Web magnifies loyalty flaws, says expert

Companies that simply transfer their loyalty programs online without assessing their strengths and weaknesses risk "turbocharging" any flaws inherent in their business model, says a leading organizational design consultant....

Companies that simply transfer their loyalty programs online without assessing their strengths and weaknesses risk "turbocharging" any flaws inherent in their business model, says a leading organizational design consultant.

Mark Van Clieaf, past president of the Toronto chapter of The Strategic Leadership Forum, told attendees at a briefing hosted by the Association for the Advancement of Relationship Marketing (AARM) that companies often don’t understand the long-term impact of loyalty programs on their bottom line. By transferring their programs wholesale to the Web, where responses are faster and easier to make, they’re simply magnifying those problems.

Van Clieaf, who based his conclusions on a study he did for MVC Associates International, says he is surprised to hear managers tell him they’ve merely taken their programs and shifted them to the Web.

" ‘We haven’t touched it,’ they say," he recounts. "Later on, they tell me: ‘What we did was turbocharge all that we were doing wrong.

"They’ve learned a lesson – that ‘e’-plus-mass-marketing does not equal eCRM (customer relationship management)," Van Clieaf says.

Before they even consider shifting their programs to the Web, he says, companies need to be able to differentiate segments based on customer economic value. Retention, rather than acquisition, he says, should be the focus.

"Companies must use modeling and customer information to customize reward and recognition," he says. "In other words, they have to be customer-centric and not campaign-centric."

That requires rethinking the whole branding process, Van Clieaf contends. Instead of using marketing simply to build awareness of the brand, marketers must now consider the customer’s involvement with and advocacy of the brand promise.

And that means companies must engineer a total "customer experience" to ensure that each customer contact point – whether through a call centre, direct mail, retail outlet, e-mail campaign or Web site -provides an experience that’s consistent with the brand.

"Branding," says Van Clieaf, "is taking on a whole new meaning."

From Karen Howe’s dining table: Creativity, COVID and Cannes

ICYMI, The Township's founder gathers the best of the best campaigns and trends so far.

Cannes Base Camp

By Karen Howe

I’m attending Cannes from the glory of my dining room table. There’s not a palm tree in sight, yet inspiration and intel are present in abundance.

Cannes Lions is a global cultural pulse check. The social course correction in the wake of the murder of George Floyd and BLM has delivered far greater diversity in the judging panels as well as the work. And we are all better for it.

I’m proud to say that creativity defeated COVID, which speaks to its power. Great work and big ideas flourished, despite unimaginable odds.

The work from the past two years spans a vast emotional range. From the profundity of Dove’s “Courage is Beautiful” to the hyper exuberance of Burberry’s “Festive,” they are opposite ends of the spectrum, but each answered a need in us.

Take note, the ascendency of gaming cannot be understated. Smart brands have embraced the channel. It makes sense, because gamers participate to meet others around the world, not just to play. And they represent a huge and powerful community. That’s why QSR Wendy’s gamified their iconic gal in RPG’s Feast of Legends.

Burger King sponsored the unknown Stevenage Football Club, transforming the team into online heroes and vaulting BK into the fray at the same time. Once again, the brand embedded itself in culture.

The birth of gaming tourism arrived when Xbox snuggled up to travel guides and created a brilliant baby: a travel guide for gaming worlds. It, too, embedded itself in culture.

From the standpoint of social good, Reporter Without Borders showed how it worked with Mindcraft for its “Uncensored Library” to bypass press censorship, with Minecraft providing a loophole to a space where young people could be educated. It provided youth with a powerful tool to fight oppression: truth.

COVID changed us in unexpected ways. We learned how to pay attention again and there was a notable lack of 30-second commercials. Instead, longer format content thrived. Apple’s WFH was seven minutes long. Entertainment reigned king, so we find ourselves returning to our advertising roots.

Seeing competitive brands form partnerships was one of this year’s other great surprises. The brilliantly simple “Beer Cap Project” by Aguila to reduce binge-drinking saw the brand reach out to competitive beers to join in. Aguila put incentivizing (keyword: free) reminders to drink water, eat food and get home safely on its bottle caps from all sorts of fast food chains, ride-share co’s and H2O brands.

On a personal level, I’m so proud of Canada again this year. Given that it was two years of work from all over the world being judged, even making the Cannes shortlist was an accomplishment. Canada is herding in the Lions in tremendous numbers – and it’s not even over. Fingers are crossed.

KAREN-HOWE-PIC-higher-rez-300x263Karen Howe is a Canadian Cannes Advisory Board Member and founder of The Township Group