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Loyalty, a Journey or a Destination – How to Build and Execute Successful Loyalty Programs
Marietta:
Welcome to Velti’s webinar, broadcasted from The Netherlands & Greece. We are here with our 8th webinar, I’m GLAD you’re all watching.
Today we will be talking about Customer Loyalty, what is it and why is it important for every business to aspire to keep their customers loyal on the long term.
We will explore how to build and execute successful loyalty programs, and answer one of our main questions through Velti’s experience and practice: is Loyalty a destination, or rather, a journey?
We have divided the webinar into 4 parts.
First, I will tell you more about VELTI, who we are and what we do.
Then we will tune in to Velti Greece, where my colleague, Marian Romano, Senior Client Success Manager will share more insights on how Loyalty is done ‘the Velti way’, as well as one of our great success stories with Goody’s Burger House. We also host {name and title of guest}, sharing her experience with working with Velti.
If you have any questions, please do not hesitate to type them below and we will come back to it during the Webinar if time allows, otherwise after the Webinar in writing. My name is: Mariëtta Robbé Groskamp, Business Development Director Europe and let’s get started!
Let me start with a brief overview of our company.
Velti was founded in the year 2000 and has more than 20 years of experience in the Mobile Marketing area. The main solutions that we offer can be classified into: CVM, Marketing Automation, Gamification, Loyalty, Permission Marketing and WebApps. Today, we are going to talk about Customer Loyalty and Loyalty programs – how we help our Clients keep their customers for a longer term, increase their lifetime value and maintain a positive relationship with their brand.The Velti family is ever growing, currently we have 130 employees – 50% of which are software engineers ensuring that we are using the latest trends and technologies.The main offices of Velti are in Athens (where you also find the HQ and the development centre), Dusseldorf and Dubai. We also have 5 additional sales offices in Europe, Middle East, Africa, and Latin America.
In the next slide you see an overview of Velti’s footprint which is something we are extremely proud of.Here is an overview of the main clients we are working with. More than 300 clients representing 70 countries, from Europe, Middle East, Africa and Latin America.Clients such as Deutsche Telekom, Vodafone to Etisalat and Pepsi and many more. This is something we are really proud of.
If you would like to know more about a specific case study, please do not hesitate to contact us.
Before we talk to my colleague Marian from the Velti Athens office, let me share some more information about Customer Loyalty.
What comes into mind first, when you think of loyalty?
It is of course connected to emotions, relationships, trust. It is something that is long term, ideally goes both ways and requires constant ‘work’ and ‘maintenance’.
Marietta:
Customer loyalty is no different.
What makes you loyal to a brand?
Is it tradition? For example your mum used the same detergent for years and you’d swear by it?
Is it the price? The best value for money?
Maybe, convenience? Is their product accessible and easy to get hold of?
Or perhaps your previous experience with it? Have you tried and liked it?
The quality of the product? The company’s values?
Loyalty is influenced by all these factors, and many more. Let’s see our chosen definition – what is, and what isn’t Customer Loyalty.
Loyalty is an ongoing emotional relationship with your customers that is based on trust. It is a customer’s likeness to engage with you, and repeatedly purchase from you versus your competitors.
It is the result of a customer’s repeated positive experience with your brand – a habit that is formed by multiple seamless events.
Loyalty is not a static status, it constantly changes and evolves based on the customer’s experience with your brand. It is certainly not guaranteed – can easily be lost, only one negative experience is enough for your customers to choose your competitors next time.
So in this sense, Loyalty is not so much a destination, but more like a journey, it needs to be constantly earned. Loyal customers engage with you through multiple channels. They are your biggest assets in bringing in steady revenue via repeat purchases, and recruiting new customers via advocacy.
And their trust can be re-gained – by listening to them and incorporating their feedback into your products & services. Let’s take a quick look at the history of loyalty, where it comes from and how it evolved through the centuries.
The very first examples of earning customer loyalty go back as far as the ancient Egypt – where beer and bread tokens were distributed to workers. The late 1700s (seventeen hundreds) saw the introduction of copper and brass tokens handed out by merchants. These acted as delayed product discounts valid on the next purchase, thus generating return visits and purchases.
In the 1850s (eighteen-fifties), individual retailers started introducing product package promotions, ‘box-tops’ which could be cut out and tickets that could be collected and exchanged for aspirational rewards from a catalogue.
The 1900s (nineteen-hundreds) could be called the boom of loyalty programs – when the expensive brass and copper tokens were replaced by stamps, a much cheaper and viable alternative that were collected in small books and exchanged for a variety of rewards. These programs were the early examples of today’s popular coalition type loyalty programs.
