Paula: Welcome to Let’s Talk Loyalty, an industry podcast for Loyalty Marketing Professionals.
Paula: I’m your host, Paula Thomas, and if you work in Loyalty Marketing, join me every week to learn the latest ideas from loyalty specialists around the world.
Paula: So today, I am delighted to be speaking to Laura Cagnacci, who is an account manager with a top loyalty marketing agency out of Italy.
Paula: Now, I first came across the work that Laura’s involved with because of my own work as a judge for the Loyalty Magazine Awards.
Paula: And Laura had put together a phenomenal presentation, and it really covered some really interesting insights within the field of sports loyalty.
Paula: And certainly as a judge, it wasn’t a category I expected to see because I think we all expect sports fans already to be loyal.
Paula: So for a company like the Advice Group where Laura works, to be delivering programs for a big professional football club like AS Roma really, really intrigued me.
Paula: And what I definitely know is it certainly intrigued all of the judges because the Advice Group and AS Roma ended up winning three different awards this year in the Loyalty Magazine Finals.
Paula: So first and foremost, I want to really welcome Laura Cagnacci to Let’s Talk Loyalty.
Laura: Hi Paula, thanks for having me here today.
Paula: Great, it’s lovely to have you on the line, Laura.
Paula: And I hope all is good in Italy.
Paula: I think you’re based in Turin, am I right?
Laura: In Turin, yes, of course we are.
Paula: Wonderful, wonderful.
Paula: Well, I’m going to, I suppose, first of all, tell listeners some of the clients that I’ve seen on your website, because I think what that does, Laura, is just explain the breadth of expertise that you’ve got.
Paula: And I was super impressed because, again, I’m not familiar with the Italian market, but brands like Coca-Cola and Lavazza Coffee and obviously AS Roma, as I’ve already mentioned, but also a big one called Chubb, which I was impressed to see in the B2B space because I’m always interested in loyalty marketing.
Paula: And that was described as the world’s largest publicly traded property and casualty insurer.
Paula: So, again, a different type of expertise.
Paula: And obviously the Advice Group is doing work across all different categories.
Laura: Yes, of course.
Laura: We normally help companies of different industries to enhance the redemption and performances of their activities.
Laura: And well, of course, we do take care about their loyalty programs, thanks to a proprietary platform, which analyzes all the data and coming from all the activated touch points.
Laura: And as a second step, our business intelligence assigns to user a personal index to plan personalized marketing activities and to enrich the profiles of the users involved in real time.
Laura: And by doing so, we start knowing deeper and deeper users.
Laura: And I think that really knowledge is power when you talk about loyalty.
Laura: And once you start knowing better your audience, of course, you can decide what’s the next step for you and your company to do in order to make a connection with your users and consumers or fans in sports.
Laura: And this process, of course, finally brings to that monetization as a consequence.
Laura: But most important of all is that once you have a connection, once you have an equal value exchange and an emotional connection, of course, you can ask more to your user and consumer.
Laura: And in fact, as a consequence of this, you can say that, for example, in sports, one fan treated in a loyalty program like this worth 30 normal fans.
Laura: And in a different industry, for example, in the insurance field, one loyalty user that you’ve treated through this process, through this specific process, was five normal users.
Laura: And so this is probably one of my best data that I’ve encountered during my work here in Advice Group.
Paula: Amazing, amazing.
Paula: And I guess I love that because we’re all about behavior change in loyalty, as you know.
Paula: And the really big interesting piece that I want to understand, first of all, is within the sporting sector that you’ve done so much work with AS Roma, as we’ve said.
Paula: So I know you’ve got algorithms, as many loyalty programs do.
Paula: And for me, the multiple of one standard fan is worth 30, sorry, a super fan is worth 30 standard fans, really does prove the value of treating them, as you said, completely differently and nurturing them along a journey from not being engaged all the way up to being advocates of a particular business.
Paula: So I guess the question I wanted to ask Laura at the very start is, AS Roma is I think a 92 year old professional football club in Rome.
Paula: And again, from my experience with football, people are quite loyal, maybe from childhood, in fact, and probably throughout the family.
