#279: Loyalty Insights, Successes and Trends with Epsilon

Ralph Browning recently joined our friends in Epsilon as their Business Development Director for the EMEA region.

Ralph has been building loyalty programs and propositions for over twenty years, and he joins me today to share some of the latest fascinating case studies and trends he’s seeing in our industry.

In our discussion, Ralph showcases some exciting ideas that have been launched recently by some of Epsilon’s clients. including the latest innovation in FMCG loyalty, with Kelloggs as one iconic industry leader that’s creating compelling new concepts to connect with their end customers.

Ralph also shares the strategies he believes are important to drive loyalty in 2022, and the increasing importance of connecting with consumers in meaningful ways to drive your brand loyalty.

Show Notes:

1.) Ralph Browning, Business Development Director EMEA

2.) Epsilon

Audio Transcript

Welcome to Let’s Talk Loyalty, an industry podcast for loyalty marketing professionals. 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.

This episode is sponsored by Epsilon. Today, I’m delighted to announce a unique opportunity for one lucky listener of Let’s Talk Loyalty to enjoy a complimentary workshop with the loyalty experts at Epsilon. One brand every month will have the chance for a unique, independent loyalty lab. A review of your loyalty program where Epsilon will share their expert ideas, how to drive your program’s performance to a whole new level. This workshop is a powerful way for you to measure and then increase the return on your investment in your loyalty program. So to apply, head over to letstalkloyalty.com/Epsilon and enter your details.

Hello and welcome to episode 279 featuring Ralph Browning, who recently joined our friends in Epsilon as their Business Development Director in the EMEA region. Ralph has been building loyalty programs and propositions for over 20 years. And he joins me today to share some of the latest, fascinating case studies and trends that he’s seeing in our industry. In our discussion, ralph showcases some exciting ideas that have been launched recently by some of Epsilon’s clients. For example, we discussed the latest innovation in FMCG loyalty, with Kellogg’s as one iconic industry leader, that’s creating compelling new concepts to connect with their end customers. Ralph also shares the strategies he believes are important to drive loyalty in 2022. And the increasing importance of connecting with customers in meaningful ways to drive your brand loyalty.

Paula: So Ralph, welcome to Let’s Talk Loyalty.

Ralph: Thank you for it. Nice to be here, looking forward to it.

Paula: It’s wonderful. Have you done a podcast before, Ralph?

Ralph: No, hopefully that won’t be too apparent, but no, I haven’t there.

Paula: Oh, okay. Well, it’s wonderful to have you, as you know, I’ve done some wonderful interviews with various different Epsilon people over the last couple of years, so fantastic to be working with you guys. Um, and let’s get started. So as you know, Ralph, first of all, I always love to get straight into understanding what you as a loyalty professional, uh, really, I suppose, admire in the world of loyalty marketing. So. Please do tell our listeners, what is your favorite loyalty program?

Ralph: Okay. So, um, as, as we discussed over previously, this a kinda like a difficult one, like, you know, choosing your favorite movie or your favorite song, whatever. So I thought about things like, uh, Boots Advantage, you know, Starbucks, Nike, I kind of like the, the North Face one is really kind of interesting, but I ended up landing on, um, yeah, Etihad Guest Program. Um, not only because it’s, I think it’s basically one of the best frequent program, um, frequent fly programs, um, out there, but because I was kind of very much involved in the creation and design the program way, way back where Etihad was only like a year or two old. And it had like about like half a dozen, a dozen aircraft. Um, so it made kind of very interesting cuz it was a sort of very rare opportunity to start with sort of like a blank piece of paper. Yeah. And build sort of like a better FFP from the ground up because we had. We, we, yeah, new, you know, challenger brand, you know, Emirates was already very well established. We had to kind of do something kind of new and kind of different. So, yeah, that’s very interesting. I mean, previous to that, I had worked in Europe with, um, uh, Skynet Airlines and BA and KLM, so I kind of knew the areas that, you know, and members didn’t really like, and wasn’t, weren’t really working. So that was a good opportunity to start with. Yeah. And also the client at the time, Peter Baumgartner ended up being CEO, he was headed loyalty that time. So he was, he was similar kind of, you know, that’s kinda like do something kind of really different. So, so the kind of things we liked about it, um, you know, it’s the whole idea of like the Etihad Guests at that time, the idea of calling somebody, a guest as opposed to a passenger was like new. Yeah. And it was all built around the kind of like the idea of the Etihad Airways was built around the whole idea of Arabic hospitality has been very much part of the brand so it’s a great example. I think of like, you know, a brand being very close to the program, being very close to the brand. So we talked about the guest, so there was, yeah, for the get go, there was the idea of like making sure that the cabin crew were where a member’s status and yeah, that was all part of the kind of passage manifest. So we kind of made do that. And then in terms of the actual program itself, you know, things which are kind of fairly common now, but things like, um, you know, um, no blackouts, um, you know, getting. You could redeem with one point, um, very flexible sort of expiry reward choice. So you could kinda like, you know, go there and go and use the reward shop. They were all based around things that we knew that kinda our members didn’t like, so it’s like great to do that. And I think, you know, the programs continue to evolve around that. I mean, even today, it’s quite interesting. I haven’t flown for a long time cause I haven’t been in the middle east. But I’m still getting emails saying, you know, you have these points about to expire. You wanna like get a mug or do you wanna do this, that, this, that, and the other, and the whole idea of kinda like, you know, rather than talking about breakage, but trying to get people to be very much involved in the program and taking advantage of it. So, yeah, that’s, that’s my favorite program.

