I’ve been tracking the use of email by loyalty program sponsors for the past year as part of a broader study which I plan to release by September 2008. An early look into how the airlines use email to communicate with their frequent flyers was published earlier this year in the Breaking News section of my website CustomerGrowthllc.com.

One observation from the complete study I can share is how seldom companies reach out to survey me at all. When they do, I have rarely noticed follow up offers or promotions that tie back to my survey responses.

Borders has broken that string, and the e-survey they sent me today was worth a post.

The cornerstones of an effective e-survey were in evidence:

1. My participation was encouraged by the promise of a 30% discount off my next purchase.
2. The survey was promised to be short and it was! It only consisted of 4-5 questions.
3. The survey was structured to generate answers which could populate a financial model leading to actionable promotions.

The objective of the survey was to identify the value of my book spend over the past 6 months and learn how much of this amount was purchased online, and where. Using these answers, Borders will be able to estimate my value as a customer and understand my preference for online or offline shopping. Key to the survey is that Borders will be able to calculate their share of my book-spending wallet.

What Borders will do with the survey results is a matter of conjecture, but one expectation that stands without compromise is that they follow up by offering me a promotion to make a purchase online in the very near future.

Doing so would let me know two things:

• that it was worth my time to participate in the survey, and
• that Borders took action on the results

If Borders comes through with this expected follow up, you can bet I’ll be more likely to open their emails in the future.

In Loyalty Truth……..Bill Hanifin

I’ve seen a few “Top 10” lists looking for clever ways to inform the community of loyalty practitioners the reasons why loyalty programs fail. Some of these lists are based on “research” that was so narrowly conducted that the results are more conjecture than fact.

I have been involved with the launch and operation of many loyalty programs and still can’t offer any statistically based opinions on why programs most often fail. Staying true to the mission of Loyalty Truth, I want to offer the most transparent and valuable information possible while staying in compliance with confidentiality agreements and my own ethical compass. My opinions are rooted in having my sleeves rolled up while working with clients shoulder to shoulder and trying to generate profit.

Here is my own experientially based list of reasons why loyalty programs run into trouble:

DIY only works at home! The breadth and depth of information about loyalty program strategy has yielded a result that is counter intuitive. One would think that the more information disseminated, the more program sponsors could successfully plan and execute their own programs. I don’t see it working out that way. When companies elect to not engage the services of loyalty planning specialists, or worse, allow themselves to be convinced that loyalty is “simple”, the results can be disastrous.

Budget for the whole scheme! More than once I have seen corporate budgets account for pilot programs but not roll out. Or, they include all operational elements but miss the need for communications including media and promotion. In 3 cases over the past 18 months, I have encountered organizations that were not making entries to the financial reserve for the value of unredeemed points, even though they were giving lip service to the subject in meetings. Each of these examples can derail a successful pilot if there is no money available to move to the next level.

The Owner is NOT in! Strategic planning efforts can be managed in team format but when the time comes to put the program into market, there must be a designated project owner that is recognized throughout the organization and has a reasonable degree of power and influence. Imagine the loyalty VP not being able to execute a promotional/media plan because the Marketing department wants to revisit the entire communication strategy. Or, trying to use line resources to recruit merchants into partnership when no one told the line personnel why they should care to help? Like any enterprise level initiative, loyalty programs must have clear owners which are empowered to get the job done.

Measure What? I bet you have seen more than one consultant fire up a PowerPoint with a circular process depicting “Plan, Test, Measure, Adjust”. If you have not, you just haven’t met with enough consultants! (Full disclosure: I have one!!) If we agree that data driven marketing programs that take the form of “loyalty” programs are created to amass customer and transaction data in order to understand customer behavior and build long term relationships, then why don’t we ALWAYS commit to a measurement plan that is well understood by stakeholders and is regularly executed and discussed at high levels of the organization? I had a respected colleague who posted a sign on his office “If you can’t measure it, it doesn’t matter”. A loyalty take-off of this sentiment might be “Don’t collect the data unless you’re going to do something with it”.

