Alternative marketing thinking

Often it is simple ideas that can create unique opportunities to build loyalty with audiences. Like this one from Boots. A simple marketing message delivered at the end of a receipt that’s customized to the person who has just completed the transaction. Nice and easy.

Forrester’s Shar Van Boskirk talks about her recent experience with an airline, with whom she has a platinum relationship. And how employees at the front line need to understand that building loyalty is all about experience and not on all the points she makes flying around, most of which she may never use. Read more.

Forrester Research has some interesting banking observations by analysts Bill Doyle and Jost Hoppermann. “Customer Advocacy”, Doyle says, is a phenomenon among customers that firms have their best interests in mind while catering to them, and is becoming an increasingly common key driver of deeper customer relationships. Learn more on how Canadians rate their banks on customer advocacy, read the report here. Doyle also points out in another report that a class called the “Early Adopters”, or high-income technology optimists, who form the most active online bankers and investors. Among the top 10 US banks, online pioneers Citibank and JPMorgan Chase have the highest share of Early Adopters. Hoppermann brings to light how European financial services are working with enormous budgets for renewal, with the focus lying in being tactical. Read the report here.

In the world of banking Jyske brings in a difference. When asked by management to double the number of retail customers, the marketing and product team decided to build a new kind of retail experience. Like Starbucks, which people call The Third Place, a place between home and work, Jyske is the third place in Denmark. Where they serve some very fine coffee for free. Anyone can walk into the bank, just like they could into a coffee shop, read papers, hang around, and maybe even check out some new products and services the bank offers. All the products that the bank sells is available in a packaged form, with a barcode that you scan on specially designed computers and the computer then shows you a small movie about the product and what it has to offer. Jyske not only managed to double its base, it also managed to get so much free press for its efforts that the bank’s awareness skyrocketed (see the Google trends graph here). Here’s a small video from AdAge that shows off the bank’s new point of view.

A few months old, important nonetheless. A recent survey by Forrester and American Banker Magazine indicates that 97% of banking executives indicate that focusing on customer experience is important to competitiveness over the next three years. A great way to think about customer experience? It’s a production, just like a movie. Successful firms practice “experienced-based differentiation” (Read a summary of the Forrester Report) based on three key areas. Obsess about customer needs, not product features, says Forrester analyst Peter Kim. His examples, Disney mobile, with plans designed for the family  and Geek Squad . Reinforce brands with every interaction, not just communications. I.e. make promises and keep promises. For example, Westpac Bank. Treat customer experience as a competence, not a function. British sandwich chain Pret A Manger has some innovative ideas  in this space. Take the experience-based differentiation self-test . Consider hiring a Chief Customer Officer  . Start a customer listening/VOC program .

Finextra has this whitepaper from SunTec on the pricing innovation that banks are involved in to get a better share of retail banking. The paper argues that pricing - already the most common criteria consumers use while selecting a financial institution - will become increasingly important as a tool to attract new customers and strengthen the existing relationships. Download the PDF here.

In its study, The ‘Wallet-Share’ War: Measuring Customer Value and Profitability, Aberdeen surveyed 280 companies across industries to understand how they approach customer profitability. The findings, unsurprisingly, say that best-in-class companies share the use of analytical and precision marketing tools to measure and increase customer value and profitability. While no “magic bullet” emerged as a way to manage customer value effectively, the study identifies four measurements that when analyzed together show a useful customer picture: customer retention rates, customer turnover/churn, return on marketing investment (ROMI), and customer acquisition costs. More than 7 out of 10 have implemented or are planning to implement solutions to identify and segment high-value customers. This includes customer dashboards, real-time analytics, and both descriptive and predictive statistical modeling. The study mentions Australia Post as an example of a company leveraging customer value metrics. It uses both financial (revenue) and non-financial criteria (mail volume, length of contract, cross-product purchases) to profile and group its top customers. With this insight, the organization offers flexible pricing and personalized messages to its best customers. Senior managers are responsible for the customer experience and customer profitability remains a top executive priority. Read more from 1 to 1 magazine.

A recent survey by Unisys in Britain shows that some 71% of Brits do not trust their banks. The company that has been running these studies for the past few years had found that security was the main factor affecting customers - a 2006 survey found that 47% of UK consumers would switch accounts to institutions offering stronger fraud detection and protection services. But the latest findings point to a significant shift in consumer sentiment and their willingness to switch banks if better customer service was available. The attributes most cited for eroding trust were ‘disrespectful attitudes,’ poor privacy, weak IT - including websites, poor corporate governance and a lack of investment in the local community. More from Finextra.

New York’s Regal Entertainment Group of Cinemas have begun arming some members of their loyalty program with black plastic pagers that can be used to silently alert the theater staff about various irritations. People talking loudly over their mobile phones, noisy neighbours and others can be reported by using these toy like devices. It’s a new kind of loyalty program that empowers select guests to make a tangible difference to their movie going experience and members are loving it. Read more from The Times.

Green Hills Grocery Store in upstate New York, dubbed by INC magazine as The Best Little Grocery Store in America has become a case study for running one of the most sincere loyalty programmes in the country. A few months ago, the store installed a biometric loyalty management system designed to individually reward its members. Research company Aite Group studies the impact of the program, says that even though the store had a high average sales per sq ft and the sophistication of its previous loyalty program, and despite its stagnant top-line sales in the previous years, the roll-out of the new SmartShop program had a high impact on its financial performance. Read more about the loyalty program from the Inc Magazine. Paybytouch has details on the biometric program. The Aite Group research topline is here.