Customer Relationship Management Strategy: Does The Loyalty Card Has A Value?

There is a lot of innovation regarding loyalty reward programs. This tool remains one of the most appealing CRM project, even though new kind of CRM has appeared with new media. At the beginning, one of the main component of this kind of CRM was the famous loyalty card, which was the symbol of the relationship established between one customer and a brand.

Now the new era of customer relationship management implies to set mobile strategies. Indeed, mobile phones thanks to fast technology improvement have become the best tool to be on customer’s at all time.

Thanks to mobile loyalty reward programs, you may propose to customers more added value than a simple plastic card: you may access your points information, promotions, special features, tools to help you buy more.

Now the thing is that for some people, or at least some marketing directors, the loyalty card has steal a value: An emotional device which marks the relationship between the customer and the brand. With mobile phones, you may have several loyalty cards in the same handheld. But there is no challenge to become one of those card that customers are proud of owning in their wallet. I remember how proud people were to be part of the club Fnac program. They feld somekind of elite, due to the fact they were loyal customers to a retail which was considered as the best in the culture industry.

But to be honest, there is a very few number of companies that could actually set a premium loyalty reward programs which would be rewarding enough to get such a success. Hence I believe that the loyalty card, as we have known it, is on its way to vanish.

What do you think about it? I’d be delighted to share with you on the topic.

Facebook Delivers Poor Customer Satisfaction

Despite Facebook hype and unbelievable fast increase of users, some people are criticizing a lot the service. Of course, among the main reason why Facebook is not appreciated is due to privacy reasons. Nevertheless, Facebook can be considered as the best social network. There is no other service that allows you to share so much online with people you care. Facebook has been able to create some kind of online social communities of people.

Thanks to its social attributes, Facebook is considered for a lot of people as the ultimate customer relationship management medium. This medium provides to brands a new total way to engage with customers. It is actually the first time you may actually have a conversation with your customers.

However, I found this very intersting article: Facebook has poor customer satisfaction figures.

Facebook scored 64 points on a 100-point scale on the consumer experience front, according to a report based on the American Customer Satisfaction Index, developed by the University of Michigan’s business school.

The report finds Facebook score in parallel to two low scoring categories such as airlines and cable companies.

The report attributes privacy concerns, frequent interface changes and commercialization and huge advertising as the reasons affecting the consumer experience on Facebook.

I wanted to share with you the results of this study, because I find it ironic that this medium has such a poor results. Now it seems that one of the main weakness has been to change so much over such a period of times. The lack of consistency, either with privacy policy or with interface is always confusing for users.

Unfortunately Twitter has not been considered by the survey. With all the technical prolems they constantly have, I would be surprised if their index would be way lower than Facebook's.

Community Management: Why Creating A Facebook Page Is Not Enough

A lot of companies are very interested by what is going on with web 2.0. The high number of Facebook users is very interesting for businesses which would like to advertise. Nevertheless, even though the comon wisdom around social network is that they are free advertising you should not miss understand how it works.

Hence, developping a customer relationship management strategy using social network implies more than simply creating a Fan page where customers will be able to discuss about your brands. Indeed, like any other medium create before, social networks are used for malicious usages.

I have read not so long ago a book called the Victorian Internet, which explains the history of telegram, and how you could link its development and usage during its era with nowadays and the Internet. And since the beginning of telegram, telegrams have been used to "spam" users by providing commercial messages over the wires. I found thanks to @sleroux this link to the Ferrero Rocher's Facebook page.

What do you think you could find on Ferrero Rocher's Facebook page? Let's remember that Ferrero also owns Nutella, and has able thanks to this brand to create a strong community of lovers.

In my opinion, Ferrero Rocher could have done a page speaking about how to organize events, cocktails, which would be linked with their commercials and positioning in the market.

Instead, since they have not taken care of their community, the page is stacked with spam comments to win Ipads, naked girls pictures. It is a total failure. Now I don't know if you'd rather should not have a Facebook page, or own one but let people do whatever they want with. I believe this Ferrero Rocher page is a total failure, and it is one of the best example that you must have a community management strategy, which implies:

• A goal which will link the brand and its customers by providing service or content to customers
• Have some community management system to animate the community and to make sure it remains viable
• Have specific metrics which will show out the interest of the project.