I am going to stop here if for no other reason than to suggest that valuable learnings can come in forms other than a “Top 10” list. Letterman is funny but he’s not Peter Drucker.

Loyalty programs work when planned correctly and executed carefully. They must have an empowered owner and be measured on a regular basis. Enlist the help of loyalty specialists to help you build your strategy and then make them stay around to have a role (and be somewhat responsible) in its execution.

The good ones will eagerly take you up on this challenge as they know that success is tied more to brilliant execution than a beautiful PowerPoint articulation of the strategy.

Bill Hanifin

A thought provoking email hit my inbox the other day. Written by David Baker, Vice President of email solutions at Avenue A/Razorfish, the title “What is Loyalty Marketing Today?” caught my eye. You can read the post at http://blogs.mediapost.com/email_insider/?p=672 and it might be worth a visit to David’s blog.

The premise was similar to a question posed by a banker at the Millennial Financial Services Forum. As many discussions around consumer marketing tend to do, the subject at the conference had turned to loyalty programs, what tactics work, how to manage their cost, and what new approaches are around the corner. “So, do these programs really work or do they just take away margin from the sponsor?” was the question thrown to the group.

The question posed by David Baker was prompted by the saturation of similarly constructed programs in today’s market by asking “What are the keys to a great loyalty program?” and “What will the future of loyalty programs be?”

Taking these in order, the sad nature of the banker’s question is that she was asking based on her accumulated experiences with poorly executed programs. If every bank has a credit card program that earns 1 point per dollar which may eventually be redeemed for items in an online catalog, then what is the point? Where is the differentiation? And, how does one bank gain advantage over another or, as she suggests, are they all just eroding margin by participating in a game they are forced to play?

The industry is long overdue for innovative tactics that will draw new attention to rewards programs and re-energize cardholders towards their rewards. At the same time, the massive stores of data that are currently possessed by card issuers has been vastly underutilized. From the mailings I receive, it appears to me that they are either generated from a risk management standpoint (credit line increases, courtesy checks, etc) or are travel offers that lack personalization. It would take a very small effort to learn that I am not a golfer in order that the issuer could stop sending me offers having to do with the little white ball.

The best part about David Baker’s questions is that he offered his own answers. He polled his team and shared a short list of highlights. Reading the responses, it is clear to me that the “keys to a great loyalty program” are many and that loyalty is going to be created as part of a holistic effort that includes good customer service, strong value exchange, brand support, social buzz and some form of exclusivity.

The answers to the “future of loyalty” question indicated that personalization will still be important in the digital world, programs will become more narrowly focused and quick hitting, and further differentiation is needed.

The sum of these answers reinforces the need for change and innovation in the industry. And, unlocking knowledge of how Millennials make purchase decisions and create brand preference represents the foundation to success with this large population group.

Can you hear the footsteps of nearly 80 million people? It might be the sound of GenY running away from your current loyalty offer. It’s time to invest in this budding consumer group and meet them on their turf, whether through use of social media or their mobile phone.

The future is now…..Bill Hanifin

Anyone who tuned in to ABC’s Wide World of Sports in 1982 may have witnessed one of the most compelling athletic events of all time. Julie Moss was leading the Hawaii Ironman and closing in on the finish line when she became crippled with exhaustion and dehydration. She collapsed to the ground, losing her lead to eventual winner Kathleen McCartney, but refused to quit. In personification of human determination, she crawled to the finish line on her hands and knees.

Viewers were bipolar in their reaction to Julie’s effort. Some were inspired to complete an Ironman, etching it into their “bucket list”. Others dismissed the whole scene as crazy, unrealistic, fringe behavior at best.