Paula: Wonderful. Well, I can hear, first of all, I suppose, Ralph, your love of loyalty coming through in that kind of explanation. So I think it’s one thing to have a great understanding of what customers are asking for, but to have, as you said, uh, a total blank sheet of paper to have permission then to create something that actually the members will love. Um, I think it sounds like it gave you a love of our whole industry.

Ralph: Oh yeah. Well, yes. Yes. I mean, it was kind of, yeah, I don’t think that many as good opportunities I say was that, but yeah, it was kind of like really good to be able to kind of, you know, do something kind of different and, um, you know, change the way things are done. Let’s say like, you know, very much now, uh, a lot of those kind of stuff I’ve mentioned is kinda like now, everybody’s everybody, you know, talks about guests and, you know, a lot of things I didn’t like, cuz back in those days it was like you had like really high thresholds and you had these weird tables about how many points you got, um, based on where you traveled. And it was kind of quite complicated to work out what was going on and then, and then you’d find out was blockdown anyway, but now it’s all kind of very flexible and very transparent, which is, which is great.

Paula: For sure. Yeah. And I I’m sure, you know, most people listening would be very clear in terms of airline loyalty, and I guess hotel loyalty are perhaps some of the, the most mature sectors, I would say in terms of, you know, where these programs have originated from, you know, how much attention, how much investment they’ve got. And clearly they’re evolving hugely as well. But I think I’m most interested particularly now, Ralph, in the direction that you are going. I know you are relatively new on the business development side for Epsilon, but you mentioned a couple of very interesting sectors to me. Um, when we met last met in terms of, you know, starting for example, to go into say beauty brands, Um, huge retail, of course, I know airports and most excitingly, I guess, from my perspective FMCG. So I thought we would talk a bit about, I suppose, which of those sectors do you, I suppose, enjoy working with, see opportunities with and what kind of, I suppose, requirements are these kind of sectors coming to you with, um, to explore, I suppose, customer loyalty, right? Right.

Ralph: That’s. Huge question. huge question. Yeah. So, um, no particular order. I mean, I began work with FMCG on and off for kind of quite a while. Like things like Huggies Clubs back in the day, whatever. But now the interesting thing I think now is, um, the drive that FMCG companies have for more like first party data. Okay. To basically, um, build a direct relationship with a, with a customer now at one stage that was, you know, from operational perspective, you know, you had to kinda like print little codes inside boxes and, you know, input them manually, whatever. But, and that was sort of like big clunky, and now you can, till receipt scanning is like, you know, fantastic. It’s sophisticated these days and very simple to use using the mobile phone. Yeah. Kind of opens up, you know, huge opportunities. And, um, you know, one of the programs particularly admire is, and it’s not just because it’s an Epsilon one is, uh, the Kellogg’s Family Rewards and what is particularly interesting about that. Cause we, we, we’re running a kind of what we’d consider probably like a traditional program where you’d like, you know, you would collect points yeah. via, um, Codes within, inside, you know, boxes or whatever. Okay. And that was kind of really good and it was successful and it was attracting like, those people are interested in the coupon cutters that they say in the states. Sure. But there was an idea that kinda wanted to kind of change things and move things along. So it was like a very big strategic review and the importance of first party data was like identified as like a key objective. Okay. Um, you know, rather than, well, let’s just throw out a loyalty program. It’s say what actually we’re really, really trying to achieve here. And once you actually. We’re interested in first party data, then it means like we wanna have as many members as possible. Therefore we want to make it incredibly simple and easy and also have kind of benefits very quickly. So they, the basically they, the program is redesigned to basically based around tokens. Um, so you can earn tokens just by, by spending with also by liking, by referring a friend by doing gamification, whatever. And you only really need to get five in a month, which is relatively straightforward. Yeah. And from the, then you got with a monthly basis, you’ve got some kind of reward now that was entry to a sweep stake, or you could save up and get a little bit merchandise or you get a sort of deal in the discount from your, um, from partners, uh, in particular. So, um, like you get months for, uh, access to sort of like a streaming service or, you know, money off trying to say in a, in a, uh, a, pizzeria or that kind of stuff. So it wasn’t just about the, um, you know, buying like Kellogg’s food and the basic products. Yeah. The key thing area, but the idea is like, well, that wasn’t really, and that was an important thing obviously, but, and has been very successful in that kinda area, but it’s fundamental about getting like many people involved as possible, uh, and also learning enough about customers. So using the tool receipt stuff, Um, you can then see where, when people are buying what shops they’re buying from and also, uh, what else they’re buying as well. So it gives you a much more broader view. Mm-hmm to such an extent that now, you know, if you’re doing that kind of stuff as FMCG company, you can basically like use that data when you’re in discussion with, um, retailers are always, basically had to whip hand for many years. So I think that’s kinda like really interesting how you can sort of move that forward and still within all that maintain the, a model whereby you can save your points and you can get free merchandise as well. So I think that’s a lot of the programs we are talking about and discuss discussing design are bit more about that token basis. Mm-hmm and the instant gratification mm-hmm than they are about, you know, saving up for like six months to a year before you get like a big reward, which I think is. Interesting. And the, uh, and the, the way that gamification is kinda like exploded. Yeah. Is, and also moving away and moving away from sort of like, you know, cause people say, show me the money kind of thing. You know, it’s not just a game . So you mentioned earlier on about the, uh, beauty and sort of like fashion brands and cosmetic brands. So we are, you know, developing little kind of games, which says, you know, which makeup do you think the model looks best? Or what’s the best kind of like, you know, can you guess what it is? Can you guess what blusher, what kind of thing you would. What, what we’d wear particularly time with a day. Yeah. And that not only is like entertaining and entertaining when points, but also kind of, it’s very interesting in terms of, um, learning more about a customer mm-hmm and also the customer learning more about how the brand works and what, how the kind of products work. So it’s kind of, that’s a very, you know, so moving gamification to more now entertainment being like a real business driver. Um, yeah. Yeah. So that’s the interesting, interesting part of that. And also in that area is moving towards things like NFTs as an interesting little way of giving a privileged access and exclusivity. So we’re like, you know, so you can, on some, you can get ’em for like a few dollars these days, but the particular, if you, you know, if it’s a celebrity driven, um, cosmetic brand, shall we say, then you can actually get like pictures or you know, of the actual person and you are the only one who’s got it kind of thing. So I think that’s a nice, clever idea. And, and it’s almost like a lot of things. And it’s bit like, you know, back in the day, when you get signed photograph, when you joined a club or something, so it’s same thing, but using technology. So that’s.

