Following on from last week’s blog post on Customer Loyalty we decided to post a summary of our full conversation with Leanne Papaioannou of Chilli Pepper Marketing, as there was just too much great content to leave anything out!
So, keep reading if you want to hear more on what one of the industry’s leading experts had to say when we spoke to her.
“Often times brands are fixated on Loyalty referring solely to a loyalty programme. However, this is to ignore the true essence of what loyalty seeks to achieve.
Loyalty aims to create two-way mutual relationships between a brand and its customers.
It is part of the larger marketing strategy and works in tandem with Customer Experience (CX) and Customer Engagement (CE) initiatives to provide customers with the best, most personalised relationship possible with the brands they love.
Customer Loyalty Programmes cannot exist in isolation. They need CX & CE in place to be a success”.
Having had the opportunity to sit down with Leanne we decided that there were a few more questions we wanted to ask her;
What do you consider to be the biggest challenge that companies face when trying to implement a customer loyalty programme (CLP)?
One of the biggest barriers to success when it comes to implementing a customer loyalty programme is the lack of Board Level buy-in.
A successful campaign will come about as a result of Board members recognising that a CLP is a strategic method to solve a business issue and result in a commercial benefit.
To succeed a CLP must not be seen a simply a function within the marketing department but as a device to aid overall organisational performance.
Additional budget is another reason as to why CLPs fail.
Often brands fail to consider the ongoing costs of implementing a CLP and look only to the initial set up.
However, if brands take this short-sighted approach they will likely fail in their endeavour as CLPs are ongoing as opposed to a “once and done” endeavour.
They should continually be evolving as new data flows through the organisation.
This is why, according to Leanne, that it is always vital to create a business case ahead of time which seeks to set out the overarching aim of the CLP and showcase its commercial benefits.
In the Loyalty Performance Index conducted by you, you found that Debenhams most valuable customers were not members of their loyalty programme. Why do you believe this to be the case? And if retailers find themselves to be in this position how can they seek to rectify it?
If a brand finds themselves with a CLP that their customers are not responding correctly to, then they have the wrong strategy.
This sometimes can be driven by poorly executed copy-cat strategies or simply a lack of understanding as to what it is that truly motivates your consumers.
CLPs are difficult for brands to get out of. So it’s important to take the time to conduct the research beforehand to avoid falling victim to a highly mismatched CLP.
“In recent years, loyalty schemes have attracted considerable interest as companies practice one of marketing’s most familiar strategies, namely, “if you see a good idea—copy it.”” How can companies gain a competitive advantage if they’re applying the same formula as those against whom they are competing?
“Copy Cat CLPs simply don’t work. And even if you think they do you can be guaranteed that they aren’t working as well as they could. You should always look at your CLP through the eyes of your customers, not your own.
Implementing a copycat CLP may seem tempting as you’ve seen that its worked for someone else, so it should work for you… right? Wrong. Doing this is simply doing a disservice to both your brand and your customer. Why would you copy when there are so many great options out there that would better serve your customers & align to your overall business goals.
Copycat CLPs ignore customer insight and determine that the brand knows best, which is rarely the case. Of course, the CLP should align with business goals, but it should ultimately seek to serve your customers in a better way than any of your competitors. And it is this customer centric approach that drives loyalty and thus revenue.
A CLP is a way to stand out from the crowd not to blend in. And from speaking to Leanne it is clear that despite the feeling that it can be hard to stand out it is far from impossible”.
A massive thanks to Leanne for collaborating with us on this piece. If you have anything to add or there is a topic you would like us to cover send your suggestion to firstname.lastname@example.org.
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