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 and also Loyalty TV. If you work in loyalty marketing, you can watch our video interviews every Thursday on www. loyalty. tv. And of course you can listen to our podcasts every Tuesday, every Wednesday, and every Thursday to learn the latest ideas from loyalty experts around the world.
Today’s episode is part of The Wiser Loyalty Series, which is hosted by our partners, The Wise Marketer Group. The Wise Marketer Group is a media education and advisory services company providing resources for loyalty marketeers through the Wise Marketer digital publication and The Loyalty Academy program that offers the certified loyalty marketing professional or CLMP designation. I hope you enjoy this weekly podcast, The Wiser Loyalty Series, brought to you by Let’s Talk Loyalty and The Wise Marketer Group.
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Aaron: Welcome everyone to this week’s Wiser Loyalty Series podcast on Let’s Talk Loyalty. I’m your host, Aaron Dauphinee, CMO, and I’m here with our co-host, Bill Hanifin from the Wise Marketer Group. Each week on this podcast series, we take a look at new topics month by month that tap into the course curriculum that we have with the loyalty Academy, which goes towards our certified loyalty marketing professional curriculum, or CLMP for short, as we, as we allude to it.
And so what we try to provide in these podcasts are. Our own perspectives and bring current examples based upon the curriculum and make it relevant for our listeners. And in the month of July, we are exploring the multi academy course that focuses on how to create a winning value proposition. It’s of course, number 106 and last week we talked a little bit about the mechanics of, you know, the polarizing shift in mindset by leading multi brand marketers to utilize alternative currencies.
And it was an interesting conversation. We went a little long, so hopefully we’ll, we’ll tidy that up and have a little more succinct conversation this week where we explore the role of the customer experience in your CVP. So, I think to kick off and kind of frame up the conversation for this week, there’s probably 2, maybe 3 questions that really come to the top of mind for me.
The 1st, of course, is, you know, what is the importance of customer experience? And then the third, of course, is, you know, assuming that there is a role, which is what I think Bill and I will get to is that there is, in fact, a role, and that’s the first one is, you know, is it really that important? And, you know, maybe put another way, perhaps, is, you know, can programs, multi programs, particularly survive without it?
That’s maybe another way to frame it around. And then the third, of course, is, you know, assuming that there is a role, which is what I think Bill and I will get to is that there is, in fact, a role. Could it be or is it the most important element or is it just one piece of the puzzle? And so maybe Bill, I’ll turn it to you to kick off and tell us why you think customer experience is important to creating a great CVP.
Bill: Yeah, thanks, Aaron. Good to see you. Good to see you here. Glad to be back, everybody. I think it’s a worthwhile question that we, we pose because Do we not often hear people talking about the importance of CX, and then they seem to separate that from loyalty. They’ll talk about, well, you have a loyalty program over the CX has to be really worked on.
We need to look at the customer journeys and create this wonderful CX. The actors are the 2 are separated and so. I think there definitely is a connection. I think it’s important that CX is, is looked at as part of the overall value proposition of what a brand delivers. But you know what it reminds me of here is the age old story about building the guy that built his house on a rock rather on sand.
And so whatever source you get that from, but. You know, the person who builds on Iraq has something to fall back on in tough times. The person on sand, obviously not so fortunate, but the way I look at it as though in our foundations of loyalty course, 101, we talk about it, even and we say. There are certain things that loyalty can accomplish and then there’s certain things that are outside of the circle of influence.
And we always say, if the business is fundamentally flawed, if you have a bad product, if you have. Pricing strategy out of whack, or guess what, you know, terrible CX sort of, you know, the way you present yourself to the world, the stores are disorganized, the website doesn’t work, the, you know, the the cashier checkout cart, shopping cart craters all the time, people are going to walk away from you, right, and they’re not going to like it, and it doesn’t matter if you’re giving triple, quadruple points, or you’re giving freebies, who wants two for one if the first one’s no good?
Aaron: Yeah, it doesn’t matter.
Bill: Right, right. So that’s that’s that’s the way I feel about it. That’s why I really think that there is a connection and it’s pretty important, but I don’t know. Do you think I’m overdoing it or you agree or disagree with me?
