Build it, and they will come

Iain McCrossan, Director at iris Concise, on how to select the right CRM proposition and ensure the creative execution resonates.

Recently, in her blog, “One loyal friend is worth ten thousand relatives”, Claudia Georgiades discussed the key components of CRM required to build a loyal customer base. She argues that a successful programme should “make it easy” to engage with and use. It should “incentivise and reward” valuable engagement and purchase behavior. It should “be relevant”, through intelligent use of data to personalise the offer and finally, it should create “engaging” content and experiences.

The way in which the scheme delivers this value exchange can vary greatly though, depending on the type and depth of relationship you have with your customers, e.g. their socio-demographic, needs, wants and behaviours.

Whether it is a points or tiered based approach, (British Airways Avios, Boloco card), charging up front for VIP benefits (Amazon Prime), structured non-monetary programmes based on your customers values (Patagonia common threads), partnering with other companies to offer all-inclusive offers (AMEX Twitter sync, Lloyds Bank everyday offers) or providing experiential and lifestyle promotions (O2 Priority Moments), the rationale for what type of scheme to provide is complex.

So how to select the right CRM proposition and ensure the creative execution to resonate?

It’s worth asking yourself the following questions to validate what it is your programme is trying to achieve and if it will have the necessary impact:

  1. What customer need are we trying to fulfill?

Some needs sit nicely on the surface of people's consciousness, so they are easy to identify. This is particularly true of functional needs like price, taste, convenience or availability. Others, though, sit at a deeper level. These are more emotional in nature and are sometimes unconsciously felt. Tapping into these needs and understanding why they are important is often the basis for a successful loyalty model.

  1. What reason(s) are we giving our customers to believe?

The task is then to understand how your solution meets the customer need. How does it make the customer feel? And importantly, is your organization the best placed to do this? By asking yourself these questions, it should become clear if the programme will encourage loyalty and be welcomed by your customers.

  1. Are we aligned to our brand strategy?

This is strongly linked to question 2. It is important that any loyalty scheme provided is aligned to your organisations brand / category values. This will create the boundaries in which you are able to operate and dictate how conformist or daring you are able to be.

  1. Is the idea big enough?

Now we need to think about scale and reach. How much longevity is in the idea? Does it enable a wider communications framework and how should this be activated to encourage both loyalty and possibly extended to aid acquisition? How easily can this idea be scaled? How does it capture hearts & minds? Does the idea reach enough of the right people?

  1. What are my key implementation challenges?

The practicalities of implementation should not be overlooked at this initial stage. What time and resources are required to deliver against the idea? Do you have existing assets and partnerships that can be leveraged or will new ones need to be developed? How much autonomy do you need to launch such an idea and is this within your sphere of responsibility?

  1. How do we measure ROI?

Understanding how the idea will deliver a return and over what period will be critical to ensure buy-in from the necessary stakeholders. Setting up the appropriate ROI metrics such as retention rate, negative churn, NPS, Effort, Lifetime Value and WOM will be critical. As well as a top line consideration of operational and marketing cost. Finally, ensuring you track and report against these measures and align the results to business objectives will encourage corporate buy-in.

  1. WOW factor / why pick us?

Finally, if you build it, will they come? This is the acid test. Will your customers be more loyal as a result of this programme being in market? How standout is this for your brand and how easy is this scheme to replicate? By ensuring the idea is both unique and closely aligned with your customer’s needs and wants, loyalty and ultimately bottom line value should follow.

By using this framework, CRM value propositions can be validated against customer insight, commercial effectiveness and creative impact. Build it and they will come.