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May 2017

Loyalty Role Models: Sephora, REI and JetBlue

Every industry has different models of customer loyalty. You should know who are the 'role models' for your industry, and consider adapting their programs for your customers. 

TowerData: 3 Big Brands with Exceptional Customer Loyalty Programs, 2016-May-17 by Phil Davis

  • Sephora’s loyalty program, Beauty Insider, offers everything a cosmetics addict could want in a beauty membership. It’s free to join, and each dollar spent accrues points that earn members free beauty supplies. 

  • REI proclaims, “REI is … dedicated to inspiring, educating and outfitting its members and the community for a lifetime of outdoor adventure and stewardship.” And its loyalty program embodies this goal. 

  • At its core, TrueBlue by JetBlue is a pretty typical airline rewards program. Members earn points for the dollars they spend on JetBlue travel, which they can redeem for discounted flights and other perks. Where TrueBlue takes it to a new level is with extra features they’ve been adding since its launch 15 years ago.
    • “Continuously Extending” [offers] TrueBlue points for members who use the JetBlue Card from American Express
    • TrueBlue Mosaic [is] a program that rewards the most loyal customers with waived cancellation fees, early boarding, access to a dedicated customer service line and complimentary in-flight alcoholic beverages
    • Family Pooling... allows families to combine their existing TrueBlue points into a shared account 

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eBay's unique CRM is real-time, all channels

Managing customer relationships is not a function--it's a passion. eBay demonstrated the passion by developing technology that supports their specific and existing customers--those people actually buying from eBay, today. No CRM "platform" available "off-the-shelf" is going to serve our customers as well as something we build ourselves. 

eMarketer: eBay Incorporates Machine Learning to Overhaul Email Marketing Platform, 2017-May-3, interview of Alex Weinstein, Director of Marketing Technology and CRM at eBay

eMarketer: Can you talk more about this personalization platform? How does it work?

Weinstein: Imagine a customer is browsing eBay for shoes. Marketers constantly create deals—there are some deals on shoes, some on electronics and some on accessories for cars. As those deals are created, they’re placed into virtual “buckets.”

For every piece of marketing content, such as our newsletter, a machine learning model looks through all these buckets and decides that based on a customer’s browsing history, a shoe deal would be most relevant. It’s the best of both worlds—content is filled by a machine learning model selecting from deals that humans have created.

eMarketer: Why did you decide to build this platform in-house instead of buying a prebuilt one?

Weinstein: We evaluated a bunch of third-party offerings, but there were two reasons for doing this in-house. The first reason was eBay’s sheer scale. We are one of the largest marketplaces on the planet, with a billion items for sale and 167 million active buyers. Third-party solutions struggled with the scale.

The second reason was our internal decision to prioritize this work and be one of the best in the world at it.... 

Now, we have a real-time data pipeline that powers our downstream marketing campaigns. Whenever an action takes place on the site—a customer buying an item, browsing or just seeing an ad—the activity is tracked by our real-time engine, which updates the profile of the customer and sets off triggers that we have embedded in the system. The triggers apply to both customers and items: For example, the moment the price changes on an item a customer has viewed, we can automatically send that customer an email. No batches involved.

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How Marriott and Hilton are innovating loyalty

Just as customer experience allows us to move beyond price competition to capture customers, loyalty innovations are growing our mind share. 

Hospitality Net: Hospitality, Meet the Digital Age, 2017-May by Marc Berman

Hospitality loyalty doesn't have to limit itself purely to the transaction step of the travel plan. A traveler's planning journey is much bigger than that. According to an Expedia Media Solutions survey, more that 60 percent of American digital users consume travel content. Collectively, they're spending 1.5 trillion minutes each month doing so. That makes for a lot of browsing, researching and planning.

Loyalty programs are beginning to catch onto this and are adding content into their offerings. Marriott's new loyalty app, launched in February, can deliver curated, original content from Marriott's digital magazine, Traveler, based on users' previous hotel searches or upcoming travels. This content helps the brand become present at other stages of the travel planning process, instead of just settling for the purchase touchpoint. Not to mention, it's sure to help the wanderlust kick in for those who are more likely to travel on a whim, or the business traveler plan a last-minute trip.... 

Solo travel may be on the rise, but traveling is still most often done in a group. In 2015, 76 percent of those who travelled did so in a group. Digital elements to the hotel-booking experience can ease the tension here, especially when it comes to payment.

The new Hilton Honors loyalty program allows users to pool their points with up to 10 friends or family members, giving it a leg up on Airbnb where users have to settle for only one payment method rather than splitting it across a group. The program also allows users to put a certain amount of points towards a stay rather than forcing them to pay for the stay entirely in one currency, a great feature for groups who don't have everyone participating in the program. Loyalty marketers sometimes neglect that group, though with easy payment options like this, brands can drive new membership. 

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Mining for customer aspirations at Kohl's and Marriott

One of the big advantages of a sophisticated loyalty program is the opportunity to find out what your customers are dreaming about. 

Forbes.com: Experiential Rewards: How Kohl's, Neiman Marcus and Marriott Set a New Bar, 2017-Apr-28 by Bryan Pearson

The best retail customer experiences are designed to fulfill consumer expectations. For the shopper who got to participate in a fashion photo shoot for Kohl’s, it meant filling a celebrity’s shoes.

That’s basically what a member of Kohl’s Yes2You Rewards got when the retailer invited her to participate in a photo shoot of the LC Lauren Conrad line, designed by The Hills TV star and fashion designer Lauren Conrad. As Conrad described it, the member (Kayla Watters) got to "fill my shoes...."

For Kohl’s, the Yes2You Rewards program also provides its own set of merchant benefits. These include having “an authentic, two-way dialogue” to learn what its shoppers want, how they interact with the retailer and what matters most in their brand experiences, said Michelle Gass, Kohl’s chief merchandising and customer officer.

“As we learn more about our customers through Yes2You Rewards, we develop deeper relationships and provide promotions, experiences and surprises that are meaningful to them,” she said.

Since the program launched in 2014, Kohl’s has made millions of customer surprises, she said, ranging from a VIP trip to the American Music Awards to an early screening of a blockbuster film to the opportunity to star in a Kohl’s photo shoot. “The positive sentiment we’ve seen from these customers is incredible and absolutely deepens customer affinity with our brand.”...

Marriott Rewards Experiences Marketplace offers for auction a meet-and-greet with Tony Bennett, VIP access to the Belmont Stakes Racing Festival and tickets to the Rock & Roll Hall of Fame Induction Ceremony. Recently, it auctioned off a chance to stay in one of eight tricked-out tents at the Coachella music festival, each of which duplicated a room in one of its eight boutique hotel brands.

Important to these experiential reward strategies is that each is sized up to its audience. From Kohl’s branded photo shoots to Marriott’s customized tents, each brand uses its program data to develop reward options that hit the relevant sweet spots of its core members.

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