November 7, 2014

Getting Personal with Customer Loyalty Programs

On this episode of the Customer Loyalty Space podcast, loyalty experts Barry Kirk and Ashley Tate spoke with TechnologyAdvice host Clark Buckner about knowing customers, the four core drives that connect people to experiences, and how to validate different customer personas.

Barry Kirk is the VP of Loyalty Strategy at Maritz Motivation Solutions, a one-hundred-year-old company that provides incentive programs, loyalty rewards, and employee recognition. Ashley Tate serves as the Director of Marketing at loyalty marketing rewards program and engagement company BigDoor.

Kirk and Tate underlined that before even thinking about creating any kind of loyalty initiative, marketers need to know their customers by first establishing these premises:

  • Remove “consumer” from your marketing word bank.
    If you truly want to build loyal relationship with customers, then you should work to stop seeing people as just buyers of products and services.
  • Understand customers in a loyalty context.
    Realize that those who buy your product or service are human beings. Therefore, you need to go beyond seeing them as a consumption machine and rather work to build human relationships with them.
  • Understand pre-loyal customers.
    Customers are in this so called phase of pre-loyalty when they get curious about a product before they even purchase it. They want to know details such as what the product is for or where it comes from, so they seek as much information as they can about the product or service.

The Four Core Motivation Drives in Loyalty Marketing

Kirk explained that Maritz Motivation works to understand customer loyalty behavior through neuroscience, behavioral economics, and behavioral psychology. Additionally, they use these four core drives to motivate people to connect with their offered experiences:

  1. Drive to acquire stuff: Customers crave points, rewards, status, and more.
  2. Drive to defend: Customers strongly hang on to the brand and the experience.
  3. Drive to bond: Customers love to connect with others.
  4. Drive to create: Customers want to have some unique part in the experience.

Consequently, understanding these four core drives is crucial to knowing your customers. It’s like getting into the minds of your customers so you can have a better grasp of what they want and why a certain brand is important to them. This is critical, especially in our world today, where customers can become heavily invested in a brand so long as a company is delivering the right products through the right approach.

Shifting from Value-Based Segmentation to Persona Marketing

Kirk made a point that although loyalty marketers are buying into the idea of really knowing their customers, what’s really happening in the loyalty scene is value-based segmentation. This means marketers are still running numbers to see and compare who’s spending more or how many products a certain person buys versus. Apparently, there’s too little understanding as to who that person really is beyond what the numbers reveal about that customer.

Moving forward, marketers should direct their focus to the idea of persona marketing,where they create different customer personas in order to craft a better experience when launching a loyalty program.

With your potential audience in mind, answering these questions will help you create personas in a holistic perspective:

  • What’s their job title or seniority ranking?
  • What’s their daily life like?
  • Why do they visit your site?
  • What value do they get from using your product?
  • What are their goals?
  • What kind of experiences do they wish to get from the product/service?
  • Do you want them to make a purchase the first time they visit your site? Or is the experience better suited for a six-month journey?

Validating Personas through Data Gathering

Analyzing customer flow and usability will help marketers gain a clear picture of the different drivers that influence a customer’s online behavior.

  • Heat maps: This allows marketers to track the “click journey” of their customers in an online experience.
  • Customer advice reports: These reports allow marketers to gather data on new ideas from loyal customers as well as those who may have tried the product or service only once before discontinuing their association with the brand.
  • Survey methodology: Through surveys, marketers can determine the dominant value systems of their target customers. Because different people have different values such surveys help marketers know why their customers behave in various ways, especially when choosing a product or using a website.

Tate and Kirk agreed that brands with customer loyalty programs need to ultimately provide something meaningful to customers. However, this can only be done with a basic understanding of your customers and their different personas. Such research and analysis should top any loyalty marketer’s to-do-list before working on creating a customer loyalty initiative.

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To keep up to date on the latest in loyalty and engagement, subscribe to the Customer Loyalty Space on iTunes!

For more information on creating customer personas for customer loyalty programs, visit BigDoor or Maritz Motivation Solutions.

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