Paula: Welcome to Let’s Talk Loyalty, an industry podcast for loyalty marketing professionals. I’m Paula Thomas, the Founder and CEO of Let’s Talk Loyalty. Today’s episode is hosted by Charlie Hills, Managing Director of Mando – Connect, a UK based agency that uses smart data to create brilliant partnerships and rewards that really work.
If you work in loyalty marketing, make sure to join Let’s Talk Loyalty every Tuesday, every Wednesday, and every Thursday to learn the latest ideas from loyalty experts around the world.
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Charlie: Hello and welcome to episode 431 of Let’s Talk Loyalty. I’m Charlie Hills, the Managing Director and Head of Strategy for Mando-Connect, WPP’s Loyalty Specialist Partnerships and Rewards Agency. We have created a new white paper in partnership with YouGov that explores loyalty membership appeal and impact across 24 European markets. And I’m delighted to be hosting a series of podcasts with some of the experts featured in the paper to help our listeners better understand loyalty across Europe.
Today, I am delighted to welcome Emre Polatken of EPAM. Emre is taking the place today of Leon Huyben. They work together to provide the expert commentary on the Netherlands in the white paper. Emre is a versatile professional, skilled in CRM, loyalty, growth marketing, and experience design with industry experience and expertise, Emre excels in building customer relationships, creating loyalty programs, driving business growth, and crafting engaging experiences. Their diverse background enables them to make a significant impact across industries.
Today, we will be learning about Emra’s favorite loyalty programs. What the loyalty landscape looks like in the Netherlands and which of the programs to watch. I hope you enjoy our conversation today.
Hello, Emre. Welcome today. I’m absolutely delighted to have you on the Let’s Talk Loyalty podcast.
Emre: Hello, Charlie. Thanks for having me.
Charlie: It’s so nice to have exciting guests. And I’m particularly excited today to talk about the Netherlands because it was such an interesting market in the research that we conducted.
But before we get into that insight on the Netherlands market, I wanted to start with Paula’s favorite, favorite question that she asks all our Let’s Talk Loyalty guests. Tell us about your favorite program. What’s your, what’s your sort of number one?
Emre: Yeah, well thanks for having me again. As for the question, I think the one that I’m most excited about is the Starbucks, in my opinion, that holds the crown of the number one loyalty program. Thanks to its seamless earning of stars with every purchase and an array of personalized treats.
Mobile ordering adds just the convenience while climbing the tiers, unlocks exclusive perks. They also do very well in what’s often neglected, in my opinion, in the loyalty programs. That is the partnerships which is actually what we’re looking into nowadays from from EPAM side as well, bringing the different companies together and basically trying to increase the the velocity of burning and burning points.
What’s also interesting about this program is that as far as I could look up online is that they have partnered up with DoorDash for faster delivery. And that airlines to do just as I explained the, the increase of the velocity of earning and burning points. And what’s interesting again is that this program evidently holds more money than some of the banks in the world, which was reported to be around 1.8 billion dollars. So I guess that speaks for itself.
Charlie: Yeah, that’s crazy, isn’t it? I mean, to think that a loyalty program can have more money in it than a bank and actually what they could do with that and what that might hold. Not to mention that the coffee is very nice too. I have very fond memories of Starbucks.
You know, I remember going when it very, very first opened and being so excited that you could get a vanilla shot in a coffee. I thought that was, you know, revolutionary. That’s, that’s so long ago where you think they’ve moved to now.
Yeah, I think coffees are really Interesting sector, actually, in loyalty. It’s sort of exploded in the British market in the last few years. We’ve seen all the big kind of chains open up really interesting loyalty programs and doing really innovative things as well. And yes, Starbucks is definitely at the forefront.
The partnerships angle is really interesting there, isn’t it? Why do you think they’re bringing those partnerships in? Like, what is it? Is it primarily about the earning velocity?
Emre: But what I’ve seen happening with some of our clients is that they their progress comes to a, comes to a stop and that they need basically new partners that they can onboard into their program to basically give different options to their, to their customers.