Aaron: Yeah, yeah, I think we’re, we’re, we’re fairly aligned. I mean, for me, I think about the relationship that a brand or even a house of brands or a set of partnered brands, for that matter, if we get into a conglomerate, low tier coalition, low tier, multi brand, low tier, whatever term you want to use which a better brand may have with a consumer, you know, it’s rarely been mutually exclusive functions between the role of the loyalty program relative to the set of experiences that come from how they interact with that brand.
I mean, yeah. Just because a company chooses to, and this is most often, not always, I’d say, draw a distinction with their operating model between the multi marketers and the brand or CX marketers, doesn’t mean that that customer knows that same distinction or draws it that way. I mean, picture it, you know, is it realistic for a customer to be like, Oh my gosh, that associate in store was not helpful.
And, and, you know, they didn’t answer my questions that satisfied me about how to redeem my points, but you know what, that’s okay. It’s silly me. I should have known that. I mean, it’s so obvious to me that the org chart is, you know, for, for brand over here and multiple over here, and there’s no allowance between the 2.
I should know that a silly me as a customer type thing they just don’t know this. Right? And nor do they need to know it. And I guess for those of you are unfamiliar with Canadian sarcasm, welcome, welcome to that, but not, not that No, if you’re an organization where the brand and CX team, the digital team, the customer service or member care, whichever you call it, and the customer loyalty team, whether acquisition, retention, loyalty, again, whatever nomenclature you put beside it, if they’re not aligned on a common goal or ambition with respect to your CVP, you have to, you then have to default to which is what is most important to get right and.
And across that in, in, you know, the sad instance of those being not all equal or aligned, then I think, yes, you know, if a customer has a negative interaction or experience, and it’s likely going to trump anything and impact that the benefits of the loyalty program can provide. And so, you know, but then the opposite is kind of true.
If there’s alignment, and these are all in sequence in step with each other. They can create a virtuous circle of benefit, care, growth, and ideally some fun for customers, which, you know, really will start to get people to be sticky to that brand. So, Bill, I mean, what are your thoughts on the quote unquote most important or is it just an element that creates a fairly balanced relationship between the brand and their customers?
I
Bill: mean, you know me, I have, I have somewhat of a linear thinking mind. I like to be logical about things. And so I was the 1st thing I was thinking about was maybe look at it as are they, in fact, mutually exclusive, or do they compliment 1 another? How do they interact with 1 another? But if you were to say, if you were in your planning meeting, and you had the whiteboard full to the brim, with all kinds of ideas, I’d say, okay, could we get away with just like, let’s just focus on operations and CX and make it just an incredibly cool experience to be in the store on the website? Would that be enough to win the day? I’d probably say no, you know, that means that you’re, you have a great CX, but you don’t have any particular incentives.
There’s no sales incentive. And I think people are expecting a little bit more of these days. And if you did the, if you went to the other end of the spectrum. Yeah. Instead, we’re just going to offer more, more value for our value proposition, points, miles, currency, discounts, all these different things.
Then anyone else, would that win the day? The answer is probably okay. It would be really compelling. But then when people got in and experienced the experience, they might disconnect, so I don’t, I wouldn’t say it’s, you know, if he held me to the fire, it’s not the most important element. Is it a critical element?
Like, you know how we always said that loyalty is the outcome of a balanced, a balanced blend of reward recognition. Maybe we should have three things in there these days. Maybe we should have a balanced blend of reward recognition, but things have to work. You have to have a good solid CX and you have to be on that solid rock footing to be able to execute.
So, that’s kind of how I look at it.
Aaron: No, I would agree. And I think a good example of this that comes to mind to reinforce, you know, why your CVP really needs to be aligned across these multifunctional teams from ideation through to operations. It comes back to a keynote that you and I were a part of when I had a, an AMY executive retreat, which was given by Gary Loveman.
And I don’t think I’m speaking outta school when I tell this story because it’s, there’s a bunch of case reviews and, and, about transformation of of Harrah’s entertainment, which Loveman went on to eventually operate operate and then be the CEO. But he’s well known Loveman for those of you who aren’t familiar with him of utilization of data to influence customer behavior.
