Getting a customer to be loyal to your brand is as old a practice as branding itself. The two go hand-in-hand. If there is no loyalty, then the competition can steal your customer away with the slightest of effort. And since you have invested in attracting your customer, why waste the investment? Instead, every brand should make a further investment in a loyalty program, something that rewards a customer’s devotion to the brand.

I am a coffee drinker. When the economy went south in 2008, I looked, like everyone else, for a way to save money. I figured that Starbucks was an extravagance I could do without, and I switched to a local coffee source, Sheetz Bros. Coffee. Sheetz is a convenience store and gas station that pushes their rewards up front in their advertising. And I felt the love when every tenth cup of 99¢ coffee was free. I’m talking about 20 oz. of caffeine, a Venti in Starbucks world, for 99¢. Very economical. And I stuck to this routine for about eight months. Even got myself a My Sheetz Card, so my gasoline consumption also fed my need for morning coffee. They had my business and my loyalty.

But then something in me snapped. I found out through a co-worker that Starbucks has a rewards program. Uh-oh, sounds like trouble. With the sense of economic ruin fading in me I ventured back to Starbucks, motivated by the fact that maybe I could get a discount on the coffee I loved. Actually, the Sheetz coffee kinda sucked anyway, so it was too easy to fall back into my old habit. But the truth is, with my Starbucks rewards card, I increased my frequency at Starbucks above my original usage pattern. By offering me a free drink after 15 purchases, and a freebie on my birthday and some refills and wi-fi, I became a man possessed by the need to have my Starbucks. My personalized gold card is in the mail, having earned it with 30 purchases, and I feel like Norm on Cheers whenever I walk into the place. (Even if they don’t actually shout my name, or even remember it.) Starbucks is an extravagance I now recognize as a necessity.

I am still loyal to Sheetz for my gasoline purchases. And about once every two months I get a discount of 10¢ a gallon on my fill-up. And I’m also an elite Marriott user, which gets me free stays and perks at Marriott properties globally. And Pet Smart, Harris Teeter, Best Buy and Lowe’s Foods are all hanging their logo on my key chain and spiffing me for shopping there. It’s not a guarantee that I will stay loyal, but it does give me some motivation.

There has been a large amount of conversation recently about Social Media and CRM. There are some that are saying we do not need CRM if we have Social Media. I have also heard it said, “Social Media, the death of CRM”. I find it interesting that this conversation is even happening. Both of these are really tried and true marketing programs that have been enhanced with new technology and some new names. It is clear to me that both Social Media and CRM are both here to stay, and both of them have very important roles to play in the marketing mix. I think the better question is how do we best utilize both strategies together to maximize the engagement of the customer and the ROI of the marketing program. Well, I came across a program last week that might be classified as the new buzz ,  ”A Social CRM” program.

Recently my wife received an invitation from Dove to be part of the ”Dove Ambassador” program for their new line of hair products. She received a series of four emails, a survey and a direct mail package. When she received the package it contained a free product for my wife to use, and it also contained five samples of the product for her to give to her friends. The trial packets for her to share with her friends also included a coupon good for their next purchase of Dove hair products. The  series of emails and instructions in the direct mail package spelled out the directions for the program and how to tell others.

I think that the “Dove Ambassador” program has successfully created a social media platform to create “word of mouth” for the brand and they have also leveraged CRM  through their use of targeted correspondence and their ability  to measure success of the program through the coupon redemption metrics.  I can see why this program might be classified as a “Social CRM” program but you know it really is not that new of an idea. Ten or Fifteen years ago it might have been called a ”a direct mail sampling” program  and now it been dusted off and rebuilt leveraging new technology.  Regardless of what we call it, “direct mail sampling”, “Social CRM” or  the “Dove Ambassador Program”,  good strategically grounded programs like this one will survive and be around for many years to come.

Whether your organization currently has a loyalty program or is thinking about implementing one, you should have a clear understanding of what you want it to deliver. At a minimum a successful loyalty program should help the organization with the following:

• Retaining customers: Loyalty programs can go a long way towards retaining customers.  And, we all know that it’s less expensive to retain current customers than it is to acquire new or win-back past customers. Customers that are heavily vested in an organization’s loyalty program are less likely to go to a competitor.
• Gaining share of wallet: Customers that perceive value and actively participate in an organization’s loyalty program will be motivated to consolidate as much of their spending as possible with the organization. This doesn’t mean convincing the customer to spend more in total, just to spend more with a particular organization.
• Uncovering insights: This is a major benefit for organizations that have a successful loyalty program in place.  Data collected about members of an organization’s loyalty program can be used for segmentation analysis. Once members are segmented into different groups based on their behavior and interaction with the organization insights can be discovered.  These insights will lead to the development and implementation of relevant and differentiated marketing strategies that work towards customer retention and acquisition.

