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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DeadSpace: 7 Reasons Why MySpace is as Good as Dead

The first behemoth of social networking, MySpace—now owned by Fox Interactive Media—is on its way to its grave, with no one to blame but itself. MySpace’s popularity hit its apex in March 2008. In the following month, it was overtaken by its first real competitor, Facebook. But the writing was on the wall long before that. Web developers and architects all over knew that MySpace was doing it wrong. Surely at least a few of its own developers knew this and pushed for change. Still, MySpace was the slowest to adapt. For a site of that magnitude—including all of its systems, engineering and hacks to make it function—change does not come easy or cheap. The site was not built to do or handle what it attempts to do today, and its poor framework and conventions of interaction are a reflection of that. This is where the ever-important step of planning and laying a site’s foundation is so important. MySpace architects did not effectively build the system to be much more than a novelty. And while MySpace is not your average website, it serves as a lesson in utility for anyone charged with planning, building and running a website on any scale. If a better alternative in Facebook had never come along, MySpace would not be in this position nor would it have pushed to try to make any changes, even in the eleventh hour. People still want to connect to other people, share things they care about and display certain aspects of their life. Whether you agree with those aspects of our culture or not, they do exist, and MySpace fulfilled those motivations for a time. All you need is one competitor, however, one other option entering the marketplace, and the incumbent developers will be challenged to fight to the death. MySpace’s architects and developers simply could not live up to that challenge. In 2008, MySpace did begin to introduce features, tweak aspects of its foundation and attempt to crack down on the juggernauts of spam bots plaguing the site—but by then people didn’t care. Facebook came along, presented a better option, and people moved with little doubt that they would ever return to MySpace. Thus, in the same way it virally grew, MySpace will die by the same domino effect that catapulted its popularity. Let’s examine seven key elements of MySpace that rushed MySpace to its grave. (It should be noted that the following screenshots were purely at random and were very, very easy to find.)

1: Out-of-control design framework

Of the people you know, how many could lay plans for their own house, paint a beautiful portrait worthy of hanging in your living room or perform cosmetic surgery? Chances are, few. There are just certain things that some people have no business doing, either lawfully or for the sake of the rest of us. Designing websites is one of those things. Designers are in a unique class of professionals, and good web design is an exact art and science. MySpace disagrees, however, and allows their users to hack everything in the page until nothing is usable, legible or tolerable. Pages are riddled with high-res backgrounds, text isn’t protected, and colors, styles and sizes are fully unlocked—just to name a few. All of this creates a design playground which breeds annoying layouts that distract from the page's content. In contrast, Facebook has chosen to restrict at least the foundational framework of the site. While customization is an important aspect, it shouldn’t be allowed at the risk of the functional system—the very heart of a social networking site’s brand and reputation.

2: Auto-play music

People love music. It’s one of the few ubiquitous facets of life. In fact, Apple’s famed comeback as a technological and cultural superpower was all a carefully conceived plan to tap into our common love for music—and they rode that all the way to billion-dollar profits. In contrast, MySpace taps into music to annoy the living hell out of most of us. In fact, it should be noted that all non-prompted audio anywhere, on any page, is a widely unacceptable and an unwanted "feature."” This goes for ads, auto-play videos, and most important, unexpected, blaring music overlaid on what you might be listening to already.

3: Identities

The days of Internet handles are coming to a close. Yes, there was a time when one would be known as “Biker5445,” as systems continued to use usernames as main identifiers. Of course, Internet e-mail systems will still use some form of handles for some time. Most of today’s websites, however, no longer need to do this—particularly social networking sites. This is even more important due to recent news and events concerning privacy and security. The use of a handle is only good for concealing identity, and that doesn’t mix well in a site intended to connect people. What good can come from that policy in a social networking site? MySpace did eventually get clued into this basic, fundamental issue and started asking its users for their real name as an option: Again, too little too late.

