Today was a groundbreaking day for brands that sponsor loyalty and rewards programs.

I woke up this morning and scanned my email. My local coffee shop sent me a free coffee coupon by email and, upon ordering in the store, was able to flash my Android smartphone to the server and cash in my coupon.

Later that morning, I went online to make an airline reservation. Even thought I am known by my middle name, Bill, the airline allowed me to make my reservation for next week’s trip in my “TSA approved name”, the one that matches to my passport, and seamlessly linked my reservation to my frequent flyer account. What a time saver.

Finally, I did a little shopping to buy some fitness equipment online, wanting to take advantage of a special offer received by email today. It all worked smoothly, I got my free training materials to complement the video purchased and walked away charged up for the weekend.

Wait a minute … today is April Fool’s Day ….. that’s right …. none of this happened.

In fact, here is what did happen:

My local coffee retailer #failed in the line of fire. Since I forgot to print out my coupon, I was not given the offer.

My airline was not able to link my familiar name with my TSA name and I spent too much time updating my profile to get credit for my flight.

My last experience turned out better. After drafting an email to customer service and finding the link broken, I posted on the TRX Facebook page asking for help.  I received a reply post within about an hour and ultimately a phone call and email from a customer service representative offering to take my order over the phone while the company corrected some flaws in its shopping cart.

I am loyal to those brands that, even if they make mistakes (we all do) show interest to correct them and remember that customers should be the center of customer-centric strategies!

What about you? Any Loyalty surprises to share on April Fool’s Day?

I woke up yesterday with enthusiasm for the day. It was St. Patrick’s day. Whether you have any real “green” in your blood, its a festive day to be sure.

Going though an inbox full of messages, I found an offer from a local coffee shop offering a free coffee with purchase of a breakfast sandwich. It was simple and straightforward, but caused me to make a slight detour on the way to the office to take advantage.

After ordering, I showed the coupon on my smartphone to the counter-person who promptly told me that I needed to have printed and presented the actual coupon to take advantage of the offer. Only due to my cheery nature at that time did I politely change my order to a coffee and leave.

Meanwhile, the Loyalty Asterisk™ was dancing in my brain while my loyalty antennae were on high alert. Small business and local merchants are striving to have their voices heard. Email marketing is an inexpensive way to connect with local customers and create repeat visits at low cost. These merchants have the tools, in this case Constant Contact, to deliver the messages, but many times don’t know how to execute to make the customer experience reinforce the offer.

A few thoughts:

1. In a world with increasing smartphone penetration, why would a merchant need to do anything other than see the coupon in vivid color in the customer’s hand?
2. “Going green” is not only sensible, but a positive sweetener for many brands. Why force a customer to print more paper that gets reviewed once and placed in a drawer?
3. When misunderstandings occur, why not allow the customer their promotional reward, rather than smacking them on the wrist?
4. If the owner was worried about fraud, I could have calmed his worries in three easy steps.

If we insist on speaking that “the devil is in the details”, then we should equally agree that “there is glory in flawless execution”.  Merchants need to complete their planning cycle and think through how a promotion plays out at the counter.  When they do, they will witness their customer satisfaction reaching new heights.

Some people are always pushing the envelope.

Don Peppers is one of those people.

Listening to his closing keynote presentation at the Mega Event 2010, I enjoyed a refreshing set of new ideas and one of the most compelling calls to action for brands wishing to build customer loyalty and improve customer satisfaction.

Peppers talked about building customer loyalty in the context of digital media, a world that is untamed today and which stands to unleash further surprises on both consumers and businesses over the next few years.

Simplified, winning brands in the future will build “Trustability“, a loyalty version of Whuffie that more often than not will mandate trading a short term loss for a longer term gain. Those corporate executives who remain entranced by quarter-to-quarter delivery of numbers to meet the expectations of “the street”, may find Trustability to be an elusive commodity.

Peppers emphasized that brands do not have the option to treat customer service like an item they put on sale at the end of every quarter.  Customer experience has to be delivered with sincerity and through associates which have either the power to make decisions on the spot or have access to systems and supervisors who are nimble enough to respond in real time to defuse customer angst.

From a loyalty perspective, Trustability means that breakage is a big no-no. Peppers reminded us that people don’t want their hard-earned miles nixed through fine print in the programs rules. In my lingo, the Loyalty Asterisk™ needs to be removed from every step of the loyalty value chain, especially at time of redemption.