And this was in the late 90s, so relatively early days of data analytics, database marketing, and he left Harvard business school to become the CEO of the casino group. So, you know, an astute economist, academic professor. Initially approached as a consultant and then and then was eventually asked to be the CMO or head of low tag.
I hope I get that right. I’m not sure, but essentially head of the marketing units and he turned around said he wouldn’t. He declined that the leadership of these marketing units and he said that he would take the job if he could be the lead for operations as well. And his reasoning was effectively that if he didn’t have.
You know, the ability to lead and be accountable for the execution of the marketing initiatives that the analytics would be recommending through total rewards, which was the program that he established, then it wouldn’t have impact. And so he, and I think he even layered into it and send a program for employees as well, too, as CEO over that.
First 5 years and then went on to become CEO of heroes and then became one of the largest casino operators because they purchased Caesars entertainment. And, and so the real point of what I’m trying to say here is, you know, he wanted the, the the beginning to end in terms of control and impact that on the touch points that influenced the customer, both from, Yeah, ideation analytic robustness to recommendation through to execution.
And, and I know people are out there saying, oh, it’s gambling. So it’s, you know, it’s a data intensive world. They got a differentiator for them comes through driving CX. And I know when you’re looking at repeat slot players or high rollers, like whales, like you’ve got a lot of margin, you can create some amazing experiences when you got seven digits of margin per customer, or I get that, but I think the application of the insight around the idea of.
Alignment of a brand promise to the analytical insights and recommendations through to whether they’re interacting digitally or in person through their interactions. They all need to be aligned. And in this case, it rolled up to 1 executive as the right means to deliver.
Bill: I love that. You know what? I think he was ahead of his time.
How many years ago was that event? 1998
Aaron: is when he stepped into that. So, late 90s and then The first five years, he was CEO. And then I believe he went on to be CEO well into like maybe 2008 ish timeframe. I don’t know. Oh my
Bill: gosh. Yeah. He was, he was well ahead of his time here. We’re talking about taking a holistic approach to loyalty and bringing different, you know, cross functional business heads together to plan.
But, you know, you know what I think he was saying and I could see it as. How would you like that feeling of having invested a lot of time and brought your whole team together to build this killer loyalty strategy for your customer base and you had you had no control over how to implement it. It’s like it stepped off.
You handed it over to other teams and you’re wondering why it’s not working. There you go. So he was really thinking well, and. Can I share one quick story with you? This is about a brand that I’ve mentioned before here. It’s one that I do like. I think they’ve done a good job, but it’s Cumberland Farms.
And so here’s what happened. This is why CX is important. I’ve talked about the fact that you can turn on the fuel dispensers from the app and you get a fuel discount. All of that goes together to make the customer experience and the reward. Cohesive and together to me, it’s a great value proposition.
Well, guess what? About two weeks ago, the app stopped working for me. And then one of my, one of the people in my family went to get gas, wouldn’t work for them either. So it, it turns out, there’s a lot of details in between, it turns out that they migrated from the mobile app they had to a new one. And they were doing a very quiet waved rollout, phased rollout.
And they had not disclosed what they were doing to the customer base. So what they were trying to effectively do is get away with, let’s just roll this out in waves and everything will be good. Well, guess what happened? I went probably 3 times in a row and was getting these you know, hard declined account declined you know, operational error of these messages.
And there’s a good side of this that we’ll write an article about, because I ended up interviewing the the head of loyalty at EG America Cumberland Farms, and I now understand a lot of what happened. So we’re going to, we’re going to give her a pat on the back at the end. But, but what I saw the potential for is me becoming disenchanted very, very quickly with Cumberland Farms.
So when it works and I get 10 cents off a gallon, am I happy? Yeah. When I get declined 3 or 4 times and it’s becoming a pestering thing where my family is calling me up and saying, I can’t get gas. Well, I can’t get gas either. You know what? All of a sudden gas turns into a commodity and I just go across the street and fill the tank.
So, that to me shows you the importance of CX and. Really how tenuous it is on the flip side. If it doesn’t work, it’s a value destroyer.