And this wide array of options basically enable the customers to, you know, spend more or earn more, you know, earning points is as just as important as, as earning. So this, this, I guess this is a win win for both the clients, the customers, as well as as well as the companies, right?
Charlie: Yeah. I mean, I’m a huge fan, obviously, of Brown partnerships, given what we do at Mando-Connect as well in this space. And I do, I completely agree. I think that equal focus on the opportunities to earn and opportunities to burn. And that variety and that new news that partners can bring into programs and new services is really key.
We’ve just had the British Airways Executive Club, you know, they’ve just announced a big partnership, The Wine Flyer Club, you know, enabling their customers to burn points in really interesting ways on wine. And they’ve just launched a partnership with one of my favorite brands, Whispering Angel. So that’s great. And they’ve really taken that partnership to town. You know, they’ve, they’ve thought about it beyond a burn partnership. They’ve actually even got bars now. I haven’t been yet. I’m going to Bournemouth next week. I must be going through an airport soon. But I’m dying to go and have a look at how they’ve activated that partnership. I think it’s, it’s such an interesting thing about how those can become such big parts of programs.
What about your loyalty background? Like, how did you get into loyalty? There’s another really interesting question that we like to ask all our guests.
Emre: Yeah, I’ve been in the industry for maybe more than 10 years. And my expertise lies in helping businesses. Develop and optimize their loyalty programs in enhancing customer engagement as well as the retention. Pretty much focused on understanding my client’s objectives business objectives that their audience and the industry they’re playing in mixing all that.
I try to recommend the most suitable loyalty strategies and structures. I do well in analyzing data, customer behaviors, and the trends of the markets to design those initiatives that align with my client’s identity and basically resonate with their customers. I’ve got hands on experience working on a few loyalty programs, such as the MYTOMMY for Tommy Hilfiger, Ecco Walks for Ecco Shoes, and the community program of KitchenAid. And with E Pen, we’re working with even more cool brands but I’ll not get into that because they’re a work in progress.
Charlie: We’ll have to get you back on the podcast in a year and you can talk to us more about them. That’s interesting. I think that’s such a big trend that we’re seeing in the industry at the moment that, you know, using technology to actually link brand appropriate behavior into loyalty, reward and engagement.
I think we covered quite a lot of those programs within the paper that are really innovating in that space. We saw Boardriders at The Loyalty Summit, you know, trying to actually kind of reward for surfing as well as purchase. Is that something that you’re seeing in more and more of the briefs coming through that you’re looking at EPAM?
Emre: Well, I would say so. Again, with one of the clients that we’re recently working on we’re trying to tap into people’s luxurious lifestyles with destination, destination, dining, adventures, and everything. I think it, at the end of the day, it boils down to how the clients of mine or the companies can connect themselves with the lifestyles of, of these, of these people. And to be, to become more relevant at the end of the day. So that’s basically the trend that I’m seeing.
Charlie: That’s really nice. I think we’re seeing that in the British market as well. So it’s interesting to see that that’s a sort of a pan European trend. The white paper obviously, and then the Dutch market turned out to be one of the most interesting markets of the 24 that we that we looked at. I’m sure our listeners would be interested to hear, you know, tell us more about that white paper that you and Leon contributed to.
Emre: Yeah, of course. We were very excited when you came to us with this idea. And we became part of part of the team of specialists across the Europe, right? That put the white paper together.
I believe it’s the first of its kind, and it’s something that’s very much needed by the, the loyalty industry that was developed by Mando-Connect, which is you and YouGov to quantify the membership appeal and the impact of loyalty programs across the board in 24 European markets.
For when it comes to our role in the community of experts, we basically were tasked with bringing the data to life. There were about seven market exports and three loyalty programs featured in the original white papers. And we built together with my colleague, the snapshot on the, on the Netherlands.
Charlie: Such a cool market. I can’t wait to get into talking about it more, but before we sort of get into that detail of that market, what stood out for you from the white paper?
What were the sort of key things that you took from it? I know we had lots of calls discussing what was interesting in the data before we put it all together, but, but what stood out to you?