Peppers reminded the group that Loyalty and profitability were flip sides of the same issue and that tweaking program rules to trigger short term gains would negatively impact customer loyalty over the longer term. The United Mileage Plus campaign that promises to be “the program that wants you to use your miles” is a great example of how to create Trustability through a loyalty program.

Peppers’ final exhortation reminded anyone listening that it is treacherous to attempt to compensate or fake your way to social media notoriety. In time, those who manipulate social networks thinking they can build a “persona” that enhances their business will be found out and reviled. Not just for today, but for a long time in the future.

Trust me, Don Peppers and Martha Rogers are right on this one.

Some people are always pushing the envelope.

Don Peppers is one of those people.

Listening to his closing keynote presentation at the Mega Event 2010, I enjoyed a refreshing set of new ideas and one of the most compelling calls to action for brands wishing to build customer loyalty and improve customer satisfaction.

Peppers talked about building customer loyalty in the context of digital media, a world that is untamed today and which stands to unleash further surprises on both consumers and businesses over the next few years.

Simplified, winning brands in the future will build “Trustability“, a loyalty version of Whuffie that more often than not will mandate trading a short term loss for a longer term gain. Those corporate executives who remain entranced by quarter-to-quarter delivery of numbers to meet the expectations of “the street”, may find Trustability to be an elusive commodity.

Peppers emphasized that brands do not have the option to treat customer service like an item they put on sale at the end of every quarter.  Customer experience has to be delivered with sincerity and through associates which have either the power to make decisions on the spot or have access to systems and supervisors who are nimble enough to respond in real time to defuse customer angst.

From a loyalty perspective, Trustability means that breakage is a big no-no. Peppers reminded us that people don’t want their hard-earned miles nixed through fine print in the programs rules. In my lingo, the Loyalty Asterisk™ needs to be removed from every step of the loyalty value chain, especially at time of redemption.

Peppers reminded the group that Loyalty and profitability were flip sides of the same issue and that tweaking program rules to trigger short term gains would negatively impact customer loyalty over the longer term. The United Mileage Plus campaign that promises to be “the program that wants you to use your miles” is a great example of how to create Trustability through a loyalty program.

Peppers’ final exhortation reminded anyone listening that it is treacherous to attempt to compensate or fake your way to social media notoriety. In time, those who manipulate social networks thinking they can build a “persona” that enhances their business will be found out and reviled. Not just for today, but for a long time in the future.

Trust me, Don Peppers and Martha Rogers are right on this one.

As faithful Loyalty Truth readers know, my recreational drink of choice is beer. But every once in a while, my wife and I will entertain friends over a pitcher of Margaritas on the rocks. (Salt, please.)

Many years ago a friend who knows about these things told me the best tequila for the money was Sauza Gold. Looks and tastes just like Jose Cuervo Gold—my friend says better—for a couple of bucks cheaper.

So a few weeks ago, with my supply of Sauza Gold running low, I picked up a bottle at my friendly neighborhood liquor store. Hanging from the bottle’s neck was a promo tag pitching a $2.50 refund if I filled out the form and mailed in my receipt.

Now for me, a $2.50 rebate is right at the threshold of “is this really worth my time and a 40 cent stamp?”, but I eventually mailed it in. I figured the $2.50 minus postage was the equivalent of a healthy tequila shot—so why not take Sauza up on their generous offer of a free drink?

Only I didn’t get a rebate check. Just a postcard letting me know I wouldn’t be getting a rebate because I used a PO Box as my home address—which I have to do, as my quaint little town has no home mail delivery.

The postcard listed a rewards Web site where I could check on my refund, but after entering my name and address into an online form, I got a message back saying they couldn’t identify me. I looked for another way to contact them—but there was none.

Next stop: the Sauza Web site, where there are some nice drink recipes—but again, no link or mention of how to contact anyone at the company. Unless I want to “friend” Sauza at Facebook, which is an additional step I didn’t want to take.

So here lies my conundrum: My relationship with Sauza has always been a simple one. I give them $20 and change, they give me a quality bottle of tequila in return. I would have been happy continuing this relationship for years to come.

Only, they just blew it. Through a promotional campaign that obviously had some bugs in the execution, they found a way to offer me bad customer service—when customer service didn’t even have to be part of the equation.

