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.

Josh Stevens is the Groupawn, striving to live off Groupons for one year. If he’s successful, Groupon gains additional publicity in extreme fashion, all for the cost of $100,000 – the carrot in front of Josh until May 2011.

I’m neither a “WegPawn” or eligible for any incentive from Wegman’s, but I am considering moving in for the summer.

The Western New York grocery chain is ranked 28th largest in the US and # 3 on Fortune magazine’s list of “100 Best Companies to Work For” in 2010. In real terms they combine the best that Starbucks, Barnes & Noble, Panera Bread, and a host of QSR restaurants have to offer and provide a learning platform for any retailer hoping to drive brand loyalty and customer engagement.

And, Wegman’s seems to be creating its momentum absent of the typical array of grocery rewards programs used by competitors.

The interesting thing from a In the 2010 United States of America, there is an expanding group of people working independently and in collaborative teams to deliver high value at reasonable cost to Corporate America across a spectrum of service offers. I co-founded the Customer Strategy Network with this in mind and believe these consciously organized networks can be the tip of spear to drive innovation and efficiency in our economy over the next ten years. Chris Brogan shares an interesting post today on the meaning of independence in today’s business world which you might want to read to stimulate more thought on this subject.

With or without permanent office space, there is always the occasional need to get work done on the fly – whether on the road or in between business meetings. I don’t think Coworking was part of Wegman’s original business plan, but they offer an ideal platform for people on the move and in the process create customer loyalty for their core business.

Having just toured the East Coast of the US, I’ve had the opportunity to experience the merchandising approach of several grocery chains including Publix, Trader Joe’s, Whole Foods, Harris Teeter, and a few other smaller players. In my opinion, Wegman’s sits above them all in creating grocery loyalty, with beautifully organized stores, reasonable prices, a fantastic array of prepared foods, and a comfortable coffee shop and dining loft where customers can relax over a meal or pound away on their laptops using the free wireless Internet.

Wegman’s is not treating customer loyalty as a fad and as a result has been on the “Best Companies to Work For” list every year since it began in 1998. The company’s mission statement outlines three beliefs that define their viewpoint on what it takes to build customer loyalty and increase intrinsic business value over time. Some excerpts:

• “We believe that good people, working toward a common goal, can accomplish anything they set out to do”
• “We set our goal to be the very best at serving the needs of our customers. Every action we take should be made with this in mind”
• “We also believe that we can achieve our goal only if we fulfill the needs of our own people. To our customers and our people we pledge continuous improvement, and we make the commitment: “Every Day You Get Our Best”"

And the absence of rewards programs?

Wegman’s discontinued a punch-card style Coffee Club in 2007 (but still offers refills for $.50) and has de-emphasized its Shoppers Club, at least in practice. Jo Natale, Director of Media Relations, shared that Shoppers Club “is still very much active”, but “since we moved to consistent, low prices several years ago (in place of short-term sales), there are fewer discounts overall, because our prices don’t fluctuate as they once did”.

Am I a Wegman’s family member? No.

Is Wegman’s perfect? No.

Could Wegman’s be more creative in collecting and using customer data & reinvigorate a fading two-tier customer club? Yes.

Despite areas of potential improvement, is Wegman’s the best example I have seen of a grocery chain delivering on its brand promise & creating grocery loyalty through merchandising and store design? Yes!

Am I really moving in this summer? No, I really like my family and will save Wegman’s visits for those on-the-fly email check ups and when I want some really great food!

Passion. It’s what fuels the average person like you and I to enter and train for a local 10K race or even a sprint triathlon.

Passion. It’s what every event sponsor at these races is hoping to stoke up by their presence at the events.

Participating in the Open Water Swim festival this weekend in Ft. Myers, I had another chance to see how well brands were connecting with their most passionate audience. While it sometime seems that everyone and her brother has participated in a triathlon, the reality is that less than 1/3 of 1% of the US population has toed the starting line.

As the Ft. Myers News-Press.com reminded readers over the weekend, “open water is not for the meek”, underscoring that participation in these events is even more selective.

Skinny audience aside, the demographic for participant sports such as triathlon is appealing to brands, and makers of apparel, accessories, and nutritional supplements for this crowd have found event based marketing to be a successful way to build brand awareness, create customer engagement, and set the foundation for longer term customer loyalty.

Hammer Nutrition, ClifBar, and Gu Energy Gel have all successfully incorporated event based marketing as a means to build their business, and one of the highlights of the Ft. Myers swim for me this weekend was connecting with the event team from Muscle Milk to understand their approach.

