GETTING A BUSINESS LIFT FROM LOYALTY
Measuring Rewards Program Effectiveness and Value
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For over 100 years, loyalty programs have attempted to secure consumer wallet-share by providing incentives for repeat business and rewards for retained relationships. Since the 1800s, when Trading Stamps were awarded to customers who paid cash in lieu of credit, loyalty and rewards programs have been positioned as central to retention strategies and fundamental to acquiring, profiling and handling preferred, high-value customers with benefits, perks and privileges (the gaming industry epitomizes this).
Yet while companies continue to spend well over $1.3 billion on these programs, few have tapped into the full revenue potential of these communities or have clear strategies for optimizing revenue potential or furthering Individualized Relationship Marketing practices with more personal, relevant and contextual communication. Though there is clear success and return from these investments, many companies are launching loyalty and reward programs to simply stick with the pack rather than build an active channel or community for furthering customer interactions and delivering more relevant offers or information.
Getting a Business Lift from Loyalty will audit and assess the operation and innovation in loyalty club programs, the value and utilization of customer data to drive response rates and revenue, and the mobilization of loyalty club members as active agents and advocates for acquiring new or repeat business.
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SPONSORS 
ADVISORY BOARD
FACTS & STATS
NEWS & ARTICLES
RESOURCES
ALL PROGRAMS 
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SPONSORS
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InfoPrint Solutions Company InfoPrint Solutions Company is a leading provider of output solutions for business customers from small business to large enterprises. The company was created in January 2007, through a joint venture between Ricoh and IBM's Printing Systems Division (NYSE: IBM). For more than 20 years, IBM and Ricoh have had a strategic partnership to collaborate on a number of innovations, including leading-edge imaging technologies and powerful production output solutions. www.infoprintsolutionscompany.com |
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ADVISORY BOARD
Corporate Leadership Committee
- Belinda Lang - Vice President, Consumer Marketing Strategy, American Express
- Kim M. Sharan - EVP and Chief Marketing Officer, Ameriprise Financial, Inc.
- Peter Horst - Senior Vice President, Brand Marketing, Capital One
- James Cornell - Chief Marketing Officer, Prudential Retirement
- Jerry Jarosinski - Sr. Marketing Manager, Loyalty & Retention, Research in Motion
- Jennifer Geddy - Senior Manager, Sony Electronics
- Brent Korte
- Vice President, Wealth Management Marketing, T. Rowe Price Investment Services, Inc.
- Paul Dickinson, - Sales & Marketing Director, Virgin Atlantic
- Alan Gellman - Senior Vice President of Marketing, Wells Fargo
Faculty Board
- Chip R. Bell - Author of Customer Loyalty Guaranteed: Create, Lead, and Sustain Remarkable Customer Service and 17 other titles.
- Stephen Denny - Consultant and Founder, Denny Marketing.
- Lou Carbone - Founder and Chief Experience Officer, Experience Engineering; and Author, Clued In: How to Keep Customers Coming Back Again & Again
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FACTS & STATS
Membership in US loyalty rewards programs has reached an estimated total of 1.808 billion. (Source: The 2009 Colloquy Loyalty Marketing Census)
For the first time on record, US credit card reward program members outnumber airline frequent flyers (Source: The 2009 Colloquy Loyalty Marketing Census)
US financial services rewards programs has reached 422.0 million, a 77% increase since 2007 census. In contrast, airline loyalty programs account for only 277.4 million members.(Source: The 2009 Colloquy Loyalty Marketing Census)
| MEMBERSHIP IN U.S. LOYALTY PROGRAMS BY INDUSTRY** |
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| Industry | Loyalty Program
Memberships | Industry | Loyalty Program
Memberships |
| Financial Services | 422.0 million | Drug Stores | 73.9 million |
| Airline | 277.4 million | Fuel Convenience | 51.2 million |
| Specialty Retail | 191.3 million | Restaurant | 13 million |
| Hotel | 161.8 million | Car Rental and Cruises | 10.7 million |
| Grocery | 153.3 million | Other Programs | 127.9 million |
| Mass Merchants | 124.8 million | |
| Gaming | 106.0 million | |
| Dept. Stores | 92.8 million | |
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| (Source: Colloquy) |
| **The 2009 figures have been adjusted to account for the inclusion of three industry segments that were not included in the 2007 version: Car Rentals, Cruise Lines and Mass Merchandisers. If these new industries are removed, the adjusted 2009 US census total stands at 1.673 billion. |
From 2006 to 2008, U/S. loyalty program memberships increased from 1.341 billion to 1.807 billion - an adjusted growth rate of nearly 25 percent. (Source: The 2009 Colloquy Loyalty Marketing Census)
There are 14.1 loyalty program memberships per U.S. household. (Source: The 2009 Colloquy Loyalty Marketing Census)
The percentage of overall active memberships in the U.S. - those memberships that demonstrate some type of engagement within a 12-month period - remains at 43.8 percent, with a blended average of 6.2 active memberships per household. (Source: The 2009 Colloquy Loyalty Marketing Census)
