Smarter Loyalty Consulting

What is LoyaltyLevers?

It's a proprietary Loyalty Design framework, developed based on my 25+ years of experience with some of the best brands in the world.  By optimizing the 3 LoyaltyLevers, you'll achieve superior customer loyalty program ROI by activating engagement, driving behavior and building true loyalty sentiment that lasts.  Our can-do attitude and hands on style creates a seamless extension to your team with rapid, measurable results.


Customer Loyalty Program Design

The LoyaltyLevers framework guides our loyalty program design, tapping into proven psychological motivators that drive behavior, attitudes and engagement.  We've dubbed these the LoyaltyLevers because of their immense power in driving loyalty program ROI!  Learn more about the LoyaltyLevers.

Using this loyalty program design framework as a starting point, we systematically optimize each of the three Levers to boost loyalty program performance. Using a Design Thinking approach, the process begins with data analysis and insight, distilling the information down to one or more key problem statements. This kicks off the ideation, prototyping and research cycle to arrive at completely new program designs or a high impact revamp.  With approval of the loyalty program design  and accompanying business case, we move into the Delivery phase. We manage the Design Process and provide the needed resources for end-to-end support.  Learn more about our design process.

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Points Rewards Programs

Designed correctly, points rewards programs can be a powerful behavior driver. There are numerous strategies to utilize rewards programs to nudge your members along, including Targeted Bonuses, Limited Time Incentives, Exclusive or Upgraded Rewards, Frequency Thresholds, and Spend Thresholds to name a few.  By scientifically designing the points scheme to align with the desired behaviors, you'll eliminate wasted incentives and maximize performance.  MyMcDonald's Rewards  provides a great example of this strategy, with a carefully designed rewards schedule that delivers both consumer appeal and positive business benefits. 

Learn more about how to design these kinds of Behavior Drivers into your loyalty program design.

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Tiered Loyalty Programs

Loyalty is not only a behavior, but a sentiment or emotion. Offering extra recognition through a tiered loyalty program can be an important way to build loyalty sentiment. Differentiated benefits leverage consumer hot buttons such as Status, Convenience, Surprise & Delight, Personalization, Control, Lifestyle & Community, Purpose/Cause and Value. Tier levels and qualification criteria must be set carefully to maximize the retention benefit and right-size the number of members who will be using the high value benefits.  For example, Nordstrom's Nordy Club features personalized services/experiences and priority access to create aspirational loyalty tiers.

Learn more about the proven psychology of Sentiment Builders.

Subscription Based Loyalty Programs

Subscription based business revenues are on track to double to $1.5 trillion by 2025*, and the loyalty proposition is an integral component of the product design. Benefits for subscription based loyalty programs may include spend level minimums, partner benefits, member only values, recognition for length of subscription or points for each recurring payment. While Amazon Prime has set the standard in this space, the range of loyalty solutions has exploded in step with the category itself. For example, the wine industry is being transformed with the advent of direct to consumer subscription programs from new entrants like Naked Wine and Firstleaf.  The alpine skiing industry has been upended with the emergence of the Ikon and Epic passes, with each aligning dozens of resorts globally for one low price.  At the same time, many of the subscription programs could do more to build true loyalty sentiment vs simply offering new product/pricing combinations.

For more information on how to build loyalty into your subscription model from the ground up, contact LoyaltyLevers.

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CRM Loyalty Programs

If your goal is primarily to capture customer information and enable a better user experience, then a CRM Loyalty Program might be a good approach to explore. This type of program offers a simple set of benefits as a value exchange for permission to track purchases and send communications. For example, IKEA Family claims to be the largest membership club in the world at 150MM members, offering only a basic set of benefits including special offers, price protection, home inspirations/ideas and chances to win. As a result, IKEA knows who their customers are and can communicate with them through their lifestages from college students to newlyweds, new parents, second home owners and beyond. For an every day low pricing brand like IKEA, this streamlined approach can be a good fit.

For more information on considerations for implementing a CRM Loyalty Program and a complimentary consultation, please contact us.