Now what will be interesting to see is how Ferrero Rocher will be able to turn the situation into its advantage, by retaking the leadership over. What do you think about it?

Les meilleurs exemples d'utilisation de FourSquare

Trouver sur le site Influencia, voici quelques exemples très intéressant de l'utilisation de Foursquare par des marques ou des enseignes.

Foursquare est un réseau social ludique reposant sur une technologie de géolocalisation sur les smartphones. Depuis son lancement en mars 2009, nombreuses sont les marques qui ont tenté de réfléchir aux possibilités du service dans quatre grandes directions.

Outil de gratification socio-émotionnelle
C’est sur le principe de gratification socio-émotionnelle que repose le concept de badges, accumulés au fur et à mesure des check-ins.
Le badge “Fashion Victim” de Marc Jacobs, le “Louis Vuitton Insider” ou encore le “Elite Shopper” du magasine Lucky - tous reposent sur le même concept: entraîner le public dans un jeu urbain. C’est grâce à un système d’indices divulgués par la marque que l’on peut identifier les endroits où il faut effectuer un check-in. Il suffit ensuite de laisser la magie Foursquare opérer et là, c’est la consécration ! Le badge. Un simple clic et vous voilà “Fashion Victim”. C’est même Marc Jacobs qui le dit!

Lancement de produit
On retiendra de 2010 l’opération “CatchaChoo” de Jimmy Choo. A l’occasion du lancement de sa ligne de chaussures de sport, le créateur a créé une course poursuite dans la ville de Londres, avec une paire de sneakers à la clé, les cachettes étant révélées par un système de check-ins. Une idée simple qui en a fait courir plus d’une.
Plus récemment, c’est Barbie qui a fait parler d’elle avec le lancement de “Barbie Video”. Pour promouvoir son système de caméra intégrée, Mattel a choisi de se servir de Foursquare. L’idée : la célèbre poupée part en vacances, direction San Francisco, Los Angeles, Chicago et New York. Pour gagner une Barbie Vidéo, il suffit d’identifier un lieu de rendez-vous secret et, une fois sur place, de relever le défi lancé par les street teams Barbie. Les aventures de Barbie ont commencé le 20 juillet et devraient durer une bonne partie de l’été.

Intégration de contenus
HBO, Bravo, History Channel... Voici quelques exemples d’intégration de contenus réussis permettant à Foursquare de toucher un nouveau public, plus large. Bravo est allé loin mêlant jeu concours et système multi-badges, le tout reposant sur ses contenus télévisuels. La chaîne a ainsi transformé l’ensemble de ses programmes télé réalité (“The Millionnaire Matchmaker”, “The Real Housewives” ou encore “Top Chef”) en véritables usines à création de contenus.

Programmes de fidélisation
C’est Tasti D-lite qui a ouvert le bal
avec son programme de “TreatCards”, carte de fidélité directement connectée à Foursquare et générant des check-ins automatiques.
Dans la même série, le badge “Barista” de Starbucks est obtenu après cinq check-ins. Pour l’instant pas de café gratuit à la clé, mais cela ne saurait tarder. Starbucks envisage de passer à la vitesse supérieure et d’utiliser Foursquare à de nombreuses fins: remise de prix, invitations à des événements privés, partage de photos ou encore système de notation de la qualité du service. Affaire à suivre.
Évoquons enfin le programme de fidélisation lancé par Domino’s Pizza en Angleterre. L’idée: réduire les coûts de livraison en incitant les consommateurs à se déplacer chez Domino’s. Une exécution simple: un accompagnement gratuit par check-in. Une pizza gratuite pour les Mayors (les Maires). En quelques mois, on voit déjà les résultats de l’opération avec un profit brut grimpant de 29% sur le territoire. Un succès que la chaîne de pizzas attribue largement à ses initiatives social media et notamment sa promotion Foursquare.

Des usages créatifs et, comme le montre le cas Domino’s... lucratifs! Foursquare est un réseau social à suivre de près.

The Evolution Of CRM

Customer relationship management is about 30 years old now, since Leonard Berry in 1982 speaked about relationship marketing. Hence Gartner has decided to span the history of CRM since its debutes. CRM has been a trendy concept for quite a while, but its evolution has been fast.

Of course, CRM is still considered by the majority as a growth source for a company, and foremost the best tool to retain customers, but also some people have doubt about its efficiency, as CRM projects are most of the time big and costly.

