existing shopping routines and enables browsing for or notification of rebates in their area. The apps innovative sensitivity features are intelligent enough to know when to requery Paragos server not only based on new location, but also on rate of movement. For example, rather than continually notifying a user that is driving down the highway of new rebates, it can send notifications of nearby rebates when the user has slowed or come to a stop. GoRebate Mobile aims to solve a genuine problem in the marketplace: until now retailers had to actively do something to market rebate promotions to the public or they had to hope that consumers would notice them in their stores. GoRebate offers a whole new avenue for businesses to make consumers aware of rebates and to drive store traffic and sales lift. For more information about GoRebate, download the application for free in the iTunes App Store or Android Market or visit http:// www.gorebate.com.
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Technology partnership creates new opportunities for building loyalty, benefitting retail merchants, card issuers and consumers alike.
ActivePath
A new technology partnership announced by Cardlytics and ActivePath presents an innovative opportunity for loyalty marketers. The program builds customer loyalty and drives adoption of eStatements for banks and card issuers, attracts new customers and builds repeat customer traffic for retail merchants, while generating tangible rewards for consumers. Joining forces has combined unique capabilities from Cardlytics Transactiondriven Marketing solution and ActivePaths interactive ActiveMail system, enabling custom incentive offers to be embedded into secure interactive eStatements. Banking customers receive, view and transact the offers directly directly within the email message at their convenience, without the need to log on to online or mobile banking or download the statement.
Customers viewing their eStatements find incentives clearly marked at each relevant transaction.
Customers viewing their eStatements find incentives clearly marked at each relevant transaction. Clicking to view the reward automatically activates it to the debit, credit or prepaid card associated with the loyalty program. The next time the customer uses their card to make a purchase that meets the offers conditions, the offer is automatically transacted without the customer having to enter promotion codes, clip or print coupons. When the customer makes a purchase with the designated card, their savings are automatically shown in their account. At the end of the following month, the savings are credited directly into their account. Its all done through their banks reward program and managed through the safe, secure environment of their bank.
One of the 11 Big Ideas for 2011 in American Bankers January cover story of the same name, was building loyalty through merchant rewards citing Cardlytics and its adopters, First National Bank of Omaha and Regions Bank. The article noted that simplicity prompted First National to implement their loyalty program, presenting bank customers with offers from a wide range of businesses. The Cardlytics program has already attracted a wide range of participating merchants, including national, regional and local apparel retailers, discount retailers, restaurants and individual brands such as The Body Shop. Now with the addition of eStatement rewards delivered and activated within email, ActivePath and Cardlytics have streamlined the loyalty marketing process for customers, retail merchants and banks alike. Read more about the potential applications and best practices, including a case study and supporting data, in the unabridged article, Technology partnership creates new opportunities for building loyalty, benefitting retail merchants, card issuers and consumers alike on Loyalty Management online at Loyalty360.org.
Anametrix
InstaVista Business Analytics (BA) fills the gap between home-grown spreadsheets and costly Business Intelligence (BI) for better corporate decision making. Marketers need a more effective way to understand how promotional campaigns specifically reach and impact prospects and clients from a holistic perspective. With so much data from so many divergent sources, the ability to measure and compare performance within the marketing mix can become overwhelming. To justify programs and allocate budgets, ROI can only be determined by knowing how marketing efforts across multiple initiatives translate into generating new business opportunities and extending relationships with current customers. Anametrix InstaVista enables marketers to see vast amounts of online and offline source information funneled to one simple interface. Real-time, customizable cloud-based dashboards offer powerful interactive visualizations of: Web Analytics Point of Sale (POS) Social Media Search Engine Marketing (SEM) Video & Audio E-mail Campaigns Market Research Surveys Customer Relationship Management (CRM) Loyalty Programs ...nearly any source data
InstaVista frees resources required to pull, clean, and understand information across an organization. Created specifically to help companies make faster, better decisions, InstaVista combines disparate data feeds and offers predictive alerting of trends, opportunities, and even problems before they arise, not after a campaign ends. Executives can focus on determining which activities are performing or not performing and immediately adjust programs to positively impact the bottom line. Smarter than spreadsheets but yet much less complicated than traditional business intelligence technology, InstaVista also features seamless Microsoft Excel bi-directional synchronization, an industry first. This exclusive function enables organizations to align day-today employee activities with enterprise systems to drive quality decision-making across multiple applications without burdening IT staff. Individual end users across all departments quickly and cost-effectively move beyond Excel to visually navigate combined complex data points and uncover unseen relationships within their own business units. For companies with brick-based storefronts as well as click-based digital presence, Marketers can clearly determine correlations and amortizations across an entire user base by tracking all on/offline activity associated with cross-channel advertising initiatives. Data segmentation by product line or locale accelerates speed to market, builds customer loyalty, and maximizes market share by weeding out inefficiencies.
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New Frontiers in Hotel Guest Loyalty:

Technology Enhances Time-Honored Formula for Success and Personal Service at Lodging Hospitality Management
by Todd Hotaling, Lodging Hospitality Management
the inside scoop
verything old is new again. Peter Allen penned those lyrics about fashion and fads, but its an apt description of the latest guest loyalty advances in the hospitality industry. Positive word of mouth among friends, family, and colleagues has always been hoteliers most coveted and effective form of marketing because it drives repeat business. The difference now is that those recommendations take place online. Social media channels such as Facebook fan pages and TripAdvisor have become the electronic back fences over which people exchange travel tips on what to see and where to stay. The good news is that today hoteliers can be part of that conversation to develop stronger, more guest loyal relationships. An active social media strategy combined with a comprehensive property management system (PMS) allows us to directly engage both repeat and potential guests. The web-connectionready Maestro PMS technology we use, makes it possible to earn a reputation for superior customer service the old-fashioned wayby getting to know our guests so that we can fulfill their needs and provide their preferred amenities and services. And when guests feel properly pampered, they come back. Adding social media and a flexible internet-savvy PMS to the formula allows hospitality marketers to engage modern travelers and be a part of their decision making process. Software applications enable hoteliers to monitor keywords throughout various social media channels. The Lodging Hospitality Management (LHM) team continually monitors social media sites to assist guests who are traveling to the St. Louis area. We operate 13 properties under major flags and two independent boutique hotels, so we can offer a variety of options. LHM uses the Maestro PMS at our two luxury boutiques, The Cheshire and The Seven Gables Inn to place a book-now reservation button on the propertys Facebook pages so visitors can join our conversations and book a room without leaving their social media page. Here is an example of how we use social media. Someone may post a query on a travel site stating, Visiting St. Louis for the first time. Can anyone recommend a hotel? This gives us a chance to educate potential guests about our properties and offer a solution to their travel needs. They might ask, Which hotel is near my meeting? Where can we stay near the zoo? By assisting potentials guests, we often convert online conversations into clicks on the book now button.
PMS Empowers Front Desk with GuestReady Wish List

When you feed social media intelligence into a web-connected front office system like Maestro PMS, you empower your front desk staff to fulfill a travelers wish list when they arrive. You can begin to learn from online conversations a guests preferences and anticipate other sales opportunities such as room upgrades, food and beverage recommendations, and future bookings, and this recognition creates loyalty. Once a prospect becomes a LHM guest, our Maestro PMS from NORTHWIND adds to what we learned online by compiling information such as historical stay patterns, arrival times, and special requests. If we were late on delivering a guests extra towel request during their last stay, our PMS will remind us and will avoid these issues on subsequent visits. LHM also relies on its PMS to help its team devise and track creative loyalty programs for our flagged hotels and independent boutique properties. These programs are particularly important to independent hotels because they do not have the name recognition and marketing muscle of a major flag.
Online Conversation Leads to Book Now
Theres No Such Thing as a Bad Online Review
Most hotels make an effort to survey guests about their stay via comment cards. Social networking channels extend our reach and keeps LHM in post-stay conversations. We find that guests tend to post two types of online reviewsglowingly positive or strongly negative. We appreciate a thumbs-up review, of course, but we also focus on turning complaints into opportunities that cultivate loyalty. We do this by immediately
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addressing negative reviews with personal messages from upper management and issue a public online response. This strengthens our personal relationship with guests and our online reputation. Online reviews are also an invaluable source of good suggestions for increasing business. Comments such as I wish they opened the pool earlier or I would have stayed at property X, but they have no airport shuttle also helps LHM hone its amenities and services. Incorporating social media as a marketing component is a major shift in how hoteliers do businessprobably the most significant change since we began using third party channels to sell our inventory. Social media involvement is a learning process that takes time to do well. But, building social media into the staffs daily tasks builds a corporate culture of service. The secret to selling a new approach to staff is presenting positive outcomes. Efficient online processes to review selected social media sites combined with a web-connection PMS streamline our guest service and loyalty efforts and help keep labor costs low. Top management at LHM quickly saw the value of a good online reputation when they viewed positive guest comments that result from monitoring and responding to our properties reviews. LHM rolled out multiple training programs across all departments to engage its teams in seeing the value of listening to what our guests are saying about us online and how to use this information during the guests stay. We now have a monthly scorecard that evaluates team members social networking efforts and gauges how our properties rank throughout the web. Management has gotten onboard with this technological sea change for the same reason that other advances have become standard practiceit created guest loyalty that produces more business. L
Nothing Sells Management Like Success
Building social media into the staffs daily tasks builds a corporate culture of service.
Social Networking + PMS = The New Normal
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The Westpac Group & Cyara Solutions

