Going the Distance: Four Ways to Build a Better Customer Loyalty Program for Your Brand

It’s easy enough for a customer to join your loyalty program, especially when you’re offering an incentive such as discounts. All your customer has to do is give out some basic information, and voila! They’re in the fold, a brand new loyalty member with your company. From there, it’s happily ever after. You offer the perks; they stand solidly by you, bringing you their continued business. Simple. Or is it? In reality, just how many of those customers are act ively participating in your loyalty program? Do you know? Sure, loyalty program memberships are on the rise according to market research company eMarketer, having jumped 25 percent in the space of just two years. However, that figure may be a bit misleading. The truth is that, while loyalty program sign-ups may be more numerous, active participation in such programs is actually in decline. At the time of the study, the average US household had memberships in 29 loyalty programs; yet consumers were only active in 12 of those. That’s just 41 percent. And even that meager figure represents a drop of 2 percentage points per year over each of the preceding four years, according to a study by loyalty-marketing research company COLLOQUY.

When discounts just aren’t enough

So what’s a brand to do? How can you make your loyalty program worth your customer’s while—as well as your own? After all, gaining a new loyalty member doesn’t mean much if your customer isn’t actively participating in your program. Consider this: Does your customer loyalty program offer members anything different from what your competitors are offering? Chances are your program includes discounts. That’s a given. And what customer doesn’t appreciate a good discount? But when every other company out there is providing this staple benefit in comparable amounts, it becomes less and less likely that customers will remain loyal to any one particular brand. Frankly, it’s all too easy for customers to get lost in a sea of loyalty member discounts. They’re everywhere. In fact, just under half of internet users perceive that all rewards programs are alike, according to a 2015 eMarketer survey. The key to success, then, is to differentiate your business from the crowd. If you can offer your customers something unique and valuable beyond the usual discount, chances are they’ll be more likely to stick with your brand. Here’s some inspiration from companies who get it.

Virgin: Reward more purchases with more benefits.

That’s not to say you need to get rid of discounts entirely. In fact, nothing could be further from the truth. Customers still love a good discount. The goal is to be creative in terms of the loyalty perks you offer. Take the Virgin Atlantic Flying Club, for example. As part of its loyalty program, the airline allows members to earn miles and tier points. Members are inducted at the Club Red tier, from which they can move up to Club Silver and then Club Gold. Here, it’s not just a discount. It’s status. And people respond to feeling important, elite. Still, even where the rewards themselves are concerned, Virgin is motivating loyalty customers with some pretty attractive offers. At the Club Red tier, members earn flight miles and receive discounts on rental cars, airport parking, hotels and holiday flights. But as members rise in tiers, they get even more. At the Club Silver tier, members earn 50 percent more points on flights, access to expedited check-in, and priority standby seating. And once they reach the top, Club Gold members receive double miles, priority boarding and access to exclusive clubhouses where they can get a drink or a massage before their flight. Now that’s some serious incentive to keep coming back for more. Discounts are still part of the equation – but they are designed with innovation and personal value in mind, elevating them to more than just savings.

Amazon Prime: Pay upfront and become a VIP.

What if your customers only had to pay a one-time upfront fee to get a year’s worth of substantial benefits? It may not sound like the smartest business idea at first glance. But take a closer look. Amazon Prime users pay a nominal $99 a year to gain free, two-day shipping on millions of products with no minimum purchase. And that’s just one benefit of going Prime. It’s true that Amazon loses $1-2 billion a year on Prime. This comes as no surprise given the incredible value the program offers. But get this: Amazon makes up for its losses in markedly higher transaction frequency. Specifically, Prime members spend an average of $1,500 a year on Amazon.com, compared with $625 spent by non-Prime users, a ccording to a 2015 report from Consumer Intelligence Research Partners.

Patagonia: Cater to customer values.

Sometimes, the draw for consumers isn’t saving money or getting a great deal. The eco-friendly outdoor clothing company Patagonia figured this out back in 2011, when it partnered with eBay to launch its Common Threads Initiative: a program that allows customers to resell their used Patagonia clothing via the company’s website. Why is this program important to customers? And how does it benefit Patagonia? The company’s brand embraces environmental and social responsibility, so it was only fitting that they create a platform for essentially recycling old clothing rather than merely throwing it away. The Common Threads Initiative helps Patagonia build a memorable brand and fierce loyalty by offering its customers a cause that aligns with deep personal values. OK, so their customers get to make a little money, too. Everybody wins.

American Airlines: Gamify your loyalty program.

