Reactions to story from Forrester's Marketing Blog

• 

  The declining value of loyalty plans

  http://thebankwatch.com/2007/12/28/the-declining-value-of-lo...
  209 days ago in The Bankwatch · Authority: 79

  Shars experience is a classic example of how the whole loyalty model is broken. Step by step the Airlines [just to pick on them] are eliminating and discounting benefits associated with loyalty. Then you have situations like this, that frankly have no
• 

  AMR has a blog - they just don’t want to admit it

  http://spatiallyrelevant.org/2008/02/05/amr-has-a-blog-they-...
  170 days ago in spatially relevant · Authority: 88

  AMR continues to impress me with their continuous stream of meaningful content. AMR is my favorite analyst firm, mainly because they are topical and everyone I have met is cool - albeit Boston cool, the Red Sox  are”Wicked cool” cool and Tom Brady is the best quarterback ever cool (Probably not now, but last week). Each firm brings it’s own style - Forrester - Conceptual and market pulse info. Gartner - Cool gadgets and technical diligence for buyers. ARC - Their apparent ability to publish on topics 6 weeks late and still get paid based on the “spin” into their niche. There are a host of others, but AMR is a “RESEARCH” firm and perhaps that’s why they don’t have blogs but “Newsletters“. But not sure what I get every week is a actually a newsletter, but more blog like, here is Jeremiah’s description, while not a crisp as I would like - it works: Blogs are like a keynote speech where the speaker (blogger) is in control of the discussion, but allows questions and comments from the audience. Blogs are journals often authored by one individual, and sometimes teams. In the context of business communication, these are often used to talk with the marketplace and to join the conversation that existing external bloggers may be having. AMR has 2 newsletters that get pushed to me weekly Chain Reaction “a biweekly e-newsletter in which AMR Research Chief Strategy Officer Kevin O’Marah examines the business strategies that matter for today’s operations executive” and Bruce Richardson’s First thing Monday, which is a blog if I ever saw one. The only delta to a real blog is comments being readily posted, but they do welcome input and ideas - so it’s transparent-esque. They have a third newsletter, but my subscription doesn’t support it - “Above the Noise, AMR Research CEO and President Tony Friscia discusses AMR Research opinion on the world events and issues affecting today’s operations executive”, so maybe this one isn’t a blog, sounds like one, just can’t confirm or deny. So why don’t they just have a blog? I’m confident that other upstarts at the firm would like to develop a brand for AMR. Forrester is hip to it, the concept that the next generation of analyst will be blogger-like, more so than full-on statisticians, but they need to know stats, just ask Jeremiah or Charlene Li. So does comments or lack there of may something more researching than bloggy? Not sure, but Bruce’s most recent non-blog post “Ready to Rumble: Microsoft-Yahoo! vs. Google” ( a non-bloggy title) leverages Rolling Stone’s references: I’d be ecstatic that Steve Ballmer has taken Mick Jagger’s offer and has come to “my emotional rescue.” And Bruce is hip with cool web 2.0 assets too, just like any good blogger - think social graphing: When I think of Yahoo!, I think of my portal. In considering the Microsoft-Yahoo! combo, I initially overlooked Zimbra. Yahoo! bought the collaboration software vendor last September for $350M. I first wrote about Zimbra, last April, saying: “When I first saw it, my reaction was that this is what SAP and Microsoft are trying to do with Duet. The Zimbra Collaboration Suite is designed to allow PC users to add or build new capabilities on top of their preferred desktop standard (like Microsoft Outlook or any of its competitors). The company provides a wide range of Zimbra-developed and third-party “zimlets” that allow users to access Google maps, VoIP services, data sources (such as Wikipedia and catalogs), enterprise applications, and third-party services such as travel.” Zimbra’s software would be ideal for extending—some would argue saving—the Microsoft Live initiative. It certainly sets up an interesting play against Google Apps. Does Microsoft Zimbra escape the scrutiny of the U.S. Department of Justice? Just keep writing the newsletters, I’ll keep reading - but a conversation would be nice.
• 

  Experience Works Harder Than Loyalty Points.

  http://icontract.wordpress.com/2008/01/07/experience-works-h...
  200 days ago in Alternative marketing thinking · Authority: 11

  Forrester’s Shar Van Boskirk talks about her recent experience with an airline, with whom she has a platinum relationship. And how employees at the front line need to understand that building loyalty is all about experience and not on all the points she makes flying around, most of which she may never use. Read more.
• 

  Loyalty for financial products

  http://improving-nao.blogspot.com/2007/12/loyalty-for-financ...
  206 days ago in Improving New Account Opening - Solving complex business problems with financial services technology · Authority: 3

