The Personal Touch

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There's no doubt that creating customer loyalty has grown increasingly complex. Being the low-price provider is much more difficult; consumers know where to get the best deal. Stressing convenience isn't as unique and defensible as it used to be; consumers can now shop online 24/7 in the comfort of their own homes. Without price and convenience, what's left? The answer is the experience. It's a consumer's experience with a product, service, or store that truly creates an emotional bond with the brand. It's the experience that connects the customer on a deeply personal level, which, in turn, drives real loyalty. According to a recent study by OgilvyOne, customers who have these emotional bonds with a brand are more likely to:
  • stay with the brand year after year;
  • devote a higher share of wallet to the brand;
  • recommend the brand to others; and,
  • interact with the brand, replying to surveys and other requests for information. Further, a Gallup survey found that shoppers who were emotionally connected to their supermarket spent 46 percent more than shoppers who were satisfied, but lacked an emotional bond with the store. Experiential marketing takes center stage Experiential marketing is not a new concept, but its definition and applications have expanded over the past few years. Once thought of as primarily OTO marketing events where consumers interacted with products (e.g., demonstrations and sampling), experiences are now being used to help brands connect with consumers at much more emotional and personal levels. Some companies have been promoting "the experience" as a core part of their value proposition for years (think Starbucks, BMW, Walt Disney, Harley Davidson), but others are just now beginning to harness the power of experiential marketing. Consider an example from this past holiday shopping season. Saks Fifth Avenue launched its first ever RSVP Reward Packages--a collection of eleven unforgettable experiences that could be purchased only with SAKSFIRST points. Offered exclusively to Saks's most loyal customers, the program provided once-in-a-lifetime opportunities that included VIP treatment at the Cannes Film Festival, haute couture week in Paris, a personal "wardrobe revival," and a holiday weekend in New York City, complete with a behind-the-scenes look at the acclaimed Saks Fifth Avenue holiday windows. The City of Chicago also got into the act of selling experiences this holiday season. In December the city raised more than $240,000 by auctioning off a collection of unique experiences: dinner for 10 with broadcaster Bill Kurtis (along with a documentary about the winning bidder's life); the chance to turn on Chicago's Buckingham Fountain for the season; and the opportunity to lead the legendary St. Patrick's day tradition of dying the Chicago River green. In an attempt to differentiate and enhance customer loyalty programs, a growing number of companies have incorporated experiences into their redemption portfolios. Marketers are finding that for the most part customers have grown bored with the sameness of loyalty programs. The Colloquy Group, which provides news and research for the loyalty marketing industry, found in recent focus groups that once the branding and logos were removed from rewards catalogues, members could not tell the difference among most programs. The link to your customer data strategy Long-term success with experiential marketing requires companies to explicitly link their data strategy with their marketing strategy. The general demographic and purchase behavior information that many companies have (e.g. transactions, enrollments, direct marketing response data, etc) is simply not enough to effectively drive meaningful customer experiences. What is needed is a broader plan for identifying and leveraging customer insight that helps to understand the attitudes and motivations of individual customers. As companies continue to implement CRM strategies and technologies, they would be well advised to consider how existing customer touch points such as customer service representatives, account managers and field sales/support resources can be leveraged to capture this information in the course of existing customer dialogue. A number of companies have even added "virtual" concierge services for their most valuable customers. In addition to providing a valuable benefit to these customers, concierge services also offer a tremendous opportunity for companies to engage customers in meaningful dialogue that can be used to gain insight into individual customer interests and needs. It is information that can then be used to craft even more compelling experiences and personalized marketing communications. With a carefully crafted data management (and privacy) policy, this cache of customer information--information that is more intimate, personal, relevant, and valuable than standard demographic profiling information--can be used as a key enabler to developing and delivering brand and business-impacting customer experiences. Organizations can improve the economics of their marketing investments as they shift from traditional marketing campaigns geared toward all of their customers to the delivery of more personalized and targeted experiential marketing campaigns that drive emotional bonds and the bottom line. About the Author Rob Murphy is vice president of marketing at Circles, a leading provider of experiential marketing services. Circles creates and delivers concierge services, events and experiences for some of the world's leading brands. Rob can be reached directly at 617-622-6514.
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