Amazon Key: overreach versus loyalty

The American Heritage Dictionary defines overreach as "to defeat oneself by going too far or by doing or trying to gain too much." Amazon would do better to outsource this service. 

LA Times: Amazon wants a key to your house. I did it, and I regret it, 2017-Dec-7 by Geoffrey A. Fowler

Amazon is barely hiding its goal: It wants to be the operating system for your home. Amazon says Key will eventually work with dog walkers, maids and other service workers who bill through its marketplace. An Amazon home security service and grocery delivery from Whole Foods can't be far off. (Wal-Mart has announced plans to test delivering groceries straight to the refrigerator with a smart lock maker called August.)

Amazon said it doesn't have access to data about when you lock your door or the video feed from the Cloud Cam — both good things. But surely its data team is also crunching the numbers on how Key changes your consumer behavior, especially whether you are buying more stuff from Amazon.

What's so bad about living in an all-Amazon house? The company doesn't always have the best prices or act in ways that benefit consumers. For example, it's currently in a spat with Google, whose smart-home products such as Chromecast and Google Home are not carried by Amazon — and who retaliated by blocking access to its YouTube apps on some Amazon products. (Grow up, you two!)

Amazon Key did give me some peace of mind about delivery theft. But the trade-off is giving more power over your life to a company that probably already has too much. 


Sephora innovates loyalty by wrapping their business around the customer

Mentioned below are just a few of the innovations among Sephora's experiments in customer experience. When we see a company investing so much in us, in our education and well-being, it's hard not to become loyal. 

Retail Dive: 30 minutes with Sephora's head of marketing, 2017-Nov-29 by Cara Salpini

Deborah Yeh, SVP of marketing and brand at Sephora, gave Retail Dive a glimpse into three of the retailer's most dynamic marketing moves.... 

"We want to make sure that we are catering to not just folks who are the ultimate beauty junkies, but also people who are early in their beauty journey and exploring beauty for the first time," Yeh said, noting that Sephora has an exceptionally broad audience to address.

Offering beauty classes not only gets customers in the door, but it also gives them something more than just a product to walk away with. Similar to Lululemon's approach, which was to feature yoga teachers in stores and turn them into brand ambassadors that could both sell clothing and offer free classes, Sephora's beauty advisors are there to give customers an experience first, and sell them a product second.

But even outside of scheduled courses, Sephora stores are looked at as hubs of learning and experimentation — something that is bolstered by the use of in-store tech. Take, for example, Sephora's color IQ technology. If a girl walks in looking for foundation, a beauty advisor can scan her face in three different places to find what should be the perfect foundation for her skin tone. 


How Starbucks captures customer loyalty

For Starbucks, the mobile app is key to customer retention. Competitors should look elsewhere for differentiation, or evolve a mobile app with different benefits. 

The Motley Fool: Starbucks Corporation Talks Digital Strategy, Guidance, and Food Sales, 2017-Nov-16 by Daniel Sparks

Starbucks is regarded as the pioneer in mobile loyalty programs and mobile ordering, proving how a well-executed digital flywheel can help increase sales. But even after years of success in digital, Starbucks' digital flywheel remains paramount to the company's long-term plans -- and it's still driving significant results.

Starbucks CEO Kevin Johnson explained (via a Motley Fool transcript):

Our priority to accelerate the power and momentum of our digital flywheel reflects the fact that digital relationships are among our most powerful demand generation levers. In fiscal '17, Starbucks Rewards membership in the U.S. rose 11% year over year. Per member spent increased 8% in Q4, alone. The cumulative fact is that today, 36% of tender comes from Starbucks Rewards, the vast majority, via our mobile app.

With this compelling data in mind, Johnson said the company will soon start making mobile order and pay available to all customers -- not just Starbucks Rewards members.


Marriott, IHG, Wyndham discover dining rewards can lead to loyalty

Recently, we saw a restaurant refer to the second and third return visits as the 'pre-loyalty' stage. At first, 'pre-loyalty' seemed a little silly, but then we realized that many, many visitors will never make it to the second visit, so capturing the third visit moment is key for helping the owner decide whether to offer loyalty rewards. 