Q&A with Sam Jackel, Project Director, The Westpac Group & Alok Kulkarni, CEO, Cyara Solutions
Sam Jackel
Alok Kulkarni Sam mentioned. Customers also like the idea that we run on non-proprietary hardware, offer a choice of deployment models a at the right price point.
he Westpac Group and Cyara recently spoke at SpeechTEK in New York on the topic of creating and managing customer-centric, speech-enabled, interactive voice response applications. This interview was a follow up to their joint presentation.
What current marketplace challenges brought Cyara & The Westpac Group to work together?
Sam Jackel: From my perspective, the cost of poor quality is high. The service landscape is very competitive and the key consumer differentiator is service. We needed to be able to repeat speech testing, quickly, efficiently and cost effectively and to monitor our production systems to alert us in the event critical customer experience issues. We view Cyara as a key plank in our strategy around quality and efficiency and use Cyara for end-to-end regression, systems integration, functional, stress, performance and load testing and real-time monitoring of the customer experience in the production environment. Alok Kulkarni: We provide a solution that our customers tell us is the most complete, mature solution for helping them ensure their customers calling in have a favorable phonebased customer experience. We provide automated, interactive voice response (IVR) simulation and testing, and load, agent routing and CTI simulation, testing and monitoring. Companies like Westpac often have requirements such as end-to-end testing; simulating a caller entering the voice system and interacting using natural language speech or DTMF input and traversing the established paths and exercising the data integration and agent routing so that they get a true picture of how the system is really performing from a customers perspective. We automate very tedious, time-consuming testing and monitoring, which means companies end up testing applications and systems more quickly, more frequently, and more broadly with less time and effort, which ultimately results in the kinds of quality and efficiency improvements
Are there any marketplace trends, unique to Australia (vs. US), which require a particular approach to Customer Experience Management (CEM)?
Jackel: From a banking perspective there are a small number of banks competing for client business when compared to Europe or the USA. The challenge is to differentiate from a customer service and relationship management perspective. Kulkarni: We have a global customer base and while there are nuances and challenges unique to each region and each verticalbanking, telecommunication, utilities or retail, etc. what we find common is the need to find a way to balance the goals of delivering exemplary customer experience while ensuring operational efficiencies and bottom line results.
Why is CEM important to Westpac at this time?

Jackel: Westpac takes a customer centric approach to speech recognition design, designing the system around customer requests rather than around business or organizational structure. This approach allows us to keep dialogue with our customer short and sharp but at the same time efficient in terms of the information gathered about the customers request. Customers gain access to banking representatives very quickly and with a very high degree of accuracy. From a customer experience perspective, this is unique among speech recognition applications in the Australian market. Customer experience as measured by Net Promoter Score (NPS), a rating based on the simple question of how likely one is to recommend Westpac to a friend or colleague, is a strategy that underpins everything we do and think about at Westpac. Each member of staff is focused on improving customer experience and this is a shared scorecard measure.
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From my perspective the cost of poor quality is high. The service landscape is very competitive and the key consumer differentiator is service. -Sam Jackel, The Westpac Group
How are Cyara & Westpac working together to improve upon the customer experience?
Jackel: We take a continuous approach to testing and improving the quality of our speech application. Kulkarni: I think the simplest answer is before you can fix a problem, you have to identify and pinpoint where the problem is, as fast as you can. We help customers like Westpac understand where problems exist in the applications and systems their customers use to interact with the organization. And Westpac quickly responds and improves the application. And as Sam mentioned, its not a one-time effort. Westpac takes a continuous, unrelenting approach to testing and improving the quality which has a direct, positive impact on customer experience.
How does this partnership drive customer engagement?

Jackel: The solutions we deploy are high quality, quick to market and we get it right the first time. Kulkarni: Cite any survey or your own consumer experience and you will note there is vast room for improvement for phone customer service. One of the barriers to improvement is how much time, money and effort it takes understand where or how to tweak and improve the applications and systems. Our solution in combination with the broader overall commitment to truly taking a top-down, customer-centric approach to service as Westpac does, drives positive customer engagement as hes indicated from their NPS improvements. And from our perspective, we view customers as partners and consider our relationship a two-way street. We have continuous dialog with and take input from customers like Westpac and roll that invaluable feedback into every product release.
What has been the impact on overall customer satisfaction as a result of these efforts?
Jackel: This cannot be directly attributed to the speech recognition program or the partnership with Cyara, however since a broader program of work was commenced over 2 years ago, customer satisfaction measured via NPS has lifted from 30's to 60's in the contact center channel. Kulkarni: We are all consumers. One of my favorite statistics Sam quotes when talking about the impact of improving customer experience at Westpac is the reduction in the time a customer must spend in the automated system before reaching their intended destination. What took a minute and a half dropped to 13 seconds, which means customers are getting their needs met more quickly, which has factor into how likely they are to recommend Westpac.
Of course, we have to ask, what is next for Cyara? The Westpac Group?
Jackel: Westpac will continue to leverage its recent investment in the contact center channel and focus on continued improvement in customer satisfaction. We also continue to extend relationships with our existing clients. Kulkarni: Cyara continues to focus on helping Fortune 500 reduce risk and project timelines with their often disruptive and transformational technology and process contact center deployments. In the second half of this year, we opened an office in the United Kingdom to serve a growing customer base in EMEA and continue to serve and support a growing customer base in both the U.S. and APAC regions. And, we look forward to sharing more positive deployment results such as Westpacs in the coming months.
Background on Interviewed & the Companies They Represent

Alok Kulkarni, CEO Cyara Solutions Alok Kulkarni is the co-founder and CEO of Cyara, a pioneer of next-generation premise and cloud-based solutions for simulating, testing and monitoring IVRs, voice biometrics and other contact center systems and applications via automated load and functional testing and production monitoring. Cyara Solutions Cyara Solutions is helping Fortune 500 companies around the world redefine their customer service through a better contact center experience. Cyara is a pioneer of next-generation premise and cloud-based solutions for simulating, testing and monitoring IVRs, voice biometrics, outbound dialers, voice callback and contact centers. Sam Jackel, Project Director, Contact Center Transformation The Westpac Group Sam Jackel is a voice technology expert, who has experience in implementing innovative technology solutions and large scale projects. Sam has been working in the financial services industry since 1998, and his career has encompassed roles in online banking, project delivery and voice channel management. Sam is responsible for the delivery of Westpac's new speech recognition system. The Westpac Group Westpac was established in 1817 as the Bank of New South Wales. In 1982 it changed its name to Westpac Banking Corporation following the acquisition of the Commercial Bank of Australia. Westpac has branches and affiliates throughout Australia, New Zealand and the near Pacific region and maintains offices in key global financial centers including London, New York, Hong Kong, Singapore and Shanghai.
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The Next Generation of Customer Feedback is Social Customer Satisfaction Intelligence

by Ashish Gambhir, newBrandAnalytics
ustomer surveys. Mystery shopping. Printed comment cards. Inbound emails. Website comments. Call ins. Not too long ago, marketers relied on these traditional forms of feedback as the primary methods to gauge customer satisfaction. As feedback volume from these sources continues to declineresponse rates from these channels has fallen from 50% in 2007 to 28% in 2011the value of traditional guest satisfaction is being questioned. During the same time period, mentions per store per year on social feedback channels grew exponentially, skyrocketing from 450 to 9,330. Social media feedback is rapidly growing, has tremendous reach, and is unbelievably influential. Facebook boasts some 750 million active users worldwide,Twitter receives 95 million Tweets everyday and Yelp has surpassed 50 million monthly unique users. The number of Foursquare check-ins exploded by 3400% in 2010. 90% of consumers online trust recommendations from people they know; 70% trust opinions of unknown users.
Given these staggering numbers, there is no denying that your customers are talking about you onlineand with great reach and influence. They are tweeting, posting, and blogging their experiences with your brandboth the good and not-so-good. They are also talking about whether or not they will return to your location, buy your product again, and recommend you to their peers. As Jeff Bezos says, Make a customer unhappy in the real world, they might tell six friends. Make a customer unhappy on the Internet, they can each tell 6,000 friends. One good or bad experience can be easily shared and broadcast to thousands of existing and prospective customers, magnifying its effect within minutes. Knowing what customers are saying online and putting all of the social media activity to work in a productive way is a business imperative. Mining and translating the rich information embedded in online customer mentions arms brands with the unfiltered, real-time, voice-of-thecustomer insight they need to enhance customer satisfaction and earn their loyalty. The question on the minds of most marketers, however, is HOW. Yes, the vast majority of companies today
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capture customer feedback in some form. But, nearly all are struggling to create structure in the unstructured and unsolicited feedback fire hose that is online customer feedback. How, they ask, do I turn volumes of online insights into actionable opportunities? For instance, a hotel may cull samples of online feedback and notice an unsettling service issue, but is it enough to warrant action? Management may even be able to see an inconsistency in service from a few customer mentions online, but are the authors credible? Collecting the data via current methodologies does not pinpoint clear opportunities for improvement, let alone what actions need to be taken to turn the situation around, re-engage the customer, and earn their loyalty and brand ambassadorship. The answer: Creating social customer satisfaction intelligence.
with all their establishments) working with newBrandAnalytics to mine the Internet for customer satisfaction feedback. Specifically, Parsasole identified three key strengths during its first few months: authenticity, taste, and ambiance. With the same social customer satisfaction intelligence tools, Parasole realized a key and credible concern: customers wanted the ability to build their own pizza. We learned that some patrons enjoyed the authentic pizza combinations we offered on our menu, but others really wanted the flexibility to make their own creationsfrom a simple pepperoni pizza to ones with a variety of ingredients, says Sarah Nerison, Social Media Marketing Manager at Parasole. Gaining this deeper level of social customer satisfaction intelligence enabled us to revise our menu in order to meetand often times exceedour customers expectations. Whats more, the analysis also helped us hone in on how we should promote our new menu. We learned what messages would
We learned what messages would be most impactful for our current and prospective customers. And, because we were able to see where online these folks are talking about us, we knew exactly where to engage them in a conversation.
Sarah Nerison, Parasole The intersection of online customer feedback with business intelligenceor what is known as social customer satisfaction intelligenceis the sweet spot from which brands can most effectively leverage online feedback for operational, marketing, and strategic insight. By tapping into tools that blend social media feedback themes, customer satisfaction, author credibility algorithms, web analytics and enterprise business intelligence, brands can capture a complete, real-time view of customer satisfaction, synthesize it into the richest customer insight, and distill the actionable insights needed to improve customer satisfaction and loyalty, increase revenue, and drive sustainable bottom-line results. Gaining this deeper level of social customer satisfaction intelligence is just what Parasole needed to take its customer experience to the next level. Minnesota-based Parasole is one of the nations premier restaurant concept generators, operators and developers (founders of Oceanaire, Buca Di Beppo). In November 2010, Parasole opened Mozza Mia, an upscale pizza shop and mozzarella bar. The company found that for its portfolio of restaurants, feedback gleaned from traditional sources gave them some insight into guest satisfactionbut certainly not a complete picture. So, from the time of Mozza Mias launch, Parasole monitored every single online mention about the restaurant (as they do on a regular basis be most impactful for our current and prospective customers. And, because we were able to see where online these folks are talking about us, we knew exactly where to engage them in a conversation about our new menu. The theme in the feedback, generated by the newBrandAnalytics approach to social customer satisfaction intelligence, would otherwise not have been identified. And thats precisely what Mozza Mia did. In additional to several other marketing channels, they posted the news about their new Build Your Own Pizza on their Facebook page: Ask and you shall receive. We now offer a "Build Your Own Pizza" at Mozza Mia! Beginning with a freshly baked crust, red sauce and shredded Mozzarella cheese, then it's up to you to build your own creation! Says Nerison, We introduced the build your own pizza on April 1, 2011 and already nearly 10% of our pizzas ordered are build your own. Thats one in ten people who are now choosing to create their own Mozza Mia pizza experience. Besides increased sales, we are no longer receiving negative online reviews that can persuade potential Mozza Mia customers. Were enhancing the experience of our guests by listening to them and eliminating any reason they would have to not be pleased with our pizza options." L
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BY THE NUMBERS
BY THE N UMB ER S
Highlights from Recent Industry Research