According to Web Flyer, there are 89 million members of airline frequent-flyer programs in the world, 74 million of them in the U.S. alone. (Source: The Web Flyer, 2009)
The Food Marketing Institute reports that more than 76 percent of all U.S. grocery retailers with 50 or more stores now offer a frequent-shopper program. (Source: The Food Marketing Institute, 2009)
A McKinsey study reveals that 53 percent of U.S. grocery customers are enrolled in loyalty programs. (Source: McKinsey, 2009)
According to Cardweb.com, 40 percent of all Visa and MasterCard issuers now operate a rewards program tied to their credit card offering. (Source: Cardweb.com, 2009)
COLLOQUY estimates that loyalty program penetration among U.S. debit card issuers is already at 20 percent and rising rapidly. (Source: The 2009 Colloquy Loyalty Marketing Census)
96% of people are currently a member of a reward scheme and 64% of people belong to three or more loyalty schemes. Over three-quarters of the consumer population hold some form of loyalty or rewards card, while 25 percent of the shopping population belongs to two or three programs. (The Wise Marketer)
In Canada, led by the Air Miles loyalty coalition, more than 70 percent of all households participate in at least one loyalty program. (Source: The 2009 Colloquy Loyalty Marketing Census)
In the retail market, 73.7% of supermarket and grocery store respondents use face-to-face interactions to invite customers into their loyalty programs. (Source: DMA's Loyalty Programs: A Cross-Industry Analysis of Usage and Effectiveness study, 2008)
More women than men are likely to take advantage of more loyalty schemes during 2009 (65% compared to 56%). (The Wise Marketer)
Membership of loyalty schemes is more popular in general among women than men (72% of women were members of 3+ schemes, compared to 51% of men). (The Wise Marketer)
Membership of loyalty schemes is more widespread among older people (46% of 18-29 year olds belonged to 3+ schemes, compared to 56% among 30-39 year olds, and 67% for the 40+ age group). (The Wise Marketer)
British consumers feel that loyalty rewards are more valuable in a recession, with 95% having actively participated in travel and shopping reward schemes, and 90% planning to redeem them during 2009. (UK Air Miles travel rewards programme)
Loyalty ratings: grocery sector
While Wal-Mart rules the Grocery sector in terms of frequency of visit, respondent loyalty ratings told a more cheerful story for traditional Grocers and offered little praise for the Bentonville, Arkansas-based retailer. (Source: Colloquy)
- Northeast winner: Safeway. ALDI and Costco also received high loyalty ratings
in this region.
- Southeast winner: Costco. The Hybrid-model retailer was the clear favorite in
this region. Publix, Sam's Club and Kroger also evince strong customer loyalty.
- Midwest winner: Safeway. Despite the Midwest serving as Kroger's stronghold,
Safeway holds the highest loyalty rating in this region.
- Southwest winner: Costco. The membership club topped the list once again,
followed by Safeway and H-E-B.
- Northwest winner: Albertsons. Costco and Safeway came in virtually tied for
second place.
- Overall winner: Costco. Costco emerges as the grocery retailer to which U.S.
consumers profess the highest degree of loyalty. Runner-up: Publix.
90% of best-in-class retail enterprises indicate at least "some level of success to very successful results" from their loyalty programs, whereas 47% of laggard retailers and 35% of industry average retailers indicate 'no change in performance' from their loyalty program. (Aberdeen study, 2008-2009)
53% of retailers surveyed indicate that customers can join their loyalty program on the retail website, but a mere 37% of all retail respondents reported that customers can join their loyalty program via the point-of-sale system in stores. (Aberdeen study, 2008-2009)
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NEWS & ARTICLES
Featured
Orbitz Tees Up Hotel Deal • The Wall Street Journal
The "Hotel Price Assurance" program is similar to an offer Orbitz introduced last June for airline tickets, which automatically reimburses customers for tickets if someone else buys the exact same ticket at a lower price. Read »
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RESOURCES
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Studies & White Papers
2009 Brand Keys Customer Loyalty Engagement Index
The annual Brand Keys Customer Loyalty Engagement Winners are those brands best able to engage consumers and create loyal customers. Initiated in 1997, it is fielded annually in the spring and fall. The current Index examines customers' relationships with 444 brands in 63 categories.
Your Loyalty Program: Time to Refresh
Best practices for keeping loyalty programs fresh and relevant in a market where they have become commonplace.
Nine for '09: Loyalty and Engagement Trends
A ChiefMarketer whitepaper details nine major trends that will have a direct impact on the success (or failure) of brand marketing efforts in 2009.
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Blogs
Church of the Customer Blog
Ben McConnell and Jackie Huba are writers, speakers and consultants who have been researching the effects of word of mouth on customer loyalty. Forbes calls their work “the word of mouth gospel.”
The Customer Loyalty Blog
Sallie Burnett of Customer Insight Group, Inc. provides fresh ideas for building profitable customer relationships.
