Postcards from Perkistan

While we quietly work away on our iPhone app here in Perkler HQ (yes it’s coming and yes it will be relevant to making your loyalty shopping easier), we thought we would take a look at a couple of loyalty apps that are on the market already and take them for a spin.

To be frank, the tie in between retailers and loyalty on the phone is pretty lean. While there are plenty of loyalty services companies developing technology, Australian retailers still seem reluctant to link perks to purchasing in the mobile space.

Let’s hope loyalty gets its act together and starts getting out there with the Lasoo and Get Prices of the world!

And if you’ve come across a loyalty app let us know all about it, we’ll happily take a look.

For the moment, here are a couple we’ve been impressed with.

Flybuys - iPhone, iPod Touch and iPad

In all honesty we’ve been really impressed with the work the Flybuys team have been doing over recent months. The launch of Everyday Rewards has really kicked the market along and the result is a revitalisation of competing programs.

The app itself has everything you would expect from a coalition points program. The basic menu covers stores, rewards and points balances.

Set up can take a little while as you need to establish a password to keep authentication secure - but that seems a small price to pay for an updated points balance. And that’s one of the great pieces of information - not just current points but importantly when they expire - critical if you want to make sure you use them effectively.

The wishlist section is clear and allows you to set up goals so that you know what you are ‘earning’ towards, and the store locator is a neat feature with so many brands available under the one program.

All in all a nice little package.

Choice Hotels - iPhone and PDA / “standard” mobile phone platforms

Hotel Chains are perfectly placed to take advantage of the app market. With multiple brands, multiple locations and last minute booking all the ingredients are there for a great app. Choice Australia utilises its international connections to bring you a comprehensive app across multiple platforms.

You can search hotels from 10 brands - that’s an enormous range to choose from - and then make reservations. Importantly from a loyalty point of view you can access your account (it throws you to a secure but clunky webpage) so that you can see point balance and redeem straight from that balance.

With the range of hotels these guys have this is GPS heaven - and the loyalty account tie in ticks all the right boxes for us. A bit more design work on the web pages and it would be the total package!

So that’s two…

I guess the development required for an app and tying in loyalty is a reasonable investment, but surely linking earn and particularly burn  to the point of purchase is a critical part of the modern retailer’s armoury.

I can only assume Everyday Rewards, Qantas and lots of others are working on their mobile malls now…Would be interesting to know what their thoughts on this channel and how it links to loyalty are.

As far as we go, we are putting the final touches to our app - which in true Perkler style will seek to bring your whole wallet to life, more on ‘Perky Shopper’ soon.

Okay, so after being asked by a range of media outlets what I thought of the Choice wrap-up of loyalty programs I thought I’d better sit down and pencil in a response for our members.

Firstly - if you haven’t read the Choice material, you should.

Here are some top of mind thoughts - I’d love to know what you think.

Loyalty Card Review or simply supermarkets?

Firstly (and I know this is being a bit trite) but headlining your article as a Shopping Loyalty Cards story and then only really reviewing two supermarket programs in detail and anecdotally looking at a couple of other larger programs seems a bit disingenuous.

I used Choice a lot when I was having kids and I didn’t expect them to do reviews of prams or cots and only look at the two major brands… If it’s a review of Supermarket Points Based Loyalty then call it that!

The reason this is important is that the media (and now Choice) can be guilty of not relating the loyalty market to a total consumer point of view. Supermarkets are important but a large amount of discretionary spending takes place in other retail segments - holidays, transport, insurance, fashion etc.

Picking one segment and then using this to say ‘loyalty programs don’t offer anything’ is simply wrong. Saying - ’supermarket programs in their current form offer low earn ratios when used without any related offer’ is a bit more correct. But it would have been a short report then!

I take on board that they also looked briefly at Myer, Priceline and a couple of others but this story was all about having a close look at the big two supermarkets (in my opinion).

We have over 650 loyalty programs in the Perkler database, ranging from membership entitlements and pure discount programs through to points accumulation. Each one of these types of programs, across multiple retail segments, is the consumer reality. This breadth of the industry simply isn’t addressed by Choice.