Emre: Basically, I I also learned a lot from it. The biggest learning for me was how different markets can be very different across Europe.
They often think that Europe is one homogeneous thing, but it’s, it’s not right. And it’s very clear from the research that that the membership, the appeal and the impact can differ significantly across across the markets.
To give you to give you an example, we have Norway who has a very high membership appeal, which fluctuates around 85 percent while in the Netherlands unfortunately, it’s down to 59%. And, what’s also very surprising for me individually, I’m from Turkey. We have the lowest of all in Turkey that’s around 31%. So that just tells me brands and businesses need to make sure that they take account of this variation, all these differences in culture, in behavior and whatnot in planning their strategies and basically optimization of their programs. So after all, this just taught me that one size doesn’t fit all apparently.
Charlie: Yeah, I think that was a really key takeout actually from the paper. And actually, I think as we’ve learned and we’ve evolved the paper, we actually want to bring in more experts to bring in more of the markets to life.
And Turkey is again, a really interesting market. It’s sitting down there in that lower end of engagement in Europe. But then actually, when I start talk to Turkish experts and people who know that market really well, they all have that same element of surprise. Well, actually what’s happened in our market, and that’s what I think is so interesting in the paper. You know, it’s the beginning of the journey. We actually want to, you know, look at why and the stories underneath. So I’m looking forward to looking at the Turkish market actually is as we proceed.
Emre: Of course, even people who claim themselves as experts have a lot to learn from this resource. I would very much recommend everyone to have a look at it.
Charlie: Yeah, definitely. I mean, that’s what’s been, I think, so fascinating about it, you know, the data and I’m, you know, a complete loyalty nerd. So to me, it’s great that we’ve now got these benchmarks established that, that we can help to use for business cases and to understand what membership might look like across the kind of, you know, a European portfolio of markets. But definitely the stories and the case studies have been the most, my most favorite bit of it.
So what about the Netherlands? What does the loyalty landscape look like? You know, what is it, what stands out about the Dutch market versus sort of the other 23 markets that we looked at?
Emre: Yeah. Yeah. I would say the Netherlands is a, is a fascinating market to be in, and we’ve got a great potential to do much more. As it stands out, 59 percent of all our members of loyalty programs and 36 percent followed by that is thinking that loyalty programs are a great way to reward customers. And we have 28 people of 28 percent of all saying that the membership and the loyalty program makes them more loyal.
So these are all very positive metrics in my opinion, but of course, when you compare this with other markets in the, in the report, we can actually see how much of an opportunity there is in the Netherlands to optimize our loyalty programs. When you look at membership, it’s quite close to the European average.
But we’re lagging behind on the appeal and the impact of our life loyalty programs. So actually out of the 24 markets of all we have in the research, Netherlands ranked 24th in the loyalty gauge score. That just means that the Netherlands is the least engaged loyalty market of all driven by lower appeal and lower impact than in other markets.
When we looked at the reason why the potential reasons why we concluded that the reason why we are lagging behind is is because we’re too focused on the transactional programs. I mean It’s not quite a fault of our own per se. It’s also the people of Netherlands, they’re quite transactional driven. They’re cost conscious people.
So it’s no wonder that the companies have focused perhaps too much on the transactional side of things, but not so much on the emotional connection with the members. We did highlight some of the good examples in the paper. All is welcome to look look at that. And of course, there’s clearly more work to be done.
Charlie: Yeah, I think that’s one of the things that stood out in those early conversations when we were having our expert calls and actually the markets that were lagging behind, you know, slightly across the 24 were the markets where actually it was very transactional value focused.
And I remember Leon’s outrage, but the touch, you know, we’re so savvy, we’re so engaged, we’re so value driven and, and, you know, great coupons and making sure that we’re getting the rewards, but, but then to see actually where the appeal is, is done really, really well. It is in those programs that are hitting kind of the heart strings as well as the wallets.
Yeah, it was fascinating to see that come out so strongly actually across the data and the podcast that we recorded on Germany, we talked about this quite a lot as well. Actually, obviously the dominance of Payback in that market but also how those programs are very transactional. And Nicole Wilhelm, who’s the, the German expert that we interviewed talked about, you know, very much the need in the German market to build that emotional connection.