Hotel owners have a similar incentive to find out which guests are spending beyond the room, and now they're realizing the dining experiences may be key to building loyalty. 

Econsultancy: Hotels are boosting loyalty with dining experiences, 2017-Nov-22 by Nikki Gilliland

While dining can undoubtedly be a social experience within the context of travel, at a basic level, it’s also a daily habit. IHG and Wyhndam tap into this, giving members greater convenience (and loyalty incentives) no matter where or how they want to eat. In contrast, both Marriott and Shangri-La use the emotive and social aspects of food, offering them memorable and immersive experiences to drive loyalty.

When it comes to choosing a hotel, food and drink might not be a key incentive. However, when it comes to re-booking or becoming a loyal member, these examples show that it is certainly a key driver.


7-Eleven Leverages Facebook Messenger with a bot

In strengthening their brand of convenience, 7-Eleven responds quickly in every communication channel their customer uses. The 7Rewards program makes the 7th cup free for any mix of a variety of beverages. Everything is their marketing is a quick read--very impressive. 

The Wise Marketer: 7-11 leads in Digital Transformation, 2017-Nov-22 by Rick Ferguson

Consumers using Messenger can engage in a conversation with the 7-Eleven Bot by chatting with 7-Eleven on Messenger.  The chatbot allows customers to engage with 7-Eleven easily and quickly. Users can sign up for the 7Rewards customer loyalty platform, find a store location near them, and learn about the latest discount offers. Money quote from Gurmeet Singh, 7-Eleven’s Chief Digital Officer:

“Today’s digital-savvy consumers expect brands to be present when and where they choose, in an effortless manner, and 7-Eleven Bot on Messenger allows that to happen. We are launching a unique loyalty experience for our consumers through an intelligent Bot. Using groundbreaking technology, customers immediately receive a digital card in messenger and can scan to start earning points, check status as well as collect coupons when they choose. Bye-bye physical loyalty cards.


From frequent flyer to big charger... American Airlines follows the trend

We find it easy to be nostalgic about air mile chasing. In the beginning, the big challenge for the airlines was to get people off the ground. That was also the case after 9/11. I remember the VP of Marketing for Continental Airlines telling us, "We discovered how to overcome the fear of terrorism in the sky: $99 coast-to-coast."

Credit cards and mobile apps give all kinds of companies dramatically more and better ways to build loyalty and maximize their profits customer by customer. Now that they've moved their loyalty program to the cards, watch for an explosion of mobile apps. Don't cry for the mile. Use our new communication channels to demand better service. 

Wired: Frequent Flier Miles are Kaput--The Game's about Credit Cards Now, 2017-Nov-20 by Aarian Marshall

For the first time since frequent flier programs got their start in the 1980s, most American airline passengers are earning rewards in a new way. To put it bluntly, the frequent flier mile is dead.

Since 2015, American, United, and Delta Airlines have each changed the basis of their rewards programs from miles flown to money handed over. (American just made the switch in August.) You get points based on what you pay, not how far you go.


McDonald's, McCafe and coffee... habits that pull us into a CRM

What I've learned over the last couple of days... is that... McCafe is the nexus for McDonald's next step into CRM as amplified by customer experience revolution. Many people think that digital purchase platforms will be key... but I believe the leverage provided by a strong digital purchasing platform is a SIDE EFFECT of the desire among customers to share their data with the brands they love. 

First, we select the product or service that makes us feel grounded and able to run our lives with less pain and more enjoyment. Then we share as much of our personal information as we can with the provider of that product or service. They become embedded. Then we become their tool (if we're not careful).

Diginomica: McDonald’s parks digital tanks on Starbucks lawn as coffee becomes CRM differentiator, 2017-Oct-25 by Stuart Lauchlan

So it was only a matter of time before there was some kind of collision looming and this week comments from McDonald’s CEO Stephen Easterbrook hinted a potential turf incursion onto Starbuck’s turf:

As we build out our digital capabilities and loyalty in CRM, we think coffee, because it’s such a habitual purchase, will play well against those customers who we want to encourage back more often. When we talk about converting casual customers to committed, we know coffee and snacking plays strongly against some of those more casual consumers.