The Customer Experience Report notes that 85 percent of consumers would be willing to pay moreup to 25 percent moreto ensure a superior customer experience.
Javelin Strategy Group reports that 71 percent of frequent credit card users indicate that rewards are key to top of wallet position.
DIRECT M AIL DISCON N ECT FROM A RECENT ACXIOM SU RVE Y Consumers feel they are in control of their brand relationships and receive marketing only when they want it50 percent higher than the proportion of marketers who think their consumers are in control
82%
Consumers who say they receive "inappropriate" marketing communications
25%
Consumers happy to receive mail from organizations they are already customers of
71%
People who welcome SMS marketing (marketers guessed 25% of customers would be happy to get text messages from brands)
9%
CONSUM E R RESPONSE L 360 MOBILE WALLE T SU RVE Y
Nearly 89% of consumers surveyed would like to make payments using their mobile phone at their favorite stores.
Mobile preferences included the ability to link to various payment options: 77% of survey respondents wanted the ability to link a Credit Card to their mobile phone 64% would like to link their ATM/Debit Card 54% would attach a Gift Card as a payment method on their mobile device Nearly 78% of consumers surveyed are open to receiving targeted location based offers on their mobile device. 89% reported interest in using their mobile phone as a preferred shopper/ loyalty card, and 90% would like to use their mobile device to redeem rewards/ benefits in store.
60%
of consumer respondents are currently using a credit card or gift card to make payments using a mobile device!
Where do consumers want to use this new technology offering? Grocers ranked first as the top desired location for using a mobile device. 42
Data Insights from "Turning Customer Data into Action"

In Turning Customer Data into Action Loyalty 360, on behalf of TSYS, polled marketers to learn more about if and how brands are using customer data. The results of the research provide
keen insight into the types of data marketers are collecting, where and how theyre collecting it and challenges they must overcome along the way, and how theyre using the data to drive fact-based marketing decisions.
94% of respondents are collecting

data on their customers.
KEY FIN DINGS HIGHLIGHTE D IN THE RESE ARCH INCLU DE
82% of respondents collect data with the goal of growing their marketing database and building marketing campaigns (81%). Nearly two-thirds also collect data on their prospects. The data-collection sources most often cited include website, point-of-sale, call center and loyalty program. Lack of budget and lack of support from other departments most often impede data collection.
While 68% report using the data they collect, limited staff (51%)
and systems integration issues (49%) make using the data effectively more challenging.
The 32% that sometimes or never use the data report that limited analytics expertise is the bottleneck. Results most often realized by using the data include increased loyalty program participation (59%), increased marketing ROI (55%), increased number of transactions (53%), and increased marketing effectiveness (53%).
Find a full copy of the whitepaper, Turning Customer Data into Action on Loyalty360.org
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Achieving CEM Goals: Customer Experience Competency Centers Drive Processes

CECC: A central clearinghouse for all CEM analyses, its mission is simple: drive effective, coordinated and customer-focused decisions throughout the enterprise
by Sid Banerjee, Clarabridge
ustomer Experience Management (CEM) has been a hot topic this year, with the c-suite engaged and looking to launch enterprise-wide initiatives tied to this new discipline. Competitive realities and market volatility have created ever more complicated customer requirements. Customers want value, they want to be heard, they want their suggestions acted upon, and they dont have time and loyalty for companies that cant listen to and act on their feedback. Now more than ever companies need to quickly collect, analyze and act on customer feedback. Getting feedback and using it to solve the right problems more proactively increases sales and improves customer retention. And equally important, CEM programs can help pinpoint opportunities to create customer sales, support, and marketing efficiencies, saving money. That is how a sound CEM process works, whether its reacting to negative feedback on a new product or identifying and acting on customers suggestions, addressing the customer input quickly and effectively translates into significant ROI. In todays tough economic environment, its no wonder that more and more c-suites now include Chief Customer Officers who are building out their organizations to create a new organizationthe Customer Experience Competency Center. So often, the first question asked by companies who understand the need and importance of CEM is: How can we do this quickly and cost-effectively? You need to deploy technology that activates all the
Making It Happen
listening posts and sources of customer inputs to rapidly spot and track specific issues and problems that can impact revenue. The latest, proven analytical tools for doing this includes advanced text analytics, based on natural language processing (NLP), as well as accurate sentiment scoring techniques that return meaningful and actionable data. Feedback can be as short and sweet as a tweet, or as detailed and verbose as a ranting review about a bad experience from a survey or a site like yelp.com, but either way you need NLP and advanced sentiment scoring algorithms need to be able to precisely identify, for every single piece of feedback, what is being said about products, services, people, experiences, and qualitatively how its being said. And, once you have the data, you need to build a team who can take advantage of all the feedback, track it, use it to create and manage performance management programs, and execute changes to the business as needed, to create maximum business benefit and impact. And,
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those very people make up a Customer Experience Competency Center (CECC). A CECC is built on the concept of being a process-driven entity that proactively monitors and responds to global Voice of the Customer (VoC) feedback by driving action across all business units in an enterprise. Who are these people and departments concerned with monitoring and acting on customer feedback? Certainly, product marketing spends a good deal of effort to identify what people want and why, as well as seeking out the most up-todate information about quality and safety issues. Marketing specialists need input to accurately gauge the effectiveness of their own initiatives. Customer service personnel are tasked with discoverywhat keeps customers happy and loyal and what drives them away. And, human capital is always looking for hot button issues to act more quickly on employee feedback. A company may choose to add more people to the mix, but these core individuals within a CECC ensure analysis based on customer feedback gets processed and disseminated throughout an organization as required. A CECC should be viewed as a central clearinghouse for all company-related CEM analyses, tasked with leading communication efforts with appropriate individuals or business units. Its mission is simple: drive effective, coordinated and customer-focused decisions throughout the enterprise. Without a structured cross-functional CECC in place, many companies CEM efforts have been ad hoc, with duplication of efforts between business units and inefficient or sporadic action taken based on customer feedback. The types of data inputs are wide and varied (i.e., surveys, call centers, website feedback) and complicated further by emergent input from the likes of social media, blogs and chats. Recognizing that the data management dilemma can be insurmountable, companies need a means to integrate raw data from all available sources of customer input and render it into analytics and insights that can be acted upon. Armed with actionable data, a CECC determines and implements an agreed upon set of cross-functional processes specifically tailored for improved CEM. These could include sales alerts (i.e. specific products are spiking in feedback with negative sentiment, sales staff are not addressing questions about a hot product,
a food product is alerting with quality defects suggesting a recall is needed); product quality issues or actions (products are hard to use, difficult to configure, poorly labeled, contain defects, are generating excessive customer support inquiries to call centers). A CECC uses these insights to communicate fixes via customer support and plan HR response tactics to ensure the customer is prioritized and that employees know they are essential to the process. When these processes are built and enacted effectively, producing more satisfied customers, cost center savings and enhanced sales and marketing capabilityand thats definitive ROI.
they manage the heavy lifting involved in gathering and transforming text-based customer feedback from listening posts into actionable insights. Utilizing sentiment and text analytics technology empowers a CECC to establish itself as a repository for all aggregated customer experiences and feedback, which can be used to develop strategies and tactics to grow and serve customers over time. Communications A CECCs functional responsibility is to create greater transparency throughout an organization, so that important insights are more easily shared and outbound efforts not reproduced. The ability to connect and build internal relationships with individual organizations is elemental to a CECC, and providing regularly scheduled updates on customer insights, such as an electronic newsletter or report, helps maintain strong stakeholder relationships. Recognition that a CECC provides customer experience insights that directly supports business and productivity is a common theme.
Customer service personnel are tasked with discoverywhat keeps customers happy and loyal and what drives them away.
Functional Pillars
To ensure processes are properly followed that result in positive metrics, a CECC needs to operate on five functional pillars: Organization, Listening, Collection and Analysis, Communications and Delivery. Organization For a CECC to succeed, it must be supported at the executive level. In fact, some companies have created executive positions directly responsible for CEM oversight, while others might assign responsibility to an existing marketing executives organization. Without senior leadership support, a competency center cannot take root within an organization. Similarly, investment must be made in a team capable of analyzing and disseminating practicable information within the enterprise. Listening Capturing VoC data requires the establishment of listening posts that deliver consistent, high-quality data from call centers to social networks. Inbound channels should be aligned with relevant business units and generate data that supports those constituents. Conversely, outreach initiatives, such as surveys, should be coordinated to avoid redundancies and annoyed consumers. Collection & Analysis Robust sentiment and text analytics platforms are essential to a CECC, in that
Delivery Timing and communications tactics are the buttresses that support effective delivery of CE insights within an organization. A CECC works to get the right information to the right person at the right time, and in the right format. Achieving this involves a deep understanding of internal clients needs and the use of different communication channels to deliver data, from online reporting tools and sales playbooks to RSS feeds and iPhone apps.
Revealed ROI
Business is driven by ROI. According to Forrester Researchs 2009 report, Customer Experience Boosts Revenue, on average, a large company can net $284 million per year with a modest improvement in its customer experience management, based on $65 million in increased sales, $116 million from a reduction in churn and $103 million from new customer conversions through positive word of mouth. Clearly, CECCs possess an enormous potential to support ad grow businesses, while also improving internal communication of customer insights. Most importantly, for those businesses that understand the undeniable importance of customer satisfaction and loyalty, CECCs should be given serious consideration when assessing current CEM goals and processes. L
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CVS: Dont Be a Money Trasher Campaign