Today’s modern age is characterized by Loyalty cards and a large variety of loyalty programs from coalition schemes, paid exclusive membership programs, tiered solutions; where Loyalty cards are replaced more and more by app-based loyalty schemes.
Now that we defined what Customer Loyalty is for Velti, and how the practice evolved throughout the years, let’s see why Loyalty is important, what it could mean for your business, with the help of some well-known statistics. There are hundreds of useful statistics and reports about loyalty – we collected some of the most important ones. They say, 65% of your business is coming from your existing customers; 43% of customers spend more on brands they are loyal to, and 75% of consumers favor a brand that has a rewarding loyalty program in place. à Focusing on your existing customers and retaining them for longer will have a positive impact on your revenues.
In order to keep your customers loyal, you need to focus on their experience with your brand – 93% of customers will repeat their purchase if the previous experience was good! Having relevant, meaningful offers is just as important – 33% of customers abandons a brand without personalization. No blanket offers, please!
Finally, 84% of customers choose companies whose values align with their own – select your causes carefully and tailor it to your target customers, to be successful.
I hope you enjoyed getting to know more about the origins, the basis and importance of Customer Loyalty!
It is time to tune in to the Velti office in Athens, and learn how to do Loyalty the Velti way!
Marian is our Senior Client Success Manager who specializes in Loyalty solutions for Restaurant chains, among other verticals. Hi Marian, and welcome!
Marian: Hi Marietta! Thank you very much, I’m glad to be part of this webinar.
Before jumping into the Velti way, let me tell you some more details about customers’ Loyalty journey, and how the Loyalty landscape changed during the past few years as we certainly saw a big shift in the market during the pandemic.
Like every journey, the Loyalty lifecycle also has different stages. In each stage, you need to apply different approaches and techniques to nudge customers into the next level of the loyalty ladder.
In the first stage, targeting and acquisition of the customers, you understand their needs and how your product or service helps satisfy these needs.
In the Engage stage, you develop a relations hip with your customers early on – ensure they are satisfied with your products, ask for their feedback and build this feedback into your offering.
In growth stage, you need to set a clear and personalized loyalty journey for your consumers – observe and understand their behavior, purchasing habits and likes/dislikes to be able to send relevant offers at the right time.
From here on, you will need to encourage repeated engagement and interaction with your brand, also rewarding these interactions, making your loyal customers feel like important assets and inducing customer advocacy. At the same time, it’s crucial to identify customers most at risk to ‘churn’, and prepare pro-active solutions to retain them. Happy customers will spread the word amongst family and friends, but unhappy ones will certainly do so too!
Nurturing customer loyalty can help you increase repeat business, strengthen customer retention and attract new customers at the same time. The past 2 years of the pandemic era have been very special in the loyalty market too. They brought a significant shift to digital channels and much disruption to loyalty: consumers now often choose online channels to interact with brands, switching brands became very easy and quick, brand loyalty is difficult to earn.
Companies need to look for more creative engagement, offer flexible, gamified and innovative solutions and reward also the non-purchase engagement of their customers (for example interacting on social media or watching a brand video on YouTube). Consumers are increasingly favouring brands that have similar values of their own, outside of the product or service on offer, they are looking for charity and community-building opportunities.
Personalisation is now key not only in the communication and promotions but also in the products and services offered. For this, it is essential to focus strongly on customer data and analytics, with the help of Machine Learning and Artificial Intelligence. Finally, customers demand a consistent exceptional experience across all channels that includes also an easy and seamless switch between channels even within the same journey! Think researching a product online on a desktop, to then try it in-store and finally purchase it on a mobile device.
So, how do we do Loyalty in Velti?
We pride ourselves on building all our Loyalty solutions on three pillars: Technology, Agility and seamless Execution.
Our Loyalty Solutions run on a state-of-the-art, omni-channel customer engagement and Loyalty platform called Sympan, which has built-in Machine Learning Capabilities, a great variety of modules and different reward mechanisms to choose from. We are also ISO-certified and ensure customer data is secure and protected to the highest level. We are agile! Flexible and responsive, with customized and unique loyalty solutions for all our Clients, that are future-proof, sustainable an competitive. We provide a full-service, end-to-end management of all our offerings. In execution, we follow a holistic, forward-thinking approach which benefits from powerful, data-driven segmentation and reporting; supports multi-channel communication; and transactional and emotional engagement alike.