Suaza: as far as I’m concerned, you shouldn’t have run this promo in the first place, because the bottle of Jose Cuervo Gold sitting next to you on the shelf suddenly got more appealing. But there’s still time for you to make amends.

Like all good companies these days, you should have an ear to the social networking ground listening for chatter about your brand. Sauza, are you listening?

Evidence of the health of the loyalty marketing business is that my list of subjects to write about grows faster than I can type.

Yesterday, as I picked up the USA Today slipped under the door in my NY hotel room, a glossy 8 1/2 x 11 flyer fell in my lap and changed my blogging plans for the day.

“It’s Like Joining EVERY Hotel Loyalty Program. Except, it’s only one.” was the message. Flipping the piece over, the offer was clear: book  and stay 10 nights using Hotels.com and earn 1 free night at any of the 60,000 hotels offered through the site worldwide. Better yet, signing up for the WelcomeRewards™ challenge offered the chance to win 2 bonus nights over the course of 30 total nights booked.

The punch card might be the oldest loyalty tactic in town, but it works well for Southwest Airlines and for Hotels.com. I did a quick comparison and the simplified approach is not too far away from the basic value promised by traditional hotel loyalty providers Marriott and Intercontinental Hotels Group. For example, if a member of Marriott Rewards or Priority Club stays 10 nights at one of their respective properties with average room rate of $100, a free night is on the radar.

I know that Marriott and IHC offer multiple ways to boost earnings and have much more sophisticated programs overall, but for the budget driven traveler, joining WelcomeRewards™ is not a bad deal.

Interesting to me is that the program was launched in July 2008 but has had low visibility in the consumer eye. Also, given that Hotels.com is an operating company of Expedia, I wonder why the ThankYou! Rewards currency that Expedia uses wasn’t extended over to this brand.

WelcomeRewards™ comes with a few conditions (a/k/a the Loyalty Asterisk™), specifically:

• Rewards may be redeemed at “eligible” hotels, but I could not find that term defined on the web site
• The maximum value of a free night can’t exceed the average daily rate of the 10 nights used to earn the reward. You can however, choose to pay the difference if you really want to stay at a higher priced property
• Taxes, fees, meals, incidentals and any “other costs associated with the booking” are not covered by the free night
• Each loyalty credit is valid for three (3) years from date earned
• The program may be terminated by Hotels.com at any time

Summing it up, the flyer that dropped in my lap reminded me why brands continue to choose data-driven incentive (Loyalty) programs to engage and retain customers. Far too many people that I have heard from are using travel aggregator sites like Hotels.com and Expedia to shop around and then login to their frequent guest account at the airline or hotel chain of their choice to book reservations.

To break the habit, Hotels.com had to do something and WelcomeRewards™ is an easy to understand program that delivers sufficient value change a few consumer minds.

Evidence of the health of the loyalty marketing business is that my list of subjects to write about grows faster than I can type.

Yesterday, as I picked up the USA Today slipped under the door in my NY hotel room, a glossy 8 1/2 x 11 flyer fell in my lap and changed my blogging plans for the day.

“It’s Like Joining EVERY Hotel Loyalty Program. Except, it’s only one.” was the message. Flipping the piece over, the offer was clear: book  and stay 10 nights using Hotels.com and earn 1 free night at any of the 60,000 hotels offered through the site worldwide. Better yet, signing up for the WelcomeRewards™ challenge offered the chance to win 2 bonus nights over the course of 30 total nights booked.

The punch card might be the oldest loyalty tactic in town, but it works well for Southwest Airlines and for Hotels.com. I did a quick comparison and the simplified approach is not too far away from the basic value promised by traditional hotel loyalty providers Marriott and Intercontinental Hotels Group. For example, if a member of Marriott Rewards or Priority Club stays 10 nights at one of their respective properties with average room rate of $100, a free night is on the radar.

I know that Marriott and IHC offer multiple ways to boost earnings and have much more sophisticated programs overall, but for the budget driven traveler, joining WelcomeRewards™ is not a bad deal.

Interesting to me is that the program was launched in July 2008 but has had low visibility in the consumer eye. Also, given that Hotels.com is an operating company of Expedia, I wonder why the ThankYou! Rewards currency that Expedia uses wasn’t extended over to this brand.

