Going the Distance: Four Ways to Build a Better Customer Loyalty Program for Your Brand

It’s easy enough for a customer to join your loyalty program, especially when you’re offering an incentive such as discounts. All your customer has to do is give out some basic information, and voila! They’re in the fold, a brand new loyalty member with your company. From there, it’s happily ever after. You offer the perks; they stand solidly by you, bringing you their continued business. Simple. Or is it? In reality, just how many of those customers are act ively participating in your loyalty program? Do you know? Sure, loyalty program memberships are on the rise according to market research company eMarketer, having jumped 25 percent in the space of just two years. However, that figure may be a bit misleading. The truth is that, while loyalty program sign-ups may be more numerous, active participation in such programs is actually in decline. At the time of the study, the average US household had memberships in 29 loyalty programs; yet consumers were only active in 12 of those. That’s just 41 percent. And even that meager figure represents a drop of 2 percentage points per year over each of the preceding four years, according to a study by loyalty-marketing research company COLLOQUY.

When discounts just aren’t enough

So what’s a brand to do? How can you make your loyalty program worth your customer’s while—as well as your own? After all, gaining a new loyalty member doesn’t mean much if your customer isn’t actively participating in your program. Consider this: Does your customer loyalty program offer members anything different from what your competitors are offering? Chances are your program includes discounts. That’s a given. And what customer doesn’t appreciate a good discount? But when every other company out there is providing this staple benefit in comparable amounts, it becomes less and less likely that customers will remain loyal to any one particular brand. Frankly, it’s all too easy for customers to get lost in a sea of loyalty member discounts. They’re everywhere. In fact, just under half of internet users perceive that all rewards programs are alike, according to a 2015 eMarketer survey. The key to success, then, is to differentiate your business from the crowd. If you can offer your customers something unique and valuable beyond the usual discount, chances are they’ll be more likely to stick with your brand. Here’s some inspiration from companies who get it.

Virgin: Reward more purchases with more benefits.

That’s not to say you need to get rid of discounts entirely. In fact, nothing could be further from the truth. Customers still love a good discount. The goal is to be creative in terms of the loyalty perks you offer. Take the Virgin Atlantic Flying Club, for example. As part of its loyalty program, the airline allows members to earn miles and tier points. Members are inducted at the Club Red tier, from which they can move up to Club Silver and then Club Gold. Here, it’s not just a discount. It’s status. And people respond to feeling important, elite. Still, even where the rewards themselves are concerned, Virgin is motivating loyalty customers with some pretty attractive offers. At the Club Red tier, members earn flight miles and receive discounts on rental cars, airport parking, hotels and holiday flights. But as members rise in tiers, they get even more. At the Club Silver tier, members earn 50 percent more points on flights, access to expedited check-in, and priority standby seating. And once they reach the top, Club Gold members receive double miles, priority boarding and access to exclusive clubhouses where they can get a drink or a massage before their flight. Now that’s some serious incentive to keep coming back for more. Discounts are still part of the equation – but they are designed with innovation and personal value in mind, elevating them to more than just savings.

Amazon Prime: Pay upfront and become a VIP.

What if your customers only had to pay a one-time upfront fee to get a year’s worth of substantial benefits? It may not sound like the smartest business idea at first glance. But take a closer look. Amazon Prime users pay a nominal $99 a year to gain free, two-day shipping on millions of products with no minimum purchase. And that’s just one benefit of going Prime. It’s true that Amazon loses $1-2 billion a year on Prime. This comes as no surprise given the incredible value the program offers. But get this: Amazon makes up for its losses in markedly higher transaction frequency. Specifically, Prime members spend an average of $1,500 a year on Amazon.com, compared with $625 spent by non-Prime users, a ccording to a 2015 report from Consumer Intelligence Research Partners.

Patagonia: Cater to customer values.

Sometimes, the draw for consumers isn’t saving money or getting a great deal. The eco-friendly outdoor clothing company Patagonia figured this out back in 2011, when it partnered with eBay to launch its Common Threads Initiative: a program that allows customers to resell their used Patagonia clothing via the company’s website. Why is this program important to customers? And how does it benefit Patagonia? The company’s brand embraces environmental and social responsibility, so it was only fitting that they create a platform for essentially recycling old clothing rather than merely throwing it away. The Common Threads Initiative helps Patagonia build a memorable brand and fierce loyalty by offering its customers a cause that aligns with deep personal values. OK, so their customers get to make a little money, too. Everybody wins.