Well, the Fringe has become Mainstream. Membership in USA Triathlon, the sport’s governing body in the U.S. soared above 100,000 members in 2007. The granddaddy of US Ironman events, Ironman USA, sold out the 2009 race the day after this year’s event, meaning that about 2,200 “fringe” athletes dropped over $400 each to reserve a spot in next year’s race in Lake Placid, New York.

Why should Loyalty Truth, or You, care? In one word – Brand! The Ironman brand has become one of the most recognized in the world and represents a valuable constituency with more than 50% of its members earning over $100K.

That a truly fringe event conceived by a bunch of unrelenting jocks in Hawaii could evolve into a global brand is remarkable. Considering that anyone wishing to associate with the brand through competition in one of the growing number of events around the world is more incredible as you can’t join the “club” without suffering through 140.6 miles of swim, bike, and run in one very long day.

The brand has been vigorously licensed by its owners to makers of automobiles, watches, clothing, sunglasses, and financial services providers. Major companies including Ford, Timex, Dell, Aflac, and Janus have associated their own valuable brands in partnership with Ironman.

If you want to see world class brand delivery and reinforcement in action, seek out an Ironman event and wander around the race site. You’ll sense the magnetism of the event and, if you are a brand manager or owner, you’ll walk away asking yourself how you can do the same with yours.

Bridging the gap from Fringe to Mainstream has been critical to increasing the power of the Ironman brand. Rather than insulate non-competitors from the experience, Ironman has worked hard to create a lifestyle message that anyone with dreams and aspirations can share.

“Anything is Possible” is the current tagline and judging from the growth of the brand itself, I would have to heartily agree.

My earlier post, “Finding a cure to digital myopia” offered the thought that while people are consumed with keeping the pace with the introduction of new applications synonymous with Web 2.0, we stand in danger of missing the bigger picture.

The offline version of the same story started in the late 70’s when during the first gas crisis in the US, consumers learned how to pump their own fuel. In the name of cost and time savings, consumers embarked on an era of self-service that continues today.

Low cost delivery of customer support services was first made possible by automated voice response systems (IVR) and got better with web based applications. In the midst of all this “progress”, consumers nearly lost the ability to speak to a human being if that was their preference.  Try finding the “cancel account” contact information on web based services like Vonage for instance and you’ll see what I mean. Like it or not, you’re forced to go on a digital treasure hunt that does not pay off consistently.

Over the past few years, we’ve also learned to swipe a credit card, enter a pin, and check out our own groceries, office supplies and home improvement goodies. It seems that every step of progress we take to save time and move more quickly through a line comes with a learning curve.

George Carlin captured out plight in one of his NEW RULES FOR 2008 “I’m not the cashier!  By the time I look up from sliding my card, entering My PIN number, pressing  ‘Enter,’ verifying the amount, deciding, no, I don’t want Cash back, and pressing ‘Enter’ again, the kid who is supposed to be ringing me up is standing there eating my Almond Joy.”  I would only add, “Why do I have to pay full price when I am doing part of your work?”

Flying on JetBlue recently, the announcement was made that the airline had gone to a “cashless cabin” meaning that only plastic could be used to pay for drinks and sandwiches. We were also encouraged to participate in cleaning up cabin trash as a means to “keep air fares as low as possible.” Interesting how the airline has reduced consumer choice and shifted responsibility while spinning it like a step towards air travel nirvana.

How far our new self service society will progress is up for debate. I have been used to helping myself around most big box stores for a while as store associates are not only scarce but lightly trained. I can tell you that I don’t want to make my own sub at Quiznos or have to start checking stock on shoes at Sports Authority.

Owners of businesses that are high touch and offer personalized service should be encouraged. The more retailers shift their daily chores to customers, the greater the backlash by those hungering to be treated with some TLC.