As well, you know, everyone’s getting slightly competitive. The Irish who sit at the top of the loyalty gauge and the Polish are very pleased with themselves in positions one and two sort of most engaged loyalty markets. I think everybody else is, is trying to shift up to that way.
What other sort of trends do you see in the Netherlands? I know we pulled out a couple of of key sort of stories from the white paper, but what else are you seeing in the market?
Emre: Yeah, I guess what I can talk about would be two different trends. One of which is basically the increased focus on sustainability. We can talk about two different examples here.
One of one of them is Ekovriend aka Ekovriend. That’s the loyalty program of a Dutch eco supermarket chain Ekoplaza. This this program basically gives importance to the rise off the sustainability and that with that it gives its members the chance to save points for discounts and free products. But also enables them to support and donate points to sustainable initiatives, which is, which is something we’re also trying to integrate into the clients that we’re working with nowadays to give them more options to do good not only for themselves, but also for the world.
I’ve got another example on the sustainability, which is yet another supermarket JUMBO and the program is called JUMBO Extra. What they’re doing with, which is very interesting to me is adding the, adding electric car charging stations to their stores. And of course, all powered by, by solar energy and the loyalty program is basically in close conjunction to that. So while members do their grocery shopping, they can charge their cars and collect points while charging. So I guess that’s a very good extra benefit for the customers for shopping day in day out.
Charlie: Yeah, that’s a great integration of the loyalty brand actually. And it feels very genuine and authentic, doesn’t it? That loyalty program is really in service of the most of the brands CSR activity. That’s a, that’s a really good example. I hope we see some more of that in Great Britain. Listen up, supermarkets, listen up. Because we’ve got electric chargers, you know, going in everywhere across, you know, the whole country at the moment. But I haven’t as yet seen that level of integration in our market.
Emre: Yeah, yeah. But in the Netherlands, we’re quite conscious of our environment. I would say more to count. The, as far as the second trend goes we see the, the rising focus on brand ambassadorship. And the experience of the members. We, we, we, I often see that in more smaller companies to be honest. What they’re trying to do is to give people an option to become part of the brand itself by providing stock options that are linked to the amount spent by, by transaction.
There is there’s a company called Seabass that is a Dutch brand that produces ultraviolet swimwear for children, and they have introduced what’s called the Seabass Club who is doing that’s who is doing just as I explained basically.
Charlie: That’s a really nice example as well and that real focus on member experience and bringing people into the program is I think something that we saw reflected across all 24 markets actually and particularly those brands that are really bringing those emotional connections to life as much as the transactional ones. We’ll all have to have a look out for Seabass Club. It sounds really interesting.
What about the sort of the other programs in your country, you know, who would you sort of hold up as actually these are the best examples of, you know, activating retention and engagement strategies in the Netherlands? Who, who should we all be looking at?
Emre: Yeah there are I would say several multiple programs that the Dutch customers love. First and foremost I should mention all the times bonus card. What stands out is that they personalize the discounts and cash back rewards based on the shopping habits. Albert Heijn is actually a client of ours. So I know that they actually do that. It makes them a hit among regular shoppers.
What else is a Bold that come the program is called Select which is one of the Bold that come is the, one of the large online retailer in the Netherlands. They offer members free delivery, early access to deals, exclusive promotions making everything around all that come more enticing. The program is very much like Amazon Prime, but of course, without the Prime media. But it’s still good.
Charlie: Yes. They’re not making TV shows and movies yet. Probably won’t take them long to catch on. Are there any other big programs as well that you’d call out? I know you have a couple of other favorites.
Emre: Yeah, we do have HEMA. For those who don’t know, HEMA is a Dutch variety store known for its affordable prices. I think it’s even in the name. I don’t have a touch, but even they call themselves out by have been affordable prices for the products that are mostly made by themselves and for themselves. They have this customer loyalty card and it’s basically appreciated for its simplicity for special discounts, birthday treats and the access to exclusive perks which in the end creates a sense of belongingness for the, for the life of the customers.