Let’s take a closer look at the Sympan platform. It easily integrates with 3rd party channels – no coding is required. No need to choose between Loyalty, Gamification or CVM – you can have all three, as we are able to operate multiple programs under the same installation. We are able to create complex customer journeys, support different types of points schemes, gamification elements like missions, tiers, badges, and multi-channel communication campaigns to engage your customers.
Our solutions use the power of Machine Learning and Artificial Intelligence to ensure we target the right customers with the right message at exactly the right time. It is able to optimize a variety of campaigns, reward mechanisms and channels at the same time.
Machine Learning allows superior targeting accuracy versus the traditional CVM methods, based on holistic customer profiles. We use cluster analyses for audience segmentation, in which customers with similar characteristics and behavior are grouped together so patterns and further insights can easily be drawn.
Our Loyalty programs are continuously monitored and accurately reported on near-real time, that allows us to provide useful insights and identify trends for business decisions, as well as to spot any discrepancy that may need further investigation.
We know that the early stages of a loyalty program are very tricky – they require a delicate mix of vision, and flexibility. Being agile allows us the flexibility to quickly respond to changes and opportunities, and maintain focus on the outstanding customer experience. Also, having Innovation at the core of our Loyalty approach, helps us provide a competitive advantage to our Clients and results in successful and long-term solutions.
Success in the Loyalty market requires proactivity – a deep understanding of the environment, and anticipation of the Brand’s needs. It requires a personal approach – programs need to be designed with the brand’s customers in mind, and closely monitored for changes and evolution of their relationship with the brand.
And Velti provides a full-service management of such loyalty programs from setup, to maintenance.
When it comes to execution, at Velti we follow a holistic approach, yes, still relatively new, although increasingly popular in businesses.
This means, loyalty is at the heart of everything we do. It connects all our departments from Marketing to Sales and Customer Service, but also Business Intelligence and Technical teams. This ensures a smooth execution, improved efficiency, increased customer satisfaction and repeated positive experiences.
When working together, we obtain a deep understanding of your goals and work towards achieving them in a trusted and reliable way. We provide a ‘Turnkey solution’ so you don’t have to worry about anything, we take care of your loyalty process from conception and copywriting through design, set-up, project management and maintenance.
When we talk about execution, we need to see Rewards are a key feature and differentiation point in any loyalty program.
Offering tailored, meaningful and valuable rewards for your customers is no longer a nice to have, it is expected.
Velti’s solution features a large variety of reward types from discounts, vouchers and cashbacks through free products, special treatment and VIP services to aspirational draws. We can effortlessly create new items of different types and assign these reward types via multiple mechanisms depending on the goal of the program: instant wins help changing customer behaviour; points collection motivates long-term engagement, whilst aspirational draws help raise customer attention. Rewards can be applied along various business rules, for example available only to specific segments or time periods, have limited quantity, or exclusivity, related to brand-events or thematic months.
It is a well-known business fact that it costs more to acquire a new customer than to retain an existing one.
Therefore, we should always aim to show customers that we value them, and not only for their monetary transaction, but also for being responsive to our campaigns (i.e. survey, games, etc.), engaging with our social platforms and website(s), participating in our events. Providing the opportunity to engage with your brand on multiple channels and platforms allows each customer to choose the one(s) most suitable for their preferences and current circumstances – encouraging them to stay with the brand longer, and have higher lifetime value.
Marietta:
Wow Marian, this was a perfect summary and showcasing of how the holistic and data driven approach of Velti’s can mean real success to brands, measurable in Loyal customers and increased revenue! Thank you very much for these insights.
Marian:
Thank you Marietta, my pleasure.
Marietta:
Now that we know all about Velti’s approach to Loyalty, let us show you what it looks like in practice.
Goody’s Burger House is a long-term valued Client of Velti’s, who trusted us with their loyalty program, Goody’s All Star Club, for 5 years now.
Marietta:
Goody’s Burger House was founded in 1973 and are Greece’s largest fast food company. They have 127 stores in Greece alone and 10 additional stores worldwide.
Velti partnered with Goody’s Burger House since 201x to launch a Loyalty Program reinforced with CVM campaigns. I will give the floor again to Marian to give us a full view how the program works and main KPIs reached
Marian:
The All Star Club loyalty program has been running since xxx, engaging customers across multiple touch points – Call Centre, Point of Sales, Web and mobile web sites as well as its very own application. Participants of the All Star Club are rewarded with stars for their every purchase, and various other engagement elements are also in use from gamification (like badges), through instant gratification (gift cards) to aspirational draws.