Aaron: Yeah, I can tell you a little bit of a positive story on CX where two systems, you know, should be disparate and come together. It’s actually in a recent flight that I just did to London with Air Canada and I’ll name Air Canada because I tend to pick on them.
And so this is a positive thing that that comes forward. And so I was on a redemption from premium economy. So I’d used the program properly, getting the reward at the status that I’m at, happy about that. Was on a flight around 1130 late night, the lounge and close. So, and now in the main or main infrastructure of the, of the airport.
And, you know, they announced that it was going to be a bit late due to maintenance, which happens. It’s really understandable. And and so I could see some people being very frustrated with the agents and I thought to myself, it’s going to take off a little bit later. Maybe I’ll try to get an upgrade, but.
On the app and online, I couldn’t get an upgrade because to business class from premium economy, because I shouldn’t have, because I was in the lowest redemption. I knew that, but I thought it doesn’t hurt to ask. So I’m in line to wait my turn. People are getting high rates. These agents are doing a great job at the front desk being firm, but fair.
I get there. I ask the associate, the gate, the gate agent, and she says, I can’t figure this out. I don’t know why I kind of sheepishly knew the reasons why, but I, you know, I thought I’d ask anyways. And so she took the time, like about 15, 20 minutes with me. Talk to her then lead who she referred it to said, stand aside.
I got to work with some other people and whatnot. And he came back and, you know, they the flight was in again, delayed to like 1 32 o’clock. And so he came back and said, Hey, because it’s, Delayed, we’re going to do this. So they went out of their way to change a system, two different systems, probably working, I’m guessing you know, where one wasn’t going to allow it because it was a redemption on the loyalty side, but the operational side had the authority and ability to make the change, even though I had to go out the chain, so to speak, to make my experience better.
And so I was then, you know, flying late 2 am going to be able to hit the ground running because it’d be in business class and be a little bit fresher than even being in premium economy. Fast forward to the fact that the flight got delayed, right? And it eventually got cancelled at 4am. Didn’t like that experience whatsoever.
But the next day, when I went to check in for my next flight, went to use eUpgrades and just asked the associate, thinking that it would still be the not available, and the system had changed it, so I could easily use my eUpgrades. So I didn’t get it for free, not the point, but the point of going through the right systems to be able to have that little bit better benefit.
Was done. And, and the two worked well together. The, you know, the rewards mechanism was in one infrastructure, I’m sure, and the operations in another, and they were able to overcome it to create a positive experience for me that now I’m talking about to a number of people and have since then so kudos to our Canada Frontline staff on both days of getting me to London so positive for them.
That’s
Bill: good. We like to blend a positive story in there, right? We don’t, we don’t mean to be critical all the way down, but, and then in the next episode, we’re gonna talk about good, bad, and the ugly of cx, so, we’ll. We’ll make sure and have a little bit of balance in that discussion too.
Aaron: Perfect. Perfect.
Well, hey, I think that we probably talked enough for this week. Let’s leave it for next week. As always, we try to stream these episodes together. So, you’ve heard Bill kind of lead you a little bit for what we’ll be talking about in the 5th on CVP this month, because we have 5 weeks to go. July of five weeks of Tuesday.
So, please join us next week as well too. And just as always as a parting reminder you know, if you wanna join the community of, of professionals that we have that have earned their CMP through the Loyalty Academy, you know, we’re getting close to a thousand around the world, as we say, 53 different countries.
Feel free to check out our website@loyaltyacademy.org and, and or contact us with any questions that you have and I’d be happy to help sort you. So until then, have a great week. Take care. That’s great.
Paula: This show is sponsored by Wise Marketer Group, publisher of the Wise Marketer, the premier digital customer loyalty marketing resource for industry relevant news, insights, and research. Wise Marketer Group also offers loyalty education and training globally through its Loyalty Academy, which has certified nearly 900 marketers and executives in 49 countries as certified loyalty marketing professionals.
For global coverage of customer engagement and loyalty, check out thewisemarketer.com and become a wiser marketer or subscriber. Learn more about global loyalty education for individuals or corporate training programs at loyaltyacademy.org.
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