It is interesting that they have, when I talk to them, what they told me is that they almost have everyone in the Netherlands in the database. Yeah, through transactions, through their stores and online. It’s definitely got a great potential to do more. So all these programs, perhaps many more that I haven’t mentioned here successfully captured the hearts of Dutch consumers, enhancing their experience and basically encouraging the long term loyalty.
Charlie: And I think that’s so key, isn’t it? That focus on the long term loyalty over the short term sort of tactic. And I think as we’re all, you know, in our cost of living crisis as well, the role of loyalty programs to drive that long term engagement is becoming ever more important.
And, you know, on a personal note, I absolutely love that shop. It’s my favorite. We’ve got a few of them now in Great Britain as well. Not nearly so many as you’ve got in the Netherlands, but it’s a brilliant shopping experience and the products are great. And I love how they then bring that together to life in the program itself.
What are some of the most important lessons that you’ve learned about loyalty marketing? I know you’ve been in the industry a while. What would you like to share? What are your pearls of wisdom?
Emre: Yeah. What I learned throughout the years was that driving loyalty is, is very different than driving repeat sales. I think we were always mixing, mixing the two things. And we just have to acknowledge the fact that you know, people may do business with you for variety of reasons that may have nothing to do with you. It could be about the timing. It could be about the price, how convenient it is. If you, if you take the supermarket as an example you may be loyal to all the time, but if there is around the corner or you boys around the corner to me, that’s more important.
So that just goes to show people may think differently when it comes to repeat sales, repeat transactions versus loyalty. I believe loyalty exists. When a customer basically has to face inconvenience and yet they remain to be your customer. So if I have to walk, I don’t know, a couple of kilometers to get to my favorite supermarket all the time, then you may maybe consider me as a, as a loyal customer.
Think about all the people that wait in the line, right. To be one of the first to buy a new version of an iPhone. I would say these people are loyal or think about people who make a tattoo of Harley Davidson to their body. I mean, it’s, it’s it’s ridiculous, right? It’s not a rational, but quite an emotional state of business.
What I have to say maybe not say I would recommend our listeners to go and find the book of Simon Sinek’s. Find your why, where he explains how companies that found their why can communicate effectively and attract and retain loyal customers.
Charlie: Yeah, that’s a great book. And his content is, is really inspirational, I think, on so many levels.
And I particularly like that idea that loyalty is more than a program. I think we would talk about loyalty beyond reason. You know, it’s actually, you know, I love the brand. I care about the brand. The brand is a part of my lifestyle. And the loyalty program itself is very much a part of that, but only a small part of it.
I also really like the idea that you walk slightly further to get to your, you know, your favorite supermarket over the most convenient one. We see that a lot in the fuel sector, actually, people sort of driving past the most convenient sort of fill up station, a lot of that driven, you know, by the loyalty program and actually how much better value they get. That’s a really interesting piece of insight there and a great book recommendation.
What sort of resources do you rely on for your updates in the, in the loyalty industry? What are you, where are you looking?
Emre: Yep. Except for the books of these marketing gurus. Yeah, I try to utilize a combination of different valuable resources. Of course, one of them is the companies, the research companies like Forrester and Gartner. So time to time provide the in depth reports and analysis, which in return offers basically key insights about the behavior of the customers and trends.
I do try to join LinkedIn groups that involve a lot of people like me across the world who can bring in different different point of views, different elements, different ideas. It’s just nice to engage with them.
And of course, not to mention, I work with Group of highly intelligent people in my agency who always try to be one step ahead of the competition. I also get a lot out of my community. So these are the resources I look up to.
Charlie: I think that’s really nice. And actually, I think we’ve had that a lot from our guests, actually, the importance of the colleagues that we work with, but also our peers across the agency and, and looking out to other markets and looking out to other programs.
And I think one of the things I love about the loyalty industry is it’s so connected. And as we’ve, you know, we’ve come into this sort of new normal area, then actually the rise of the video call, the rise of the podcast actually means it’s so much easier for us all to connect, you know, across borders. I think that’s been a really lovely part of it too. I’d, I’d echo. I think all those are great sources.