 

Personalized Loyalty Programs

The transition to personalized offers is particularly timely as marketers look to make each promotional dollar work harder. This kind of customization at scale has been in place for some time to power the personalization for offer based loyalty programs like CVS and Albertsons, but the application to loyalty point schemes is a somewhat newer development. For example, using Machine Learning, Starbucks personalizes over 20 million loyalty incentives weekly, delivering 3X the return of non-personalized offers.

Brands like 7-Eleven also use personalized loyalty programs with algorithms to assemble dynamic incentives and rewards that nudge members towards the most relevant categories, sub-categories or products for their 55 million members. All while varying dayparts and locations with different levels and type of rewards. Personalizing incentives and rewards can be implemented in stages, beginning with testing among a few key segments based on an analysis of the rich historical data you already have. More information on how to start with an opportunity analysis and segmentation

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Gamification Loyalty Programs

Loyalty Program Gamification has been growing in popularity in recent years. Some programs focus on a gaming approach, but it’s important to note that it does not always mean leaderboards and prize wheels! Many marketers utilize a game play construct that pulls customers along a sequential set of actions/incentives, which together provide a customized experience that keeps them looking for what’s next. 

The most successful programs tap into our fundamental needs for competition, status, achievement, and mastery, fueled today more than ever by the vast reach and visibility of social platforms. Google Guides has done an amazing job in this arena, creating seven types of badges for photographers, explorers, connoisseurs’, fact finders and creators. There are also 10 different recognition tiers based on overall points and achievements. The programs has mobilized 150M members who generate 70% of the content on Google Maps. Find out more about Google Guides, or schedule a consultation to discuss your ideas on how gamification could elevate your program’s performance.

 

Loyalty Program Partnerships

Loyalty program partnerships can dramatically increase the relevance and appeal of loyalty programs for any participant brand, while expanding reach into new segments or markets for the anchor brand.  Best partner prospects can be found in non-competing sectors of the same industry or within complimentary purchases (think wine shop and cheese shop).  United Airlines has developed a vast network of partners that together deliver 71% of program cash flows: both attracting many high potential flyers and expanding relationships with existing customers.

For more on loyalty program partnerships including program design, partner selection, management and other opportunities, please Contact Us.

 

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Small Business Loyalty Programs

Loyalty Programs for Small Business

There is a quiet revolution happening in the small business world, due to the convergence of POS and loyalty technologies. Now, small businesses are able to offer loyalty programs that compete with the big brands to identify customers, increase repeat business, grow the average ticket and create a stronger bond with best customers.  Many of the new software options include customizable loyalty schemes to pull members up the loyalty offer, and ways to identify best customers and deliver the recognition they deserve.  Learn more about the software options available, and effective tips of loyalty programs for small businesses.

Please Contact Us to for a complimentary consultation on how to quickly and efficiently implement a loyalty program for your small business

 

Loyalty KPI's and ROI of Loyalty Programs

Calculating the ROI of Loyalty Programs is a tricky endeavor due to questions of attribution and causality. Utilizing an approach similar to media mix modeling, the impacts of the loyalty program on purchases and margin can be calculated over many scenarios and statistical analysis can identify the core lift. However, we recommend a Balanced Scorecard that provides a comprehensive view of program performance beyond just profit, to measure loyalty sentiment and engagement levels. Within each of these primary Loyalty KPI’s, the individual scores provide strong diagnostic power, informing strategic and tactical decisions regarding rewards, benefits and communications.  More on how you can use our balanced scorecard to measure loyalty impact

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Loyalty Consulting Group

Customer retention consultant, loyalty marketing companies, customer loyalty consultant, loyalty consulting firms

Phil Hussey

Principal Consultant

Phil's experience as a customer loyalty consultant and program operator spans myriad verticals for brands including Marriott, Disney, Hyatt, Continental Airlines, DIRECTV, JCPenney, IKEA, Jeep, Sanofi and many more. Phil works with both brands and loyalty marketing companies supporting loyalty program transformation -- creating compelling & integrated propositions that drive acquisition, engagement, brand affinity and incremental share of wallet.  Implementation related services include technology evaluation, change management, ongoing measurement and other support necessary for true success.

Connect with Phil on LinkedIn


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