The 64 dollar question is what motivates this trend in the first place. Retailers are pressed by operating costs and plagued by high employee turnover. Shifting tasks essential to the shopping experience to the customer helps with both issues, but does it serve consumer needs?  A by-product of the new paradigm will be less need for trained associates while the ones that remain are, by definition, less valued by the retailer. Bottom line: the longer this trend continues, the more frustrating the shopping experience will become.

Businesses that craft their in-store experience based on what consumers want will increasingly stand out from the crowd. Personal service is always in style and knowledgeable staff makes the shopping visit something to remember.

Consumers should step back from their silent acceptance of this self-service avalanche and ask themselves if they like the purchase experience better today or 5 years ago. Businesses should have a finely tuned ear poised to capture the responses and make changes in their front lines to recognize what consumers really want. The good listeners will benefit from higher store traffic, more sales, and highly satisfied customers.  >>>>  Bill Hanifin

Being a player in our new digital age is akin to being the catcher in a knife throwing act at the county fair. It’s exciting, and cool that you can keep up the pace, but will the end game work out in your favor?

Both games are fast paced and just a little dangerous. The pace of introduction of new web based applications, communities, and services never seems to let up and the merit badge of those “in the know” is expressed by their ability to dissect the latest phenom, master it, and then declare it nearly passé as they go on all night vigil waiting to coin the next great thing. The danger in playing is not physical, so you can relax on that count. The risk is that while we are chasing the rabbit in this blistering race, we can easily lose sight of why we are running so hard.

The rapid progression of Web 2.0 offerings MySpace, Facebook, You Tube, and Twitter are example enough. According to Business Week, the most well known social network in 2005 was Friendster. With multiple generations of social networking in play, it’s safe to say things have changed.

Marc Andreessen, of Mosaic and Netscape fame, is behind Ning, a platform that allows people to make up their own mini-MySpace. Speculation abounds that instead of one of the established social networking platforms dominating an industry consolidation, there may be a big bang in our digital future with the resulting fragmentation translating into everyone having their own micro-mini network.

While I do hear people asking questions about how this will play out, I don’t hear them asking the important question – what tangible benefits do I get from social networking and how much time do I have for it? In short, we should be looking for the drivers of desirable behaviors, rather than “twittering” about which glob of mud thrown against the wall will still be worth our time in two years.

For the majority of the connected population that still finds sleep useful, decisions will be made of how best to allocate our digital mind space. Life online still has competition with TV, music, movies, meals, work, and families. While it’s fun to have a profile on LinkedIn and pages on MySpace and Facebook, we will eventually make choices as to where we get the most benefit from time invested and pare down the number of engagements we maintain online.

Don’t misinterpret my take here. Social networking is an awesome concept and has benefits for its participants. I just find it interesting that the web started off with bulletin boards and forums and now envision that we could return full circle to an environment where people match up with others on increasingly granular subject matter. Where the commercial benefit resides is not yet clear, but so far it looks like the participants stand to receive greater benefit as they can short-cut rolodex networks and bring efficiency to their business and personal lives.

It may be that the next great thing will be found in the madness itself.

Just like Executive Book Summaries, which offers summaries of business books to save time and money for their subscribers, maybe a clearinghouse application that aggregates and filters multiple networked memberships will constitute the most hip home page that you can add to your browser.

Or, maybe it’s already out there and I just haven’t had the time to find it! >>> Bill Hanifin

Having a well planned and executed Customer Strategy should be the litmus test for the efficacy of today’s corporate marketing department. Think you can live without it? Then ask yourself why companies are putting more choice in consumer hands each day and striving to gain perspective on customer preferences via blogs and communities.

Whether a Loyalty program should be part of the Customer Strategy is continually up for debate. My old friends at Colloquy have long postulated that “Loyalty is a tie breaker”, citing distinct circumstances that loyalty can and cannot influence. The assumption is that industries which are highly competitive and are approaching commoditization can leverage a loyalty program to their advantage. Caution is encouraged as shortfalls in brand image, product or service quality, pricing, or even physical coverage of a geographic area will limit the impact of even the most compelling loyalty program.