That’s the rationale behind the burger firm’s rolling out of McCafe outlets. When Starbucks starts selling burgers, we’ll know this a serious clash coming up, but the old cup of java is now on the McDonald’s menu.



Consider Rockets coach Mike D'Antoni... Loyalty and routines

The story of Mike D'Antoni and Starbucks is entertaining, and I'm glad Jake Fischer asked D'Antoni to explain it because it brings up some of the complexity of loyalty. Visiting Starbucks is a daily morning obsession with D'Antoni, wherever he travels. He admits that he's less in love with the coffee than the routine. 

As a great coach, D'Antoni understands the value of good routines. Sometimes that's exactly why we need more loyalty in our life. Not because the product or service is perfect, but because it fits and enhances our life. Let's be loyal for our own benefit. 

Sports Illustrated: Mike D'Antoni: For the Love of Starbucks, 2017-Nov-9 by Jake Fischer

A daily ritual emerged, reading the USA Today in between bites of his pastry and scribbling in the paper’s daily crossword puzzle. “I could not wait to wake up and go get my routine going.”


Marriott Flywheel project is integrating social into customer journey management

A huge challenge for marketers is integrating social media activity into the CRM. It's not enough to have links to the social media profiles. We need to be able to tap into the data stream coming from those profiles. Here's an excellent story about how Marriott is innovating around this challenge. 

AdExchanger: Marriott Brings Customer Hospitality To Inhospitable Digital Media, 2017-Oct-19 by James Hercher

Marriott began working on Flywheel with Facebook last year to map its 100-million-member loyalty program to Facebook targeting signals, like travel searches or when people are in an airport. Andy Kauffman, who developed Flywheel and will be promoted to Marriott’s SVP of global marketing optimization beginning in January, said he hopes to extend Flywheel into Marriott’s broader marketing and operations....

For instance, Marriott’s loyalty team, its brand marketers and a team tasked with filling empty rooms could all be disconnectedly chasing the same people.

Flywheel has helped Marriott’s marketing department de-emphasize the objectives of specific teams by providing a more comprehensive view of customer identity.

The new approach “starts and stays with the individual and should map to what we understand about that person,” Kauffman said.

Whether someone is a rewards member or has previously downloaded the Marriott app and even details about previous stays and hotel preferences should all dictate the sequence of marketing, he said. And that’s only possible when Marriott can hold a single view of identity across media.

Facebook has hosted Marriott’s Flywheel efforts so far, but the brand wants to apply personalization and tracking beyond the social platform.


Hooked on Starbucks? That app's probably not going to save you money

When Starbucks was spreading across the country, I was really excited about its culture and the way it makes it easy for people to hang out, but I could never get used to the coffee. "Dark roast" always tastes burnt to me. And they serve everything too hot for me to drink in the first 15 minutes. I still go when a friend really wants to meet there. 

Anyone interested in understanding innovation in loyalty programs should sign up for their rewards mobile app. Just be aware that it's among the most manipulative in the business. I'm not sure who is more dedicated to milking their customers: Apple, Amazon or Starbucks.  

I really enjoyed this Lifehacker article, and I will probably bring my own cup the next time someone wants me to meet them at Starbucks. 

Lifehacker: The Ultimate Guide to Paying Less at Starbucks, 2017-Oct-23 by Nick Douglas

Wean Yourself Off Frappuccinos

They’re the least bang for your buck, says Consumerist. To satisfy your sweet tooth, add syrup to a basic drink. Multiple shots of syrup cost the same as one shot.

Bring Your Own Cup

If you use your own cup, you get ten cents off, no matter the drink size.

Don’t Use the Drive-Thru

The drive-thru has to charge you for every add-on, says Consumerist. But face-to-face, baristas can give you extras for free....

Use the App With Caution

Order your drinks through the app and earn loyalty rewards. But if you’re the type of person easily tricked by an upsell—if, say, you’ve ever spent money in Candy Crush—the rewards system will backfire. Starbucks will dangle “extra” rewards points in front of you if you buy baked goods or promoted drinks. Don’t be a sucker.