So you think the world of marketing is moving too fast. It’s about to move 4000 times faster. And, if you can’t keep up, you may be out of business sooner than you think.

I was recently paying a cell phone bill for my teenage daughter and noticed she had over 4000 text messages in 30 days. That’s over 5 text messages per hour with no sleep. I was complaining to a friend about this massive amount of text messaging and he said his teenage daughter had 6000 text messages last month. What’s all this communication buzz about? It’s about the mobile phone constantly vibrating with a new message. It’s about the multi-tasking ability of our next generation and it’s about your message being lost in a world of fast paced conversations.

What does that say about the attention span you can expect on your advertisements in the future? Who would possible sit down and watch a 30 second commercial or take the time to read a banner ad when they are communicating with 10 friends on Facebook, checking in on Twitter, watching a YouTube video while playing an interactive video game on their laptop?

The answer is no one will take the time to engage with your advertisement if you are not part of their conversation in the first place.

You only need to listen and watch a teenager to know what’s ahead. If you have had the pleasure of spending a few days with a teenager recently, you can easily see that the art of communication is changing rapidly and will have a profound impact on marketing communications.

First of all, the expectation of a relevant response when a teen asks you or your company a question will go from “we will get back to you in 24 hours” to “you better get back to me in 5 seconds” or you will be lost in the conversation.

You will need to listen and learn to understand how to be a part of their conversation or you will become irrelevant. And, if you attempt to be part of a conversation that is intrusive, you make become relevant very quickly and out of business even sooner.

The art of telling a story in marketing is rapidly changing to participating in a conversation. And, the most important part of a conversation is listening, not talking. Are we good listeners in marketing?

I don’t think so, in fact most companies still spend their time trying to figure out what we need to show and tell our customers to get them to buy our product, but few are really listening and figuring out how to engage a customer in a conversation, because that is much harder. There are conversations taking place right now about your product, they might be taking place via text messaging, on a blog or on Facebook, but most companies don’t even know what they are saying about them, because they are too busy figuring out what to tell them.

As these teenagers get older and become even a bigger force in the marketplace, we all better figure out how to become part of their conversation in a positive manner or you will be lost in the conversation or  even worse, you will be part of a conversation that may kill your brand and you will never even see it coming.

If you want to get back to your comfort zone, the one area that hasn’t changed about our teenagers is they still know everything!

However, if you want to be a successful business, you better start listening.

Or so says Connie Reece. I agree with her.

That’s right, all you crackberry addicts and other smartphone users. You’re officially old, especially if you’re using it primarily for email. And you probably are using it primarily for email unless you’re an iPhone user who’s downloaded the Facebook app and the Twitter app. (And let’s be honest: anyone with a smartphone who believes they haven’t been conditioned like a Pavlovian dog into grabbing the phone every time the device twitters, buzzes, beeps or rings is lying to themselves.)

Here’s why you’re old (if you fall into the aforementioned group): 92% of adults (those older than 22) rely on email for communication; 16% of teenagers and undergraduates rely on email for communication. In fact, a peer of mine who works at the High Point University School of Communications recently told me that he apologized to his students for emailing them. “I just can’t text all of you,” he said.

While adults have embraced the communication that came of age while we were younger, younger generations will continue to do the same. Given that those younger constituents of our world are communicating through text, IM, Facebook, MySpace, YouTube, and a host of other social networks, it’s no wonder that there are often disconnects in communication between the generations. If you extrapolate that idea just a bit more, it’s also no wonder that those disconnects appear in marketing discussions between brands and consumers as well.

Knowing your audience–from understanding insight, not just instinct–will help you Unmass the Message, allowing you to communicate effectively and efficiently with your brand’s targets.

For me, that means learning about and participating in social media because, well, I’m old.

If you knew somone who was about to unknowingly do something that could be dangerous or even life-threatening, you’d tell them right? Thats just what Costco did.  After selling  products that contained peanuts and peanut paste that may have contained salmonella, Costco used thier customer information database to identify customers who purchased these products and called them. My mother-in-law was one of these people who recieved a robo call stating that she had purchased products in the recall. They told her to destroy the items and they would refund the purchase. They certianly didn’t have to do this, but since they did my mother-in-law is now a fan for life (at least a long, long time anyway).  She isn’t the only one, people are singing praises for Costco all over the internet. I thought it was nice to see a retailer put all of their Big Brother-like data gathering to use in a way that could positively affect the health and safety of thier customers.