WelcomeRewards™ comes with a few conditions (a/k/a the Loyalty Asterisk™), specifically:

• Rewards may be redeemed at “eligible” hotels, but I could not find that term defined on the web site
• The maximum value of a free night can’t exceed the average daily rate of the 10 nights used to earn the reward. You can however, choose to pay the difference if you really want to stay at a higher priced property
• Taxes, fees, meals, incidentals and any “other costs associated with the booking” are not covered by the free night
• Each loyalty credit is valid for three (3) years from date earned
• The program may be terminated by Hotels.com at any time

Summing it up, the flyer that dropped in my lap reminded me why brands continue to choose data-driven incentive (Loyalty) programs to engage and retain customers. Far too many people that I have heard from are using travel aggregator sites like Hotels.com and Expedia to shop around and then login to their frequent guest account at the airline or hotel chain of their choice to book reservations.

To break the habit, Hotels.com had to do something and WelcomeRewards™ is an easy to understand program that delivers sufficient value change a few consumer minds.

Auto insurance is not the most sexy purchase you can make as a consumer. It’s one of those “must have’s” and often its hard to differentiate the pros and cons between major insurers to make a decision.

I’ve admired the advertising creativity from Allstate and Progressive over the past year or so. Dennis Haysbert has put an incredibly trustworthy and down to earth face on Allstate’s brand and their ads have ranged from serious to funny, all effective in their own way to communicate Allstate’s brand promise.

And, who doesn’t like ditsy Flo, the Progressive girl, complete with her tricked-out name tag?

State Farm, the biggest of these competitors has been strangely quiet. Big Red offers not only insurance but banking and investment services through their State Farm Bank group, but for some reason has kept their light, comparatively speaking, under the bushel basket.

Progressive has launched a new campaign to pitch Loyalty in the past month and I’ve seen splashy print ads in USA Today and ESPN The Magazine touting “We Like Long Term Relationships”  and announcing rewards for new and existing customers alike.

I have to smile when any big brand chooses to put the “L” word front and center in their advertising. Customer Loyalty remains front and center with customer facing businesses, large and small and there is growing realization that growing a satisfied customer base and keeping them around for an extended time drives fundamental business and shareholder value.

I also have to let you know that Progressive’s program is a Loyalty program with a little “L”, and deserves a smallish Loyalty Asterisk™ for its manner of expressing its value proposition to consumers (i.e. calling benefits commonly offered across competitors a Loyalty program). Dig in to their web copy and you will see that they offer a myriad of tenure based and other discounts, not unlike what Allstate has been touting for the past few years and a similar package to those I have earned with State Farm, having been a client for over 25 years.

The difference? Progressive is the only of the top 3 insurers to use the “L” word and as such, makes it so.

The range of options to execute a Customer Strategy to develop and nurture brand loyalty has never been greater. They have always existed, but with points-fatigue on the rise and consumers demanding transparency and value, every brand should evaluate the Big L and the Little L as they form up a go-to-market plan.

That’s the best way to get yourself a tricked-out Loyalty program.

These days, it seems that consumers can’t buy a major appliance, personal computer, or big screen television without being offered an extended warranty.

The irony in the sales pitch is that talking points from store personnel leading up to the purchase decision are centered on the high quality of the item being considered for purchase.  Once that decision is made, whoosh, the chatter morphs to emphasize the need for a “consumer protection plan” to shield you from any number of consequences – especially manufacturers defects.

Most major appliances and consumer electronics are sold with a one year manufacturers warranty, hence the evolution of sales pitch from quality to protection communicates a (wink-wink) message that, despite the advertised quality of the product, you are rolling the dice that it will function as intended beyond one year. If there was ever a better example of fear-based selling, I can’t think of one.

I’ll leave the full analysis of when it makes sense to buy extended warranties to Consumer Reports and others who have more time on their hands. I do instinctively know that the lower the price and more disposable the item, the less it makes sense to buy a protection plan. It’s interesting to observe how some products like computer printers have devolved into this category as prices have come down, repair costs have skyrocketed and new technology is plentiful. Rather than buying a printer warranty, your money would be better spent buying discounted print cartridges!

Long ago, I added added Extended Warranty Plans to the list of Loyalty Asterisks™ in the market today. As a brand, you should be careful to monitor the presence of the Loyalty Asterisk™ in your marketing mix as they throw up barriers making long term customer loyalty tougher to achieve by creating mistrust and diluting value.