Paula: So what was the idea behind building a loyalty program in a sporting industry where there’s already so much loyalty available?
Laura: Oh, when you have to consider that, when Roma got in contact with us, it was 2017 and it was right after the new GDPR probation.
Laura: And when they first met us, they had four main requests, which were not so fully linked to a loyalty program, because they wanted to bring users from social networks to a property channel.
Laura: They wanted to launch a unique engagement hub.
Laura: They want to, let’s say, build a fun behavior database and understand funds better.
Laura: So as you can anonymize these, it’s very far from a common loyalty program.
Laura: But this is the interesting part of my job, because we need to understand what is loyalty.
Laura: Because they probably have created a loyalty program.
Laura: They have taken their fans’ hands without knowing that they were creating a loyalty program.
Laura: You need to consider that you don’t become loyal to something, to a brand, to a club, just because they say that there is a loyalty program or because you subscribe something and you get a card, a fidelity card in return.
Laura: You become loyal to a brand only when you can establish a bit directional relationship when you, as a consumer, as a fan, feel that you are receiving back something and I’m not talking about money, I’m talking about something very different, something deeper and more profound.
Laura: I’m talking about an equal value exchange, about an emotional connection.
Laura: So I’m loyal to a brand which really knows me and understands my needs and that constantly operates to improve the services and products I’m interested to.
Laura: And if I knew that I’m sharing information, my personal information, with such a brand, well, I would probably be happy to do so because I know that by doing so I would receive something back, something I’m really interested in.
Laura: And this is what we consider an equal value exchange.
Laura: And how can we in Advice help companies to improve their loyalty programs?
Laura: How did we help Roma to do so?
Laura: Well, we did it by simply creating diverse paths that users may follow, each path being a different touch point, of course.
Laura: And analyzing in real time users’ response to the stimuli in order to react promptly with a dedicated one-to-one communication.
Laura: That’s what we did, and that’s what has worked so good with Roma.
Laura: Because we didn’t start thinking that we needed to create a loyalty program.
Laura: But the result of all our actions was the creation, the development of a good loyalty program.
Laura: And the best part of this is that users, is that fans didn’t even realize that they are participating to a loyalty program.
Paula: Yeah.
Paula: And I think actually what I really am hearing from you, Laura, is particularly, I suppose, it’s a very intelligent approach, strategically, I think, for the club to recognize, I suppose, that all of the engagement that was happening with the club was probably happening either, obviously, at the games, you know, in the real world, or on social media networks, where they really just didn’t have the direct connection with the customers in the way that a proprietary platform and one single hub would give them.
Paula: So I think it’s not every brand that has realized the importance of encouraging their customers or their fans to move with them into their own environment so that you’ve then got permission, as you said, with GDPO and everything else to create the emotional connection in whatever way you feel is appropriate, but where you have full access to communicate anytime, as much as you want or as little as you want, and not be dependent on a third party platform.
Laura: Yes, absolutely.
Laura: And you need to consider also that, of course, Roma has millions of fans on Facebook, on Twitter, on Instagram, but this is not a problem just related with them.
Laura: We have 90% of our customers have a huge fund base in Facebook, and they do not know how to talk with them.
Laura: So what we did, we started using Facebook as a leverage to bring new users on our portal.
Laura: And through our portal, connected with our business intelligence, we managed to start mapping the fan’s behavior that’s giving back to Roma enriched profiles that they can finally use to create one-to-one communication.
Laura: We opened up a communication channel and we allowed them for the first time to create a deeper relationship with fans from all over the world.
Laura: And I know this may look simple, but just think how much the companies of different industries spend just to create contents for third-party platforms.
Laura: That is almost wasting money since those party platforms don’t allow you to talk directly with your audience, to your followers.
Laura: And you can never get their emails, never.
Laura: And the only way for you to talk with them is to invest more money on Facebook, YouTube, Twitter.
Laura: So, well, let me be clear.
Laura: I’m not saying that we want to substitute Facebook or Instagram because of course it’s impossible.
Laura: And if I’m allowed, you need your fans and you need them on Facebook because they are important there and you can use them and you can, well, of course, use the platform whenever and however you want.