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oyalty 360 had the opportunity to hear from Melissa Studzinski, Vice-President of Customer Relationship Management for CVS/pharmacy for an inside scoop on the CVS Money Trasher campaign. Melissa shares insights into what inspired the campaign, why social media is an important channel for CVS fans, and how the campaign has lead to greater engagement with CVS customers.
the inside scoop
What is a MoneyTrasher?
Melissa Studzinski: MoneyTrashers are customers who trash their money by not doing simple things like checking their receipts for ExtraBucks Rewards before tossing them in the trash, or redeeming special coupons cardholders receive by email and at in-store ExtraCare Coupon Centers.
How did CVS engender internal support for this innovative approach to customer engagement?
Studzinski: As the largest retail loyalty program in the country, a key part of ExtraCares success is the choice we give our members in terms of how they want to engage with us. Over the past year, social media has become an important way for us to engage with customers who prefer to connect with us this way. We are constantly offering sneak peeks and exclusive deals through Twitter (Twitter.com/CVS_Extra) and Facebook (Facebook.com/cvs) and have utilized our social networks as a platform for fun and interactive campaigns such as MoneyTrashers. These campaigns foster a sense of community among our cardholders and make it even easier for our customers to share their excitement about the ExtraCare Rewards program, which ultimately helps more people learn how to participate in the program and save more during their shopping trips.
What inspired the creation of the campaign?

Studzinski: CVS/pharmacys customers save millions of dollars each year by redeeming their rewardsin fact, the ExtraCare program has grown into the largest and most popular retail rewards program in the country because so many people do take advantage of the savings available and love how the program caters to them in a personalized way. However, there are millions of other customers that are throwing their earned ExtraBucks Rewards away when they receive them, either because they dont realize they have earned them or forget to use them during their next shopping trip. CVS/pharmacy launched the MoneyTrashers campaign to encourage more ExtraCare cardholders to take advantage of their ExtraBucks Rewards.
Tell us about the CVS MoneyTrasher campaign? Does it tie into the CVS ExtraCare Rewards program?
Studzinski: The ExtraCare Rewards program is designed to make it easy and convenient for our customers to save money on health, beauty and household items throughout our stores, and ExtraBucks Rewards is one of the primary saving options available through the program. CVS/pharmacys customers save millions of dollars each year by redeeming their rewards, however, there are millions of other customers that are throwing their ExtraBucks Rewards away when they receive them. This educational and fun campaign puts a spotlight on the millions of customers who arent taking advantage of their ExtraBucks Rewards and encourages them to redeem them. Additionally, CVS/pharmacy launched a redesigned ExtraBucks Rewards coupon this past July to help make the rewards stand out more prominently to encourage shoppers to take notice and redeem the rewards on register receipts.
What is the goal of the MoneyTrasher campaign?

Studzinski: The goal of the campaign is to help more customers realize that ExtraBucks Rewards can be used to buy items they need and want at CVS/pharmacy. During the first and second phase of the MoneyTrashers campaign, which launched alongside the July 1 and October 1 ExtraBucks Rewards payout dates, CVS.com/moneytrashers and the CVS/pharmacy Facebook page featured interactive content, including playful videos showing shoppers how to avoid being a MoneyTrasher, as well as an interactive pledge application so customers can take a pledge to not be a MoneyTrasher and share their commitment with friends and family.
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How are consumers guilty of wasting rewards & becoming, MoneyTrashers?

Studzinski: Some dont look close enough at their receipts and others dont realize that theyre throwing earned ExtraBucks Rewards in the trash. Some even leave them at the register or lose them in the bottom of their purse. These actions are a result of customers not realizing they can use their earned ExtraBucks Rewards to buy almost anything they want at CVS/pharmacy.
How can shoppers save money by spending points at CVS?

ExtraCare cardholders receive 2% back on nearly every dollar spent in store, every time they shop, regardless of whether or not they participate in any sales or special offers. Additionally, in nearly all U.S. states, for every two prescriptions filled at CVS/pharmacy, ExtraCare cardholders automatically receive $1 ExtraBuck reward. At the end of each quarter, these automatic ExtraBucks Rewards are printed on the bottom of cardholder's receipts during their first visit. Each week certain items are also marked with instant earned ExtraBucks Rewards offers in the sales circular and on store shelves. By purchasing these qualifying items, cardholders earn instant Extra Bucks coupons that print on the bottom of the receipt after the transaction is completed. In addition to automatic quarterly earned ExtraBucks Rewards and instant earned ExtraBucks Rewards, there are a number of different ways customers can save: ExtraCare E-mail Alerts: If an ExtraCare cardholder provides an email address at sign-up, or links an email address to their ExtraCare card online at CVS.com they will also receive special money-saving offers by email that are personalized just for them. Additionally, CVS/pharmacy recently announced the launch of a Send to Card digital savings option, which gives cardholders the ability to send select ExtraCare coupons received by email directly to their ExtraCare card. ExtraCare Coupon Centers: These scan and save kiosks have also been introduced in nearly all stores they let shoppers swipe their cards at the beginning of trips and get personalized coupons they can use right then and there ExtraCare GreenBagTag: Available for 99 cents, the GreenBagTag rewards customers every time they use a reusable bag or simply decline a plastic bag. For every four scans members receive $1 ExtraBucks rewards ExtraCare Advantage for Diabetes: ExtraCare members who opt into the program receive savings on diabetesspecific products, including 4% DoubleBucks back on more than 100 store front items ExtraCare Beauty Club: ExtraCare members who sign up receive rewards for purchasing qualified beauty products, including $5 ExtraBucks rewards for every $50 spent on beauty. Social Media Savings: Shoppers can follow the CVS/ pharmacy official ExtraCare Twitter feed (twitter.com/CVS_ Extra) or Like the CVS/pharmacy Facebook page (facebook. com/CVS) for the latest deal, savings advice and inside scoop updates, as wll as exclusive coupons and contests. Additional information about the ExtraCare Rewards program can be found at cvs.com/ExtraCare.
Social media has become an important way for us to engage with customers who prefer to connect with us this way. Our campaigns foster a sense of community among our cardholders and make it even easier for our customers to share their excitement about the ExtraCare Rewards program.
The MoneyTrasher videos have gone viral, what drove the decision to include videos in the campaign?
Studzinski: CVS/pharmacy incorporated videos into the MoneyTrashers campaign to provide our savviest customers with fun, digital resources to spread the word and teach their friends and family to stop trashing their ExtraBucks Rewards.
Any fan favorites?

Studzinski: During the first phase of the MoneyTrashers campaign which launched July 1, CVS/pharmacy encouraged viewers who came to the Facebook page to vote on their favorite videos and ultimately help spread the word to their friends and family on Facebook and Twitter to teach them to Stop Money Trashing. The most popular video was CVS/pharmacy ExtraBucks Thriller but the others were well trafficked as well.
What have you learned about (or heard from) the CVS customer as a result of your MoneyTrasher campaign?
Studzinski: Since launching the campaign, the number of cardholders redeeming their rewards has increased and it is clear the message is resonating with our customer base and people are really having a lot of fun with it. L
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Dont Expect Loyalty Without Romance

If your loyalty program seems to be missing that spark, maybe its time to put some real effort into spicing up your relationship efforts.
by Darin Rock, SolutionSet
ow do you define customer loyalty. Often, the term loyalty in marketing is used to mean one of two things: 1) Increased purchase frequency, or 2) lower likelihood to attrite. Sometimes it means both at the same time. This casting of loyalty tends to entrap the concept as a tactical applicationanother tool in the marketers arsenal. One that can be prescribed for the right set of circumstances, but is known to take substantial overhead to run, needs a long ramp up to generate ROI, and frequently becomes an Albatross of liability and maintenance. Thinking of loyalty programs this way reflects the years of weathering the concept has endured, not to mention the rigorous scrutiny every marketing idea now undergoesespecially in a less exuberant economy. It certainly takes us away from thinking about customers as people, and far from the meaning of loyalty as a positive quality for partners in a relationship. Oh yes, relationship.
If I described a customer that was 680% more likely to buy with you, 732% more likely to make timely payments, 18% more likely to stay with you, more likely to tell you about themselves and definitely more likely to talk about you with friends and other customers, would you call them loyal?
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Have we lost that loving feeling?