American Airlines: Gamify your loyalty program.

If you’re going to offer your customers a loyalty program, why not make it f un? After all, engagement is key to building a strong relationship with your customer. And what better way to achieve that goal than making a game of it. American Airlines had this very thing in mind when it created its AAdvantage Passport Challenge following its merger with USAirways. The goal: find a new way to engage customers as big changes were underway. Using a custom Facebook application, American Airlines created a virtual passport to increase brand awareness while offering members a chance to earn bonus points. Customers earned these rewards through a variety of game-like activities, from answering trivia questions to tracking travel through a personalized dashboard. In the end, participants earned more than 70 percent more stamps than expected – and the airline saw a ROI of more than 500 percent. The takeaway: people like games.

Stand out from the crowd.

Your approach to your customer loyalty program should align with your overall marketing approach. Effective branding is about standing out, not blending it. Being memorable is key. To this end, keep in mind that loyalty programs are no longer a novelty. That means that yesterday’s strategies won’t work moving forward, so look for ways to rise above the noise, setting yourself apart from the cloying drone of countless other cookie-cutter programs.

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The Cult of Personality (Part 2)

Recently Fame Foundry had the opportunity to talk with Eliza Metz, the "Violet" half of Lime & Violet. What began as a late-night conversation between friends led to a podcast for the yarn-obsessed that struck a chord with fellow fanatics. The secret to their success is equal parts serendipity and savvy, as they have carefully grown and nurtured their legion of dedicated followers into a full-fledged knitting empire. Below Eliza shares some of the lessons she's learned along the way. FAME FOUNDRY: Thank you for sharing this time with us. ELIZA METZ: My pleasure. Did someone mention an open bar? (kidding, kidding...) FAME FOUNDRY: You're known as Violet to your audience and most of the world. What's the origin of this name? ELIZA METZ: Lime & Violet was born from late-night hysteria, actually. Miss Lime and I were driving to a fiber festival in Colorado about nine hours or so from where we live. We'd left late, and were having a few way-way-way-too-much-coffee moments, since it was 2 a.m. and neither of us were very coherent. At one point, she misheard something I said, thinking I'd answered "lime and violet." The whole weekend, any time we didn't understand something, we'd just look at each other, say "lime-n-violet," and laugh at our own joke. We still do that even now. On the way home, I told her we should start a podcast. There were only two knitting-related podcasts at the time (versus the 100+ there are now), and after explaining what a podcast was, she agreed that it'd be a fun little project for our spare time. The name came from the inside joke, and since she really wanted to stay anonymous to avoid the crazies that proliferate on the Internet, we decided I'd be Violet and she could be Lime. We had no idea that neither of us would ever have spare time again, or that random strangers would know us better by our "anonymous" names than our real ones. (Not that that's a bad thing, either, really.) FAME FOUNDRY: So the podcast, which evolved into this massive business, was purely and spontaneously created out of your own interest in knitting and putting on a show for the fun of it? ELIZA METZ: Simplistically speaking, yes, that was the genesis of the thing. It's not to say we didn't have a plan, however. I'm one of those people who writes business plans for fun, so we had a pretty good idea before we ever put voice to mic where we wanted it to go. The problem, we found, was that we didn't dream big enough or fast enough, really. It took on a life of its own pretty quickly and started branching out pretty organically from there. But, yes. It was just for the fun of it at the time. FAME FOUNDRY: Sounds like you were expecting this from the beginning. ELIZA METZ: We were. I think we didn't know the whole extent of just how big it would be, or what it would spawn, but we knew it had the potential to be big. Or maybe we just didn't know how big "big" really was at the time, which is probably a good thing. If we'd known about all the work, we may have given up and decided to take up macrame instead. FAME FOUNDRY: What was the first sign that let you know this was big. ELIZA METZ: Oh, man. That's an easy one. A couple of months after we started the show, we had quite a few (we thought at the time) online "fans." The community was starting to form, and podcasts in general were becoming a bit more well-known in yarncrafting. It wasn't uncommon to get e-mails with offers of yarn or undying love, and we were okay with that. It was all kind of remote and surreal. Then one night we were in a local yarn shop in Nebraska, and a customer -- a complete stranger -- stopped her transaction and asked if I was Miss Violet. blinkblink She recognized me by my voice, which I hadn't really expected. So we made a huge joke about it all, started calling ourselves rock stars and carried well-publicized purple and green