I have been studying loyalty programs across vertical industries and have a pending research paper which will outline a new set of best practices for the business. Look out for the related white paper, coming soon. In the meantime, I had to share my experience with two big box retailers illustrating how pricing anomalies can constitute one of those hurdles that even a well done rewards program cannot clear.

A simple home project caused me to seek out a 25 foot section of CAT5e networking cable. Since I needed to buy some office supplies and like Worklife Rewards, I headed into Office Depot to knock off my to-do list. There I found two choices of cable, with Gray or Blue being my color choices. The $31.99 price point seemed high, but I trusted ODI to be true to their big box origins and tossed the cable into my cart.

The need for some way to neatly attach the cable to the wall led me to Home Depot as nothing of the sort was available at ODI. Within 30 minutes I was staring at the clips I needed and, OMG, the exact cable just purchased at a price of $14.98. Not only could I save big bucks, but the cable came in white, a much better choice for my application.

Giving Office Depot the benefit of the doubt, I hope that I stumbled onto a true exception. I can understand price variances on individual items within a reasonable range, but this was a shocker. I left with the suspicion that ODI must provide certain items as “convenience purchases” to their shoppers and exacts a premium price in return.

Whatever the explanation for this huge price differential, this was an un-welcome wakeup call to a loyal customer. I felt betrayed. Where Worklife Rewards had lulled me into a willingness to give the chain a broad share of my home and office spend, I now was wondering how much those points were really costing me.

All things being equal, Loyalty programs are supposed to break the tie. They are intended to redirect consumer attention from price to free program benefits. My experience snapped me out of my loyalty trance and rerouted my brain to more carefully evaluate pricing of any significant item. More importantly, my confidence in taking a relaxed approach to shopping in this store was shaken.

Transparency and trust are two essential elements of building long term loyalty. I hope that these items are not “discontinued merchandise” at Office Depot but only “temporarily out of stock” >>>> Bill Hanifin

“While not every business needs a loyalty or rewards program, every business does need a thoughtfully created and well executed Customer Strategy.” This snippet of dogma clipped from the Customer Growth LLC site is backed up by many examples in the marketplace. It emphasizes the importance of forming marketing strategy with your customer’s best interests at heart, and only then creating tactics for execution.

For years, Walmart has drawn the attention of every loyalty marketing business development executive who can fog a mirror, each pledging to “be the one” to convince the retailing behemoth that giving away points will drive customer loyalty. To date, Walmart has perfected the art of playing hard-to-get better than any prom queen in history.

You see, Walmart already has a loyalty program in place – it’s called the business model. Beginning with “Always Low Prices” and evolving to “Save money. Live better”, Walmart is all about optimizing its supply chain and delivering the benefits of low prices to its customers. The company website (www.walmart.com) even has a counter to show the “amount of money Wal-Mart saved American families since Jan. 1, 2008.” The graphic below was taken May 18, 2008 at 12:15pm ET. Check it again when you read this article and see how much the number has grown! Note: it is tiny, please click on it to enlarge it!

Tapping an example from the local retail market, every cyclist and triathlete depends heavily on their LBS, otherwise known as the Local Bike Shop. I don’t know the origins of the LBS descriptor and I’ve never heard of a Global, National, or Regional bike shop. Just take it to mean that LBS equates to your good old neighborhood bike shop where you place your trust for all your cycling needs.

For years, I frequented a shop that had a lot going for it. A convenient location, wide selection of product, and word of mouth recommendation from friends made it a no-brainer to be my LBS. Too bad that nearly every time I walked through the door I was greeted by “Need a new bike?” I am sure the owner treated this as a throw-away line of little consequence, but it just wore me down. Most people keep their bikes for years, not months, at a time and depend on the LBS for parts, service, and clothing in the meantime. In weak moments when I responded to the standard question by asking “what’s new?” the owner would point me toward the latest bike he had in stock. According to him, nearly everything in his inventory was perfect for me.