Paula: Well, you’re, you’re absolutely right. Ralph. I have to say, just to go back to the Kellogg’s Rewards Program that you mentioned there, um, I’d realized, uh, just from our previous discussion that they’d moved away from points and with the, I suppose, clarity of understanding that you, that you shared, that they were super clear about the importance and value of first party data. I think that’s brilliant to, to see that they’ve actually gone a different direction. But what I really love actually that you mentioned is it’s not just purchase transactions. So you mentioned for example, referrals, um, it sounds like social media mentions. So the, the actual engagements or the qualifying behavior, let’s say that Kelloggs are, have identified and are rewarding, um, in order to give people whatever the rewards might be, but it’s not just, uh, buying Kellogg’s products by the sound of it.

Ralph: No, no, there was things like, you know, um, recipe ideas, following a recipe, checking a recipe, sending out what you can do with kind of like strange, uh, well, I mean, uh, I think Nutella are doing something quite interesting in that as well, about how many, I mean, it’s, that’s a different program, but how many different ways you can use new teller and how many different kind of recipes? And I mean, it kind of moves on to the whole community’s idea, which I think is all of interesting, very interesting, um, development it’s like, so rather than, you know, not tips and advice from the, um, the brand itself, but actually setting up forums so people can discuss their, have a love of a brand. And therefore you can like drag on, you know, get out the advocates to really love a brand, whatever. Uh, yeah. And also issues around a brand in terms of like, if there’s a, a. Um, not a problem necessarily, but you know, for example, if you talk about skincare, people have different skincare issues and then you can set up a group of people, likeminded individuals to discuss how they found a solution. It wouldn’t, so it’s not really like tied exactly to the brand. It’s, it’s kind of, I kind look at it like, you know, you, you have a village hall, you, you set up a, a tier in the corner and find a few biscuits, whatever. And let people just talk and do their own stuff in there. Um, and that’s in terms of like an engagement device, which I think engagement, emotional engagement is like the really key thing I think at loyalty, which is a lot of brands struggle with, cuz it’s not quite as easy as some of the other areas. For sure. And other communities are very strictly. So again, if you’ve got like a celebrity brand or, or a brand, which is built around a particular, lifestyle way of, you know, like a love of, you know, Italy, shall we say, or particularly kind of lifestyle. I think like North Face do something, some great stuff about you can earn points just for sort of like showing the fact you’re on top of like, yeah, Yosemite Valley. And if you kinda like log in on the top of some massive cliff cliff face, you get points or stuff again, it’s I dunno. I think how many people wear North Face do that kind of stuff, but it kind of reinforces the brand that’s been adventurous and it’s like really cool, little, like little. Yeah. So I think that’s that community. So I think, yeah, the clever gamification and like the community side is where the, I think programs are, uh, definitely moving in that direction. That’s kind of really interesting way of doing it.

Paula: I, I definitely agree, Ralph. Um, the only one that I’ve really seen doing it well, and if you’ve any others to add, I would definitely be intrigued to hear. Um, but I do feel it’s quite early in that community space. Yes. But the one that I do know was, was building it was Ikea. Um, so again, this was kind of a couple of years ago, you know, we, we had, um, the Ikea loyalty, uh, manager on the show and I, I, I agree with your insight, Ralph, in that it’s not just, you know, wanting to interact with the brand or dare I say it, you know, the, the member responding back, which as we all know was the, the holy grail of social media. Yeah. But this idea of facilitating a discussion between people who have similar interests, similar ideas, similar needs. And I think we talked about, you know, mother and baby clubs, for example. Yeah. You know, I mean, it’s, it’s, it’s clear, like to me, as a podcaster, Ralph, what I do is I find myself, you know, talking to people clearly I wouldn’t have ever met, but because we’re all podcasters we’re in Facebook groups, for example, And we’re, we’re answering each other’s issues and problems purely because we understand each other. And I do think that that’s where loyalty programs need to go in terms of the, the overall direction, you know, and building that emotional loyalty that you talked about.

