Postcards from Perkistan

A few months ago we covered cinema loyalty programs with the release of Hoyts Rewards, the last cinema to create a loyalty program. However, with this addition it meant that all major cinemas had a loyalty program that had some kind of frequency-based benefit… except Village Cinemas. Re-launched this morning the Village Movie Club has now added more loyalty-focussed offers. This is how the programs compare:

Australian Cinema Loyalty Programs

Taking a quick look at the table we can see that all the programs are very similar. This means we aren’t being forced to make another decision about where to take our money. This brings about a few observations and questions. If the programs aren’t competing with each other then the sole purpose can be to give something back to their regular customers, what a loyalty program should be from a consumer perspective. Given that all the programs are similar though, they aren’t gaining sales through the program, creating a low return on their investment, what a loyalty program shouldn’t be from a business perspective.

Are movie theatres wasting their time and money on their loyalty programs? Let us know below.

Cheers,
Graham.

While doing an update of the AAdvantage program I’ve stumbled across some interesting 2008 stats for the program:

Q: How many AAdvantage Awards were claimed in 2008?
A: The number of awards claimed in 2008 in each AAdvantage mileage redemption category were as follows:

MileSAAver® and AAnytime® Awards: 2,858,222
Upgrade Awards: 769,527
Product Redemptions: 407,074
Special Mileage Awards / Other Airline / Other: 780,533
Total Redemptions - 2008: 4,815,35

It’s pretty interesting to see that most miles (60%) are redeemed for flights using American Airlines even though there are 20 leading airline partners that members can redeem their points with. Total redeemed on Flights is an astounding 92%.

All flights within continental US are worth 25,000 points flying AA. A flight from New York to Los Angeles on American Airlines is worth around $382. Meanwhile, if we compare this with a 25,000 point merchandise reward we are looking at getting $250 worth of value for our 25,000 points. It certainly seems that AAdvantage members are making the most of their points.

-Me

Here at Perkler we’ve just embarked on an eye opening campaign. Until now we have focussed our efforts on letting people manage their entire wallet in one virtual place.

In this new campaign we are responding to the current economic climate, and the need for people to get value from their loyalty programs immediately, by isolating the best possible loyalty perks on a product by product or brand by brand basis.

Our first port of call has been cosmetics. We figure make-up is the kind of thing people can still think about making small purchases on and get a ‘luxury’ item despite not being so flush right now. Having said that, Graham our database and community guy has been seen to weep as he has entered the RRP for some of these products!!!

You can see what we’ve found for cosmetics here - an interesting list that shows the big programs as well as the small have a lot to offer if you know where to find it. We’ve had LOTS of people looking for Napoleon Perdis and The Body Shop - very different brands in lots of ways.

Next cab off the ranks is likely to be cameras - always a really interesting product segment. But it could just as easily be a brand like Apple or an activity like travel.

So what would you choose - what product or brand or activity do you think rewards would make you purchase in the current climate? Be interesting to see the responses.

Justin

@JustinBarrie  on twitter

One of the things we want to do at Perkler (and Adam is working hard to implement) is to not only allow you to search across your loyalty portfolio in one place, but receive special offers or discounts, on top of the current loyalty offering, to get you in the store.

As we build relationships with retailers we’ll be pushing this as an opportunity for them and consumers and will offer coupons for use on the phone and web to facilitate this.

It’s a good space to be in as belts tighten and interestingly the idea is gaining traction in markets that you wouldn’t expect.

The US is traditionally big into coupons - thanks to green stamps and the Great Depression there is a strong culture of coupon use. The UK on the other hand has has a good tradition of coupons, but don’t tend to attack them with the same veracity. Until now!

New Media Age out of the UK reports today  (you’ll need to register with NMA to see the whole article) that searching online for coupons is up 133% in the past year (my guess is that demand and searching will double again in the current climate in just a few months). At the same time Google is talking about the move to mobile advertising.

Perkler - mobile based search results linked to an additional discount coupon AS WELL as your current entitlements is looking pretty good in this space.

Justin

I was put onto a post on Read Write Web this morning by a twitter connection ( @paulmckeon ) which highlighted a very interesting reaction to a technology we are investigating here at Perkler.

The story talks about price comparison smart phone apps - based on bar code scanners. It’s a cool idea and, I think, one of the next big moves in retail. For ages retailers have been talking about ‘real time inventory’ this is ‘real time pricing’.

RWW give examples of stores not really knowing how to cope with customers scanning products for their own purposes (in this case price comparison). The RWW article even links to an even more interesting (worrying?) blog post warning retailers to install phone jammers or have ‘no scan policies’ to stop people doing this.

I think retailers who even countenance such an approach are missing the point. Surely, if your customers are price matching and comparing - the best place for them to be doing that is RIGHT UNDER YOUR NOSE!

If they are there and doing it, you are uniquely placed to counter their bargain hunting and get the sale.