Always shopping with a cautious eye towards these plans, I was gripped by signage in Dick’s Sporting Goods offering Footwear Coverage.  As the copy read, I was being offered “Added protection from failures due to defects in materials and workmanship, including those experience during normal wear and tear.”

If you are asked to make a list of popular multi-line sporting goods stores, only a few come to mind. My list would include Sports Authority, Dicks, and Modell’s. Though they have similar inventory, store layouts, and staff knowledge on the floor, each chain has its own personality and Dicks has been my favorite of the three. I’ve also been running since I was 15 and am convinced that it is wise to replace running shoes every 400-500 miles to improve performance and avoid injury. Depending on your running volume, that equates to 2 pairs of new running shoes per year for anyone training for more than a dog walk.

That said, the idea of a consumer protection plan for running or any other athletic shoes is just plain mad. Dick’s announced the warranty coverage in February 2009 and while it makes more sense for high priced treadmills, it’s value is questionable for expendables such as shoes. Readers of Runner’s World seem to agree.

Dick’s offers ScoreCard Rewards, a basic rewards program that delivers about a 3% deferred discount (spend $300 get $10). With consumers seeking transparency and value in the retail shopping experience these days, the offer of a clearly suspect extended warranty product undermines the “loyalty” that Dick’s is seeking to achieve with ScoreCard Rewards.

Consumers keep score on the sum total of offers made by retailers and ultimately evaluate brand worth on a holistic level. Now that’s something to mark down in your retail playbook!

These days, it seems that consumers can’t buy a major appliance, personal computer, or big screen television without being offered an extended warranty.

The irony in the sales pitch is that talking points from store personnel leading up to the purchase decision are centered on the high quality of the item being considered for purchase.  Once that decision is made, whoosh, the chatter morphs to emphasize the need for a “consumer protection plan” to shield you from any number of consequences – especially manufacturers defects.

Most major appliances and consumer electronics are sold with a one year manufacturers warranty, hence the evolution of sales pitch from quality to protection communicates a (wink-wink) message that, despite the advertised quality of the product, you are rolling the dice that it will function as intended beyond one year. If there was ever a better example of fear-based selling, I can’t think of one.

I’ll leave the full analysis of when it makes sense to buy extended warranties to Consumer Reports and others who have more time on their hands. I do instinctively know that the lower the price and more disposable the item, the less it makes sense to buy a protection plan. It’s interesting to observe how some products like computer printers have devolved into this category as prices have come down, repair costs have skyrocketed and new technology is plentiful. Rather than buying a printer warranty, your money would be better spent buying discounted print cartridges!

Long ago, I added added Extended Warranty Plans to the list of Loyalty Asterisks™ in the market today. As a brand, you should be careful to monitor the presence of the Loyalty Asterisk™ in your marketing mix as they throw up barriers making long term customer loyalty tougher to achieve by creating mistrust and diluting value.

Always shopping with a cautious eye towards these plans, I was gripped by signage in Dick’s Sporting Goods offering Footwear Coverage.  As the copy read, I was being offered “Added protection from failures due to defects in materials and workmanship, including those experience during normal wear and tear.”

If you are asked to make a list of popular multi-line sporting goods stores, only a few come to mind. My list would include Sports Authority, Dicks, and Modell’s. Though they have similar inventory, store layouts, and staff knowledge on the floor, each chain has its own personality and Dicks has been my favorite of the three. I’ve also been running since I was 15 and am convinced that it is wise to replace running shoes every 400-500 miles to improve performance and avoid injury. Depending on your running volume, that equates to 2 pairs of new running shoes per year for anyone training for more than a dog walk.

That said, the idea of a consumer protection plan for running or any other athletic shoes is just plain mad. Dick’s announced the warranty coverage in February 2009 and while it makes more sense for high priced treadmills, it’s value is questionable for expendables such as shoes. Readers of Runner’s World seem to agree.

Dick’s offers ScoreCard Rewards, a basic rewards program that delivers about a 3% deferred discount (spend $300 get $10). With consumers seeking transparency and value in the retail shopping experience these days, the offer of a clearly suspect extended warranty product undermines the “loyalty” that Dick’s is seeking to achieve with ScoreCard Rewards.

Consumers keep score on the sum total of offers made by retailers and ultimately evaluate brand worth on a holistic level. Now that’s something to mark down in your retail playbook!