Sharpies in our purses so we could sign boobs at yarn stores. No, really. (And, yes, we've signed them.) FAME FOUNDRY: And thus began 'The Empire'? ELIZA METZ: Of a sort. There was a fair bit of work from there, but it was the first time we realized that we had a little bit of sway with the knitters, and it sort of drove home the fact that we had this fabulous base of customers who were listening to us, for sure. Empires aren't built in a day. FAME FOUNDRY: And the Empire seems to even refer to itself as 'The Empire." Quite a stunt there. ELIZA METZ: Of course it does. Luckily, we're benevolent rulers. FAME FOUNDRY: So everything -- the blog, the store -- evolved out of the podcast? ELIZA METZ: In a sense, yes. All of it sort of grew organically around the podcast's evolution. It's a little hard to explain, really. See, while a lot of the places that the podcast has grown into are completely random and unexpected (happy accidents, of a sort), we sort of knew where we wanted it to go from the beginning. We had this ridiculous business plan before we even put down the first tracks -- more of a wish list of activities than an actual business plan, per se. We had it structured so that growth would be based on the number of listeners because we truly thought that it would give us quite a bit of time to do things. At 100 listeners, we'd set up the message boards to let the fans talk to each other and start building a community. At 500 listeners, we'd start putting together the first knitting pattern book...that kind of thing. I remember writing down a milestone for 5,000 listeners and thinking that was just crazy, that we'd be waiting for YEARS before that ever happened. Three months later, we hit 5,000. I sat back, took a screenshot, sent it to Lime and told her that, perhaps, we should look into changing the structure of our business plan. Ahem. Duh, right? The problem, we found, was that we didn't dream big enough or fast enough, really.Not all of what we've done has been a part of the plan, since we had to scrap most of that pretty early on. We had a catastrophic lightning strike that took out our first book and the back-up copies thereof. Local hotels laughed at us when we approached them about doing a knitters' retreat on a full floor of a hotel (even though we had over 1,000 people who had filled out the form saying they'd come to our slumber party weekend). We tried partnering with various yarn/knitting-related companies for co-branded product support, but we found that contract law isn't quite our strong point and the brand started diluting a little. Lots and lots of learning experiences in that first year or so. If you want something done right, you need to do it yourself. So we started doing dyed sock yarns, which sprouted off into bath and body stuff when we talked a lot about the indie companies. The blog was just a way to pass on information to the listeners every day, since the volume of really fabulous projects and patterns and yarns coming into L&V Central was just too much to talk about on a weekly show. We keep learning all the time. It's one of the best things about the way we just dived right into this. Had we KNOWN the kind of work we were in for, we'd have turned tail and run, honestly. Our ignorance saved us from the get-go, really. The big lesson from the past year -- at least for me -- has been that narrowing the focus of what we're doing isn't nearly as counterproductive as I thought it'd be. We launched the Intention Yarn line, which has a very, very narrow focus (and, uh, intent), but it does 10 times better than our generic sock yarns did, largely because people know what they're about. They get the concept, so it's something they can buy not just to support their Lime & Violet addiction, but for a specific purpose of creation, and they seem to dig that. Same with things like the Neil Gaiman project, TheFatesThree.com -- which isn't just generic knitting patterns, but patterns all created with a theme around a particular author's works -- the narrowing-down process made the focus just that much more clear for both listeners and the occasional non-listener who stumbles upon it. There are other projects unrelated directly to Lime & Violet -- KnitLife, which is an oral history collection process that's just getting going, for instance. While it's not directly related to the show, I've got no illusions that being "known," so to speak, doesn't help promote the projects or get the word out there. Whether or not it's an obvious connection, the Empire doesn't just affect the success of the stuff we do -- it's the basis for it. FAME FOUNDRY: You share a lot of yourself with your audience and the community that has formed around the Lime & Violet brand. Where do you draw the line between your personal life and what you broadcast to the public? ELIZA METZ: There's supposed to be a line? (You can't see me right now, but trust me, I'm laughing relatively hysterically.) If someone has listened to every single show, they know more about me than my own mother. Before there was a Lime & Violet, there was me. And way back in the olden days of the Internet, when you used to have to do markup by notepad and ftp everything from a command line and design was largely a matter of tables with varying cellpaddings (and we rode dinosaurs to school both ways uphill in the snow...), I was one of those freaks with an