4: Little focus on content with a horrible user interface

There’s actually too much of this subject matter to fit within this article’s short space. One could write volumes about the sheer usability and UI issues that plague MySpace. One thing is for sure, this aspect is a website killer, no matter if you are local deli or a major social networking site. In the case of MySpace, most interactions and conversations occur within a never-ending, scrolling guestbook. These “comments” also have very little restrictions and are filled with a cacophony of text, pictures, videos and animated gifs—all without any context in the conversation. Ultimately, the interface leaves everyone reading essentially one-half of an e-mail conversation between two people and no one else. That’s just the beginning. Features that are, at best, a one-time read about a person’s interests, life story, and favorite music, movies, books, television shows, heroes and foods are typically placed near the top of the page in one long column. Whether you have an interest in any of this stuff or not, you’re treated to it every time. The list goes on, but we just can’t stomach any more.

5: MySpace has cultivated a raunchy, immature base

MySpace’s culture—formed by the foundation created by its architects—has without a doubt developed an immaturity and a raunchiness that is unique to MySpace. It’s widely known that MySpace has sold-out to become a platform built around dating, which doesn’t help its state in terms of the quality of content. You can easily find all the "vital" statistics that you want from a date on most pages—everything from sexual orientation, build types, even income takes headline status. The archetypical “MySpace photo” is often mocked and mimicked today by a photo with the person in a sexually suggestive pose, with bright light and the camera aiming down from above. It’s not just about sexually suggestive material, but about the framework of how MySpace works. The site can’t be responsible for user’s content, or perhaps lack of content, but what MySpace’s architects have built promotes an underlying immaturity that is not present in Facebook—at least not yet. Coupled with all the other out-of-control elements, a light click-through of MySpace easily resembles a walk down a tattered, defaced red light district. And why is Facebook not facing this degree of the problem? Its architects have planned better. Perhaps it’s embracing the common sense of restricting anonymity. Perhaps it’s because Facebook doesn’t allow layouts and its interface to go nuts. Either way, it’s well-known that Facebook has attracted a more mature presence and left MySpace with the rest. If you have never experienced this cultural difference, click around random pages in MySpace—if you dare. Chances are, you don't need to and you're just nodding along with the rest of us.

6: Inordinate number of ads

News Corp is definitely profit-centric. Whatever soul MySpace ever had, it was sold to the highest bidder ages ago. The number of large, animated, irritating, irrelevant and sometimes offensive ads compared to what matters—content and utility—is terribly imbalanced. While Facebook has yet to turn a profit at the date of this article, it will eventually need to solve this problem and will most certainly shift its balance as well. Until the day comes when Facebook burns through its cash faster than investors can pour it in, this difference makes it an easy switch from MySpace to Facebook.

7: Spam

If there’s one thing that’s notorious on MySpace, it’s spam. The site’s spam comes in many forms, but the most prevalent are the spam bots for sex and dating sites. They pose as skanky figures, companies, scam artists, music groups and interest groups, which scour friend lists in public profiles and send out friend requests to drive traffic to their MySpace page or other shady website. MySpace came to its senses in recent times, figuring that this was annoying people beyond limits and started to ruthlessly crackdown. Again, too late. The brand of MySpace, “A Place for Friends,” became “MySpace—A Place For Sleazy Marketers.”

The Future

While MySpace's reputation is dead, Facebook isn’t perfect either. In fact, more and more people are becoming annoyed with its limitations and methods as well. It is still plagued with its own problems, some of them similar to MySpace in terms of its core usage. Simply put, there are things that “social networking” sites should be doing and they are not, along with things that they are doing and shouldn’t be. Facebook is—for the moment—simply a better option. But it’s got a thin line to walk as well, not the least of which is to actually turn a profit. With MySpace as good as buried, look to Facebook to begin making changes to address the pressures of creating more revenue. The balance between utility and profits will be tilted. The question is how much will it tilt and how much will be sacrificed when the next social networking site comes along and ups the ante?