Ralph: Yeah. Cause I think, um, an interesting example, um, Walgreens in the U.S, which again is a kind of, was it, you know, standard, you know, you, you buy pharmaceutical products or whatever, whatever, and you are you in points, but they’ve set up, like communities, the obvi, you know, there’s a beauty community, but there’s also stuff about, you know, wellness and fitness. And, but not for like, you know, gym bunnies or whatever, or like buffet, but like, how do you, you know, over fifties sort of group. And I think, again, people are, if you’re talking to people who think you’re your friend or a bit, like you, you’re more likely to open up and discuss things and then you’re kind of engage and then it’s have a little bit of product placement in there, shall we say? But yeah. And then you moved on to things like dealing with Alzheimer’s and, you know, expanding out into, yeah. And then they kind of pull it back into loyalty things. So therefore, you know, if you, you know, eat, you get certain kind of diet products, you earn extra points, or if you commit to doing certain like walks or certain kinda like amount of like, you know, walking hun, you know, whatever is 10,000 paces a day or something, you’re an additional point. So it kind of makes the brand, not something you go there to kinda get new friend from or buy or something it brings. It means it’s more important part of your. And it’s not the brand and the brand can set that up. And it’s sort of like, you know, it’s like a flywheel it’s sort of, like, you can see you go into these sites and you can see people chatting and they’ve got, you’ve got advocates in there and who really love the brand and they, but it’s not, it’s not that commercial. It’s a bit more subtle, I think. And that’s helps with the engagement you say very much. And I think, you know, mothers and babies was in, you know, and students was another one, but I think it’s kind of moving out even further. And I think certain supermarkets are moving into like, you know, food. Yeah. What vegetables, veganism, you know, you know, those communities which are sort of like hosted. Um, and not just the obvious subjects. So we say.

Paula: Well, that’s true. And I guess, you know, given that there’s so many of us now just living our lives online, you know, there is, you know, going to be, um, enough of scale, I would say within practically any one of those communities. So what might start as a niche, you know, for example, vegetarianism or veganism might be a tiny interest from a grocer’s perspective initially, but definitely, you know, as those kind of trends grow. Those communities then kind of, I think they educate each other and also yes. Yeah. You know, it is so it’s education and, but it’s also interesting, I think for loyalty professionals, Ralph, exactly what you’re kind of identifying. I actually did have Boots on the show as well recently. And of course, an iconic, you know, UK brand, same sector as Walgreens, um, and Boots is investing significantly in content, which I can hear that Walgreens are doing as well. Yeah. So, you know, to help people understand whether it’s, you know, illness or wellness, I guess. You know, there’s both sides of the spectrum, but I do love that there are more and more, you know, programs that are starting to say, actually, no, we do need more of that depth in order to create again, emotional loyalty. It’s not just the purchase transaction. That’s gonna keep people coming into our stores.

Ralph: Yeah, exactly. And the odd thing is kinda like going full circles. Like very good at actually inquiring new customers because the community becomes a bit, the community is not directly related to like buying something. So friends can say, you can join, join the Walgreens, blah, blah, or their key, whatever. And then you kind of think, oh, well this just came. And then you, you know, back with you, don’t join the, spend, join the program during the community. You kinda have reversal thing. And when you go down there, go down the other, way’s like, very interesting way of doing it. And as you point you mentioned their content, it was, you know, one was one of the, as a loyal, you know, loyalty program, practitioners, particularly certain brands who’ve got you. We all know that, you know, something, I can remember, like 67% brands could disappear and nobody would know. And they’re very important to us because we cause we’re working with them. But yet, so if’s a low interest brand or, um, a low, uh, very low frequency. Then it’s diff you know, where’s the content come from. Um, and I think, so jumped around a bit, like for example, Procter and Gamble, they have pro you know, nobody’s really that excited about cleaning product server, but they then link their program to safe water. Yeah, causal marketing. So I think so if you spend basically buy Procter and Gamble products, they’re all the same contribution that goes towards like water. So I think that, you know, so, so I’m doing a good thing as well as I’m buying some stuff. And I think it’s like a very clever idea, you know, to bring a partner on board like that and not just, I mean, they will, we all, you can donate your points to charity. That’s, that’s a nice thing to do, but they’ve kind of made it part and parcel of this program, which I think is a clever idea to actually put part, put a partner right in the middle of everything you’re doing.

Paula: But also one that align, aligns with their own products, purpose, you know, as you said. Yeah. So, so there is, you know, that clarity and consistency that I think members, they probably really get it. Then when there is something that actually is, is so complimentary, that makes such logical sense, you know, because as you said, cleaning products with the best one in the world, even if you give me, you know, a load of points, we all know there is a certain amount of, let’s say fatigue around pure point space programs. So I do think whether it’s charity or community or content, all the C’s are coming out. Now I can I can see a PowerPoint emerging, but it sounds like that’s what you’re hearing from your clients as well, that they realize that the loyalty program, not just a points engine, it needs to be more intelligent. And I, I guess, more connected with the consumer’s lifestyle in a, in a bigger way.

Ralph: Yes. Cause I think the one of, the problems I think with, with, with many loyalty programs, there’s people, it’s a bit of a tick box thing. So we’ll kinda like, you know, you spend a buck or a euro or a pound or whatever, and you get points and you get 10, you get something in return and you kind of throw it out there. And expect it to really work, but it’s not really that connected. It’s difficult to kinda get the content, the engagement in there, if you just that’s all there is. Yeah. And also doesn’t really link in with the brand. I say earlier on it’s kind, nothing I bang on about a bit too much is, you know, the Etihad Guest Program. It’s all about being a guest, you mentioned Boots. I Boots, you know, back in the, back in the day, it was kinda like proposition was buy lots of, you know, buy lots of like boring stuff, you know, stuff you have to buy and then treat yourself, with aromatherapy or some nice, you know, like something for the bath or something or some. So that was that, that was the kind of proposition then, you know, Tesco every little bit helps, and that P&G. So the idea of having like a, like a, like a, a customer proposition, which is linked to the brand and you can build things out of rather, oh, it’s just a point program. Yeah. And, but say put the points program, like it’s kind of quite simple. And then people say it’s not really working, nobody’s joining or they’re joining and they’re not doing anything. Yeah. You gotta, you know, the whole, if you build it, they will come. Isn’t the case, you know, you’ve gotta really, yeah. You can build it. You can get the tech there, you can do the financial modeling, but you really need to work hard. Yeah. Whether it’s through gamifications or putting a cause in there, or have a really strong point of view or community or something, you know, it’s got something exciting just to kind of keep it sort of going on.

