This post first appeared on StopPress.
Loyalty technology is developing at an ever accelerating pace. The rise of smartphones, cloud computing and big data have compounded to create exciting opportunities for loyalty programs.
No surprise then that a flock of loyalty startups have surfaced, each with their own unique spin on rewards, incentives and loyalty schemes. While most focus on small business, the impact higher up the food chain is taking hold, transforming the way larger enterprises approach loyalty.
Chief among the impacts of this transformation is recognition of the value tied up in loyalty data. Unlocking actionable insights from loyalty data has become a primary goal of any new program launch or program overhaul.
While increasing shopping frequency – the “share of wallet” – is still a prevalent goal, the focus on using loyalty data to drive business and marketing decisions is stronger than ever. Recent launches of OneCard credit card, AirPoints credit cards and the FlyBuys revamp in Australia are evidence of this – new tactics to collect ever more granular customer purchase and behavioral data.
This trend, alongside the proliferation of marketing channels, has brought omniscient marketing databases back into the limelight. Historically difficult to achieve, the goal of such databases is to capture and store all marketing data in a customer centric way – creating a “single view” of customers. With modern marketing tools more readily integrating with each other, and modern loyalty management software developing better data management features, building a single customer view database has become significantly simpler. Products like Simplicity combine loyalty operations and single view database into a single platform, further reducing the complexity of integration.
Indeed for many of the world’s leading loyalty programs, a single view of customers has become the heart and foundation of their success. A person stored once in their marketing database – not once per brand or per card but once for the entire marketing program – enables marketers to truly understand customers and their behavior holistically. More specifically, this means individual level data about preferences, survey responses, transactions, in-bound and outbound calls completed, Facebook likes and emails opened: a full individual history of every multi-channel interaction with your business.
A single view of customers enables:
1. Maximum relevance of marketing communications
With rich customer centric transaction and behavioural data readily accessible, marketers can use data to deliver personalised and coordinated multi-channel marketing communications. The result is a superior customer experience, demonstrated by higher conversion rates and engagement with campaigns.
2. Evidence based segmentation tactics
With a single view of customers we can identify, measure and target segments based on a larger and more holistic data set. Not only can we assign customers to segments based on richer data, but a greater number of segments are possible and we can measure the performance of segmentation strategies more accurately and objectively. Whether your goals are to migrate select customers to higher margin brands, maximise basket value within a segment, or win-back disengaged segments – you can measure the success of the selected tactics against evidence in the data.
3. Meaningful metrics to measure the performance of loyalty marketing
With a holistic view of data, you can measure the performance of marketing using the metrics that matter most and attribute conversions to the right channels proportionally. Beyond opens and clicks, this means measuring the total in-store sales generated from digital marketing campaigns, life-time value of prospects acquired through social media or the bottom line contribution from the entire loyalty marketing program. It means assigning the credit for conversions proportionally across each contributing channel, so you have a holistic view of the purchase process (not just the “last-click”). With this level of insight into marketing performance, you can optimize and tailor your approach to maximise the success of each individual campaign and the entire multi-channel marketing program.
4. Product lines that differentiate from competitors and attract more profitable customers
With a recorded history of transactions for each individual, you can identify patterns and customer behaviours that drive product design and stock selections. For example, reviewing purchase history can reveal the products that your high value customer segments buy frequently, and the products that they never buy. Stocking more products that appeal to high value segments, and discontinuing those products that don’t, will differentiate product lines over time and attract more of your target customers.
5. Exceptional customer service
With a single view of customers, your customer service team have access to all marketing emails sent to the customer, loyalty vouchers they’ve recently redeemed, calls to the contact centre, complaints under investigation, recent transactions, posts they’ve made on your Facebook page and any other interaction. Consequently, the customer service agent can resolve queries efficiently and effectively, resulting in happier customers and lower customer service costs.
Creating a single customer view database
While for many the benefits of a single view of customers are undisputed, the challenge is in the execution. When data is scattered across agencies, service providers, internal systems and online marketing tools this can create expensive data integration issues.
So the time to consider a single view database is when you’re launching a loyalty program, withdrawing from a coalition to set out on your own, or switching from a legacy solution to a modern loyalty platform. Treating a single-view database as an “add-on” or separate piece of technology is a recipe for inferior results and higher cost of ownership.
But when the time comes, to fully harness the value of your loyalty data, make a single view of customers a must-have requirement.