Laura: But what we did was to change the way that those platforms can be used.
Laura: And we gave to Roma and to many other customers of ours a way to improve the role of their investment on social.
Laura: They finally start converting.
Laura: This is what we did.
Paula: I love it.
Paula: So Laura, one of the things I really loved, certainly from reading the award entry, was the amount of touch points that you guys were able to tap into really from external sources.
Paula: So I suppose the loyalty programs I have worked on, we have obviously had full visibility of the customer’s behavior internally.
Paula: So whether it’s a billing system or any of our internal platforms, we’ve been able to build our loyalty program to track their behavior.
Paula: But actually, I think what you guys have done so well is you’ve been able to leverage the massive social media platforms where the fans have been traditionally hanging out and connecting with each other.
Paula: And you’ve been able to, first of all, track that behavior and score that behavior as you’ve talked about in terms of segmentation.
Paula: And again, direct it now internally into one hub in terms of recognition of behavior.
Paula: And then I think you also do stuff where you incentivize them to do various different behaviors again on those third party platforms.
Paula: Am I right in understanding that?
Laura: Yes, of course, you’re right.
Laura: Well, of course, each touch point can become a relevant source of data for us, whether it be Facebook, whether it be an e-commerce, or a physical event that you are creating for your fans or users.
Laura: And of course, all the information, all this information that we can retrieve from these activated touch points are funneled into our property platform, which can analyze all the data incoming.
Laura: And let’s say as a second step, with the help of our business intelligence, assigns the user a personal index.
Laura: That’s the CDI that I was talking about before.
Paula: And I’ll explain actually CBI, Laura, because I think you explained to me that’s the Customer Value Index, yes?
Laura: Yes, absolutely.
Laura: The FBI is an index, and it represents the fund’s value, which is based on the analysis of his behavior.
Laura: And it takes into account various variables, such as the frequency of the interaction with the brand, the social information regarding the user and the extent of his proactive participation in the activities proposed.
Laura: And the best part of this index is that it’s dynamic.
Laura: It has a dynamic value that rises or falls depending on each friend’s behavior over time.
Laura: And when all this is combined with the real-time user clustering, it allows to estimate the potential value of each user and of the entire database, thereby turning it into a tool offering useful information for marketing activities.
Laura: Just to make things clear, because I know it’s sometimes difficult to understand this, can we do an experiment together?
Laura: Because this is something that I already explained to you in the loyalty surgery, and sometimes it works better.
Laura: So if you allow me, I’m asking to you and to everyone here to do for one moment to Charles, the Prince of Wales, and to Ozzy Osbourne, the British heavy metal singer.
Paula: So we just have to think about Prince Charles and think about Ozzy Osbourne separately, yeah?
Laura: Correct.
Laura: And without thinking too deeply about it, we can say that these two people have nothing in common, right?
Laura: Sure.
Laura: Nor in their private lives, nor as a consumer.
Laura: But yeah, a traditional clustering process would lead a brand to consider them both within the same cluster.
Laura: And in fact, they are both British, born in the late 40s, they have two marriages, to their name, both are fathers.
Laura: So a traditional information analysis process leads to two totally different people being identified as belonging to the same cluster and consequently receiving the same commercial communication.
Laura: And this is a huge mistake.
Laura: In fact, just think to an insurance company that based on these parameters, activate the same type of insurance cover for both Prince Charles and Ozzy Osbourne.
Paula: Oh my God.
Laura: No, I know you missed that, but this example identifies a theory of low performing investment in terms of marketing communication.
Laura: And it would also expose the company to potential consumer dissatisfaction regarding the use of products, services that are not suitable for their needs.
Laura: And this is where resides the importance of our CBE because it identifies not just the standard, you know, monitoring value, frequency, recency.
Laura: We really understand how this specific user is behaving and we can do it because we do know its interaction with the activated touch points and each activated touch points has a different call to action.
Laura: As, for example, a specific price estate, so we do understand what the user is interested to.
Laura: So all this information at last brings you a specific value that will avoid this kind of mistakes, which can really be a risk and can bring a great damage to your company.