Made by Cyto Sport, Muscle Milk is a lactose-free, well balanced protein formula that can be used for post-workout recovery or as a meal replacement. The on-site team was friendly, attractive, and fulfilled the athletic image of the people the product was designed to serve. The marketing method of the day was simple – be friendly and give away product samples to participating athletes.

Kudos to Muscle Milk for getting out of the gym and tapping into a huge potential market of multi-sport events. But the simplicity of execution whetted my appetite with a host of possibilities to enhance their presence and create marketing ROI through Muscle Milk’s appearance at the race.

For instance, a simple contest or drawing would have been the path to collecting lots of email addresses and a short survey (what’s your favorite flavor, tell us what races you want to see us at this summer) would create a shortcut to understanding customer preferences.

I also have to think that someone (on or off site) could have been tweeting about the event in the week before and on race day, maybe weaving in a promotion or coupon for followers who joined the conversation.

With many races under budget pressure, sponsorship of the finishing medals would have been an inexpensive way to further stamp the Muscle Milk brand in participant minds. Don’t forget that those finishing medals are displayed with pride for a while at home, generating multiple brand impressions.

I don’t want to give it all away, but consumer packaged goods marketers (CPG) like Muscle Milk could create a virtual location in Foursquare and create a promotion for those that check-in most often throughout the summer’s events. I could also imagine a special Groupon being created or a way for Muscle Milk to participate in the Zavee fun to build customer data and create sales.

Like Tom Cruise once said, multi-sport is a “target rich environment” and everything I’ve outlined here could be easily executed by Muscle Milk at relatively low cost and with measurable return on marketing investment.

Sounds like a podium sweep to me.

I just signed up for the Virgin Atlantic loyalty program called the Flying Club. I have no immediate plans to fly on the airline. Nor do I really need another frequent flyer card, as I’ve got miles banked in three or four programs now.

The reason I joined the club is I just finished reading Business Stripped Bare, Adventures of a Global Entrepreneur, the new book by Virgin-owner Richard Branson. I’ve come away impressed with Branson’s business acumen, his marketing skills, as well as his infectious joie de vivre.

I mean here’s a guy who started in the record business and has since branched out into mobile phones via Virgin Mobile, financial services, health clubs, bio-fuel, stem cell research, health-care and even space travel with Virgin Galactic. His brand, and passion for business, truly knows no boundaries.

But, getting back to Virgin Atlantic, what might be most impressive is how he has keyed into the customer experience as the crucial element of continued loyalty. Sure, Virgin has a traditional air miles program, but Branson identified several areas he believed would offer a better onboard experience, and delivered on them.

These features, some since copied by competitors, include:

• The ability to order food from your seat on-demand, according to your schedule, not the flight attendant
• A vast choice of music and movie options, delivered to a personal entertainment screen at your seat
• Seat-to-seat chatting with friends, colleagues or the attractive woman in 9B, via an entertainment screen keyboard
• Custom designed “soothing” lighting and comfy seats

It’s a reminder that true customer loyalty is never achieved by points programs and perks alone—you also need to deliver a superior customer experience. It’s something Branson strives for across all his business lines, and has me hoping I can find an excuse to fly Virgin Atlantic soon.

Don Peppers and Martha Rogers gave birth to the concept of 1 to 1 Marketing over 15 years ago. The brilliant marketing innovation is intended to “illustrate the importance of treating different customers differently. (from their website).

From a practitioners viewpoint, 1 to 1 has also been difficult to execute while attaining measurable ROI.  “Mass customization” has been the closest application of the general idea that most marketers have achieved.

In my opinion, Web 2.0 communication tools including social networking platforms finally open the door to communicate with consumers on an individual level without breaking the bank, but a big question remains: how do we gain insight into the customer preferences that drive purchase decisions?

• Yes, you can survey, but the process does not invite accuracy unless carried out within a permission driven environment
• Focus groups are not conducive to promote a diversity of opinions shared with full transparency
• Satisfaction surveys are pretty window dressing that don’t serve as reliable predictors of future purchase behavior
• And NO, there is not just one question that can be asked to determine future customer loyalty

A conversation with a friend provided an example of how bundled preferences can become a purchase-decision reality.

Marketers try so hard to collect and understand personal preferences through qualitative surveys. And, after all the work and investment, we find the behavioral data contradicts survey results on many occasions.