Are there any, you know, from that community, from that insight that you’ve seen, are there any sort of big new ideas or innovations that you’ve spotted recently that you’re particularly proud of or that you would admire?
Emre: Yeah. One thing I was very surprised and really impressed by using his his, his, the synthetic personas that’s been very interesting in validating the loyalty strategy that we put forward for our clients. So how it works is that we create simulated customer profiles that represent different segments of the target audience.
I can then simulate their interactions over the loyalty programs with the to be loyal to program and assess its potential impact. These personas also enable me to test various scenarios such as different reward structures, engagement tactics and predict predict how each segment would respond to the offering.
So, we analyze the result and the feedback from this personas. We then refine the strategy. Ensuring that the lines with the diverse needs and preferences of the actual customers. At the end of the day, we try and fine tune the loyalty program to maximize its impact and drive customer engagement. Hopefully leading up to a successful implementation.
Having said that, this by no means should replace the actual customer interviews, surveys and all that comes with the qualitative research. I just see this as an extra medium to get to the end goal of understanding the customer, which is, which I think is very important.
We always try to multiply qualitative understanding with quantitative. And come, come up with a better understanding of our customers to give you an example of why this shouldn’t replace the, the actual process of customer understanding. We work with one of our clients in Saudi region where we targeted high network individuals.
So by the, by their nature, these are very busy people during their day to day, and it’s not always easy to get ahold of them. So we came up with this approach to basically minimize the time we need with actual individuals, but that’s not going to prevent us from actually talking to a few of them in the process. So that I guess that’s, that’s a good example of how that could be just an add on to the, to the processes that we’re following already.
Charlie: I think that’s a really nice sort of tale of innovation, but also application for the listeners. Isn’t it? It’s so important that we understand and that we’re using the new technology and data approaches to sort of test, you know, how to be able to run live tests with synthetic personas, I think is probably something we would have dreamed of, you know, 5, 10 years ago.
And the fact that that’s a reality is so great, but that it is still important to bring that insight lens as well. And that kind of that human component to actually see what people think. We do that a lot with the reward strategies that we develop as well. And the reward portfolios that we put together in programs, research, research, research, refine, infer it from data, but there’s nothing like a live test actually out there with sort of, you know, real people using and engaging to, to understand where the real opportunities lie. People will surprise you sometimes.
Emre: I mean, I would recommend the listeners to still proceed with caution, take the learnings with a pinch of salt and try to validate with actual customer interviews. But for those who want to start somewhere, maybe from their desk, they can, they can use it, there are great tools out there that they can leverage.
Charlie: Yeah, that’s a fascinating application of technology. It’s been really interesting to talk to you today. I think we’ve covered some brilliant case studies, some brilliant themes and a really useful overview of the Dutch market and the sort of programs that we should be looking at. However, I’m sure people are going to have more questions for you, Emre. So if they want to reach out to you, how can they find you?
Emre: Yeah, they can find me on LinkedIn. Once again, the name is Emre Polatkan. I was really happy to be here today and thank you for having me, Charlie. It’s I’m quite excited to engage even more meaningful discussions with people like yourselves and all people within the community.
Charlie: Oh, likewise, I’m sure. I hope all our listeners do reach out and, you know, more questions about obviously the Dutch market, but your considerable expertise, you know, beyond just that one topic and we’ve covered today. Thank you so much for your time. It’s been an absolute pleasure. Thank you and goodbye from Let’s Talk Loyalty.
Emre: Goodbye.
Paula: The Australian Loyalty Association is proud to bring you The Asia Pacific Loyalty Awards to celebrate excellence, innovation and best practice in the thriving loyalty industry active in the region. The awards have been split into 16 key categories and submissions will be judged by a panel of local experts.
Early bird submissions close on the 5th of November 2023. And the awards gala event will take place on the 14th of March, 2024 at the Glasshouse in Melbourne. Contact them at the australianloyaltyassociation.com for further information.
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