Numbed by the continual barrage of sales pitches, I visited a few competitors. My search landed me in a shop that didn’t even carry finished bikes. In fact they won’t sell you a bike without first measuring you on a test machine and then recommending a short list of frames that are compatible with your anatomical dimensions. I had suits tailored to fit before, but never a bike. The business model at the Racer’s Edge (www.theracersedge.net/) is optimal for any serious cyclist. Not only did I get the message that my interests came first, but the process of being fit to the right bike created a level of trust and respect for the staff that could not be replaced with a points program, no matter how good the offer.

It should be clear by now that winning and retaining customers can result from adoption of a unique business model that emphasizes price, service, quality as well as other factors. The finer distinction to make is that regardless of whether your business adopts a traditional loyalty program to reward customers, there is always value in collecting and leveraging customer data in order to improve the in-store experience and the economics of marketing spend.

In both of the examples cited here, there is room for improvement.

• With Walmart’s dedication to a low price strategy, it might be difficult to craft the mechanism to begin the collection of individual customer data and match it to transactions. It’s tough to pull off without creating some type of “club” and Walmart is likely to stick to its one-to-many philosophy.
• For high service, high touch businesses such as my favorite LBS, collecting customer data and preferences is much easier to embrace and the investment in such efforts is guaranteed to pay off handsomely.

Building a Customer Strategy for long term success is inextricably linked to your business model, brand, and objectives. Determining a strategy before applying tactics is the key to victory. To quote the military strategist, Sun Tzu, Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat”.

… Bill Hanifin

A Loyalty program can be to a retailer as snakeskin is to a reptile. The program is an external manifestation of the retailer’s identity (in this case, brand) which must evolve in response to growth and change within its environment (the business).

The analogy is intriguing but has limitations. Snakes shed their skin up to four times per year without having any say in the matter. Nature knows when refreshment is necessary and a new skin allows for growth as well as purging of parasites from the outer layer of the reptile. Not conforming to this pattern, retailers have been known to launch loyalty programs and leave them unattended for years.

Secondly, when a snake moults its skin, a new one is always created. There is no choice in the matter and the new skin is normally bigger, brighter, and moist with brilliance. The fate of a retailer’s loyalty program lies in the hands of the reigning executive team. Corporate acquisition, new directions in brand identity, or fundamental changes in the competitive landscape impact the perceived usefulness of the loyalty program and threatens its future existence.

The manner in which retailers or any customer facing organization manage changes to their loyalty programs has direct impact on their customer base. If you are tempted to think that loyalty doesn’t matter or that program saturation translates to consumer apathy, take note of the massive volume of emails received by the airlines each time they change their program rules. Believe me, consumers are paying attention.

Vitamin Shoppe doesn’t sell snakes or snake oil but caught my attention by the way they handled a tricky circumstance relating to their loyalty program. The company recently acquired Nutrition Depot, a homey chain of health food stores that had earned a strong following. As part of the purchase, Vitamin Shoppe inherited an existing rewards program and needed to manage customer expectations with care.

In Nutrition Depot’s VIP Rewards, customers could earn 1 point for every dollar spent in the store and received money off purchases when reaching specific thresholds. Point balances were reflected on purchase receipts and redemptions were transacted seamlessly at the point of sale. No website was needed for support and program communications were minimal. This very basic frequency program awarded regular shoppers and capitalized on POS messaging to keep expenses low.

As local stores were shuttered and “coming soon” signs were posted, customers raised questions on several fronts. Would loyal Nutrition Depot customers identify with the slicker, corporate feel of the Vitamin Shoppe stores? Would prices increase to support national advertising? How would Vitamin Shoppe handle point balances from VIP Rewards?