In April of this year, Forrester reported that more than 40% of loyalty programs the marketers they surveyed have in place under perform. The problems cited included lack of differentiation, increase in cluttered offers, and disconnect with the brand, among others. In essence, these initiatives treat loyalty as a bolt on programlacking brand relevance and cause for engagement. With all the money and time these programs require to model, build and approve, theres a lot of effort that ends up with all the fun going into a dis-fun-ctional relationship. But if we look where relationships are creating a big impact for marketers, we might discover some new developments that could rekindle our hope for loyalty. If I described a customer that was 680% more likely to buy with you, 732% more likely to make timely payments, 18% more likely to stay with you, more likely to tell you about themselves and definitely more likely to talk about you with friends and other customers, would you call them loyal? Would you say theyre engaged? Im guessing Yes. And you might even agree signs are pretty positive on the relationship front. These are the results reported by the marketing team at CareOne debt relief services in January this year. The driver for these high results: a well nurtured social networking program aimed at increasing engagement. While these results where shared to prove the value of social media, I think its impossible to miss the value they demonstrate for engagement to drive all the classic goals for loyalty programsand more. It also points out that engagement comes from a broader and more integrated effort.
Perhaps you can dedicate more communications to just hearing back from them. Response communications/recognition: Recognition is a powerful reward that can be a lot less expensive than discounts. How often, how fast and how well are you responding to purchases, web visits or calls? Are your loyalists hearing from you on their birthdays and anniversary dates? Customization: How tailored can your experience be? What would it take to allow your best customers to pick a design for their bag, choose a type of music for their room, pick a category of quotes to be printed on their receipts? Mass customization may be feasible in unexpected and affordable ways that allow your customers to feel more in control with your brand. Promoting "hookups": Are there opportunities for you to connect similar customers? Provide them with things to talk about? Help each other with a complicated purchase or process? Tap and reward your best customers for helping others. Life stage: Are you paying attention to changing needs over time? Are there lifecycles to products theyve purchased or experiences theyve had that you can recognize to show you value their history with you? Metrics: Have you widened your view to lifetime value? If the name of the game is short term gain, you likely wont build a relationship that lasts. Think about the metrics that reflect the net effect of your efforts and help you improve relationships over timecustomer lifetime value and a dashboard of your marketing mix are the tools of tomorrow for many marketers.
Putting luster in loyalty

The CareOne discovery validates the not so surprising idea that building engaging relationships that lead to genuine loyalty takes more than tabulating points for customer behavior. Ideally youre scoring some relationship points yourselfgiving your best and most responsive customers experiences, excitementan expression of your character and their value to you. Theres clearly an exciting potential for social media to be employed to achieve engagement, and with rewards like badging, its not too hard to see how you can make your socialites your loyalists. If we take a step back and revisit our full marketing arsenal with a mind toward reshaping what and how to craft more engaging loyalty programs, we discover a rich vocabulary and a wide range of touch points at our disposal. Every company and situation has its own unique strengths and possibilities, but a good lineup of areas to examine for opportunities to liven up your loyalty relationship experience include: Company brand: what do you stand for and how can a loyalty program amplify it? Is it outstanding customer service? Premium quality? Exclusivity? Contact points: how well are you integrating channels to deliver unique experiences? Is the web an online warehouse, the store a clearance center and the phone center cross-sell powerhouse? How are your best customers experiencing these and other points of contact? Listening: Are you doing all the talking? How often do you ask your best customers for input or for their preferences?
Building engaging relationships that lead to genuine loyalty takes more than tabulating points for customer behavior. Ideally youre scoring some relationship points yourselfgiving your best and most responsive customers experiences, excitement.
Rediscovering the magic
Points programs definitely added spark to our marketing mojo when they were first being institutionalized with travel and hotels some 30 years ago. They continued to add spice to the mix as they expanded to every grocery, department and pet store we know. But, as with those other relationships we keep, too much of the same thing often transforms magic to mundane. Today, most consumers belong to upwards of 14 loyalty programs. Most only care about two or three. Arguably, those top picks are the lucky life essential stores that are able to earn frequency, but may not be making magic for their loyal customers. Theres an opportunity to stand out and rediscover the magic. Lets remix, realign and redesign loyalty to fashion a new kind of relationship that wont go stale anytime soon. L
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Driving Loyalty in the B2B World

by Karen Posey, Geehan Group
major aspiration for companies today is to be in high growth mode, which can be challenging given the current economic climate. In the Business to Business (B2B) world, high growth is achieved through sustainable, predictable, profitable growth (SPPG), for which many factors come into play, most importantly customer loyalty. Three key areas are outlined for marketing executives to consider for leveraging customer loyalty to transform their organizations: the Pareto Principle, Levels of Loyalty, and the Value of Engaging Decision Makers.
Levels of Loyalty
Unlike B2C companies who depend on frequent buyer programs to track customer loyalty, B2B companies must apply a different approach by targeting three distinct levels in top customer organizations: Users Influencers Decision makers Spending marketing dollars on all three levels is critical. However, we often find organizations spend disproportionately at the user and influencer levels. Through a recent assessment conducted by Geehan Group for a client, we found 75% of their marketing spend was at the user level and 25% at the influencer level, leaving no marketing dollars invested with decision makers. This was clearly a contributing factor to low customer retention rates. A recent study from Business Week states over 60% of defecting customers indicate they are satisfied right before they leave. Why do customer survey results reflect one thing, while actions suggest just the opposite? Unfortunately, organizations usually survey customer users and influencers, neglecting the ultimate decision makers. Vicki Cooney, Vice President of Health Systems Marketing with AmerisourceBergen, shares how they allocate marketing resources to decision maker levels. We evaluate marketing spend across all three levels on a yearly basis, Cooney stated. Over time we have evolved our marketing spend to 25% with decision makers, which has improved our position with top accounts.
The Pareto Principle

Marketing in the B2B world greatly differs from marketing in the Business to Consumer (B2C) worldmostly by the sheer number of customers alone. B2C companies have thousands, some even millions, of customers while B2B companies have a vital few. The Pareto Principle, or the 80/20 rule, best describes a B2B company: 20% of customers generate 80% of revenue. Do you know the top customers that make up 80% of your revenue? For example, Walt Disney Company does $39 billion dollars in revenue and has 100 million customers. AmerisourceBergens Drug Company division is nearly twice the revenue of Walt Disney Company with just 3500 customers.
B2C Walt Disney Company $39 Billion Revenue 100 Million Total Customers
B2B AmerisouceBergen $64 Billion Revenue 3,500 Total Customers
The Value of Engaging Decision Makers