And that’s okay, just be clear about it when you are using the loyalty market to get publicity!

The maths of loyalty

The part of the report focused on the maths around earning points and the time taken to earn vouchers and flights is spot on (as you’d expect). I think Choice have always done an excellent job of breaking complex consumer interactions down to the simplest form to helppeople.

I guess what I also expected to see here is the linking of bonus deals and related programs that make this point generation more attractive. Phil Hawkins from FlyBuys certainly touched on this in the press that he did, and in fact Choice acknowledge the existence of these deals in one of their tables without then bothering to add those scenarios into their top line equations.

Under ‘What you get for your loyalty’ they say “You’ll earn more points and rewards sooner if you pay with an affiliated credit card, use your card at other program stores during the same week, do only one weekly shop, spend more or make use of bonus point promotions” Exactly. So where is the modelling to show how this affects the assumptions they made?

I think it’s a shame that Choice didn’t look into this. It could alter the story by a fair amount.

What those mean retailers really want!

This was the part of the story I found the most bewildering. Not because any of what was said was wrong, but because it seemed so naive. The report makes constant references to supermarkets and other retailers trying to trap consumers into giving away information, get them to shop exclusively at their stores and discriminate on discounts.

I would have thought that all of these tactics are widely known and accepted by consumers. Maybe I’m wrong, tell me if I am, but part of the loyalty dynamic is that consumers accept that the retailer is collecting information about them in exchange for a benefit!

So when I see “Discount Discrimination” in a story that is critical of programs not offering enough, I don’t get it.

I also think “Discount Discrimination” is “Tailored Benefit” something we’ve been trying to push programs to get better at. If it is a loyalty program, why should the guy who doesn’t buy as much get the same offer, even if we live under the same roof?

And Finally

I’ve only really touched on a few of the points here. I may be too close to this market now but I guess my overall feeling on the story was, yeah - so what?

The gaps in analysing the broad range of programs, investigating the relative worth of bonus shopping days and hidden member benefits like those you find in affiliated programs left me a bit underdone on this one.

From what I can tell, Choice got good press on this one so good luck to them - whether it helps anyone understand the loyalty market and how they CAN save I’m not so sure on.

But there’s always perkler.com for that

PS: no retailers were involved in the drafting of this response - not even our clients

One of the most exciting parts of our launch was being asked by A Current Affair to go on a spending spree to show just how much you can save with Loyalty Cards.

At first even we were a little dubious - our take on loyalty is that it is consistent spending over a period of time that gives maximum benefit, but with full faith in the programs out there we headed into central Sydney to the QVB and went shopping.

The results were pretty extraordinary. With no TV magic (really)!) we saved $187.00 in less than an hour. The brands were Oxford, Esprit, Kathamandu, Krispy Kreme and Wagamama.

Each of these stores had great specials on and all of the goods were things we actually needed (well, I didn’t need that Oxford knit but is was nice).

So overall we were very happy with our little adventure. You can see it here. ACA Shopping Spree

The story on ACA was the most popular of the night, so we were asked back to rank our favourite cards the following week. This is an interesting ask because programs are so different and people find value in different ways, but in the end we applied some key criteria to come up with a list. The criteria (loosely) were:

* Instant Benefits rule over accrual

* Local and multiple redemption locations are good

* No or low fee entry is a bonus

The winning card was Show Your Card and Save which is not only the largest in the world but offers significant discounts at thousands of locations.

Other cards to make it to our final list were FlyBuys, Qantas FF, Woolworths Everyday Rewards, David Jones Amex, ANZ EDine, Krispy Kreme, Myer One, Virgin Velocity and Accor Advantage Plus. You can see our reasoning here.

You can also see the full video here. ACA Best Cards

Though naturally it was exciting to get national TV coverage for Perkler as part of our launch week what was the most exciting was the response. The fact that we were the most popular segment, and that hundreds of thousands of hits to the site resulted proved for us that there are plenty of people out there trying to use loyalty better!