Paula: Yeah, it’s the ideal, I suppose, Laura, you’re right in terms of really mass personalization and getting into one-to-one customized communications and really to understand that Ozzy Osborne and Prince Charles have very different needs and very different interests.
Paula: So I think you’ve made a very good point, and I remember being amused when you spoke at the loyalty conference.
Paula: So you’re absolutely right.
Paula: Clustering is not good enough anymore, and we have the technology and you’ve proven the point.
Paula: And the point of investing in those types of relationships does produce the returns that you need on the investment because clearly it’s a complicated piece of work.
Paula: And again, I haven’t done any customer segmentation in the same detail that you’ve done.
Paula: But again, it’s why you won those three awards with the loyalty surgery.
Paula: So improving it over time.
Paula: So it must be very rewarding, actually.
Paula: You must really enjoy your job, do you?
Laura: Yes, I do.
Laura: I really love it because it changes continuously.
Laura: Because once you think you’ve known something, there is something that you may not know yet, and then you haven’t seen before.
Laura: And so I’m continuously improving myself.
Laura: I’m continuously learning new things, a new way to improve the business, my business, my customer’s business.
Laura: It’s really intriguing, you know.
Paula: Wonderful.
Paula: And I’ll come on to insurance maybe in a minute, Laura.
Paula: But just before we finish on AS Roma, can you just talk through, you know, what does the actual program look like?
Paula: Because I think when we were preparing for the call, you made the point that loyalty has nothing got to do with programs or cards.
Paula: It’s very much the emotional connection.
Paula: And you’ve already made the point as well, obviously, that the emotional connection exists more strongly in sporting sector than in other sectors.
Paula: So what did you build within this hub where fans are encouraged to go?
Paula: Like, what do they see when they get to the platform?
Laura: Oh, well, what we did was extremely simple because we have developed this new digital hub for the name Roma Unico Grande Amore, which was supposed to be the main concert point for fans and a bridge between the club and its fans.
Laura: And we started activating different campaigns connected with the club and the team activities.
Laura: It means that up to now, for example, through Roma Unico Grande Amore, we delivered more than 18 different types of campaigns with totally different culture actions and prizes.
Laura: And we had more than 70 different waves and we engaged more than 80,000 fans.
Laura: But the activation was really simple.
Laura: What we need is simply sometimes asking people to register themselves and try and win the final prize.
Laura: So as you can see here, the culture action was extremely linear, simple.
Laura: We asked nothing as buying something.
Laura: We were not interested at all to the purchasing part.
Laura: We’ve never asked anyone to buy something.
Laura: And this is quite strange, you know, because when you think about loyalty programs, normally you have to buy something.
Laura: You’ve got to insert the data that you can find in the receipt into a web portal.
Laura: But that’s nothing that you can do when you want to establish an emotional connection again.
Laura: By doing so, what we achieved was to really understand who we were talking to.
Laura: Because for each prize, we were talking to a different audience.
Laura: I mean, just two examples, which are quite clear.
Laura: We had a member-get-member activities in which we asked to people, to users, to register to Roma Unico Grande Amore and to share a specific code with four of their friends.
Laura: And if they were doing so, they were completing their team.
Laura: And once you’ve completed your team, you can participate to the final draw, which we’re assigning an experience with the team.
Laura: You were supposed to accompany the team on the field, to know each player.
Laura: You know, it was quite interesting.
Laura: The most amazing thing was finding out that the winner of this activity was an 18-years-old girl and her friends.
Laura: And the funniest thing was that the morning we called her to tell her that she had won, she was still in bed sleeping since she didn’t go to school that day.
Laura: And it was fun.
Laura: And it was surprising because we never thought that an 18-year-old girl and her friends can be so interested in this kind of activity.
Laura: So it’s not supposed to be dedicated to this kind of audience.
Laura: And it’s a continuous discovering of new things, of knowing your audience better.
Laura: And another…
Laura: Well, I want to…
Laura: Of course, this was kind of fun.
Laura: You know, talking with five 18-year-old girls were in love with football players and so on.