The program is a gamified consumer journey with a 360 digital communication plan that aims to drive frequency of orders and visits, and increase customer satisfaction.
The program consists of three easy steps.
First, you join the All Star Club, and earn stars for every purchase. Every euro spent gives you 2 stars for in-store and call centre orders, whereas if you order online, you benefit from double stars!
* In fact, the program’s double stars for online orders has been a successful engagement tool throughout the pandemic, in changing customer behaviour and driving traffic from the stores to the online channel
For each 100 stars collected, you instantly receive a 5EUR gift card that you can use in your next orders.
The All Star Club has different ways to reward its loyalty members, either with bonus stars that help them reach the 5 euro Giftcard faster, or different types of discount coupons. The stars gathered are also participations for high value draws giving the All Star Club members the opportunity to win aspirational prizes.
As we are approaching the end of the third part of our webinar, let’s close our case study with some impressive numbers. The All Star Club has been a huge success in recent years, achieving outstanding KPIs, and we cannot end our section without sharing with you some impressive numbers: Customers love the variety in channels – 63% of the active base made at least 1 purchase on ALL available order channels.
The loyalty program helps generate significant revenue for Goody’s Burger House – up to 90% of total ONLINE orders come from Loyalty members, and the biggest loyalty segment’s orders take up 40% of the total Loyalty revenues.
Gift cards are very popular and well-received reward of the program, 50% of redemptions happen within the first week of receiving such a gift card.
And last, but definitely not least, is the ROI of the program 556%.
Gift cards are very popular and well-received reward of the program, 50% of redemptions happen within the first week of receiving such a gift card. The program’s double stars for online orders have been a successful engagement tool throughout the pandemic, in changing customer behaviour and driving traffic from the stores to the online channel: now online is the preferred channel for registrations with 68% coming from web and app, as well as the preferred channel of ordering for the largest loyalty segment.
And with this, we reached the next and last section of our webinar.
I thank you for your attention and hope you enjoyed seeing behind the scenes and understanding more of our way of doing loyalty, and what KPIs and success stories it translates to. If you have any questions or would like to receive one of our case studies, please don’t hesitate to reach out.
Marietta 556%. What do you think? Back to you!
Marietta:
Wow, 556% ROI, I can’t believe it! This is a very impressive result indeed, and such a perfect example of how the holistic and data driven approach of Velti’s can mean real success to brands, measurable in Loyal customers and increased revenue!
Thank you very much for the insights, it was really great to have you here today!
Marian:
Thank you, Marietta, for having me here. I also enjoyed it very much!
Marietta: For the next section, let’s welcome Stefi Anarousou – Group Loyalty Manager of Goody’s, the number one food service Group in Greece.
Stefi has over 10 years experience in the marketing, e-commerce and CRM sector. She joined Goody’s 5 years ago in Branding and digital media departments, to then switch to CRM and ecommerce strategies.
Since last year, she is the Loyalty Manager for all the brands of the group including their corresponding CRM strategy – among them “All Star Club” the multi-awarded program of the Greek burger chain “Goody’s Burger House” that reached 556% ROI! Welcome Stefi, very nice to have you here today, and such impressive results to showcase!
Marietta:
Welcome, Stefi, lovely to have you here today!
Stefi: Hello Marietta, it’s a pleasure being here today! Thank you for the intro, indeed, very nice results that we achieved, I hope to share some more details today on how we did it together with Velti.
The last three years were quite challenging for the QSR sector. With Covid-19 pandemic taking the ultimate control of our lives everything we knew has changed. The way we live, the way we work, we socialize, we entertain everything has been affected. Across all industries there has been a significant swift in consumers behavior and consumption patterns.
Our sector was perhaps the one who has faced the most difficulties, with our stores operating mainly through the delivery and the takeaway services for the biggest part of that period, due to the measures imposed about the pandemic.
Even today when finally, things are starting to go back to normal, the consequences of the Russian – Ukrainian issue and the Global Energy Crisis have significantly affected the running costs of a business and the purchasing power of customers.
One of the many benefits of having a loyalty program, is that it gives you all the necessary data which enable you to understand your customers. What they buy, when, their needs and their expectations. All this information can turn into valuable insights and guide your business strategy. In our case we had the chance to identify the emerging changes on consumer’s behavior during the pandemic on time and adjust our communication accordingly
Nowadays that customers have become more price sensitive due to the reasons mentioned before, the perceived value that they receive from their interaction with All Star Club is a strong competitive advantage of our brand towards competition. It is important to note that in our recent customer satisfaction survey, 85% of the participating members mentioned that All Star Club is one of the key reasons for buying our products.
