Tuesday, June 22, 2010

Localization and Customer Relationship Management

I have thought a lot about how you could set a loyalty reward program for a brand, while you don’t master your retailing channels. Indeed, for companies like Coca Cola, Kraft, it is very difficult to create a customer relationship management program for your customers, as you can’t base an actual reward program.

Retailers know for a fact what the final customer shops for, and therefore, they can reward their loyalty. Now the true clients for a brand like Nintendo is not the end user, it is the retailer that will propose in its stores the products.

The Internet medium offers the potential to reach those end consumers. Now, you may interact, and entertain a base of loyal customer, but it is very difficult to actually set rewards based on loyalty, meaning the customers with the most potential, in terms of use, and purchase.

One way to do it was to actually ask your customers to send by mail their product packages, in order to shows out what they have actually purchased. This system is obviously biased, because:

  • Not all of your customers will do it. Let me rephrase it. A minority of your customers will do it.
  • It is a difficult process where the customers has to mail it, which makes it a bargain.
  • You are not sure that your customers sent 100% of all the purchases they might have done.

On the company’s side, it is very costly to deal with those mails. Therefore it is not really efficient. Also, even though this kind of system might fit to grocery shopping brands, it is not sure it is adapted to premium brands, like cosmetic brands, or perfume producers.

Now new mobile apps based on localisation could turn it different. I liked what Pepsi made with their application. Now thanks to this type of applications, you may have data on:

  • Where your customers shop (which kind of retail, what type of district…)

  • When do they shop (at night, at lunch break…)

  • How much they consume

  • How influent they might be (if you empower your app with Facebook, Twitter, or Foursquare APIs)

I believe there is a great potential in those kind of programs, because it will allow to get customer data, interact with customers, and also to act during the first moment of truth, when the customer is seeking for purchase.

What do you think about it? Do you other examples of localisation examples?