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Top takeaways from the Loyalty Summit CXM conference in Zurich.

7 mins
Kunsthaus museum picture

Key Takeaways

Loyalty programs can help protect retailers and customers from inflation. - Cristina Ziliani, University of Parma
Marketers are overly focused on customer acquisition and not focused enough on post-purchase communication. - Jisun Hahn, Kognitiv
10x your points are so much better than 10% percent off because it helps engagement while protecting your margin. - Bradley Breuer, PetSmart
In math, 1x3=3x1. In psychology, it doesn’t. - Rory Sutherland, Ogilvy UK

My goodness! It’s so good to attend conferences in person again.

As this conference is our first since the pandemic, we wanted to make sure this event was a good one and, wow, did it deliver!

Big name retailers attended and presented during the 2-day event at the Kunsthaus Museum in Zurich, Switzerland, March 15-16, 2023, alongside sponsors (like ourselves), and big-name keynote speakers Cristina Ziliani, Professor of Marketing and Scientific Director Loyalty Observatory, University of Parma, and the incomparable Rory Sutherland, vice-chairman of Ogilvy UK.

A LOT was covered in two days, but these are the stories I believe are most worth sharing.

Cristina Ziliani delivered a great presentation on how loyalty programs have had broader societal benefits over the course of time and also have the power to drive positive change for the future.

In one of the best history of loyalty programs lectures I’ve ever attended, Prof. Ziliani presented longitudinal data that demonstrated how loyalty programs have historically helped consumers navigate recessions, and, more recently, the uncertainty of a pandemic by functioning as an extension of their household budget.

She also made the clever prediction that loyalty programs will help brands and consumers make positive contributions to sustainability, providing they take the right approach. Cristina called this next phase of loyalty “Citizen Engagement Management”, and described it as a series of levels brands can choose to engage their customers on. The first level is to offer program members the option to donate their loyalty currency to causes they care about, but she cautions brands that ‘this can feel opportunistic to consumers because it puts the onus on them to act and that you’re taking credit for their contribution’. Ideally, brands would either match the contributions of their members or—even better—reward them with currency for taking positive action.  

"When brands show leadership, commitment, and work in partnership with their customers to fight the climate crisis, truly meaningful change can happen."

presentation screen

Our chief strategy officer, Jisun Hahn presented some recent Forrester Research that suggests that marketers might be so focused on customer acquisition that they are missing opportunities with their customers post-purchase when brands need to continue to earn their trust and build deeper their relationships with them.

She suggests focusing on delivering relevance when customers expectations are lower, and increasing efforts around personalization after brands have earned a customer's trust and the expectation for that brand to know them is higher.

The trick to delivering a transition from relevance to personalization that feels like a natural evolution of the relationship between the brand and the customer, is knowing when that customer has entered the appropriate customer lifecycle stage, and their trust has been earned.

Based on our proprietary customer milestone mapping methodology, SmartJourney®️, we’ve created a new product called Kognitiv Pulse, which tracks how your entire customer base—both loyalty and non-loyalty—move through these lifecycle milestones in real time.

Jisun set up the launch of this new customer data and activation tool in her keynote on day one of the conference and Anthony Wintheiser, chief data officer for Kognitiv, provided a live demo of the product on day two.

presentation image

Anthony shared that “It’s one thing to know that you’ve got 14,129 customers that are risk, it’s another to know that 1,642 of them need to be engaged today and to receive prescriptive recommendations telling you what you need to engage them with.”

Kognitiv Pulse offers the ability to see which customers need to be activated today, and clearly with different messages. Because they’re in different stages of their relationship with the brand, this is incredibly powerful for marketers.

Next up was Kognitiv client, Bradley Breuer of PetSmart. Bradley delivered an incredible compelling presentation about the evolution their Treats program has undergone, from being seen as a cost-centre to becoming the heart of their marketing strategy, and a critical channel of empowerment for their pet parent customers to do anything for their pets.