Paula: Yeah, but yeah, no, I, I definitely agree. And I remember again, running programs, myself, Ralph, as you know, I was kind of more in the telecom side, but, you know, there was, there was so much kind of excitement when we had the TV campaigns, when it was above the line, when the board was really kind of prioritizing loyalty as the, the big, you know, dare I say it, you know, panacea, um, for all kind of issues in terms of churn. So the solution, you know, at certain times in the evolution of the company. Would be seen as loyalty is going to really, make a dramatic difference to the business, but then after two or three years, for example, maybe the engagement would be dropping off or the, you know, awareness or whatever.

And it was always difficult for, you know, me certainly as a loyalty professional to keep the, the senior leadership team, you know, believing in the power of loyalty and perhaps, you know, we maybe weren’t evolving the program enough, you know, I do think there is a cycle that programs go through, um, and maybe it’s directly related to the, uh, the advertising spend. But would you say that that’s your experience as well with your kind of clients?

Ralph: Yeah. Yes. It’s interesting. You mentioned, cause I telecoms, I work with them. So, Belgacom in Belgium and uh, few top brands in the, in the Middle East and, and a lot of, and a lot of them, you were kinda like, you get money off, you’d get money off your, um, tariff, shall we say, or get free air time, which is sort of like great for, you know, for the low level kind of spenders, but it wasn’t really that engaging. So you had like introducing partner awards around like, you know, travel or getting people a little bit more excited around that introducing partner earn shops and that kind of stuff. So it’s like, make it more important. Cause most people, you know, you maybe have an Apple phone or when Nokia, whatever it was back in the day. Yeah. But who your carrier is, was not really that I’m sure it’s not really that excite as long as it doesn’t go wrong. Um, you know, as long as you get bad, you know, uh, some, you know, as long as it works and you don’t get some problem with billing, you don’t really care that much. So it’s that, you know, totally trying get people engaged and exciting, excited in what you are in what you’re doing.

Paula: In utilities particularly. You’re absolutely right. Yeah. And I, I remember you told me a wonderful, um, I mean, it seems small, but it obviously had a great impact, ralph, on you. Um, and this was your Home Base Reward.

Um, oh, yes, yes. .

Yeah. So.

Ralph: Yeah, so back in the day I worked at home. Yeah. Home base spend and save. And I used to do a lot of like ray poor quality DIY as my wife used to say . Um, but I still, uh, enthusiastic, but yeah. Then one of the rewards as I, um, I actually got like a, a plant, a rubber plant, a rubber, yeah, a plant. So it’s like a rubber tree sort of thing, which is only like, eight, I can’t find it here now. So about like about 12, 12 inches high, shall we say? Yeah. But I’ve always had that ever since. And that was like about God know how many years ago. Um, that’s a reward growing and growing and it’s almost, there was a as a reminder. Um, and as I talked about clients, who’s that story. Cause like, you know, you forget about a cash back. But you do remember like a dream holiday again? Well, the airlines had the great, you know, you could say you, your free points, you had that fantastic weekend break. You should live in your mind forever. But if you’re just a sort cash back or we talked about like free air time, it’s kind of nice, but not really that exciting, but if you gonna have something that sits there. Yes. Um, you know, if you, I just say, if you’ve got yeah. And small you a small apple tree, you know, like it looks like a branch and then 20 years later, it’s like a massive tree it’s, you know, that kind of idea. If you can kind of have that loyalty as a constant reminder of what you actually got out of a program.

Totally totally money. Yeah. You can’t buy that. Yeah, well,

Paula: exactly. Yes. And you’re clearly very, you know, fond of that plant the fact that it has survived in your house for so many years, it’s actually shocking. It’s actually massive survive but, but the only one, it has ,

but, but you still have that incredible memory of home base. You know, being loyal and giving you that, you know, burn reward, um, as you said, it was probably worth about 8 quid. I mean, you may or may not have bought something like that, but to have something with that level of longevity, I think is amazing. Um, so well done Home Base will give them, uh, full marks on that one. Um, and yeah, I suppose from my, I suppose, experience with. I used to always focus on what I would call like the, you know, the ones that couldn’t fail. So to me it was coffee and chocolate . So when, whenever we had budget, I would go out and negotiate, you know, bulk purchase discounts with, you know, whatever the, the nationwide coffee chain was and, uh, set up whatever kind of, you know, single use codes, for example, and send all our members off and just say, look, go and have a coffee on us. So, I think that’s a similar thing where, you know, we can all buy ourselves a cup of coffee, but actually when it’s gifted to you that suddenly, and I can tell you Ralph, and I’m sure you’ve seen it as well. And I’m sure you know, all of your clients have seen it as you educate the members about how easy it is to get a reward like that to your point earlier about, you know, breakage. You know, being very much a thing of the past and actually prioritizing letting the member enjoy what they’ve earned. I think that’s a hugely important trend. Yeah. And continuing to grow.

Ralph: Yeah. Yeah. I mean, it was things like, yeah. Starbucks doing very well. It was kinda like surprised and delight. Just give yourself a free bun or something. Again, it costs some overly, but it’s, it’s a nice sort. Oh, that’s kind of like, you know, it’s a thought that counts, I think is the, exactly is the point. And also the, I mean, there used to be a kind of like idea that if redeemed them, people would like. Would drop out of a program, you know, zone of defection, cause they didn’t have any, um, points in there, but I don’t, if you discovered, found that, but we always found that after people redeemed, they were more loyal, they’re much more excited, more wanted to get back on there so sooner you can get somebody to get something out of a program, even if it’s a, you know, money off a pizza or something or two for one, if you get that in there in the, in the first like hundred days. Yeah. You got them, you know, got them for, for life rather than, you know, eventually people forget they’re a member of a program and what the points are for and yeah. What we’re trying to get.