Costco had the information and they did the right thing.  And that probably created more brand loyalty that any sale or marketing effort they could have thought of.

Given the very tough economy, many customers are willing to look for new brands. We recently did a study of over 3000 consumers using our Trone Brand Connections Panel and determined that over 40% of all adult consumers are ready to switch to new brands.  Of course, there are many strategies brands are using to gain share.  Just look at Walmart, who is upgrading their stores, adding new brands,  and attracting Target and Kohls customers (which is all working).

On the other hand, there are many other companies that are blindly losing customers by cutting costs, cutting their front line employees, and praying that when the economy turns around, they will be in good shape. But will they?  Are those customers lost for good? Have you eroded your brand by just trying to stay alive?

Let me offer some simple advice, continue to invest in customer relationships or fold up the mats, because they will not come back.

If you want to keep your customers, don’t give them an easy reason to leave you, especially in today’s economy.  Rarely do any divorces, even brand divorces, result in reconcilliation.

Here is an important insight that many companies miss – A customer’s most recent point of contact is the most important and the most memorable so it MUST be a positive experience.

What not to do? 

I recently walked into a wireless cell phone company because my phone was not working properly.  I explained why is was not working and, of course, they did not listen to me and immediately opened the cell phone assuming it must have been under water and was my fault.  Since they did not find the deadly red dot,  they were finally interested in what I had to say. After about 30 minutes of  back and forth conversation, they finally determined I needed a new phone.

Now here is the shocking part.  I was handed a new phone from the front line employee,  and then he proceeded to take the old scratched back plate off my current phone and attach it to the new phone.  I asked why he could not just give me the new back plate that came with the new phone, and he stated “you never mentioned there was a problem with your back plate, so we will not replace that part.”  Though we debated back and forth, he refused to let me keep the new back plate which was very cheap and short sighted.  You can image that this really ticked me off, but I went on my way because I had an important business trip.  During my business trip, the back of my phone kept on falling off  and reminded me how pissed off I was over this situation.

Yes, this was my very last experience with that brand although I was a very high value customer. I had three family members with the same company.  Thankfully I only had about 3 months left on my contract, and when it was up, I was out the door and they never knew why I divorced the brand forever. Just another blindly lost customer. Now they need to find 4 new cusomters to replace me.  And,  to find a new customer in this industry it costs about $300 per individual.  If you do the math, they exchanged the cost of a back plate for the $1200 to acquire 4 new customers and the revenue our account generated.  Not a smart decision on their part and certainly not the experience I am sure their corporate management wanted me to have.

So, if you want to do something simple during these tough economic times, treat your current customers right to ensure that when the economy turns around, you will still have them.  And if you are lucky, they may even tell their friends how they were treated.

I was originally going to pontificate on the need to be cognizant of others in need and the role of corporate social responsibility in this post, but I’ve since changed my mind.

A crisis has happened, you see.

If you’re local to the area, you’re undoubtedly aware that one of our favorite shopping centers, Friendly Shopping Center, had a tragic incident occur on property recently. A Brinks armored truck driver was shot and killed near Old Navy while picking up a deposit for the store.

If there’s anything I’ve learned in crisis communications, it’s that you have to have a plan in place and you have to capitalize upon every opportunity to communicate with your stakeholders. Friendly Center, or more likely its parent company, CBL Properties, has lost almost every opportunity it had to affect this situation positively. (Full disclosure: I was the Assistant Marketing Director at Friendly two years ago.)

A visit to CBL’s  online media center shows no information about the crisis situation at all. No press release. No links to local stories. No statement to the community. Nothing to reassure the shoppers that the center or the company that owns the center is concerned, upset and impacted by the event. Friendly’s website also ignores the crisis that happened, although it does invite you to take a survey about which stores you visit. 

Now, because I did spend some time working at Friendly, I know that a crisis management plan exists. Or that it existed two years ago. However, two years ago, Starmount Company managed Friendly Center, not CBL. Two years ago, I was working with my director to add communications objectives to that plan as well.

CBL has centralized marketing. I would bet good money that CBL has a retained PR firm as well. It’s quite unfortunate that firm’s representatives, based in Chattanooga, TN, haven’t jumped on a plane to come handle the crisis response of Friendly Center and CBL.

On the other hand, the crisis response of the Greensboro Police Department has been absolutely fabulous. The PD has shown that they are involved, active, concerned, working, deliberate, reassuring . . . the list goes on.

Friendly Center? CBL?

(Insert cricket noise here.)