The company took a big first step in helping customers find the right answers to these questions through their intelligent and caring communications regarding their own loyalty program, Healthy Awards Club. A Welcome letter was sent to all customers in the Nutrition Depot program informing them of the acquisition and pointing out benefits of the Vitamin Shoppe chain. Customers were sent a coupon good for 20% off an entire purchase and were informed of their automatic enrollment in Healthy Awards Club. Membership cards were enclosed for wallet and key chain.

Best of all, Vitamin Shoppe made clear that “we will add the points you earned this year at Nutrition Depot to your Vitamin Shoppe Healthy Awards account” and emphasized that “every dollar you spend earns points towards FREE merchandise”. A minor criticism is the unclear messaging about point transfer. Would the total account balance be brought forward or just those “earned this year”. Regular readers of Loyalty Truth know how we detest the marketing “asterisk” and this phrase appears to bear strong resemblance.

Not all customers embrace change. Bigger is not always better and just because Corporate Finance determined that an acquisition to expand the footprint would be beneficial to shareholders does not ensure that customers will see it the same way. Change can stimulate unwanted reevaluation of purchase decisions and habits. How many times have you, as a consumer, witnessed an acquisition and wished for the “good old days” in the aftermath?

Loyalty programs are meant to be differentiating factors in a business. All things being equal, they should make a difference, turn a head, and encourage consumers to give up a little “share of preference” towards the sponsoring business.

In this case, Vitamin Shoppe elegantly and effectively communicated with the loyal Nutrition Depot customer base and set the tone for this group to give them a chance. The 20% off coupon will stimulate lots of visits to trial the new stores. The enclosed membership cards and promise to make good on points earned provides further assurance that Nutrition Depot customers will take a liking to the new owners. Most importantly, Vitamin Shoppe communicated with sincerity and created a foundation of trust through their highly positive message.

Nutrition Depot customers could have felt “snake bit” in this transition, but instead feel like they have been invited to be part of a new creation. My bet is that the letter generates a high response rate. What happens next will be dependent on the availability of familiar product, pricing, and service – those factors that Loyalty cannot overcome, just emphasize to make a difference…….Bill Hanifin

I have long maintained that two moments of truth define whether consumers will engage with a loyalty program, the exception being that some loyalty geeks like myself will sign up for anything just to see how it works!

The two-step process goes like this:

1. What’s in it for me? A quick read of the “take me”, direct mail or email invitation triggers the “loyalty calculator” that resides deep within the human brain. Nearly instantly, we register brand compatibility or lack thereof, and calculate the potential reward and recognition of the offer. The outcome dictates our willingness to invest additional time to enroll and engage.
2. What do I get? The value proposition having passed the initial test, consumer attention turns to rewards. We ask ourselves, “So, if I earn what I expect from this program, what can I get in exchange?” Easy understanding of reward options and their accessibility confirms our continued interest in the program offer.

Assuming these two tests are successfully passed, the ball is in the hands of the program sponsor, who is now in a position to win.

A similar mental process can be mapped to how consumers think about any advertising offer. I observed a digital bank sign the other day which rotated several messages beyond just time, date, and temperature. My attention was drawn to the invitation “Want a friendly hometown bank? Visit Us”.

Intrigued by the message and the implied high-touch service from this community bank, I was making the right hand turn into the parking lot only to see the follow up display. “Restrictions Apply….. Details Inside.”

Even allowing for substantial benefit of the doubt, I was put off by this bank’s take on full disclosure. Every Sales 101 course instructs that you keep the prospect’s eyes on the benefits before directing them to the fine print.

In an earlier post, I described the “asterisk” effect that plagues many marketers today. In this case, the bank might have just as well printed a large asterisk on this sign, symbolic of the shifting sands upon which this message was constructed.

If this pairing of digital messages were part of an invitation to a loyalty program, I would have read the value proposition and then passed the rest to the shredder once deflated by the second message. In this case, I just moved the shifter to reverse and headed home!

Bill Hanifin