CRM has been based since its early age, and remains based on metrics. The capacity of analyzing customer data to find cost optimization or commercial offers which will boost sales is obviously the main goal of CRM in a company. But as technology is moving fast, so does CRM.

Many business trends have affected the way people design customer relationship management projects:

• Multi channel retailing, which implies to have specific metrics set. It also implies it is more difficult to track customers relationship with the brand, depending on the retail he purchases. But what is sure is that the Internet channel drives in store business and in store visits leads some Internet purchases.
• Multi channel communication: Marketing one to one has become a huge advertising budget for brands. But new media have come up, especially on the web with social networks like Facebook, or micro blogging places like Twitter.
• CRM Know How: 30 years ago, CRM was brand new, and everything was to be designed. Now CRM managers have got experience and knowledge which helps.
• CRM competition: It is rare now that companies haven't set yet their customer relationship management program. Therefore, CRM programs is not a source of differenciation on the market by itself anymore. Innovation must be supported, and you need to take care of potential improvements you may get.

The Present of CRM: The Non Customer

According to this study, customers has become more and more skepticals about brands.

"Consumers are more skeptical, more willing to complain, more willing to leave you for a bad experience," Thompson said. "And 89% will tell their friends about their bad experience. Twenty-five percent do that on social media."

They are more eager to complain than they used to be. They have taken the power and knows it. I have read the book in French "le non consommateur", which explains it. It shows out how the relationship between customers and brands have evolved in a bad way, and why customers are expecting more of brands.

That is going to shift rapidly, he predicts. By 2015, 75% will tell other people about a bad experience with a company via social media, he said.

The future of CRM: C2B

Now the future of customer relationship management is that customers, due to all this factors and the fact that markets become more and more mature has got the power. Loosing one customer could be pretty expensive to a company, and customers know that as a matter of fact.

Now customers thanks to the Internet and social media are able to create groups which will empower them even more.

Now CRM is based on conversation, thanks to community managers which animates community of customers. This social part of CRM is very important because it is very difficult to apprehend with a traditionnal CRM prospective. Hence, CRM was based on pre definite data feeds, but now Twitter and Facebook feeds are hard to apprehend that way. This is the reason why CRM is becoming more "human", as community management can't be automatized at least for now. And I believe that after the failure of many sales force automation projects, the human side needs to be considered.

Finally, the three fundamental blocks of CRM will undergo more rapid change as well, according to Thompson. Currently, 90% of CRM spending is for operational processes, a little more than 9% is for analytics, and roughly 1% is for social CRM. Gartner predicts that will shift over the next five years to a mix of about 70% operational, 20% analytics and 10% social.

The Future Of Loyalty Cards

Loyalty cards and loyalty reward program have been around for a while. Most of the time, they are the central core of customer relationship management strategies. Companies spend fortunes to create those cards, but also to maintain them.

Hence, a company like CVS is counting 60 millions cardholders and Best Buy for about 40 millions.

Now I don’t think loyalty cards are going to remain as they are right now. Mobile technologies might give a real boost. Indeed, why would you keep actual cards in your wallet, while you may have them all integrated into an application?

There is a simple rule that I have learnt while I was studying customer relationship management and more precisely loyalty reward strategy with Michel Raicovitch, that people usually own a maximum of 5 cards they carry with them at all time. This is actually pretty few when you think about it, as most retail chains propose their own. If you are not into these cards, people don’t believe your program is worth it, and won’t use it, which ultimately leads to not getting data about your customers.

Now I have found this very interesting video on Youtube, about a new company called Cardstar. This company proposes you to enter in their applications all your loyalty reward program, in order to avoid to keep all those plastic cards. While shopping, you simply scan the code bar on your smartphone, and then the cash desk will recognize your profile.

Of course, you will also be able to get rewards and coupons thanks to this application, as a regular loyalty reward program would.

I believe it is a very smart idea, and what is very interesting about the service this company propose to business and shops, is that you will be able to have data from customers when they don’t visit your shop.





The program counts 700 different loyalty cards, which shows the potential of the idea to have a single application combining all of them.

For myself, top of the mind, I should have at least a dozen of those loyalty card on me. So it would obviously be more convenient to have them all on my phone.

A lot of new things are happening right now around loyalty reward programs and mobile devices. This is pretty exciting