Sage Words
Mark Sage, Loyalty Director at one of the most established global loyalty marketing companies, shares his thoughts and musings on customer loyalty and retention marketing.
eBusiness and Channel Strategy Blog
Experts at Forrester Research share best practices and opinions.
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Books
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| Customer Satisfaction is Worthless, Customer Loyalty is Priceless: How to Make Them Love You, Keep You Coming Back, and Tell Everyone They Know
To longtime sales and customer-service pro Jeffrey Gitomer, boasting about a near-perfect customer-satisfaction rating of 97.5 percent is a major mistake. "That means 2.5 percent of your customers are mad and they're telling everyone. And 97.5 percent of your customers will shop anyplace the next time they go to market for your product or service." Based on a philosophy that's been developed through his syndicated business columns and the more than 150 seminars that he gives each year to companies such as Radisson, Sony, NationsBank, and Time Warner Cable, the book outlines his formula for making customers so faithful they "will fight before they switch--and they will proactively refer people to buy from you." Regularly employing oversized type in screaming bold fonts to grab the reader's attention, Gitomer breathlessly recounts his start-to-finish approach to becoming "memorable" to consumers along with illustrative tales of his own encounters with particularly egregious examples of poor service. All of this is bolstered by an ongoing sampling of his inspirational quips and a variety of self-evaluating quizzes designed to pinpoint individual strengths and weaknesses.
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| The Loyalty Guide
The Loyalty Guide III from The Wise Marketer is almost 1,000 pages of solid loyalty marketing data, practice, and theory. The report explains customer loyalty, engagement, metrics, best practices, concepts, technologies, models and the latest tools and innovations. It details ways to gather and use customer data to increase customer profitability, reduce churn, and to monitor and increase customer frequency, spending, and share of wallet. Packed with detailed case studies, research, market sizes, forecasts, models, charts, illustrations, and other materials, it demonstrates the principles, practicalities, measurement, analysis, and bottom-line effects of customer loyalty, and offers guidance from dozens of loyalty thought-leaders worldwide.
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| Engagement: Winning the Battle for Customer Hearts and Minds
Leading loyalty experts from Allegiance, J.D. Power & Associates, Peppers & Rogers Group, CustomerThink, and others have compiled a book examining the critical nature of engagement as the new business battleground. The book is aimed at marketing and business executives who are looking for innovative approaches to increasing customer and employee loyalty. Chapters provide insights and guidance on how to use engagement as a competitive advantage, the economics of engagement, how to increase customer loyalty, the link between employee and customer engagement, and more. |
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| Answering the Ultimate Question
By Richard Owen and Laura Brooks, PhD
With a growing number of leading companies implementing a Net Promoter discipline to improve customer loyalty and improve revenues, Answering the Ultimate Question provides key insights into the building blocks to make you successful. Creating and keeping loyal customers has become one of the key topics in today's economic market and Word of Mouth (WOM) is rapidly becoming one of the key ways customer can impact the success of your brand. Answering the Ultimate Question defines how to deploy a Net Promoter strategy. Based on numerous case studies and finding from more than 80 companies this books tells you how all types of companies are successfully building stronger customer experiences. |
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| The Customer Loyalty Pyramid
By Michael W Lowenstein
The vast majority of American companies have little awareness or knowledge of how their organizations must change strategically to improve their customers' loyalty and assessment of value. As customers increasingly perceive a sameness of products and services among companies, an intense focus on customer retention and lifetime value will differentiate successful organizations from others. Lowenstein develops concepts and approaches that enable company executives, managers, and staff to create a dynamic, proactive corporate commitment to customer advocacy and loyalty. |
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| The Loyalty Link: How Loyal Employees Create Loyal Customers
By Dennis G. McCarthy
In an age of consumerism, downsizing, and frequent layoffs, it may seem that loyalty in the marketplace has fallen victim to the fast buck and the quick fix. However, Dennis McCarthy reveals that loyalty—between a business and its customers, between employer and employee—is a major competitive advantage. Businesses that develop loyalty links to their employees will consistently retain loyal customers and gain a competitive edge. McCarthy gives business owners, managers, and executives the ideas and tools to forge the crucial link between loyalty and profitability./td> |
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| Customer Clubs and Loyalty Programmes: A Practical Guide
By Stephan A Butscher
This book carefully takes you through the benefits and pitfalls of loyalty programs, supporting the author's theories with "real world" case studies from a wide array companies. Stephan Butscher demonstrates that sucessful programs did not happen by mistake, but rather by careful planning and implementing a framework that was beneficial to both the company, and more importantly, the customers. |
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| Customer Loyalty: How to Earn It, How to Keep It
By Jill Griffin
Studies have shown that customer satisfaction does not equate with continued sales. What a business needs instead is customer retention and repeated purchases, otherwise know as customer loyalty. Marketing consultant Griffin has written a practical guide for planning strategies to assure customer loyalty. She uses actual examples to describe whom a company should target, how to find qualified prospects, and how to turn customers into company advocates. Griffin also details how to win back inactive customers and how to develop a loyalty-driven corporate culture. |
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