More...

MySpace Helps News Corp Lose $363 Million [Mashable]

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Fit or Fad?: Choosing the Right Social Media Networks to Connect with Your Customers

This just in...

Pinterest is now a marketing tool for business. That is, if the chatter emanating from LinkedIn groups and marketing white papers is any indication. Yes, there are already white papers. In just over a year, Pinterest has edged its way up the Alexa rankings to claim a spot on the 50 most visited sites in the world. It has even surpassed such well-established powerhouses as PayPal, CNN, Netflix and The Huffington Post to claim its stake as the #16 most visited site in the U.S. “But what the heck is Pinterest?” you may be wondering. I’ll let this hot new social site pin it down for you: “Pinterest lets you organize and share all the beautiful things you find on the web. People use pinboards to plan their weddings, decorate their homes and organize their favorite recipes.” Wait a minute…this bastion of all things bridal, bed sheets and baked goods is now big business? Really? How did this happen? And what does it mean for your business, if anything?

The quick and the dead

Social media is the new wild west of marketing…at least it often feels that way. In just the past few years, we’ve experienced a revolution in the way information about our world, our products and our customers is collected and shared. Connections are raw and direct with little room for error. As a result, it’s no surprise that 140-character faux pas from high-profile tweeters have become evermore commonplace – not to mention the number of noteworthy public scandals brought to light by social media missteps. And then there’s complexity of the social landscape, which changes like the Nevada desert – a few boulders (Facebook, Twitter, LinkedIn) surrounded by a sea of shifting sand, posing a challenge to any business to keep pace. So in this environment of constant flux, how do you remain relevant and cutting edge? How do you balance caution and agility in responding to new platforms? How do you make the most of limited resources? And who’s going to do all this posting, tweeting, +1ing and pinning, anyway? After all, not every business has the luxury of a dedicated, in-house social media guru.

Here’s the good news…

Using the right social media tools in the right way is far more important than using every tool in the box. A carefully curated approach can create stronger ties between your company and your customers while providing the greatest return on your investment of resources. Here’s a step-by-step guide for identifying those networks that are the best fit for your business model, capabilities and customer base.

1. Know where your peeps are.

For major consumer brands like Coke, Nike, Comcast and other B2C juggernauts, it’s important to be everywhere. Fortunately though, they also have the budgets and the manpower to sustain such efforts. Your brand, on the other hand, probably doesn’t need to be everywhere; you just need to figure out where it’s best to be. The key to maximizing the value of your social media efforts is knowing where your customers live online. Just as with all marketing efforts, success starts with knowing your audience, their habits and preferences. If the type of customer you serve isn’t likely to be active on Twitter, there’s no need for you to invest your time there. On the other hand, if your target is young moms, up-and-comer Pinterest is probably a great place to connect with these individuals. Don’t be afraid to stop investing resources (human or monetary) in poor performers. For example, I work for a consulting firm that manages enterprise software projects for utilities. Because the corporate culture of these types of companies tends to evolve very slowly, many of our prospects were still blocking employee access to Facebook and Twitter until just recently. So, historically, those outlets have offered our firm little lead-generation value. However, nearly everyone I meet has a LinkedIn profile, so our firm has a strong presence there, with many of our staff actively involved in LinkedIn groups. Find where your people are and join the conversation.

2. Align social media with your business model.

Every social media site has its own strengths and benefits, so it’s up to you to determine which ones best enable you to showcase and promote your products or services. Full-platform sites like Facebook and Google+ offer the greatest flexibility and the broadest audience, but there may be others that can better serve your unique marketing goals. For professional photographers, sites like Flickr and Instagram make it easy for people to discover and share your work. They’re also where you’re most likely to connect with people who are passionate about great photography. On the other hand, sites like Groupon, Yelp, Zagat and Foursquare are built around local deals and local reviews. If you’re a brick-and-mortar shop, these sites can help boost your traffic – the kind that walks through the door with cash to spend. Consumer products – especially those that are design or taste oriented such as fashion, housewares and tech gadgets – are likely to perform well on sites like Pinterest that let users curate collections of things they like. And if you’re in a B2B business, LinkedIn and Jigsaw are great sites for building your network and working leads while Q&A sites like Quora and Focus offer a platform to showcase your expertise and build trust with prospects by answering questions posted by the community.