Laura: But we also had another case, which was quite emotional and touching, because in one specific activity, which was named On the Road with Us, which has assigned two tickets for one of Roma away match, another young woman won, a woman who has participated to the contest only because her younger sister was blind, was totally in love with the club, and because she wanted her to go to the match.
Laura: And of course, you know, when we first learned that the girl couldn’t see, well, we were worried, because it was hard for us to figure out how she could do it.
Laura: And so we have talked with her just to understand if she needed something in particular.
Laura: But while chatting with her, she told us that she was a huge fan of Roma, of the club, of each player.
Laura: She knew everyone.
Laura: And she went really often to the stadium because she loved it so much.
Laura: The noise and the atmosphere.
Laura: And she normally had her sister constantly updating her about what was happening on the field.
Laura: And since the girl was really a huge fan, the club arranged a beautiful surprise for her.
Laura: And they made her meet Francesca Totti, as well as the other members of the team.
Laura: And she was super happy and she kissed everyone.
Laura: Yeah, it’s really beautiful.
Laura: But it comes quite unexpected.
Laura: Who could ever think that, well, a blind girl can submit a contest like that?
Paula: Yeah.
Laura: Or, you know, it’s always a surprise.
Laura: And just doing this kind of activity, you can really know your audience.
Paula: Well, I think it’s a beautiful point, Laura, and you’ve made it so well.
Paula: I think, you know, we all, you know, typically, you know, we stereotype as much as we don’t want to or we don’t think we should.
Paula: But very much the idea of, you know, the importance of a sporting stadium and supporting a team, when we see somebody who can’t see, we would never, you know, realize how much passion perhaps that they have for the club.
Paula: And they would never have been in your mass segmentation we talked about earlier.
Paula: And I just love that you’re building those emotional connections.
Paula: And I obviously went through and saw exactly how the whole platform is built.
Paula: So I love the member get member piece.
Paula: I love the money can’t buy experiences, which of course any sporting team has unique access.
Paula: And I know there’s children that get to go on the field with their favorite players.
Paula: And then you can obviously involve the parents in the entries.
Paula: So I think you’ve built a very comprehensive program for AS Roma.
Paula: And I know you do it for other sectors as well, Laura.
Paula: So just before we finish up, I’d love to get just some of your insights in terms of anything you’ve learned from applying these kinds of insights, say in the insurance sector or any of the other kind of industries that you’ve worked on.
Laura: Well, in the insurance industry, we have the pleasure to work with most important Italian and European companies such as Chubb, which is the one that you’ve already said, Unipol Sapi, Agost, Condera, Itas.
Laura: And, you know, CI is something that can become really useful when your business relies entirely on consumers.
Laura: And for this reason, we work side by side with insurance and banking companies, facing daily problems related with knowledge of users’ habits and trying to reduce drastically the trend rate.
Laura: In this industry, you know, in this industry, we created marketing projects designed to know more about consumers, talking to them.
Laura: Sometimes, what you need to understand the problem that maybe an insurance company can face.
Laura: And as far as we know, one of the main problems that we have is that the insurance policies through financial companies that are the first point of contact with the end consumer.
Laura: And this kind of intermediate relationship that is formed between the company and the end consumer probably is the cause of the high customer churn rate.
Laura: And this is why, well, in the past, we have come up with a project that helps the insurance companies to get to know users better by getting personal information, interests, and habits in order to start up constant dialogue over time.
Laura: And we did this, inviting customers to take part to a simple contest simply by using their policy number.
Laura: So we started using a tool, which is called the insurance.
Laura: It’s an old way to communicate.
Laura: It’s an old tool.
Laura: It has nothing digital.
Laura: But we used it as a leverage to bring people into a portal.
Laura: And then, of course, was simply a first contest, but it was relevant.
Laura: What is relevant here is the kind of approach.
Laura: I mean, you can use whatever you want just to stimulate your audience curiosity.
Laura: And once you’ve opened the door, well, you’re already home, and the things you can start asking are really infinite.
Laura: So once you’ve created a breach, you can ask user to complete personal profiles, periodically benefit from published content on specific websites, so that you know the brand can really start educating its audience.