Paula: Totally. Totally. No, you’re right. Ralph. I have only seen, um, more loyal behavior, post redemption. And I do remember, for example, looking at a, a, a website for one of the big global convenience retailers, for example, and in the franchise section, I was doing a bit of research and they were literally saying that their rewards program, as soon as there was a redemption. The the next basket spend went up on average 33%, which I know, you know, convenience retail, the spend is probably slightly smaller than obviously a grocery retailer, but the fact that they had measured that and proved that the value of the basket immediately went up. Yeah. Because. I think you’ve closed the loop you’ve created trust. So I just think it’s extremely important.

Ralph: Yeah. Cause I think to that point, it’s a bit like when you give away free, you know, join a program and you get a thousand points or a hundred points or 10 points, nobody really knows what they are. Totally. You need to really find out what’s going on. I mean, one thing we’re doing, quite trying to experiment with quite a lot. It’s using a more behavioral economics and the idea like fear of missing out. And if you can make people feel as if they own something. So one of the aims for example, is asking people what reward their aim say, telecom program, whatever, what reward are you looking for? You know, what particular piece of merchandise or whatever, and then kind of say, you know, that reward will be yours and current spend within 12 months. Yeah. So give people the idea that they’ve already got it. Okay. And then you can like give them opportunities to say, well, if you bought this or did that, that can, you could have that eight months. You did that in six months. And then also as a, you know, take it away for missing out. It’s kinda like, oh, you’ve stopped spending. So it’s now gonna be 18 months or something, but yeah, so like the carrot and a stick, but make the program more than you ever had. Say you are halfway there to that weekend break or that fantastic, you know, And I’m toaster. I’m just looking, whatever your, whatever your heart’s desire is, but to make that thing yours, you’ve got it then is gonna be, you know, you’ll have that for your holiday, you know, whatever you camera will be there for this summer, but, and it’s yours. And then, but if you take it away, then people feel, you know, that’s so using those kind of like clever approaches to get people more engaged and feelings, if they’re they’re, they, as you say, they’ve, they actually own it already. Um, and they, rather than randomly, oh, I’ve got a hundred, you know, it’s all a bit tragic when I overhear people saying, you know, oh yeah, I’m a member of the blah blah program. I’ve got a million points, but I dunno what to do with them. You know, it makes me, it’s kinda you, the poor money that’s been wasted on that, you know, for sure. Um, It hasn’t changed their behavior. And I don’t know what it’s for, but I mean, that’s kind of terrible. Um,

Paula: It’s shocking and disappointing and definitely happens. And as the loyalty industry gets more competitive, Ralph it’s, there’s no doubt that, you know, the, the number of programs we join obviously continues to increase the number of programs we engage with, continues to decrease. So I think there’s, um, yeah, a wide think gap.

Ralph: Yeah. In some ways, the way. Programs are much more easy to join these days. I mean, you kind of go to a yeah. Um, a shop and people say, can I be a mobile number? Yes. Okay. And then suddenly remember a program. Which is easy, it’s great. Cause that was always a problem. We had to fill in a form and wait for it to come to the post or whatever. But if you don’t actually know where that program about, and then I remember, so it’s very, yeah, it’s subtle, so make it easy, but make them at least know what’s going on, you know, like, so you join a program, but you know, your chance to win or something like this, or get freebie if you just read this thing or do this little game or give us a little piece of information, just so you are aware of what’s kind of going on. So kind of that. The whole communication of what the benefits of a program are. And that first a hundred days will say, I think that’s a, you know, totally. Yeah. A lot. Yeah. So it just, you know, you might have some fantastic tech and have a really generous program, which maybe is like, you know, 5% or something, but unless the pro. The member knows why they’re remember when they’re gonna get off. It’s all unfortunately wasted.

Paula: Well, for sure. Yeah. And I’ve often said before in this show as well, Ralph, that unless your members are actively telling each other about your program, then actually it’s probably going to be unsustainable because I dunno about you. Yeah. But in my career, you know, advertising is just so expensive that unless your members are doing the word of mouthpiece for you, it’s just, it’s just extremely difficult. Like, and, and, you know, the likes of Seth Godin, another kind of marketing thought leaders would say the same. Like if you’re, if you’re launching something, you do need to do the customer research and actually go and see do they like it enough to tell a couple of people about it? Because if they don’t, I just think it’s, it’s just extremely difficult.

Ralph: Yeah. It’s once again. Going back with saying everyone about the community idea. It’s like, yeah, I did this thing. Oh, what do you hear about this? When I was a member of this program? And I found out about this, you know? Yeah. And they joined it that way. Cause it’s mixed a bit more around saying, you know, oh, I got, you know, five points cause I bought X YZ. So I think I did this fantastic game or this is really, you know, that, all that. So people start talking a little bit more about the program as we’re connected to the brand, um, is a very. Yes. Great idea. Hence, hence the whole, you know, join the pro like, um, you mentioned Kellogg’s before, like you, if you get somebody else to join the program and they spend that’s a token, you know, if you get yeah, amazing. It gets that kind of idea. So get another. Cause once you’ve got customers to join and then you, you know, you can monitorize that idea, monetize that quite quickly, cuz then you’ve got the first party data, then you could communicate direct. Yeah. And getting another member ad and then you can move towards, you know, advocacy and you know, brand ambassadors.