If you’re going to offer your customers a loyalty program, why not make it f un? After all, engagement is key to building a strong relationship with your customer. And what better way to achieve that goal than making a game of it. American Airlines had this very thing in mind when it created its AAdvantage Passport Challenge following its merger with USAirways. The goal: find a new way to engage customers as big changes were underway. Using a custom Facebook application, American Airlines created a virtual passport to increase brand awareness while offering members a chance to earn bonus points. Customers earned these rewards through a variety of game-like activities, from answering trivia questions to tracking travel through a personalized dashboard. In the end, participants earned more than 70 percent more stamps than expected – and the airline saw a ROI of more than 500 percent. The takeaway: people like games.

Stand out from the crowd.

Your approach to your customer loyalty program should align with your overall marketing approach. Effective branding is about standing out, not blending it. Being memorable is key. To this end, keep in mind that loyalty programs are no longer a novelty. That means that yesterday’s strategies won’t work moving forward, so look for ways to rise above the noise, setting yourself apart from the cloying drone of countless other cookie-cutter programs.

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How 3 Big Brands Went Hard Core With Content Marketing (And the Lessons You Can Learn From Their Success)

In spite of all the hype that surrounds content marketing these days, many businesses still have lingering questions about exactly how to use content as a viable marketing strategy:

• What exactly is content?
• How do I know if this approach is right for my business?
• What resources do I need?
• How do I measure the return on our investment?
• My company sells widgets, so why would we need it?

In the face of such uncertainty, it's human nature – and therefore the nature of business – to look to those around us for guidance and inspiration. This is especially true for brands that have earned our respect. We may not always have access to the carefully guarded data behind their decisions, but where and how those organizations invest their marketing dollars is telling.

So let’s look at how three top brands – a lifestyle products company, a professional services association and an e-commerce behemoth – are investing in content to build relationships with customers and drive sales.

Cooking up content with Williams-Sonoma

Known for its high-end kitchen products, Williams-Sonoma has crafted a customer experience that’s far different from buying discount cookware off the rack at big box stores. Instead, the company has built a lifestyle brand around the idea of just how rich life in the kitchen can be.

As a result, it's no surprise that Williams-Sonoma's website is well stocked with content about the food-lover lifestyle, including recipes, wine, entertaining ideas and gardening tips.

The brand, however, has taken content-as-marketing-strategy a giant leap further by developing a website dedicated solely to kitchen design and remodeling – Cultivate.com – with features like premium photo galleries for design inspiration and a database of remodeling professionals aimed at helping readers create their dream kitchens.

Cultivate content partnerships Williams-Sonoma style

With Cultivate, Williams-Sonoma has done something noteworthy by forming strategic partnerships with both premium brands and remodeling professionals. As a result, they've created both a high-quality remodeling resource for consumers and a powerful sales tool for business.

It's a win/win/win scenario.

First, Williams-Sonoma wins because these partners, incentivized to provide great content for the site, bring additional expertise and value to readers while simultaneously easing the resource burden of producing so much high quality content. Williams-Sonoma can equip your kitchen with gadgetry, but "A Shopper's Guide to White Marble Counters" is outside the brand's focus. Fortunately, premium tile company and Cultivate partner Walker Zanger has the expertise and credibility with customers to fill that content void.

Second, the partners win because William-Sonoma has created a micro-marketplace and platform for engaging with customers already primed for their products. The site's powerful photo gallery feature lets users search kitchen designs by color, layout, style and cost, and all of the content is professionally produced by design and architectural firms eager to feature their services.

Last and most importantly, readers win because they get a better resource for kitchen remodeling, with professionally written content, expert advice, special offers and carefully curated products – all in one convenient package.

Even if you don't have a Cultivate-sized budget, your business can still take advantage of content partnerships and the benefits they provide. The key is to identify other companies that compliment – not compete with – your products or services.

For example, a business law firm could partner with both a CPA and management consultancy to create an advice blog serving local business owners.

Or, as a starting point, consider having other businesses provide some guest posts for your company blog. This toe-in-the-water approach allows you to test how well their content resonates with customers and which potential cohorts are the right fit, all before diving into a content partnership.

Just like cooking, gardening and most other things in life, it's often wise to start small, learn from both your mistakes and your success, and then grow from there.

Content from REALTORS that really hits home

The National Association of REALTORS (NAR) has long positioned itself as the foremost authority on home ownership, and its impressive credentials back up that message. It's the largest trade association in the U.S. with over 1 million members and its own political action committee.

So it makes sense that its brand message to potential clients is that Realtors, as experts on everything from property values to legal issues, are essential to navigating the complexities of buying or selling a home.

The challenge when selling professional services, however, is that you are, according to best-selling marketing author Harry Beckwith, "selling the invisible." There's no product to return for a refund if the customer is dissatisfied, and the stakes are often higher, both in cost and risk. So building trust with your clientele before they sign a contract is critical.