Ironically, emerging apps that use bar codes to provide reviews and ratings on individual products could actually lead to shoppers spending more money. If I scan a product that is $14.99 and a review tells me the $16.99 version is better, doesn’t the store win?

The reason this technology (and retailer behaviour) relates to Perkler is two-fold. Firstly, we think the use of scanning technology on smartphones is a great way for retailers to entice shoppers into the store.

When a Perkler does a search on the perkolator for a loyalty program in a location near them (on our iphone and storm apps that Adam is building as we speak), what better way to motivate them in-store by offering a small, additional, tailored on-phone perk. We think it is the next phase of loyalty and builds on a combination of on-phone coupons and loyalty infrastructure. And because the consumer initiated the search through the Perkolator, it isn’t a global offer and isn’t sent to them without warning (we hate ‘push’).

Neat.

The second way it relates to us gets me back on topic. I simply can’t understand retailers who aren’t willing to jump in to a consumer-driven competitive landscape. When meeting retailers to discuss Perkler most are very keen. They understand that if they work with us they will learn more about their brand and program performance than if they simply stick to their current research methods alone. They also know that our data will tell them if they are under-performing (not coming up in search preferences, not having perks that stack up or missing perks completely). Seems to me that is exactly the kind of information you would want to know.

Sure, it might be confronting. But if you don’t have a perk that is up to scratch, would you prefer consumers switching off without you knowing or would you like the heads up so you can evolve your program to meet the needs of the consumer. Isn’t that why loyalty programs are there?

So - let them scan I say! And partner with Perkler (and other social media tools like twitter) to learn things about your program before they disengage.

Justin

Razorfish has an excellent market commentary report focusing on the consumer experience and how technology affects today’s consumer experience.

The big take-out?…”Brands will need to create content that engages and “reaches” consumers across channels, provide valuable services over mere advertising and master an increasingly complicated and expansive content distribution model. And, of course, they will need to rethink the way they create relationships (or conversations) with consumers before it’s too late.”

I’ll list some pretty compelling stats that they use to back this up:

• 40% of survey respondents said they have made a purchase based on advertising they saw on a social media site. And the vast majority welcome advertising in social media experiences—76% of all consumers think a wide range brands like Nike, Virgin and Bank of America should advertise in social media.

• The majority of survey respondents (75%) indicate they spend at least one hour a week on these properties, with a large number (19%) spending more than seven hours a week on social networking sites.

• The large majority of consumers (61%) rely on user reviews for product information and research, with a much smaller group (15%) preferring editorial reviews.

• According to our survey, the same number of consumers (65%) indicate loyalty programs that offer “points,” discount incentives or discounted shipping for multiple purchases (e.g. Amazon’s Prime) highly influence purchase decisions. Loyalty services—such as Best Buy’s Rewards Zone, Amazon Prime, and others—are key if retailers are to thrive in an increasingly competitive digital environment.

• While the vast majority of connected consumers have standard mobile handsets, 26% have smartphones

• Today’s connected consumers are equally distributed across all age ranges, with a slight skew to older segments. No longer are we seeing Internet technology adoption rates limited to only certain segments. Our study found widespread acceptance of these new service offering and finds older consumers much more likely to spend money online.

• All signs point to the continuing disintegration of “one-stop” digital destinations, at least as far as consumers are concerned. We’ve found that they don’t want a one-size-fits-all solution for their needs. Consumers prefer using multiple destinations, and then aggregating media and services, via simple tools like RSS, into a highly personalized view of their digital world.

• We expect to see greater reliance on social media to influence purchasing in the near future and not just from friends, but also from brands. This might even come full circle, shortly, where brands will regain some modicum of control and credibility if they can figure out how to play meaningfully in this space moving forward.

Some really interesting stuff. We here at perkler have backed our product based on the same views which is refreshing…we aren’t the only ones! What is crazy from our experience is the average Joe Blow marketer for ABC Brand who not only thinks he is doing a good job embracing digital media, but when asked on his/her strategy replies with confidence that his “team” is all over email, and are currently looking into SMS!

Wake up and smell the rewards flavoured coffee! Engage with users on their current level and as Jus noted in the previous post…return on customer loyalty will be exponential.

Razorfish’s excellent blog can be found here http://www.digitaldesignblog.com/. highly recommended reading, as is their report.

Dan

Hi guys,

really interesting report out recently from trendwatching.com  They’ve identified what we have known for ages - that perks and the economics of perks are the next big thing in consumerism.

While plenty of people bemoan loyalty and rewards programs, the basic premise that consumers should be recognised and awarded status as part of their relationship with a brand is clearly ringing bells with lots of big thinkers.

http://www.trendwatching.com/trends/perkonomics/

Navigating the complex world of offers and disrupting the current loyalty market so consumers understand their entitlements and retailers can learn from them and communicate with then better is where perkler.com comes in!

Beta close, Adam refreshed after Web Directions conference last week and ripping through the Alpha feedback and changes.

Jus