Paula: Yes. Yes. Advocacy is a good word. I was thinking bragging rights, which I think is the same thing. Yeah. But absolutely. I think as humans, actually, first of all, we want other people to get benefits. If we thought it was amazing, we definitely genuinely want other people to enjoy. So I think there’s a human instinct to share good news or good ideas or fun stuffs, you know, doesn’t have to be like an actual reward. It can just be fun. So, um, yeah, I think the more focus we can put on word of mouth, um, and I do remember actually just another example. It was Tony hsieh, um, the CEO of Zappos who unfortunately passed away very young, but, um, a brilliant leader by all accounts and Zappos, you know, an incredible business. But he used to say that actually, you know, you know, your acquisition cost was like a tax you had to pay if you weren’t getting enough advocacy or referrals that actually the business should be self-sustaining to your point, Ralph, about community, you know, people should be excited enough about it to tell each other. Um, so that was one very successful again, as I said, a wonderful guy, uh, really was a big fan of his, but yeah, amazing. The way loyalty’s evolving over the years.

Ralph: Yes. Yeah. Yeah. I mean the whole, like, yeah, you could talk about, you know, refer a friend and you get some kind of points, but now it’s, you know, more sophisticated getting back to the beauty brands. It’s kinda, it’s one of the gamification thing is asking questions, which basically runs cut long story short ends up where maybe somebody’s got an, an issue, have you got, it’s all like, have you got a friend? So it’s not something for you, but, and then it’s kinda like, oh, you could maybe tell them about this kind of product or introduce them and we’ll send them a free, send them a free sample, which is nice a round. Yeah. Really clever, nice way of getting them. Cuz you wouldn’t say yeah, got, I don’t need that. What do I want that for? But if you kind of put it in a very clever, way and that people think I’m earning of two points I’ve been engaging and I’m also helping somebody. Yes. And it’s not cost them anything. And it’s like a really nice gift. I’ve got your gift for the yeah. Yeah. Well, you know, you can, it’s a very nice work.

Paula: I like that. Absolutely. Yes, somebody’s got, I dunno what, yeah. Some skincare issue or whatever, and you know about it, they’re upset about it and you see something that could help them, of course, you’d love to send them a sample, it’s super, super nice. Well, my goodness. So, so many things going on, I think, um, we talked about FMCG Ralph and you know, the Kellogg’s family rewards really exciting. And please, God, we’ll get them on the show at some point. I know they are a client of Epsilon as our Walgreens. So you guys are doing some incredibly exciting work and really big projects. So what else would you say, uh, you know, you’re working on, you know, in terms of, you know, across the EMEA region, what other kind of sectors of opportunity or trends are you seeing?

Ralph: Uh, Ooh, right? Yeah. So, um, the whole, you know, post COVID getting people back onto planes, ah, is an interesting area. The air, I mean like a lot of things we, and, you know, Heathrow Rewards has been around for a while and Shanghai and Singapore do very good, you know, programs with airports, but I’ve found, you know, we’re found a lot more sort of interest in that kind of area, not just in Europe, but also out in Asia Pacific. Oh. As to getting people bigger. Yeah. The new emphasis cause business travelers aren’t coming back. So we then kind of like, they’ve gotta focus more on the, the frequent leisure travelers who have a, different about airport loyalty. It’s quite interesting. You’re like, cuz like we’re in a shopping mall where most of your, most of your footfall doesn’t ever go into a shop kind of thing. Yeah. Uh, and a frequent travelers and I’m sure you you’re the same when you were travel. When you travel a lot, you kinda like time it down. So you rush from the gate, you know, you basically get there and, but if you. So a lot of people who haven’t been traveling a lot and they haven’t really, and have lost the intra and they’ve, they’re maybe even buying online even more now. So going to a shop is quite unusual for them full stop. So to get them to kind of think, think airport think shopping. Yeah. Or think airport, and relax and get there early and kind of like, you know, have something to eat and enjoy yourself there. Yeah. Um, is a, is a new thing. Um, which people are like talking a lot more cause see your, your frequent leisurer traveler is more likely to have more dwell time and not quite as rushed through whatever. So they’ve got more opportunities to buy things. So, and they’ll try and make the experience a little bit more exciting, I mentioned gamification, if you remember the program, you know, there’s the, um, you know, check in, slow through security, et cetera, whatever. So you ping out a game immediately using apps and the location dividers. So do this kind of game, keep them entertained, and then the prize is like some money, awful freebie on the other side. So do it instantly. Yeah. Um, throw in the privileges, you know, um, of, uh, fast, passport control or fast through security, which is a bit the airline. I mean, Etihad back in the day trail, cuz you can check in quickly, can get on the plane quickly, but it’s that middle bit, which is kind of quite problematic. Sure. Um, so kind of keep people engaged in the program in that, you know, so don’t don’t, if you go on a holiday don’t shop in the, your local shop or Amazon, whatever, but do something at the airport and just reminding people that that’s that’s available. So that’s a new area. And then moving on to sort of the, own the destination idea. So if you are, the airport, is the first, not logical, first, the first airport is the first thing you turn up in, um, when you’re a land anywhere. Sure. So therefore it’s your gateway. So there’s opportunities there to kind of like have privileges or discounts or something from all the, at the sites, the attractions, the hotels, etc. that kind of stuff. So, so that’s a kind of interesting area. I think air, you know, airports are kind looking again because I think, you know, necessity is a mother of invention, when something, you know, something breaks like COVID whatever, then you kind do something different. And I think airlines are looking at, um, more as well, in terms of, you know, what to do for leisure, what can we do for the leisure traveler? Um, yeah. Which it didn’t bother to do quite so much, um, before. So I think, yeah, so that, that’s, that’s an interesting area, which we’re, um, looking at another one is the, um, fuel again, it’s all kinda like, um, about changing that things are happening. So fuel, why, people are increasingly getting electric cars. Why, what do we, what’s the for call all about how do we, yeah. Deeply got fast charging. People are gonna be there for 15 minutes. What can we do with a loyalty thing to make that 15 minutes more valuable? How can we kind of get people to look at, you know? Yes. Four quarts are kind of, um, differently, that’s another, quite an exciting sort of area. And, um, yeah. And the overall, I mean, a lot of companies just looking more first party data, the end of cookies, how are we gonna, you know, direct relationship? You know, it’s just funnily enough, almost like going full circle because I think as we mentioned the other day, I mean the original idea frequent fly programs started because the travel agent owned the, the customer. So the value exchange, which Epsilon very strong and the value exchange is, you know, you raise your hand and tell me about you and what you are doing and your spend, and we’ll give you something in return, be it something free or a special kind of privilege. Yeah. And that, you know, and the same thing with retailers, nobody knew who they, their customers were kind of thing. So that was lot of that really tell loyalty loyalty programs started. And now with, you know, things obviously moved incredibly and haven’t got, everybody’s buying online and the everybody’s using their card. So we have lots of data around people, but. The end. Yeah. The end of cookies, et cetera. And the requirement first party that is making a lot of brands look again at loyalty and permission based marketing. Okay. And the value of exchanges. Why should I tell you anything about me? What’s in it for me kind of thing. Yeah. Um, what do I get? Kind of idea. And I think that’s where as a lot of pro, so people I looking so rather than necessarily the old, the idea of like, well, I give them points. They’ll spend more, it’s more about if I give them points, they’ll tell me more about themselves and more about their, because it’s coming more, it’s more going to become more difficult to kinda like track people across, across websites.

