In 2014, customer loyalty is a bit of an anomaly. Customers are empowered, informed, and have myriad options to choose from. They don’t really need to be loyal. But for companies doing business in the Age of the Customer, earning customer loyalty is more important than ever before. Satisfied loyal customers are the only reliable source of growth.
So, what do loyalty strategies look like today? For most companies I talk to their loyalty program is their strategy. While narrow, this approach doesn’t completely miss the mark. After all, the premise of a loyalty program is to create a mutually beneficial exchange for rewarding customers and collecting customer insight. And, for many marketers I talk to in retail, hospitality, and other industries, their most valuable customers are active participants in their loyalty program. The issue is that programs today are better positioned to “lock-in” customers rather than leverage member insights to drive personalization and improve the way they serve their customers. The traditional means of “driving” loyalty with points and discounts are no longer sufficient. It’s time for companies to evolve their approach to loyalty programs and strategies with a focus on relationships, advocacy, and engagement.
Customer analytics takes center stage in the age of the customer for firms trying to understand and predict customer behavior. From descriptive to predictive methods, customer insights (CI) professionals can apply a wide array of analytics methods to behavioral customer data. CI professionals have a lot to consider when deciding on the right portfolio of methods to drive customer understanding – what dependencies exist between analytics methods, what investment levels are required, where to get help and what business value do these methods drive.
To make it easier, we identified 15 key customer analytics methods that help firms win, serve and retain their customers. In our latest report, “TechRadar™: Customer Analytics Methods, Q1 2014” (subscription required), we evaluate each of these methods in detail taking into consideration their current adoption as well future potential. These methods, ranging from behavioral customer segmentation, lifetime value analysis, next-best offer analysis to recommendation analysis, allow firms to analyze customer data and use the analytical insight to drive acquisition, retention, cross-sell/upsell, loyalty, personalization and contextual marketing.
Our analysis shows that:
Methods that drive contextual insights are in early stages. Emerging methods such as sentiment analysis, location analysis, and device usage analysis are in early stages of development, but they have the potential to provide valuable context around behavior and other customer analytics methods.
This morning, as I was writing this blog post, I got an email from one of my colleagues, saying "Is it weird that since Google bought Nest, I no longer want one?" Her sentiment isn't that unusual because, as it turns out, plenty of people feel like Google + Nest = HAL. (It's hard to miss the resemblance)
My colleague Frank Gillett just published a post outlining a collection of ten key thoughts about the acquisition. As the privacy-identity-personal data wonk advising Forrester's marketing strategy clients, I thought I'd drill down on some of the more salient points for those issues.
As 2013 comes to a close, it's clear to me that much of the rhetoric about privacy's death was not only premature but downright wrong. Just in this past week, there have been several events that point to how very alive and critically important the topic of privacy is:
The US Senate Committee on Commerce, Science, and Transportation released a report (in advance of a public hearing) about the practices of the data brokerage industry, and how they impact consumers. The report claims that "data brokers operate behind a veil of secrecy, subject to limited statutory consumer protections." This certainly portends the possibility of new legislation being introduced by the committee in 2014.
US District Court Judge Richard Leon ruled that the bulk collection of millions of Americans' call records likely violates the Fourth Amendment of the Constitution. While conflating surveillance with marketing privacy is a dangerous thing, I suspect that this ruling will draw further attention to the volume, scale, and methods of data collection, irrespective of who's doing the collecting.
Adobe Cesareans Cross-Channel From The Email Market
Image Source: Ronald Grant Archive
Over the summer, we were all treated to an abundance of headlines proclaiming that Adobe, Oracle, and Salesforce were engaging in a marketing cloud war. Yet the relevant acquisitions — Neolane, Eloqua, and ExactTarget, respectively — only engaged in border skirmishes, since each focused on the distinct, yet adjacent, markets of campaign management, B2B marketing automation, and email marketing. Indeed, each of the strategic acquirers either already had partnership agreements in place or agreed to partner on the heels of the acquisitions.
We recently wrapped up our second evaluation of loyalty program service providers. From a potential pool of over 30 loyalty providers, we selected eight leading vendors that offer soup-to-nuts loyalty strategy, technology, and program management services. What has changed since our last evaluation? Notably, we found an increased focus on building programs that go beyond transactional rewards and loyalty technology. Wraparound program management services are still a key component of their solutions, but every vendor included in this Forrester Wave evaluation offers a productized platform that can be configured to meet client requirements.
In our final evaluation of eight vendors in“The Forrester Wave™: Loyalty Program Service Providers, Q4 2013,” we found a relatively competitive field of providers. Each firm has strengths and weaknesses in its current offering, but the leaders differentiate themselves through their forward-thinking company strategies. From a road map and development perspective, further increasing customer engagement capabilities, continually improving technology, and investing in more sophisticated loyalty analytics are major focus areas.