How can we re-engineer our methods of collecting attitudinal data from consumers to achieve better results?

• Could we use social media to encourage people to outline their “dream ticket” of one-stop shopping for grocery, fuel, or mobile phone service?
• Could we create a member community that provides value to Elite level collectors and opens the door to collaborative conversation?
• Could we employ location based marketing and social sites like Foursquare to generate “instant” surveys on favorite haunts?

If we changed our approach to consumer research, what might we find?

Keep asking questions across your customer base and listen more diligently.

The answers will come clear in time.

The proven model worldwide to form a multi-partner Coalition loyalty program is essentially the same, regardless of the local language.

Operators normally chase down the one or two leaders in each high frequency category (retail, grocery, fuel, banking) to form the foundations of their value proposition. With regional coalitions easier to launch than ones of national stature, consider a new path to partner identification and recruitment, one that is practical to execute and could lead to big results.

What if marketers started the identification process with the consumer, not the partner? Imagine if they paused to understand the way consumers feel about individual brands and which ones fit together best to achieve a partner network that connected with large consumer groups on an emotional level?

A conversation with a friend provided me an example of how bundled preferences become a purchase-decision reality. My friend will remain unnamed, but the complexity of his purchase decision making process is worth some server space.

After bragging a bit on his country’s Olympic Hockey Gold medal, he shared an unsolicited opinion about his favorite Canadian rewards program. His description was transparent and blended logic, emotion, and value.

After ticking off  his range of choices for loyalty programs in his market – AirMiles,  Canadian Tire Dollars, Esso Extras, HBC Rewards, Petro Canada’s Petro Points and Shopper’s Drug Mart, he surprised me by saying “I collect everything through my Aeroplan card“.

Why? Not for just one reason, but several:

• He likes the speed and convenience of paying at the pump with a RFID device and chose Speedpass for its ubiquity over Shell’s Easy Pay device.
• He’s a big Tim Horton fan, which has lots of stores within the Esso C-store footprint.
• He’s an RBC loyalist, having banked there since a young age, and Esso tends to have RBC branded ATM machines at their sites.
• His family has always considered Esso to be their “family brand” of retail fuel.
• And, the more he sticks with Aeroplan, he finds he can accelerate his collecting through his Elite status that triggers partner offers.

Through my quick conversation, I found that it was the combination of brands assembled by Aeroplan that made the difference. I realize that my conversation constitutes a “focus group of one” but it is illustrative of how we can re-engineer partner selection processes to launch and operate multi-partner loyalty programs that are more effective.

This little tale provide evidence into why coalitions work but also points to the reality that even individual loyalty program sponsors should consider the power of developing partnerships in the future.

Either way, it is clear that consumer loyalty is not triggered solely by the collecting activity itself but by brand affinities and the customer experience taken as a whole.

Online retailers have a uniquely difficult challenge in building relationships and creating customer loyalty. Without a store-front to rely upon, most online retailers lead with product selection and price to attract first time buyers.

This leaves many to rely on ad words and keyword search as their only acquisition funnel. Generating repeat business, building trusted relationships, and retaining valuable customers? Those three goals can become esoteric concepts to the marketing department as they  continually focus resources on acquisition for fear of muffling the principal sales driver that works.

The first wave of internet business placed the hurdle for marketing very low. Building traffic and gathering eyeballs was all that mattered and it seemed that selling this portfolio of traffic was more the goal than creating a business model on fundamental business principles.

Web 2.0 is different. The online stores that are working operate like a traditional retailer in the sense that they have to provide product choice, quality, and good service as a minimum to succeed. The business models adopted are generally sound and the achilles heel for those single channel, pure online, retailers remains price. Price as in LOW price.

Hammer Nutrition is one pure online retailer that caught my eye. The company caters to a well defined passionate customer group, endurance athletes. But they are not allowed the privilege to compete in a vacuum as many of their supplement and fueling products (electrolyte drinks, energy bars, joint formulas) are sold by larger, heavily branded, and more widely marketed companies from GNC to Power Bar (owned by Nestle) and Clif Bar (distributed through major grocery chains, Costco, and specialty shops).

How does Hammer Nutrition compete? It stays true to the values of its founder, Brian Frank. Brian grew up in California in a progressively-minded household and caught the action sport bug early on, riding bikes, skateboards, swimming, and racing BMX and motocross bikes to the point where he won Montana State Motocross Championships in the late 90’s. Frustrated by the sparsity of quality, naturally formulated products to meet the needs of endurance athletes, he founded Hammer Nutrition during the 80’s.