online journal. (This is in the pre-Greymatter, pre-typepad, pre-blog days. Told ya it was in the prehistoric era.) I was one of the original 50 nutjobs who thought that their own lives, as mundane as they may be, were interesting enough to warrant putting it out there for the world to read. (And, incidentally, comment on. Good heavens, the e-mails...) Coming from this background and posessing of some kind of weird self-revelatory urge that's probably borderline pathological, I don't have a line most of the time. There are some things that we don't talk about much on the show, and we try to maintain the anonymity of the innocent (relatively speaking), but for the most part, if someone has listened to every single show, they know more about me than my own mother. I'm still not sure if that's a good thing or not. Contrast that with Miss Lime, who keeps a very strict bubble around her identity. No pictures of her are allowed on the site other than one that she swears looks nothing like her. Nobody knows her real name. For a while, we even kept it secret that we're in Omaha, though that slipped out through other channels. She's pretty convinced that the crazies would find her if they knew her name, and for that, I can't really blame her. The Crazy is pretty much everywhere on the Internet. FAME FOUNDRY: You mentioned the "crazies" on the Internet. What's the craziest encounter you've had with a an Internet fanatic? ELIZA METZ: I could tell you stories that would probably make Dateline NBC producers salivate. For the most part, we've found that knitters are a pretty sane bunch, with a few notable exceptions, but the combination of Internet anonymity and pseudofame still brings out the occasional whackjob. For instance, once we mentioned on the show that we love our fans. We love them so much that we'd love to invite them all over to my house for a great big slumber party. I mentioned that I have a guest room and a couple dogs that are quite fond of visitors, and I make a mean cookie. While intended to be kind of a joke, apparently I sounded serious enough that one girl found my real name, looked up my address and drove NINE HOURS to my house, where she got out of the car with four overnight bags (three of them were knitting projects-in-progress, I might add), and just expected to stay. Um. Oh-kay... She ended up staying three days. Great girl, but omg we never said anything like that again. Then there was the lady who didn't understand personal space and kept petting my hair. Or the one who named her babies after us. Or the one who, when we didn't write her back in an arbitrarily selected timeframe, made a WE HATE VIOLET website. I wish I was kidding. The Crazy. She is everywhere. FAME FOUNDRY: You're active on Twitter, Facebook and Plurk, though you use Plurk as your micro-updating site of choice. Why's that? When it comes to what we're trying to do -- building a community rather than just a following -- there needs to be interaction. ELIZA METZ: For me, it's a matter of connection. Twitter and Facebook and all the other myriad microblogging sites out there are all fine and good for most things, but it's largely one-way communication. You broadcast what you're doing to the world. Which, again, is all fine and good, if that's what you're looking to do. When it comes to what we're trying to do -- building a community rather than just a following -- there needs to be interaction. A conversation rather than just blindly telling people what you had for lunch. And Plurk has a format that depends on conversation and commentary to stay interesting, so people get involved. Once a fan is invested in a conversation, either with me or with the other followers, they feel like they're part of it. Instead of just reading ABOUT someone, they're talking WITH them. It's just a more human format to me, and it's the one I end up going back to over and over again as a result. FAME FOUNDRY: Art journaling is a big part of your life. How has this influenced your artistic approach online? ELIZA METZ: Through art journaling, I've found out a couple of big things about my own aesthetic. I really like handwritten things (more personal). I can have all the colors in the watercolor box, and I'll still end up with a white or mostly white background (which unclutters things for me visually). And white space keeps me sane. I don't claim to be any kind of techno-head web person who writes code in my sleep. In fact, I'm one of those freaks who still uses Notepad for most things. Call that a disclaimer from a semi-luddite here. That said, almost everything I put out there has a lot of that same, rustic, plain-looking, hand-hewn feel to it -- partially from just not knowing how else to do anything, and partially because that IS my approach. And if it works, I see no reason to fix what isn't broken. I'm just happy when there aren't broken links and people look at it now and again. FAME FOUNDRY: Thank you for sharing your vast experiences in building this empire you have. ELIZA METZ: And thank you for the interview. That'll be four goats and a skein of good cashmere, payable to the jester by the door. Elli Metz is the benevolent ruler of the Lime & Violet empire, which includes the independent republics of media, yarn, perfume and history. When she's not wearing her crown (which she often does), her job title is "starmaker," a fact that still amuses her.