After the Pareto Principle has been applied, the next step in achieving loyalty is through engaging decision makers. Why engage decision makers? There are three reasons: Insight Relevancy Relationships
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Over 60% of defecting customers are highly satisfied right before they leave.
A common theme we see when organizations want to engage at the decision-maker level is that they are nervous because these are their top customers. Often they have been working with users or influencers, and while they may know who the decision maker is, they dont have a relationship at that level. However, decision makers give you insight that users and influencers within an organization simply cannot provide. They can tell you where the market is going, their biggest challenges, and their perception of your company, for example. This feedback is vital for your organization to provide more relevant offerings and solutions to their challenges. At AmerisourceBergen, several years ago the entire pharmaceutical model was changing and they needed insight. Leadership Forums were established with hospital decision makers to learn where the industry was going and what was important to them. We learned a lot from these forums, explained Cooney. The opportunity to engage these decision makers in a different way gave us tremendous insight. For AmerisourceBergen, however, the Leadership Forums were more geared to position them as thought leaders and build awareness. AmerisourceBergen achieved their objective with these events. However, they realized there were two missing pieces: enhancing decision-maker relationships and gaining insightkeys to driving long-term loyalty. AmerisourceBergen decided to create an Advisory Council to build long-term relationships and loyalty with decision makers in their top accounts. They evaluated their top customers and chose 20 that fit their established criteria. Leveraging learning from the Leadership Forums, they knew they needed a program that could be sustained, allowing them to integrate insight from decision makers to guide the transformation of their organization. Cooney shared, We are in the midst of a transformation. Engaging our decision makers in a different way will be key to sustaining long-term growth. Cooney is not alone. Our research found that engaging decision makers helps organizations drive loyalty in the
following ways: Engaging decision makers builds and institutionalizes the relationship. Once you have internal buy-in, it is important to leverage the executive team to build relationships with your customer decision makers (especially critical with products and services that have low switching costs, like travel and incentive programs, for example). Leveraging your executives to start building relationships outside the selling motion is critical to achieving game-changing relationships. Decision Maker Engagement Not Engaged Retention Account Growth Reference-able 72% 4% 28% Engaged 90% 12% 94%
Conclusion
Customer loyalty for B2B companies requires consistent engagement, creation of relevant solutions, executive-to-executive relationship-building, and an organized team approach. Keep in mind three areas required for success: Identify the top customers driving the majority of revenue Balance marketing resources among all customer levels: users, influencers, decision makers Engage decision makers to gain insight, relevancy and institutionalize relationships Transformation happens when your organization integrates insight gained from decision makers (through an Advisory Council) into shaping the future direction of the company. This is a marketing executives ultimate secret weapon to not only loyalty, but for achieving sustainable, predictable, profitable growth. L
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How Customer Intelligence Can Help Deliver a Positive and Consistent Customer Experience
Q&A with John Bastone and Wilson Raj, Customer Intelligence Marketing at SAS
he Loyalty 360 editorial team recently sat down to talk with John Bastone and Wilson Rajtwo of the resident Customer Intelligence (CI) gurus at SAS Instituteabout how organizations can use CI to help them ensure all of their decisions and actions are as customer-centric as possible.
John Bastone
Wilson Raj
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Whats the first thing someone unfamiliar with Customer Intelligence (CI) should know?
Raj: The first thing to realize is that all organizations already have customer data and information amassed through the varied interactions they have with their customers. Customer Intelligence is simply the next logical stage: gleaning insights or knowledge from the collected data to drive more desirable and profitable interactions with customers, both immediately and over time. Customer Intelligence is the process of gathering information from wherever your customers are, distilling this information into insights, and sharing these with stakeholders across your company so you can improve products, marketing, customer service, and more. In short, CI allows ALL decisions and actions to be customer-centric. Bastone: To build on Wilsons points, Id add that CI is the glue that holds together any truly differentiated Integrated Marketing initiatives we see in the marketplace today. At SAS, our CI focus targets three core areas: providing companies with the smarts to identify gold nuggets of profitable opportunities, providing information so the factory can take the best marketing actions rooted in those insights, and providing the integration with core financial and operational systems to drive real cross-business impact. SAS customers who execute on these three points arent just smarter or delivering more (and more integrated) campaigns, theyre having measurable impact on profits and customer loyalty.
Think multi-channel data: Think from an online and offline perspective. Multiple channels influence a purchase decision, a brand choice, a loyalty commitment, and so on. The key is to understand your customers journey, identify the appropriate touch-points and define the relevant data points to inform your actions. Start connecting the dots: A single view of the customer is essential to deliver positive and consistent customer experiences. With analytics, businesses can start mining for the hindsight, insight, and foresight to help take the appropriate marketing actions, make the relevant marketing investments, and pull the correct marketing operations levers. Think through these possibilities and develop a roadmap for collecting and testing these data points as they become available and actionable.
There are so many media and channels that todays marketers can use to engage consumers, and some of them didnt even exist 5 years ago. How can organizations plan to make analytics-based decisions today that will put them on solid footing for the future?
Bastone: In many ways the rules havent changedyou have to test hypothesis at a smaller scale, do proper test and control, learn and iterate, constantly. Yet in many other ways, things have completely changed, as companies now have the opportunity (and in many industries, the responsibility) to track interactions with customers at a very detailed level. If you know every promotion youve exposed a customer to, across every channel, what response was elicited, and overall activity, you have all the raw materials to understand exactly what works, what doesnt, and to what extent. Theres still roomlots of itfor creative thinking, and gut feeling on all manner of marketing. But whats unacceptable is not using the data you have to mitigate your risks. Raj: I agree with Johns points and would just add that the stepby-step approach I outlined above will serve companies well today and in the futurethis logical progression builds the foundation to support current and future goals.
What are your tips for organizations as they begin to think about using analytics and CI to drive loyalty programs and customer marketing decisions?
Bastone: Well, as a somewhat grizzled veteran of loyalty efforts in the Grocery and Consumer Packaged Goods sectors, I can tell you that any loyalty effort needs to start with the end in mind. And the end in mind shouldnt be another two-tier pricing scheme, or a me-too points program, but the basis of something that truly allows a company to offer a differentiated customer experience that impacts the bottom line, favorably. Companies committed to doing that are doing amazing things. I think Wilson can expand on the concept of start with the end in mind and give us some step-by-step pointers on how best to approach it. Raj: Yes, in my experience, steps successful organizations should take the following steps to accomplish best-in-class CI and customer loyalty efforts. Start small: test the waters by deciding which marketing goals are priorities, then collect and organize data accordingly. For example, typical marketing goals could be to increase demand generation, improve quality of engagement, evaluate campaign effectiveness, and enhance customer personas, and so on. Start by picking the one or two areas that make the most sense for your business. Get a landscape perspective: Try to identify other customer interaction points as they relate to your specific marketing objectives. Isolate various data points or inputs that may be of value. For loyalty programs for instance, data that reflects RFM (Recency of purchase, Frequency of Purchase, Monetary Value) may not be sufficient. The most successful loyalty programs are those that recognize lifetime customer value.
If you know every promotion youve exposed a customer to, across every channel, what response was elicited, and overall activity, you have all the raw materials to understand exactly what works, what doesnt, and to what extent.
-John Bastone
continued on next page Loyalty Management NOVEMBER 2011
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How Customer Intelligence Can Help Deliver a Positive Customer Experience (continued)
As CI matures, most practitioners are adapting to the need to capture, integrate, analyze, synthetize, and apply insights to marketing decisions.
-Raj Wilson
Once organizations begin collecting large amounts of data on their customers, whats the best way for them to share that data across the rest of their business?
Raj: The top three barriers to effective sharing of the data gleaned from CI efforts are: lack of a comprehensive customer view, organization culture and skills, and limited appreciation or applicability of CI to the broader business. Let me describe what I mean by all three of these in more detail: Lack of comprehensive customer view Start by building and evolving the data and intelligence infrastructure that allows you to mine insights from multi-channel customer interactions. Organization culture and skills Typically, organizations are structured around brands, verticals, channels, solutions, products, etc., but not necessarily around the customer. While this is slowly changing, many organizations still dont have a catchers mitt for all the data and insights that are coming in. Build centralized teams that
Allant ad_loyalty 360_b.eps 10/4/2011 10:02:35 AM
mine the data for customer intelligence and can translate insights to actionable recommendations for marketing. This requires insights teams or CI practitioners to have left- and right-brain skills and to focus on problem-solving. CI applicability to broader business The responsibility here is to show that data-driven and insight-fueled actions can increase marketing effectiveness. In other words: demonstrate business value. CI practitioners have to evangelize and teach the rest of the organization the value of insights by aligning with the various organizations success measures but also help create a culture of data-driven strategic thinking. Bastone: Those are all good points. Id sum them up by saying: dont just share data, add value. Ill use a retail example here. If Im running a loyalty group, and Im churning out reports on the retention rates or sales averages for my top customer segment, whats the category manager for electronics going to care? If I can identify that this same segment constitutes 60% of the profits in electronics, thats the start of a more interesting conversation. And if I know whos most likely to lapse as a shopper in
We understand the VALUE of LOYAL customers

H ere s wh a t o u r c us tomer s s ay a b out us ...
...Allant had the highest percentage of clients demonstrating extreme satisfaction across a broad range of categories...
Performance, Value, Flexibility, Strategic Contribution Score Average
5
Allant
Competitor Average
Allant delivers exceptional marketing performance through multi-channel marketing solutions driven by best in class analytic, technology, marketing strategy and program management capabilities. Visit us at www.allantgroup.com to learn what we can do for you.
Source: The Forrester WaveTM: US Database Marketing Service Providers, Q1 2011, Forrester Research, Inc., January 11, 2011 (rankings based on rating scale from 0 to 5)
DATABASE MARKETING
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INTERACTIVE MARKETING
ADVANCED ADVERTISING
the next 6 months, and can project that negative impact on the consumer electronics business, now youve got a strategic conversation. If I can guarantee within a few percentage points ROI for a campaign that engages those shoppers, using some of that electronics merchandising budget, that helps electronics hit its sales target, now Im core. Finally, if I can quantify why it is a better spend for the business to invest some of the mass circular budget into ongoing attrition campaigns, thats when marketing actually moves the needle.
If you could look into a crystal ball and see the future of using analytics to maximize customer experience and loyalty, what do the most successful practitioners look like?
Bastone: Theyre intensely curious. Those successful practitioners look at every customer interaction as a chance to learn something to improve sales downstream. Theyre also mathematically literate, with the knack for taking something complex and telling a compelling story. Where the crystal ball gets cloudy is where we will find this next generation of marketers. Raj: As CI matures, most practitioners are adapting to the need to capture, integrate, analyze, synthetize, and apply insights to marketing decisions. The notion of analytics as a key strategic capability is becoming more mainstream for CMOs and other executives. Having a single view of the customer
is now considered tablestakes, despite the difficulties and challenges involved. The most successful CI practitioners are not only doing some of the things we mentioned, but are taking analytics to the next level. Were seeing successful practitioners extend data capture beyond traditional sources. As newer channels emerge, practitioners are now integrating social, mobile, location-based intelligence and insights to optimize marketing performance. Newer sources will also likely include interactive TV, tablets (digital and mobile data), and apps. Second, there is an increasing pressure on CI practitioners to deliver real-time insights, not just real-time data. The multi-channel, always-on, reality of todays customer necessitates that practitioners deliver actionable insights almost instantly so that businesses can operate at the velocity of their customers. Third, the more successful practitioners are not only using CI to optimize marketing. They are extending the value of CI to other business functions: sales, customer service, merchandising, manufacturing, design, supply chain, etc. These leaders establish customer intelligence as a core strategic asset and valued at all levels of the organization. John Bastone and Wilson Raj are part of the Worldwide Marketing Team at SAS, a leader in business analytics. They focus on helping SAS Customers understand Customer Intelligence solutions. L
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LOYALTY FORUM: BOOKS
Loyalty Reads
Profiles in Marketing Excellence
By Pamela Lockard
DMN3 Institute | 2011
Marketers spend the majority of their career focused on buyers. In a recently published book, Profiles in Marketing Excellence, Author and Marketer Pamela Lockard decided it was time to focus on the marketers themselves. "I have always been interested in successful marketing leaders," Lockard said. I wanted to know what makes other successful marketers tick. This curiosity led me to search the globe to find 25 marketing experts willing to share their knowledge, experience and wisdom." All the people in Profiles in Marketing Excellence are successful in their field, or, in some cases, multiple fields. Many come from companies, like JC Penney, HP, Shell and
Radio Disney. Others are marketing professors, such as Dr. Mary Ann Stutts of Texas State University, or industry leaders, like John Jantsch of Duct Tape Marketing. With the unique question-and-answer format of the book, it is easy to read. You learn where these experts see the future of marketing going. You also find out how they plan to tackle the ever-changing world of marketing. Each marketer provides insights in to his or her background, thoughts and dreams. After reading, you will like them and want to know more. So, add Profiles in Marketing Excellence to your library. You'll gain new insights about marketing and meet 25 engaging marketing thought leaders at the same time.
Books to Know About Now