Most definitely. Yes. Yeah. A very interesting, very exciting time in loyalty in general. Yes. So.

Paula: Never a dull moment. Never a dull moment, Ralph. Yes. Yeah. And if a feeling we’re gonna be having conversations like this quite regularly, because I can see that you are all super busy, engaging with some incredible new clients and stuff. So I’m hoping we can continue, um, you know, having these kind of regular updates, I guess, in terms of, you know, what kind of clients you’ve signed and what they’re doing and why they’re doing it because that’s the kind of intellectual piece that I find fascinating. So, uh, for brands like Kellogg’s, to fully realize the potential for full first party data. As I said, I mean, I’ve seen their previous program and I know how proud they were of it, but I love the direction they’re going. And again, being more generous with more behavior change, you know, beyond transaction, I think there is, um, a new sense of possibility and, and it seems like a genuine intention for brands to, to have those real relationships. As you said, it’s not just, we want the big data and we wanna be able to understand it. They actually do want to have those relationships because they know they’re pretty much, you know, lost without them, I guess, because that’s what I think as human beings, we increasingly want to be connected with the brands that we are loyal to. And I think we expect more of them as well. So I think they have to show up almost to, to, to respond to our expectations.

Ralph: Yeah. Yeah. I mean, I think it’s, it’s it’s yeah, it’s a very interesting time, you know, um, very lucky and privileged to work and to come along Epsilon cause I oversay again, but a great tech, a great service, but also to have some great con through the publicist group and the, and also with the clients we have like, well, so we get to have some really interesting conversations. I think that’s so about. That’s a great thing about loyalty, is that yeah, thinking through what the kind of proposition could be, how it could link to the brand. What’s that actually gonna mean? Yeah. And then implementing it. That’s the really exci exciting part. You know, whoever. Yeah. What do we, you, that the, the, the logic of going through like Wal Walgreens thinking let’s we need to be more wellness community based, or, you know, we need to, uh, or what we mentioned about Kellogg’s, and I guess, you know, we weren’t involved, but Procter and Gamble saying it should be all about water, you know, how do we, and so it’s coming together like, yeah. Um, Because there’s nothing wor I dunno about you, but you come across a program and it’s just the same and it’s not really. And, you know, they, the, the brand says, oh, it’s not really working for us, but it’s kind of completely detached from anything they’re doing. And sit there it’s the same as same as everything. So yes, that’s, there’s a lot of, yeah. And there’s I say there’s more, there’s many more tools. I mean, I talk like till scan it. Yeah. Uh, receipt scanning, but you know, advanced gamification communities, et cetera, all that, there’s a lot more things that, that loyalty, you know, you know, practitioners have now to tools to play with, um,

Paula: Totally. Yeah. It’s almost like the goalposts have changed. And whether it’s related to the fact that we all did go through this, I suppose, shock of a pandemic or, you know, whether it’s just the, the evolution, I suppose, of, you know, the industry growing up a bit more. I do think there’s a lot more ambition on the part of, you know, people like you, people like me, loyalty managers everywhere. I mean, nobody wants to have a program that doesn’t have something that really is compelling. So I think the ambition is there. The intention is there. So love hearing about all these wonderful ideas. Um, so I think that’s all the questions from my side. Ralph, is there anything else that, uh, I haven’t asked you about that you think is important before we wrap up?

Ralph: Um, No, I think we’ve covered, um, lots of things. Thank, um, thank you for that. It’s been a, it’s been a pleasure.

Paula: Wonderful. Okay. Well with that said Ralph Browning, Business Development Director for EMEA for Epsilon. Thank you so much from Let’s Talk Loyalty.

Thank you, Paula. It’s been a pleasure.

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