I want to extend my sincere thanks to each vendor in the report — Aimia, Brierley+Partners, Connexions Loyalty, Epsilon, Kobie Marketing, Maritz Loyalty Marketing, Olson 1to1, and Tibco Loyalty Lab — for committing to and participating in the often grueling Forrester Wave evaluation process. In addition, thank you to my CI colleagues Samantha Ngo, Carl Doty, and Shar VanBoskirk for supporting and editing this research.
Yesterday, FTC Commissioner Julie Brill published an essay on AdAge.com that calls on data brokers to join -- or, rather, establish -- an initiative called "Reclaim Your Name." The goal of the program would be to provide a single portal where consumers could see what data the industry has collected about them, provide options to opt in and out, and to correct data that might be inaccurate.
While the commissioner's article is a bit heavy on the "big data" rhetoric, her point is well taken: We have entered an era where the volume of data that individuals make available about themselves -- often inadvertently -- is increasing daily. Unfortunately, guidelines for how marketers and the larger data industry collect and use personal data are in short supply. This conflict is one of the major challenges that our industry faces in the coming decade: How can brands excel in the age of the customer if they're constantly under scrutiny about their privacy and data practices?
Acxiom, one of the world's largest data brokers, recently launched its own version of the kind of portal Commissioner Brill calls for. AboutTheData.com lets individuals see a subset of the data Acxiom knows about them, provides correction and opt-out opportunities, and aims to provide consumers with education about the data industry as a whole.
Last year, my colleague Srividya Sridharan published The State Of Customer Analytics 2012 (subscription required). Using the results of her annual customer analytics adoption survey, she uncovered key trends of how customer analytics practitioners use and adopt various advanced analytics across the customer life cycle and highlighted challenges and drivers associated with customer analytics.
This year, I have the pleasure of teaming up with Sri on her yearly survey, to further explore the adoption of advanced analytics, measurement, and attribution. Please read her blog post to learn more about the survey. This survey will explore the adoption and usage of measurement techniques, including attribution, and the adoption of advanced analytics methodologies. With this expanded survey we want to understand how you use and apply measurement and analytics in your organization to optimize both cross-channel marketing campaigns and customer programs.
In particular, we’re fielding questions to understand the goals and challenges associated with measurement and analytics, the adoption and application of measurement and advanced analytics methods, the use of several marketing and customer metrics, the customer insights process and workflow, and the organizational aspects that support measurement and analytics. We encourage you to participate in this survey, as this information will help you benchmark your measurement and analytics adoption efforts.
Last year, we published The State of Customer Analytics 2012 (subscription required) based on the results of our annual customer analytics adoption survey where we uncovered key trends of how customer analytics practitioners use and adopt various advanced analytics across the customer lifecycle and highlighted challenges and drivers associated with customer analytics.
This year, I am teaming up with my colleague and attribution guru Tina Moffett to further explore measurement, attribution and customer analytics practices ranging from the type of attribution techniques in vogue to the adoption of advanced analytics methodologies. With this expanded survey we want to understand how you use and apply measurement and analytics in your organization to optimize both cross-channel marketing campaigns as well as customer programs.
In particular, we’re fielding questions to understand the goals and challenges associated with measurement and analytics, the adoption and application of measurement and advanced analytics methods, the use of several marketing and customer metrics, the customer insights process and workflow as well as the organizational aspects that support measurement and analytics. We encourage you to participate in this survey, as this information will help you benchmark your measurement and analytics adoption efforts.
My eighty-six-year-old mother called me last night to tell me that she’s been “boiling eggs wrong all my life.” It seems she’d watched a cooking show and received some “best practice” advice. My mom is an excellent cook, so this made me realize that no matter how seasoned a veteran you are, there’s no harm (and often some good) in a review of the basics. In that spirit, I am going to share some advice for a question that comes to me quite frequently:
“What are the best practices for leveraging an industry or business award?”
First, deal with the basics: the press release.
Issue a press release. Be sure to include a quote from the awarding body about their judgment process and criteria. If the award is based upon a customer story, work really hard to include a quote from the customer in the press release. It’s OK to use the template that the award giver has probably given you, but make sure the press release is search-engine-optimized for your keywords.
Get aggressive on press outreach. Focus on reporters or social influencers (bloggers, analysts) who have been diffident or unresponsive in the past. If you can offer up an interview with the co-award-winning client, you have a very good chance of getting some coverage.
Post the news on all your social media sites.
If a customer was involved, try to convert to a “customer case study” press release. The barrier to this might be lower now that the customer’s use of your product/service is already public knowledge.