NAR is using content to build this trust and reinforce the perception of its brand as a network of specialized experts through HouseLogic.com, an exhaustive information resource dedicated to all areas of homeownership, including:

• DIY home improvement and maintenance
• Working with contractors
• Outdoor and green living
• Understanding insurance, home financing and taxes
• Education about home ownership legislation and causes
• Working with a Realtor

Want to gauge whether to tackle a home improvement project yourself or hire a contractor?

What's the difference between a standard home equity loan and an FHA 203(k) loan?

Who are Fannie Mae and Freddie Mac?

HouseLogic holds the answer. So what key content lessons does HouseLogic hold for the rest of us?

Build content the REALTOR way

First, build to your brand. HouseLogic draws visitors in with content about curb appeal and customized kitchens, but it doesn't stop there. Rather, it moves beyond these themes common to thousands of other sites and addresses issues more critical for homeowners – issues only the NAR could speak to. This depth and breadth reinforces the REALTOR brand as the definitive information resource for homeowners.

If you're a product company, create content that mirrors the space where your products intersect with your customers' lifestyles. If you provide services, make sure your content approach supports the emotions that you want customers to associate with your brand, whether trust, enjoyment, security or convenience.

Second, hire pros as much as possible. Realtors want you to rely on their professional expertise, so HouseLogic follows that thinking by using experienced content creators who are knowledgeable about the topics they're covering. For example:

One writer covering home decor and improvement, is a "HouseLogic contributor and builder of luxury homes in McLean, Va. She’s been a Homes editor for Gannett News Service and has reviewed home improvement products for AOL."

Another who writes about DIY repairs and remodeling, "has written or edited over 60 books on home repair and remodeling for The Home Depot, Lowe’s, Better Homes & Gardens, Sunset, and Reader’s Digest. He's a former contractor with decades of hands-on experience."

Your organization may not have NAR's resources, but that doesn't mean you shouldn't invest in creating as much great content as your budget allows. In these freelance-friendly times, there are writers and editors aplenty. Or save yourself the hassle and outsource your content entirely to a trusted digital marketing firm that understands the intersection of the Web, content and customer experience.

And don’t forget about photography and video production – two other content areas where it's typically better to hire a pro than to do it yourself. For some brands, a slick video may seem to sales-y while a more amateur style video could come across as more genuine.

Keep in mind, the main objective is not to simply to look professional but to build your reputation as an expert in your field, and hiring a professional can help you find that focus.

Content to cart with Amazon.com

While Amazon.com has built an e-tail empire hawking content such as books, movies and music, the brand's approach to connecting with customers through content is just as impressive.

Unlike Williams-Sonoma, NAR and probably 99 percent of other companies using content to grow their businesses, Amazon has chosen to buy rather than build, to purchase a stake in pre-existing communities and their rich content rather than producing their own. And boy have they picked winners.

IMDB.com (Internet Movie Database) is essentially the Wikipedia of film and television. The content is entirely created by the user community, covering cast lists, photos, trailer clips, script overviews, production notes, trivia, industry news and much more. It's the destination site for lovers of film and television.

Similarly, DPReview.com (Digital Photography Review) has been providing in-depth reviews of cameras and photography equipment for years, building a large and engaged community of pro and amateur photographers who share their questions and insights in forums and their photos in galleries.

It's not difficult to see why Amazon would want to tap into these content communities. Ads and obvious calls-to-action allow site visitors to easily move from an article about a movie or camera to the corresponding product page on Amazon.

But Amazon has very impressively exercised much restraint here, choosing to be present in the content but not dominate it. In other words, Amazon didn't start meddling with what the community had built. To do so would have meant a breakdown of user trust and therefore site traffic and sales. They don't care which camera or movie you buy, as long as you're buying it from Amazon.

Connecting with content communities

Amazon is a trail-blazing company in many ways, and their decision to to plug in rather than publish on their own is a path worth considering, especially for organizations just starting out with content marketing.

You don't have to build a great content site if you can buy one that's already providing great content and has a loyal following. If that sounds too expensive, then look for a small but respected blog in your niche market to use as a test project.

If you can't buy at all, you can still make the most of other people's content by growing your own presence in their communities. Engage in forums and contribute content to their sites.

If you do buy a site, stay out of the way. DPReview's press release about being acquired by Amazon includes a reassuring "we-won't-break-it" quote from Amazon CEO Jeff Bezos: “DPReview.com is by far the most authoritative source anywhere for straight talk about new digital cameras. We at Amazon.com have been their fans for a long time, and we extend a big welcome to the dpreview.com team.” The release goes on to reassure everyone that the site "will continue to function as a stand-alone operation."

It will be tempting to try to bend the conversations and content in your favor and promote your products extensively, but such heavy handedness is a quick way to kill an online community. Don't ruin the trust that's already been created between the site and its followers.