Social Media Leadership: How to Get Off the Bench and Into the Game
By Michael F. Lewis
Leigh Walker Books | August 2011
The B2B Executive Playbook

By Sean Geehan
Clerisy Press | November 2011
Business just got a jargon-free guide to social media. Social Media Leadership: How to Get Off the Bench and Into the Game (2011, Leigh Walker Books) explains the field in plain English and offers experience-based counsel on practical solutions in key disciplines for companies of all sizes. The book is based on the experience of Mike Lewis, chairman of ILD Corp., a $100 million operations company, who learned the hard way to use social media for research, customer support and marketing. He wrote the book to take other businesspeople beneath the hype so they can see and seize bottom-line opportunities that social media presents. In this practical guidebook for businesses, Lewis relates the evolution of his own social media awareness from sleeping in the back pew, as he puts it, to full-fledged evangelism for the global phenomena that is changing the way the world does business. Lewis shares his own lessons learned along the way as well as abundant examples and best practices of those companies who are successfully using social media to build their businesses and their brands.
Business-to-business (B2B) companies are fundamentally different from business-toconsumer (B2C) companies. But far too often B2B leaders try to apply B2C strategies and tactics in their companies with disappointing, even disastrous results. B2B success requires a completely different playbook. In this seminal book, Sean Geehan draws upon over 20 years of experience to outline the proven characteristics of successful B2B companies and the executive customer strategies they adopt in order to thrive. The playbook described in the book is supported by case studies and research from market-leading B2B companies, including HCL Technologies, Harris Broadcast Communications, Crown Partners, Henny Penny, Springer Science+Business Media, Wells Fargo, Intesource, Oracle, and more. This extraordinary book is an invaluable resource for executives in small, medium, and global B2B companies. Geehans approach tp B2B success helped us refine our strategies, build customer retention rates, and grow our revenue and margin.
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Flowing in the Workplace: A Guide to Personal and Professional Success

By Lawrence Vijay Girard
Fruitgarden Publishing | June 2011
Each day we are challenged to find meaning and fulfillment in our lives. The workplace demands strength and toughness, while in our personal lives we seek simply to be happy, with a positive sense of purpose, and a joyful loving relationship with our friends and family. Is there a way to achieve outward success and inward fulfillment? The idea that business and the rest of life are two separate things is a myth. Science itself has declared that life is one unified whole. The truth of the body/mind/spirit connection is accepted by most people. The problem is: What do I do about it? How do I make it practical? Lawrence Vijay Girard has bridged the gap between an inspirational and practical approach to business. Based on a fresh expression of time honored precepts about how life works from the "inside out", Flowing in the Workplace presents a formula for success that takes into account how life actually works and each person's unique circumstances. The precepts and techniques in this book can be applied to virtually any life or business challenge. This is no set of beliefs with vague theories, but a very specific step by step guide; including techniques and examples. Each area of discussion is applied to three overarching areas of application: Sales, Customer Service and Management. In this way the reader can very clearly see how basic principles can be applied in all aspects of business.
Who Hired These People?

by Peter A. LaPorta
Author House Publishing | April 2009
Thirty five register lanes available but only two lanes open. You approach the customer service desk to voice a complaint and the rude woman behind the counter tells you that the customer service department is now closed. A typical response in a world where customer service has slipped away. Everywhere you go in the world today service has been downsized or eliminated. The wonderful concept of self-service dominates everything from your local gas station to the world wide web and everything in between. You call a customer service phone line and there is no one to talk to. You go to fast food restaurants and they dont give you fast food or fast service. Rude banks, rude servers, rude clerks. Where does it all end? Former DISNEY leader and best selling author, Peter A. LaPorta, takes you on a fabulous tale-telling journey in Who Hired These People? Story after story brings you into the hilarious but incredibly true world of customer service disasters. No punches are held back as Peter shares real life experiences of encounters with such giants as Walmart, Dennys Restaurants, Bank of America, and much, much more. Just when you think all service has gone down the drain, Peter takes you into the wonderful service world of champions with such companies as Walt Disney Co., Walgreens, Darden Restaurants, Stew Leonards and several others. Organizations such as Angies List are heralded for promoting customer loyalty and support. He shares their best practices and gives us hope for a brighter tomorrow.
Onward: How Starbucks Fought for Its Life without Losing Its Soul
By Howard Schultz & Joanne Gordon
Rodale Books | March 2011
How We Decide
By Jonah Lehrer
Houghton Mifflin Harcourt | February 2009
In 2008, Howard Schultz, the president & chairman of Starbucks, made the unprecedented decision to return as the CEO eight years after he stepped down from daily oversight of the company and became chairman. Concerned that Starbucks had lost its way, Schultz was determined to help it return to its core values and restore not only its financial health, but also its soul. In Onward, he shares the remarkable story of his return and the company's ongoing transformation under his leadership, revealing how, during one of the most tumultuous economic times in history, Starbucks again achieved profitability and sustainability without sacrificing humanity. Onward represents Schultz's central leadership philosophy: It's not just about winning, but the right way to win. He gives readers what he strives to deliver every daya sense of hope that, no matter how tough times get, the future can be just as or more successful than the past, whatever one defines success to be.
The first book to use the unexpected discoveries of neuroscience to help us make the best decisions. Since Plato, philosophers have described the decision-making process as either rational or emotional: we carefully deliberate, or we blink and go with our gut. But as scientists break open the mind's black box with the latest tools of neuroscience, theyre discovering that this is not how the mind works. Our best decisions are a finely tuned blend of both feeling and reason and the precise mix depends on the situation. When buying a house, for example, it's best to let our unconscious mull over the many variables. But when we're picking a stock, intuition often leads us astray. The trick is to determine when to use the different parts of the brain, and to do this, we need to think harder (and smarter) about how we think. Jonah Lehrer arms us with the tools we need, drawing on cutting-edge research as well as the real-world experiences of a wide range of deciders from airplane pilots and hedge fund investors to serial killers and poker players. Lehrer shows how people are taking advantage of the new science to make better television shows, win more football games, and improve military intelligence. His goal is to answer two questions that are of interest to just about anyone, from CEOs to firefighters: How does the human mind make decisions? And how can we make those decisions better?
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Maximizing Actionable Insights through Multi-Channel Listening

by Chris Cottle, Allegiance, Inc.
case study
veryone is talking about social media and its impact on managing customer feedback. However, most customers are still using traditional channels to engage with brands, such as email, phone and web site forms. Combining these unsolicited feedback channels, including social media, with solicited survey responses can provide the most complete picture of customer loyalty and engagement. A recent survey by the Temkin Group found that 34% of consumers shared a very bad experience directly with the company by phone, email, letter or web site. Even fewer, 20%, put a comment on Facebook, while only 4% posted something on Twitter. (How Customers Give Feedback by Temkin Group). Therefore, to ensure that your company is gaining the most intelligence from customer feedback, it is important to incorporate solicited customer surveys together with unsolicited feedback channels to uncover key insights. A good example of the benefits of this approach is 3Rivers Credit Union in South Bend, Indiana. 3Rivers created a company-wide member experience initiative that provided timely, relevant and meaningful responses to member feedback, thereby increasing member engagement. An essential part of that initiative was to obtain member feedback in as many touch points as possible, immediately acting upon the feedback and measuring the engagement level. Although 3Rivers average member is about 48 years of age, the credit unions long-term future lies within a younger demographic group. The Temkin report found that 18 to 24 year-olds are the least likely to give direct feedback to companies. Therefore, generating feedback from this group became a major priority. 3Rivers also wanted to increase customer engagement levels and be more visible in the community.
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Gathering and Centralizing Feedback

3Rivers created an easy way for members to provide unsolicited feedback and to respond in a timely manner to improve customer engagement. Feedback was given at several touch points such as branches, phone center, web, email and mail. The credit union also decided to survey members after transactions to improve the customer experience as well as measure customer loyalty through NPS scores. 3Rivers implemented the Allegiance Engage Voice of Customer (VOC) platform in April of 2010. Allegiance Engage gathers feedback from all channels into a single, integrated platform to help organizations grow and become more profitable through improved customer/employee loyalty and engagement. Specific feedback mechanisms include an ad-hoc/self-serve survey engine, a transaction survey engine, relationship surveys and unsolicited feedback management, all in one platform with easy-to-use reporting and analytics. 3Rivers decided to link the VOC platform to an I have a voice button on the company Web site. Upon clicking the button, customers can quickly enter a suggestion, comment, concern or question, which is categorized and immediately emailed to the appropriate person within Member Services. Using the Allegiance webbased software, 3Rivers had a central point where all customer feedback was captured, in real time, acted upon and measured. For example, every two weeks 3Rivers cross-functional team meets to review recurring issues from customer feedback and discuss permanent changes and actions. The results are captured in an Actionable Item Report for easy monitoring and follow up. Since many comments have a follow-up action associated with them, managing them properly is an important component of the customer experience. 3Rivers also uses the Allegiance survey tool to create a five-question online survey to follow up each VOC interaction and assess the customers satisfaction level. The survey includes a Net Promoter Score (NPS) question to determine the impact of the interaction on the customers overall impression of the company and ascertain customer loyalty. Several other surveys provide 3Rivers with additional insights. The CustomerPulse survey is sent to each member twice a year to identify customer engagement levels as well as the key drivers of engagement. 3Rivers is also using Pulse to assess what happens to new customers after the honeymoon stage is over. The survey is especially important for young customer groups, because 3Rivers found they had shorter honeymoon periods than older groups.
Identifying Actionable Insights