Laura: And you can also ask to respond to monthly surveys or to share contents through social medias, or I don’t know, you can ensure that any policies they have taken out remain active, or more importantly in this field, you can ask them to take out new policies, which are offered to them because you know them, and you know that they may be interested in that specific policies.
Laura: So this is why what we do is so important in this field.
Paula: And can I ask you, Laura, and we’ll wrap up then, but just the final question, how did the intermediates respond when you started to build direct relationships?
Paula: So, you know, insurance broking, you know, it’s a massive industry.
Paula: So, but you, as you said, you want to bypass the intermediate to build a relationship.
Paula: And I guess that’s in the interests of the broker because it makes it easier for the renewal.
Paula: And as you said, for cross-sell and upsell.
Paula: Did they react in a positive way or did you have any challenges with the brokers?
Laura: No, they reacted absolutely in a negative way.
Laura: And this is why we also developed specifically B2B programs.
Paula: Okay.
Laura: Which are created specifically to bring people back into, you know, the physical points where this intermediates work.
Laura: And this was another case of ours with a different, you know, customer.
Laura: But what we were trying to do is to develop a specific loan program which contains many co-marketing campaigns.
Laura: And in order to participate to each one of these co-marketing campaigns, for example, we made a co-marketing with Disney Pixar for the Coco film, do you know the Coco?
Laura: And another one with Sky, another one which were signing a motorcycle.
Laura: And just to participate to this contest, you, user, had to go physically inside the Intermediate company.
Laura: And they were able to give you back something.
Laura: And that something was the activator.
Laura: And that allowed users to participate to the contest.
Laura: So what we did is to announce the traffic inside the stores.
Laura: And this is what made everyone happy.
Laura: Because of course the company started to know users without the help of the Intermediate, but the Intermediate didn’t lose the business.
Paula: So that makes perfect sense, yeah.
Paula: So I can hear the B2B angle is equally as important, maybe if not more important, than the B2C angle.
Paula: If you’re starting to build direct relationships, they can feel threatened.
Paula: So it’s important to reassure them and recognize and reward their role in the whole process as well.
Laura: Yes, of course.
Laura: And then you have to consider also that we create specifically B2B programs which remunerate the best sellers.
Laura: So it’s a problem entirely dedicated to them, with prizes entirely dedicated to them, just to stimulate the first part of the contact with the user.
Paula: Wonderful.
Paula: So that’s all of my questions, Laura.
Paula: Was there anything else that you wanted to talk through today in terms of loyalty, in terms of any trends that you see coming up in the future that you’re excited about?
Paula: I’m sure you’re going to be making lots more entries into the awards again next year with lots of other lovely clients, which I hope to see.
Paula: But any other closing points from your side?
Laura: No, I want to just stress the concept that there is no loyalty unless you know your audience and unless you create an emotional connection with them.
Laura: So this is a really important part of my job and this is what we in Advice Group constantly think about.
Paula: Wonderful.
Paula: Well, I think you’ve spoken beautifully and Laura, thank you so much.
Paula: I know you were nervous about coming on the show today and English is not your first language.
Paula: But as I think I said to you, the whole purpose of this show is to bring global voices of loyalty together so that we can learn what has worked in Italy and make sure that we, you know, take those into our own ideas and campaigns.
Paula: And certainly, I think the whole sporting industry is going to be paying a lot more attention to what you’re doing with AS Roma.
Paula: So yeah, I just wanted to say a huge thank you for your time and your efforts and thanks from everyone at Let’s Talk Loyalty.
Laura: So Paula, thanks really to you.
Laura: It was a huge opportunity for me to be in here today.
Laura: And thanks a lot.
Paula: Okey dokey.
Paula: Bye bye.
Laura: Bye bye.
Laura: Bye.
Paula: Thanks so much for listening to this episode of Let’s Talk Loyalty.
Paula: If you’d like me to send you the latest show each week, simply sign up for the show newsletter on letstalkloyalty.com, and I’ll send you the latest episode to your inbox every Thursday.
Paula: Or just head to your favorite podcast platform.
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Paula: Of course, I’d love your feedback and reviews, and thanks again for supporting the show.
Paula: Thank you.
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