Loyalty Truth

Ask anyone who has participated in an IRONMAN about their race day experience and most will vividly remember the swim start. The race brochure uses the innocuous term “mass start” to describe what happens when 1,500 people respond to the starting cannon in unison.A more accurate description of the frenzy that ensues is a “wrestling match in a salt water washing machine”!

How you determine a strategy to start the swim leg of an IRONMAN is no small task. Your performance can cast a spell over the rest of the 140.6 mile race. Needless to say, crafting your plan is critical to your ultimate success.

Building a loyalty marketing strategy can be equally daunting, especially if you are committed to differentiating your offering from the competition. Judging from the offerings seen in today’s market, sponsors need to spend more time on strategy formation to ensure that they get ahead of the pack.

In the IRONMAN, you’ve got three paths to follow at the beginning of the race. If you are confident in your swim abilities, get out front and stay there. If you are better than average but have some reticence about getting in the middle of the pack, start on one side or the other, taking prevailing currents into account. If you’re not a strong swimmer, hang out on the beach until most people are in the water and avoid unnecessary contact.

Loyalty program strategy, especially in the credit card business, succumbs to one of the two safe options. Offering 1 point per dollar spend along with a rewards catalog of merchandise, travel, and gift cards is like standing on the beach until the competition is fully in the water. It’s safe and with virtually no risk of injury, but you’re not going to win the race.

Strengthening the value proposition with merchant partners and experiential rewards puts you in a better position, similar to a calculated start to the side of the big pack. You might take advantage of the prevailing “current” in today’s market by using a merchant funded program, but unless you have further steps planned, you’ll end up in the middle of the pack.

The strongest swimmers toe the line at the front of the pack and have the confidence that they can establish a lead and maintain it. Yes, they are partially motivated by the fear of being consumed by the pack, but their training has prepared them to start well and finish strong.

Today’s loyalty programs need a strong, differentiating value proposition to break from the pack. New products like Xcelerator can establish the lead, and consistent use of data and program communications will keep you there. Applying a disciplined approach to measurement keeps your finger on the pulse and allows for mid–race adjustments that are essential to success.

Decide where you want to finish the race before you start. If you want to win, seek out new and differentiating products and services in the market and make sure your strategy is durable enough for the long run.

See you at the finish line…….