3Rivers tries to give each member immediate feedback, even if it will take time to resolve the issue, so that they know their voice has been heard. The first CustomerPulse survey uncovered a few surprises. It highlighted issues that 3Rivers didnt know about that could have had serious consequences. For example, the qualitative feedback from the survey indicated members werent happy about the way the credit union had communicated a change in interest rates on certain types of accounts. The credit union took this unexpected and crucial finding to heart and changed its process. Now it sends important notifications with more advance notice, using multiple methods, not just by email or a posting on our Web site In another example, when 3Rivers implemented new online security procedures, it received nearly 100 comments. Without the VOC mechanism, the credit union might have lost a significant number of disgruntled customers. Instead, these individuals became part of the problem-solving process. Since implementing the Allegiance VOC platform, 3Rivers has increased the number of customer referrals by eight times, on average, from 25 to more than 200 per month. The credit unions overall Net Promoter Score also increased from 56% to 66%. 3Rivers has also expanded wallet share of its customers from increased engagement and referrals, as evidenced by increases in active checking account balances, total and average savings balances and average free checking balances. The multi-channel VOC program has also helped 3Rivers understand which customers offer the best opportunities for increased wallet share. Members are segmented into groups by age, by income, by preferred transaction method, by customer durationand the percentage of engaged members are identified in each group. 3Rivers then looks at the qualitative information within each group to identify what will have the quickest impact on engagement. This helps them come up with a game plan that will increase the likelihood that lessengaged customers will become strong proponents. This example from 3Rivers shows that, to gain the most insights from customer feedback, be sure to consider customer demographics and the feedback channels most applicable to them. Then set up a system to gather feedback from multiple channels in order to gain the most comprehensive customer intelligence, identify the actionable insights, and improve customer loyalty. L
Be sure to consider customer demographics and the feedback channels most applicable to them. Then set up a system to gather feedback from multiple channels in order to gain the most comprehensive customer intelligence, identify the actionable insights, and improve customer loyalty.
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BEHIND THE BRAND
Anita Emoff
President, Boost Rewards
Boost Rewards, an award winning WBENC-Certified Womens Business Enterprise, is a trusted partner for organizations committed to achieving total workforce engagement. As the President of Boost Rewards, Anita oversees the operations of the company to create smooth client implementations of employee performance programs, and has been a critical leader in designing new technology solutions that have given Boost Rewards a competitive edge. Her sales and management experience from prior work along with her driven personality have guided Boost Rewards to become one of the Fastest Growing 50 Woman Owned Businesses.
Last year you were named a 'Rising Star' by Promotional Products Business Magazine. Congratulations! You were recognized for the changes you instituted at Boost Rewards, correct? Please tell us about this.
As a relative newcomer to the Incentive industry, I quickly understood the value immersing myself into the industry through association involvement, developing relationships with industry superstars and being bold with our approach to designing performance based solutions that were relevant, fresh and highly scalable. Our rapid growth, enabled by our vision and leadership team, has been catching the eye of many industry analysts.
Whats new with Boost Rewards since?

In 2009 I became the majority shareholder in Boost Rewards and we achieved our WBE certification shortly thereafter. Our focus on process and technology led us to the development and release of our latest platformBoost 7.0 enhancing our client experience, reporting suite and reward options. Weve also built a very tight implementation process for on boarding new clients with built-in communications to all involved in the process. Ive lead a major investment in R & D and will be launching a patent pending and innovative market solution in the first quarter of 2012 that will enhance consumer to employee recognition like nothing ever seen in the industry before.
Careful consideration of trends, especially in the choice of rewards, may make your program much more relevant to the emerging younger audience in the workforce.
cation, measurable data tracking and award integration. My opinion is that if you are not engaged with leading technology you will likely earn new business through price cutting. Secondly, there is demographic evolution of the typical consumer and employee which means that careful consideration of trends, especially in the choice of rewards, may make your program much more relevant to the emerging younger audience in the workforce. Positioning yourself with relevant, sexy and high demand items that appeal to multi-generational workforce will prove the most effective motivator to modify behavior in todays market space.
What changes are you seeing in the marketplace today? What should our readers we be aware of?
My observation is that there are two major changes emerging in the market. The first is a technological evolutionprimarily on the provider side, which includes integration with social media, ease-of-use, mobile apps, advanced communi-
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What is your personal motto?

I have a favorite Maya Angelou quote that I think sums up how I approach everything that I do. Love life, engage in it, give it all youve got, love it with a passion, because life truly does give back, many times over, what you put into it. I live my business and personal life in this manner. With that said, I have become very involved with the Pay It Forward Foundation www.payitforwardfoundation.org/wristbands. The foundation believes that we are a community of hope-focused individuals whose mission is to inspire, promote and celebrate the practice of pay it forward principles.
Who has had the most influence on your professional life, and why?
Anita and her team
What do you believe is key in building the ideal employee relationship?

Creating a trusting and caring culture is paramount. Showing your employees that you truly care builds trusttrust however must be earned. My advice to any business owner is to understand that your employees must have clearly defined expectations of their role in the organization.
My inspiration comes from my husband and business partner Michael. Hes been in the industry for 30 yearshis vision, advice and belief in me has been the fuel for my professional growth.
What can we expect from Boost Rewards in 2012?

There are some amazing, unique and innovative solutions on the horizon! Some of these solutions you would not expect from the typical incentive platform. We are committed to provide fascinating on demand solutions to both large and small organizations. You can expect to see new solutions focused on the consumer loyalty market.
How do you view the relationship between employee and the customer?
The consumer is the ultimate boss of the employeemy view is that the customer is in fact, always right. An organization will have rules and procedures, however, I am a firm believer that the employee should be empowered to make decisions at the moment of truth to satisfy the customer. Unfortunately, in our society today, human interactions are being hindered by voice mail, email and text messages. Wouldnt it be refreshing to get back to developing personal relationships with the customer?
We like to end these interviews with some words of wisdom. Would you please share one or two key lessons youve learned over the years that could help?
From a personal perspective, keep people that you love close to you and do things that you are passionate about. I love my family, Zumba, traveling and experiencing other culturesMy personal life keeps me vibrant. From a professional perspective, engaging in a structured and strategic process, surrounded by strong team players, is the key to successI have a fantastic team! L
What would you like to see change in the markets approach to employee experience, engagement and loyalty?
I would like to see the market embrace an approach to recognition that evolves as employees do. There are simply too many outdated solutions in the marketplace. Without the constant infusion of bold and innovative solutions that challenge the status quo, the incentive industry is at risk of appearing ineffective.
My inspiration comes from my husband and business partner Michael. Hes been in the industry for 30 yearshis vision, advice and belief in me has been the fuel for my professional growth.
Anita and her family Loyalty Management NOVEMBER 2011
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Focusing on Key Customer Loyalty Metrics

by Karl Sharicz, Simplex Grinnell
b2b case study
aving run the customer loyalty program at SimplexGrinnell for the past several years, Im often asked to provide ONE metric that will provide a clear picture of customer loyalty. And while there are several metrics that are regarded as primary indicators of loyalty, none of them will provide you with sufficient information if used alone. The longest running metric that Im aware of is overall satisfaction (OSAT), which is what the American Customer Satisfaction Index (ACSI)* was built upon. The ACSI has more than 12 years of empirical evidence supporting the relationship between customer satisfaction scores and key financial metrics. It is the gold standard of measurement. Academic research and literature has attested to the value of the ACSI in measuring customer satisfaction and predicting business success.
Survey design should always include metrics that lead to the most accurate assessment of customer satisfaction and loyalty.
Since 2006, we have used OSAT along with two additional key indicators of customer loyaltylikelihood to continue purchasing (renewal) and likelihood to recommend. The recommend metric, Net Customer Advocacy (NCA) score, is our version of NPS*, based on a 5-point scale instead of a 10-point scale. I do not subscribe to the idea that you only need to measure customer loyalty using one metric. To the contrary, I find all the measures critically important. A pilot would never consider fly-
ing an aircraft having just one instrument, and likewise we should never believe that one customer loyalty metric will suffice. Overall satisfaction is a baseline requirement. Without that measure firmly established and returning levels of 8.2 (on a 10-point scale) and higher, we cannot and should not expect high levels of customer renewals, and certainly not customer referrals. These loyalty metrics serve only as indicators and without further clarification as to why the customer rated us as they did, we would have no clue about what we could do to improve the rating. Therefore, each of the loyalty metric questions is followed by a related open-ended question, so we can obtain additional insights through verbatim comments. Without these verbatim comments, all three metrics would be academic and entertaining at bestbut certainly not actionable. Metrics and verbatim customer comments must go hand-in-hand. The chart below shows the three key customer loyalty indicators we have used since 2006, along with the scale applied to each, its calculation, the exact syntax of the quantitative survey question, and the syntax of the related open-ended question. These are the primary KPIs we report monthly by company, by operation, by region, and by district. Because we have other variables in our customer upload data-file, we have the ability to report each of these KPIs by product, by vertical market, by customer tenure, and by contract value. Survey design should always include metrics that lead to the most accurate assessment of customer satisfaction and loyalty. Its best to avoid single metric approaches and instead combine several to serve as key performance indicators and help trend customer loyalty over time. Overly complicated and lengthy surveys that challenge the patience of the recipient should also be avoided, in favor of carefully constructed surveys that maintain the balance between quantitative and open-ended responses. L
Simplex Grinnell's Key Loyalty Indicators

OSAT How loyalty is currently measured How is the question framed? Average score on a 10-point scale where one is low & 10 is high Please rate your overall satisfaction with this service experience. Likely to Renew The percentage of top two scores on a fivepoint scale where one is low & five is high Based on this most recent service experience, how likely are you to continue doing business with SimplexGrinnell? Could you please provide an example or reason for your response? Likely to Recommend The percentage of top scores minus the percentage of the bottom two scores on a five-point scale where one is low & five is high Assuming you were allowed, how likely would you be to recommend SimplexGrinnell to colleagues or others based on this most recent service experience? Could you please provide an example or reason for your response?
Related open-ended question
In light of your responses to the questions we've asked so far, what could SimplexGrinnell have done differently to improve your satisfaction with this service experience?
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