 

 

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Applying Science to Social Media: Analytics 101

These days, the importance of using social media to connect with customers goes almost without saying. And with a variety of channels to choose from that offer direct access to millions of people at no cost, what’s not to like? Well, for one thing, there’s the issue of measurability. While the barriers to entry are next to none, how can you assess your company’s performance in engaging with all those existing and potential customers? After all, social media doesn’t conform to any of the familiar metrics that we’ve used to evaluate traditional mediums for decades. You can’t sum up your interactions on Facebook or Twitter in terms of rating points or share. Furthermore, what constitutes a good result for one company may not apply for another. What if yours is a service-based business rather than one that sells tangible consumer goods? Or what if you’re charged with managing social media for a ministry or nonprofit? Your standards for success will likely be completely different than those of a for-profit entity. The good news is that there are many tools available to help you gauge the overall health of your Facebook Pages and Twitter accounts. Even if your company doesn’t have the funds or the manpower to devote to managing your social media presence full-time, there are no-cost and low-cost options available to help you wrangle the ambiguous concept of engagement into quantifiable figures.

Free solutions

Let’s start with Facebook. The good folks at Facebook offer very helpful performance metrics via their aptly-named Insights feature, but trying to process this data can be like drinking from a fire hose (and one that changes fairly often) unless you know how to filter what you need from what you don’t. Here are a couple of simple calculations that you can perform to distill this raw data into meaningful information. At any given point in time, you can gauge the basic level of engagement on your Page by dividing the number of Monthly Active Users by the total number of Lifetime Likes. Multiply that figure by 100, and you’ve got the percentage of your fanbase that has interacted with your content in some form or fashion during the past month. Because Insights information is kept private and made available only to a Page’s designated administrators, there aren’t any industry benchmarks against which you can rate how your performance stacks up. However, what you can and should do instead is track your own figures over the course of several months. Is your engagement percentage dropping? Climbing? Holding steady? Keeping an eye on these trends will help you establish benchmarks for your own company and give you a feel for the types of tactics and campaigns that get the greatest response. Beyond that, you can determine whether your content is connecting with users or turning them away by comparing Total Likes to Total Unsubscribes. Divide Total Unsubscribes by Total Likes, then multiply by 100, and you’ll find the percentage of people who’ve left your page. Obviously, the goal here is to achieve as low a percentage as possible. Some unsubscribes are inevitable, but hopefully you’ll be looking at single digits. If your percentage is greater than 10, it’s time to scrutinize your content strategy to see what might be driving people away. What about Twitter? Their native platform is notoriously difficult for data analysis, but fortunately, there are a plethora of third-party toolsets that use Twitter’s API to crank out stats for your account. HootSuite is the platform of choice for many social media managers, largely because in terms of ease of use, they’re hard to beat. Once you get acquainted with the interface, it’s pretty easy to get a snapshot of who’s retweeting your content, who’s talking about you, and who’s asking questions that need your attention. You can either monitor this activity manually or set up reports to be automatically generated to give you a global view of the health of your Twitter presence. And did I mention that their Basic plan is free for up to five social profiles?

Almost-free options

What if you need more flexibility and data-filtering power than the free version of HootSuite offers? Then you might want to check out their Pro plan. A minimal investment of $5.99 per month will get you access to advanced reporting tools that will help you monitor sentiment and track social reach as well as the ability to add an unlimited number of social profiles. TwentyFeet also provides some promising tools at a very low cost, although they’re a much newer company without a proven track record established as of yet. However, unlike HootSuite, they offer tracking for YouTube (along with Twitter and Facebook). You can track one Twitter account and one Facebook user profile (not Page) free of charge, or you can add additional profiles for $2.49 per profile per year. Yep, that’s per YEAR, not per month. That’s a pretty incredible rate for the types of monitoring services they offer. The primary benefit of going the paid route with companies like HootSuite and TwentyFeet is the reporting option. If yours is a smaller company with limited resources, it’s much more efficient to be able to pull reports on demand rather than having to spend a lot of your own time crunching the numbers to gauge your performance.

Better information, better decisions

While this is by no means an exhaustive evaluation of all the available services that can help you track social media metrics, these solid, highly affordable options offer enough data to give you a clear view of your engagement across various platforms. Dive in today, and discover the difference that the insights you glean from these toolsets can make in your ability to guide and direct your company’s social media initiatives.

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