These themes of building trust and providing value are the common threads that connect Amazon, the National Association of REALTORS, Williams-Sonoma and every other company that's doing content marketing well. It is without a doubt the most important lesson we can learn from their examples.

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Focus, Technology and Personalization: A Master Class in Branding from Apple’s Angela Ahrendts

Angela Ahrendts was recognized as a branding and marketing powerhouse well before Apple tapped her as their senior vice president of retail and online sales. Her eight-year track record at Burberry is very nearly legendary — and with good reason. When Ahrendts came to Burberry in 2006, growth at the venerable company had nearly come to a standstill, but within just a few years, she had re-established the brand as a force to be reckoned with in the luxury market. Through a combination of savvy use of technology and some hard-nosed business moves, she rebuilt the Burberry label brick-by-brick, and by the time she left for Apple, had nearly tripled the company’s annual revenue. And while your company’s marketing budget and resources surely are a drop in the bucket compared to Apple’s or Burberry’s, that doesn’t mean we can’t take a page from her syllabus and learn to how to emulate her innovative approach to branding building. So why don’t we all turn our attention to Professor Ahrendts, and let her teach us how to embrace the principles and practices that brought her phenomenal success at Burberry and got Apple’s attention.

Focus, focus, focus

When Ahrendts became CEO of Burberry, she inherited a brand in turmoil. The venerable 150-year old name was no longer synonymous with luxury; instead it had become the label of choice for British hooligans — so much, in fact, that some pubs refused to allow patrons inside if they were wearing Burberry. Outside the UK, the situation was even worse. Burberry had forged licensing agreements with more than a dozen international companies, and those companies were creating their own inferior products, then stamping them with the Burberry label. While Burberry was foundering, the luxury market as a whole was growing. Ahrendts found herself competing against well-established brands in a competitive market where her company had lost all advantage. Her response? Focus.

The brand

She began by finding what she refers to in interviews as her “white space” — the niche in the market that only Burberry could fill. And she found Burberry had two things that made it completely unique: it was British, and it had a history that spanned 150 years back to a single overcoat. These two features have been the touchstones guiding Burberry ever since in every piece of marketing, every fashion show and every story the brand has told — British models on the runway, British music on the website and in stores, and those classic trenchcoats always on prominent display.

The market

With a clear focus for the brand established, Ahrendts moved into market research to find the white space among consumers. Research told her something interesting – something that competing brands had either completely missed or ignored. The demographic group spending the most money on luxury consumer goods, especially in emerging markets, was the Millennial generation. So she landed upon the concept of “democratic luxury” as a way to bring the Burberry brand to a younger generation, avoiding the stuffy image many luxury brands promoted and making Burberry young, exciting and friendly.

The vision

Her final area of concern was all those licenses that were diluting the brand. Burberry bought back the licenses and established tight control over every single item that carried the Burberry label, from products to marketing campaigns. The new rule was simple: anything visible to the consumer passed through the hands of Chief Creative Officer Chris Bailey, the keeper of Burberry’s brand vision.

Digital first

Ahrendts has said that she views digital technology as a force for driving change rather than a marketing tool – a philosophy that is front and center in all of Burberry’s online outreach efforts. Take, for example, the Art of the Trench and the Burberry Kisses campaigns. Neither is designed as a direct-sell campaign but rather as a way to connect with, engage with and delight consumers. Then there’s Acoustic Burberry — a showcase of up-and-coming British musicians featured online and in Burberry stores. This integration of online and physical worlds is another of Ahrendts’ trademarks, and it’s embodied in Burberry’s flagship store, opened under her direction in 2012. Her stated goal was to make walking through a store exactly like browsing the Burberry website, and that goal is more than met. The store leverages cutting-edge technology to create a truly unique experience for customers. One great example is the use of chips embedded into selected products to activate interactive screens showcasing the story behind each item. Even runway shows blur the line between online and physical reality. Burberry now live-streams their fashion shows and allows online viewers to purchase items they see on the runway — well before they’re actually available in stores. It’s this seamless integration of worlds that has made the Burberry brand unique among its peers.

And always personal

Angela Ahrendts has also pioneered the use of technology to truly personalize the Burberry brand experience. In the stores, associates carry iPads with access to an international database of customers that provide purchase histories and personal preferences in order to allow them to provide their clients with a higher level of service. And online, customers are given the opportunity to customize items with nameplates and personalized technology. Orders placed online are even confirmed by a personal call from a Burberry rep.

Your takeaway

Angela Ahrendts has established herself as a branding genius — and Apple stands to benefit immeasurably under her guidance. Take her philosophy as an example, and reap some of the same benefits in your own market and on your own scale: Keep a clear focus on your brand story. Maintain control over your brand. Find your audience and learn to speak their language, which Ahrendts would say is digital. And discover ways to differentiate your product through presentation and personal service.

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