During even the “hardest” period of the pandemic, during 2020’s lockdowns, we had the chance to communicate directly with our members, inform them about the ways that they can still enjoy their favorite burgers and target them with specific promos and incentives. As a result, we have seen a significant increase in the number of average orders per member and the value of their average order. Also the contribution of loyalty tickets towards the total network ticket count has increased which is a solid proof that loyalty members are the ones who will drive your business profitability even at the hardest times.
Almost five years ago, when we decided to develop our loyalty program, the norm for the majority of the Greek brands in the food industry was hardcopy cards used to collect stamps to earn rewards. Given the personality of our brand, our goal was to create a program that goes beyond simple point collection, offering an engaging and entertaining value-based experiences to its members.
Velti’s customer centric approach, know-how technical and expertise were critical to the project’s conception and its successful operation. Nowadays we can proudly say that Goody’s “All Star Club” has been a pioneering and trend setting loyalty program for the internal market, counting more than 350K members.
While designing our campaigns our top priorities are to entertain and engage recipients and of course meet our KPIs. Our strategy therefore is not focused in just broadcasting offers and discounts. For example, recently we wanted to increase the average selling price of our products, by educating customers to add extra ingredients in their burgers. The way we communicate this was with a hungry pacman on the hunt of tasty ingredients, collecting points for each one, which were translated in participations in a contest to win the most popular gaming consoles.
However, if I should choose one, it would be our latest campaigns for April’s fool. The concept was our collaboration with NASA to create the first burger pill suitable for astronaut’s diet. To celebrate our new product’s launch, we offered to our members a free cheese for orders above 12€. The campaign was very successful both in terms of engagement and conversion.
All Star Club has been critical for our brand’s success, enhancing our performance KPIs and helping us build strong long lasting relationships with our audience during even the most difficult periods as previously discussed. We have witnessed a significant increase not only in the CLV of members versus non-members, but also in the same persons before and after their enrollment in the program.
The future of loyalty will be quite challenging. Customers are not keen anymore to subscribe into a loyalty program and provide their personal data just for the sake of rewards. They want to engage into a more meaningful relationship with a brand from which they will receive value and benefits related to their profile and interests. Therefore, the future should be more technologically advanced allowing business to offer to their members more differentiated and personalized experiences.
Last year we have redesigned our digital properties and revamped “All Star Club”, to keep up with the latest technology trends and make the experience of our members even better. The program’s mechanism was enriched with missions, badges and more personalized benefits for the members.
For the future, our goal is to develop more gamification mechanisms that will enable us to reward our customers for their emotional engagement with the brand and introduce new communication channels that will assist us to create a constructive dialogue with our members at every stage of their journey.
Many brands still consider that loyalty programs are a luxury and they only add unnecessary operational costs to their business. Furthermore, more and more companies are engaging in broadcasting mass e- mailing campaigns which are in fact spamming recipients and since they do not have the expected outcomes, management teams are disappointed with CRM strategies and do not want to invest in this sector.
Indeed, launching and operating loyalty programs and CRM strategies comes with a cost. However, the benefits and the incremental revenue received if the planned properly is significantly higher. Especially today when customers are more demanding than ever, loyalty programs are more necessary than ever.
Marietta:
Thank you Stefi, this was so insightful – thank you for sharing your loyalty experience and advice for brands that may still be hesitating to take the next step in their loyalty journey.
Stefi:
Thank you for having me Marietta, I really enjoyed being part of this webinar!
Marietta:
..and with this, our webinar already comes to an end…
As you can see, Loyalty Solutions are undoubtedly the way to increase your revenues and build meaningful long-term relationships with your customers.
Having a combination of 1) data driven approach, 2) innovative and future-proof technology, 3) responsive and agile platform with the 4) right mix of communication and engagement tools and 5) meaningful rewards will truly drive retention, customer loyalty and as a result, increased tenure, lifetime value and ultimately revenues for your brand.
I hope you enjoyed learning about Loyalty and the Velti toolkit, seeing one of our successful case studies and hearing from our experts in the topic Marian, and Stefi from Goody’s Burger House!
If there are any questions or you want to talk about any business opportunities or interested to start a Loyalty solution yourself!
Please don’t hesitate to drop us an email at: demo@velti.com
Where we also would like to offer you a FREE 1:1 consultation with the Velti experts. Just drop us an email at: demo@velti.com …
… and we are more than happy to help you to grow your business in value & loyalty!
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See you on our next webinar!
For now: have a great day and goodbye.