3. If you show up, come ready to engage.

With social media, you get back in proportion to how much you give. If your company makes the commitment to join a community, you must be prepared to become an active an engaged participant in it. You can’t expect your tribe to accept you and – more importantly – follow your lead if you’re not willing to put in the work to contribute something of value to their community on a consistent and ongoing basis. It may take a while to gain momentum, but as you get to know a community’s values and style of interaction, your sphere of influence and the marketing capital that comes along with it will grow steadily. Fame Foundry friend Gary Vaynerchuck lives on Twitter. He has over 900,000 followers and can stir a mass of them to action at will. I have experienced this phenomenon firsthand, having watched (and participated) in amazement as Gary went on a one-day Twitter binge to push his book The Thank You Economy to the number one spot on Amazon on the day it was released. Although he did not hit number one on the bestsellers list, he did make it to number six…and number two on the “Hot New Releases” list…and number one on the “Movers & Shakers” list, increasing his sales by over 200,000% within 24 hours. That’s the power of becoming an integral part of a community, a leader of a tribe that speaks and is listened to. What kind of blitz for your business could you create with 500, 5,000 or 500,000 followers?

4. Don’t be lazy.

When you post new content on one site, it’s awfully tempting to syndicate – or rebroadcast – it everywhere else. For example, it takes no effort at all to republish your Twitter feed to your Facebook Page or LinkedIn profile. It’s so easy, and there’s no harm in doing it, right? Not necessarily. Your Facebook fans might not appreciate having their news feeds cluttered with your tweets and retweets. And LinkedIn isn’t necessarily the right venue for all the casual exchanges you might participate in on Twitter. It’s a right time/right place/right manner thing. Let’s be clear: I am not saying that you should post content in only one place. I am saying that it is best to adapt that content to the needs, expectations and etiquette of each community. You must shape and massage your content to make it relevant to both the platform and the people. For example, let’s say your business is hosting a special event. You can live-tweet the event as it unfolds, publish a recap of the highlights on your company blog, post pictures from the event on Facebook (particularly if you’re “tagging” participants in the photos), make the presentation slides available on LinkedIn or SlideShare and host follow-up discussions on a proprietary business forum site. You’re still getting great social media mileage from this one single event. But by tailoring your content to the interests and preferences of each community, you’ll give people a reason to follow you in more than one place while preventing information burnout for those who already do.

5. Don’t overlook the easy targets.

Some social sites truly are “set it and forget it,” giving you invaluable exposure while requiring relatively little active involvement. These are reference and review sites for which the benefits of being represented far outweigh the minimal monitoring requirements. If you’re a local business, be sure to keep an eye on word-of-mouth review sites like Yelp and Zagat. Make sure the information listed about your company is accurate. Check in bi-weekly or monthly to see how reviews are fairing. Respond to negative feedback in order to make things right.

A more difficult but highly rewarding option is to establish a Wikipedia entry for your company. While there are a few hurdles you must overcome in order to make this happen, the benefits are tremendous. In addition to further legitimizing your company in the public eye, a Wikipedia entry is a great way to secure a prominent position in Google search results – no sponsored-listing dollars required.

It's not easy, but it is worthwhile.

The underlying principle for all of these tips is that you must put your customers and prospects first. Serve their needs, promote their interests and conform to their expectations of conduct. Share your time and expertise generously and give your fans good reason to like and share your brand and products with their friends. It all comes down to this: to use social media effectively to promote and grow your business, you must find the right fit and then work hard to fit in.

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