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1
LOYALTY AS A KEY WORD OF CURRENT EUROPEAN
MARKETING
Louis Delcart
Chairman of the Supervisory Board
EMC - European Marketing Confederation
www.proximedia.com/web/cardone.html
2
Britannia to offer £40m loyalty bonus
Calling All Loyal Fans Sep 26 2002
Coventry City are set to introduce a ground-breaking loyalty scheme that could change the face of football fandom forever.
March 2000
CUSTOMER LOYALTY CARDS
3
Components of a loyalty system
• The right customers
• Lifetime products and services
• Loyal employees
• Measures of loyalty
4
The Service-Profit Chain
Internal Service Quality
Internal Service Quality
Employee Satisfaction
Employee Satisfaction
Employee Retention
Employee Retention
Employee Productivity
Employee Productivity
External Service Value
External Service Value
Customer Satisfaction
Customer Satisfaction
Customer Loyalty
Customer Loyalty
Revenue Growth
Revenue Growth
ProfitabilityProfitability
Operating Strategy and Service Delivery System
� workspace design
� job design
� employee selection & development
� employee rewards and recognition
� tools for serving customers
� service concept results for customers
� service designed and delivered to meet targeted customers’ needs
� retention
� repeat business
� referral
51
extremely dissatisfied
2somewhat dissatisfied
3slightly
dissatisfied
4satisfied
5very satisfied
Satisfaction Measure
Loy
alty
(R
eten
tion
)
100 %
80 %
60 %
40 %
20 %
Zone of defection
Zone of indifference
Zone of affection
Apostles
Terrorists
Mercenaries
Indifferents
The Heskett-scheme
Hostages
-- monopoly
__ normal competition
6
The Virtuous Circle of Loyalty
Deliver Superior Value
Continuous investment in hard-to-match capabilities
Increase customer loyalty
Tighten connections
Demonstrate trustworthiness
Increase customer satisfaction
7
Two Trends in Loyalty Programs
21. Rewarding Loyalty use rewards to foster their loyalty
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Two Trends in Loyalty Programs
21. Rewarding Loyalty
•Loyalty demonstrated through accumulated purchases
• Lock-in strategies achieved with the active participation of the customer
• Flexibility van be adjusted over time, e.g. through cross-promotions
• Some firms may buy into a share of the loyalty program
9
Vous découvrirez dans notre catalogue et nos magasins une foule d'articles sympas ; allant de DVD à des jouets épatants. Mais comment les obtenir?
> la société Artis d'hier et d'aujourd'hui
> etape 1: épargnerRien de plus simple, en fait: les points Artis sont présents sur une foule de produits (découvrez la liste ici ou dans votre magazine Artis). Il vous suffit de découper les points et de les conserver. Vous constaterez bien vite que le nombre de vos points ne cesse d'augmenter (surtout quand toute la famille s'y met!). 100 nouveaux points Artis équivalent à une réduction de 1 Euro. Vous l'aurez compris: plus vous épargnez de points et plus vous pourrez choisir d'articles à prix doux. C'est là que réside d'ailleurs le principal avantage de ce système: vous ne devez même pas attendre d'avoir suffisamment de points, car vous pouvez également payer toute votre commande ou une partie en argent comptant (voir étape 3).> etape 2: choisirVoici venu le moment de sélectionner un article. Furetez à loisir dans notre site (ou dans nos magasins) pour découvrir notre choix des plus larges en DVD, cd-rom, jeux de société, livres, CD, … Ceux-ci abordent les thèmes les plus variés: culture, nature, animaux, histoire, art, cuisine, jardinage, voyages,... Les petits loustics seront eux aussi à la fête. Artis Zone est un lieu de découvertes proposant des dizaines de jouets amusants, d'histoires à lire, de jeux de bricolage, de CD à reprendre en chœur,... Bien sûr, leur conception a été mûrement réfléchie afin que tous conviennent aux enfants. Artis s'en porte garant.
10
Two Trends in Loyalty Programs
1. Rewarding Loyalty threshold marketing
2.
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Two Trends in Loyalty Programs 3
1. Rewarding Loyalty behavioral change
12
When are loyalty programs successful?
1. Use rewards to strengthen the value proposition
2. Change customer behaviour
3. Learn more about your customer: the learning relationship
13
The Relationship Spectrum
Transactional exchanges
Value-adding exchanges
Collaborative exchanges
Anonymous transactions/ Automated purchasing
Complete collaboration and integration of supplier with customer or channel partner
14
Devising a Relationship StrategyUnderstand the sources and consequences of customer retention
“What is loyalty?”
Identify the reasons for defections
“Why do customers switch?”
Select the customers to retain
“Which customers are valuable?”
Design programs to enhance the value proposition and create barriers to imitation
“How can we gain an advantage?”
Align the organisation to retention as a top priority
How will we implement the strategy?”
Monitor performance and collect feedback for continuous improvement programs
“How are we doing?”
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Striving for Interactivity
2 wayActive database marketing
Fully Interactive
Communications
Addressability
Value Proposition1 way
Tailored to micro-segments
Mass Micro-segmentsOne-for-all
Individuals
Personalised
16
The Price of Loyalty
• The programs are expensive
• Loyalty programs take on a life of their own once they start
• Despite their number and apparent popularity with customers, these programs often fail to increase customers’ loyalty
17
Loyalty and customer satisfaction
1 Satisfied customers will spread the word
Service is the key to customer loyalty
Customer service beyond the sale
Make a difference with an extra-special touch
18
Loyalty and customer satisfaction
2
Satisfied customers will spread the word
Service is the key to customer loyalty
Customer service beyond the sale
Make a difference with an extra-special touch
19
Loyalty and customer satisfaction
3 Know your products
What your customers want
Discover customers' buying styles
20
Loyalty and customer satisfaction
4 Discover customers' buying styles
• Adversary buying styles
• Protective buying style
• Acceptance seeker
• Pragmatic style
21
Loyalty and customer satisfaction
5
Not all satisfied customers stay with their supplier
Solution: go beyond customer satisfaction
Develop the rapport that will make that your customers adore you.
22
CASE STUDIES
• Tesco
• Happy Days
23
PARTNERS
24
25
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Join our fantastic FREE Clubs for giveaways, coupons and great advice – including Tesco Clubcard World of Wine and Healthy Living Club.
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26
go back to...
Tesco.com home
Today at Tesco
Clubcard
About Clubcard
Tesco Freetime
AIR MILES
Your Clubcard Account
Clubcard Statement
Great ways to earn points
Points with our Partners
Clubs
Clubcard Extra Points!
Contact us
How to Join
27
OWNERS
PARTNERS
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• Created and managed by a Database management company: Sopres
• Money, discount coupons, products, events
• Motive: quality of life, granting for the family
29
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