  The festive season has given me a little time to start reading some blogs again and spend a little time thinking and writing. A couple of the interesting posts I came across relate closely to some of the research I have recently been doing around financial services and the value of financial products and their associated customer services. To start with there were several discussions around something that many of us have contact with around this time of year - the loyalty program. Love 'em or hate 'em, the loyalty program has introduced itself into every type of company that depends on repeat business. One of the longest running types, the frequent flyer programs run by airlines (e.g. BA, United) and alliances (e.g. Airmiles, Star Alliance) have traditionally been placed to encourage frequent travelers to always fly with the same airline. In the past the benefit to the customer of this was twofold: firstly to collect enough 'miles' to redeem for a free flight for pleasure; second, to gain status to receive upgrades and enhanced customer service. The cost of these programs could be assessed by the airlines and shown to provide the return of constant repeat business from customers. As the post The declining value of loyalty plans on The Bankwatch blog highlights, the loyalty program experienced by many travelers is being perceived as much lower value than in the past. In the post, Colin states: So stepping up a level, loyalty points and plans are only of value if the customer feels value.  Fewer are feeling that value nowadays, and those Banks who pay for those plans, should think about that.  I think the loyalty plan model is broken. The implication is that airline loyalty programs are failing to meet customer expectations and therefore may not lead to the repeat business that is built into the business model. The question is whether there are things that financial services institutions do for their customers that actually reduce repeat business. Colin's post was actually in reaction to Customer Experience Matters More Than Points In Building Loyalty on Forrester's Marketing Blog, which relays the experience of Shar Van Boskirk in traveling recently: Except!  That I am really bothered by Linda's mantra "I don't care who you are or how much you travel."  Now the idea of a loyalty program is that you DEFINITELY care how much I travel and I've found that my fundamental weakness as a traveler is that I really want people to care who I am. The loyalty program has degenerated from the ability to build status as a traveler to achieve enhanced customer service and rewards, to the one thing that may get you home on the same day you started traveling when the overbooked airline starts prioritizing the handout of the last remaining seats on the only flight that hasn't been canceled. This means that use of frequent flier benefits only reinforces in my mind how poorly an airline is operating since I'm only using the benefits to negate a failure on the airline's part. This is more of an 'anti-loyalty' program... Does this relate to banking and financial services in general? As banks and other institutions realize that customer service is core to retaining gaining more market share, understand customer loyalty and attracting new customers is key, while avoiding reinforcing negative perceptions should not be overlooked. An oversimplification is that much of the whole model of retail banking is built on repeat business and that banks can just assume it will happen: a bank account ties you to doing business with the bank. If I want the bank to hold my cash, I have to pay for their transactions to make a transfer. At least with my bank there is no explicit loyalty program, beyond them offering a reasonably competitive online banking service that doesn't annoy me every time I use it (i.e. being marginally better than other banks). As a standard customer if I want the equivalent of premium service I basically have to pay for it through additional charges, and traditionally its been hard to move bank accounts, so I'll not do it too often. To a bank this may appear to make a lot of sense. In everyday operation there is little to differentiate me as a customer from almost every other customer that maintains a relationship with the bank; my salary is deposited into the account and sits there until I pay some bills and maybe move a little cash to a savings account - pretty much the same as every other professional person. Attempting to segment me based on this limited information does not help the bank offer me better services or do something that will help stop me moving to a new bank. The best many institutions do is offer a basic form of loyalty bonus such as offering better rates of interest on a new savings account to current customers. Brokerage accounts can offer a sliding scale for charges based on volume or offering cheaper trades to buy into their investment products also offers a loyalty incentive. Customer service remains the new frontier of financial services as it becomes easier for customers to find and move their money to new institutions. For financial services loyalty and repeat business still have some major stumbling blocks: No aggregated view of a customer is available that the bank can use for managing my relationship and offering reasonable customer service when I call a branch or call center Information is not shared between business units, preventing me easily signing up for new products online A single / complete view of me as a customer is not available so that the bank can see whether I am actually a great customer owning multiple of their products (and therefore worth working harder to retain) or just a mediocre customer with a savings account Based on limited information, segmenting customers for marketing new services and products is impossible Credit agencies are often seen as the primary source of aggregated information about me. Does a FICO score really offer appropriate metrics for offering me appropriate products and strong customer service? Many of the issues relate back to opening a new account with an institution. Only with an accurate view of a customer from that point of 'on-boarding' through the customer lifecycle can a true relationship be effectively managed. In my opinion many financial services institutions have a lot of work to do to get an accurate and unified view of their customers, let alone measure and use the metrics that really identify the customers worth concentrating on.
• 

  The declining value of loyalty plans

  http://thebankwatch.com/2007/12/28/the-declining-value-of-lo...
  209 days ago in The Bankwatch · Authority: 5

  Shar’s experience is a classic example of how the whole loyalty model is broken. Step by step the Airlines [just to pick on them] are eliminating and discounting benefits associated with loyalty. Then you have situations like this, that frankly have no cost to fix, except a personality transplant for “Linda” and her ilk at American Airlines and others. Forrester’s Marketing Blog: Customer Experience Matters More Than Points In Building Loyalty I *want* to do business with the firms who treat me like a person. Who try to recognize the things I care about. Frankly, I find my miles with American a constantly accruing currency which I have very little opportunity to redeem and therefore don’t perceive as much of a benefit. For any airline employee to utter the words, “I don’t care who you are or how much you travel” is beyond belief. Either the loyalty plan means something, or not. There is no in-between. My own experience with air line points is disappointing at best. Gaining ’status’ brings so many conditions, that the value is discounted to a bunch of useless coupons, that seem to be impossible to redeem, unless I am prepared to book 12+ months in advance and use completely inconvenient multiple stop routes. [my example is Air Canada]. So stepping up a level, loyalty points and plans are only of value if the customer feels value. Fewer are feeling that value nowadays, and those Banks who pay for those plans, should think about that. I think the loyalty plan model is broken. Technorati Tags: loyalty+plans, airlines

Advertise on Technorati

Advertise on Technorati