Bradley noted that in the early days, their program treated all of their members well, but the same. Everyone received the same offers based on their pet category, without differentiation for their individual needs, and the program was unnecessarily expensive. Bradley and team did a lot to evolve the Treats program and find ways to better serve their pet parents that also preserved profitability.

Bradley shared that “10x your points are so much better than 10% percent off because it helps engagement while protecting your margin.”

In addition to these benefits, awarding points tends to encourage higher spend and diffuses redemption costs by distributing them across the lifecycle.

Rory Sutherland, the second big keynote of the conference confirmed this to be a winning strategy by highlighting another but equally important angle.

Dropping the price is the absolute worst thing you can do. Dropping the price is a double loser. It sets a low bar of expectation for the future and basically emits the whiff of desperation.” - Rory Sutherland, Ogilvy UK

Rory Sutherland was hilariously correct about this and a lot of other things, including the benefits of “doing daft things every once in a while.

The iconic adman, and vice-chairman of Ogilvy UK covered a lot of ground in his extended 90-minute keynote, and I learned so much I could relay his stories for ages, but I’ll keep his takeaways to the ones I think offer the most unique value to marketers.

presentation image

His Eurostar allegory of this concept is the stuff of legends, (to hear it, scrub through to 6.18 mins of his ted talk here.) but I’d never heard the Dishoom version of this allegory before.

In the photo above, Rory highlights the imbalance between psychological and rational ideas.

He notes that creatives inevitably must justify their ideas to people in finance who are infinitely more rational than they are—which is likely right—but the inverse is never the case. "No one in finance is ever asked to bring their ideas to Marketing to see if they have a better one."

This is perfectly illustrated in amarketing strategy employed by the crave-worthy Indian restaurant chain, Dishoom. They noticed a significant drop in business between 3 and 6 pm and wanted to increase traffic. This is not an uncommon problem for restaurants, and the standard solution is to offer discounted happy hour fare.

However, this is not what Dishoom did.

Instead, they sent a specially commissioned dice to 250 of their most valuable customers to bring with them if they ate at one of their locations during that timeframe. At the end of the meal, customers were to roll the die. If they rolled a six, the entire meal was free. Because there was the possibility of winning a free meal, guests tended to spend a lot more on the meal than they normally did. And, they were so thrilled and excited about the possibility of winning a free meal, that they left the experience feeling valued and happy, even if they didn't roll a six.

"Rolling a six is the same math as offering 16.6% discount. The difference is, that rolling a six is endlessly thrilling for this group of customers, and a 16.6% discount isn’t something they would have crossed the street for."

The rational idea of a discount isn’t anywhere near as effective in driving customer engagement, or revenue, as the psychological idea of offering this group a chance to roll the dice.

Some of the best ideas are a bit daft.

Rory points out that “daft things, whilst make no sense to anyone in advance, are kind of like a ratchet. Once you experience a thing you didn’t want but now love, you can never go back to not wanting it again.” I couldn’t agree more.

Speaking of delightfully daft things, let's end this post on an experiential arty note.

museum picture

This last takeaway provides an excellent segue to the most memorable moment of this entire trip, which occurred while I was exploring the Kunsthaus exhibits.

The Kunsthaus’ collection is exceptional and is filled with famous works by Picasso, Rothko, Degas, Miro, and Magritte; but it’s a sound and light installation I walked through that I can’t stop thinking about.

The pixel forest pictured above was created by Swiss visual artist, Pipilotti Rist. This otherworldly sensory experience of sound and light is tucked into an unassuming corner that you might miss if you weren’t curious enough to walk through an out-of-place opening on the gallery wall. If you’re interested in experiencing the work, you’ll find a video capture of it here. It might be the most delightful 4.13 minutes you’ve experienced in a long, long time.

If you’ve made it all the way down here and you’re still wanting more, our friends at the Wise Marketer wrote this tidy wrap up that covers more great content from the conference not covered above.

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