His mantra from those days has survived the passage of time:  Deliver naturally formulated quality products and cement customers for life with product knowledge and trust.

A little guerrilla marketing was at the core of the Hammer strategy: provide “Race Bags” at events around the country as a cost effective way to meet the core audience for Hammer products at their moment of highest interest. If you’ve participated in any organized athletic event from a local 5K walk to an Ironman, one of the “bennies” received for your entry fee is the race day bag. The bag itself carries branding on the outside and is kind of like the athlete’s version of an Easter basket – lots of product samples and surprises inside. When I spoke with Brian a few months ago, he told me that the program now distributes over 750,000 bags across 2,200 events in North America. That’s some powerful grass roots marketing – Word of Mouth advertising at its best before the term was coined.

The impressive part of the marketing strategy at Hammer Nutrition is its constant flow of educational and product information materials, part of an overall communication stream designed to build engagement and increase customer retention. A first order will usually trigger sending of the “Little Red Book” (product descriptions and usage instructions) and a “Welcome to the Family” letter signed by Brian Frank or one of his guru partners Steve Born or Dr. William Misner.

Triggered by an array of qualifying metrics, new customers receive monthly product-focused brochures, quarterly Endurance News magazines with articles highlighting athletes of all types who have competed successfully using Hammer products, and reminder post cards with previous orders outlined to facilitate easy reorder. Invitation to join the Autoship program is packed with benefits and discounts and the Referral program has a dual benefit feature where both existing and new customer earn a discount.

An open call to any athlete to use Hammer products is made via the HammerBuck$ program which challenges customers to “Turn race day into Payday”. Over $36,000 in cash and credit was awarded to 36 winners during 2009. The program is simple, race in Hammer gear, place highly in your race, and win some cash or credits for future purchase. Talk about crowdsourcing, just think about motivating gobs of your best customers who fit your ideal profile to wear your logo on race day and give it their all to stand on the podium at the end of the day!

Granted that I may have lost some of you who hate to run, or for whom the idea of an open water swim, adventure race or ultra-marathon is greeted with a wry smile while muttering “they’re nuts!”

Look past the issue of endurance sports and you will see a sophisticated, if not home grown, communication stream that delivers on the company’s brand promise while driving business goals. There are lots of good lessons for any pure online retailer to take away from a visit to the Hammer Nutrition web site.

Now and then, it’s good to know you’re ahead of the game.

A few months ago, I had written about CVS ExtraCare and, along with an overview of their program, made note that I had measured one receipt in excess of 36″. If receipts were as much fun to catch as Tarpon and Bonefish, this one would have been a World Record.

Yesterday’s front page article in the Wall Street Journal, has brought the subject of the increasing size of retailer receipts front and center. Supporting this WSJ story is another take from MSNBC that you might want to read.

From my point of view, messaging on purchase receipts should be evaluated on the relevancy of the message. In CVS, there are a series of specific product offers as well as CVS ExtraCare Bucks offered to consumers. The “Bucks” are always welcome and drive bounce back to the store.

The accompanying product offers are relevant in theory, though as I noted previously, CVS has some distance to travel before it connects purchase behavior with offer. To date, I receive offers for products that I have not purchased previously and would never be on my list. In short, my hope is that CVS will do better with its data in the future.

In another example in the WSJ story, Home Depot was chided for devoting 4″ at the bottom of their receipts for survey invitation. The Home Depot spokesperson quoted said that 500,000 responses are received each month and that this medium drew much higher response rates than in-store customer comment cards used in the past.

If customers want their voices heard, I am not sure why they complain about being asked for their opinion. Yes, there is a paper-waste issue, but at least Home Depot cares enough to ask and is willing to put a $5,000 gift card on the line for participants each month.

There are two issues at work here: store operations and customer identification. I would encourage the operations people at all retailers to review the layout of their receipts and do their best to minimize the footprint. The customer identification issue is an old one that has plagued many retailers and can be addressed in large part by a customer loyalty program.

Whether you like points, miles or widgets, you should understand that by introducing any form of membership club with benefits allows the retailer to identify customers and lay the foundation for more personalized and relevant communications. If Home Depot knew who I was, they might not have to print their survey offer on my receipt, but could send me an invitation by email instead.

By using customer data in a positive and proactive manner, there is cost savings, environmental impact, and better customer experience at the register. In the longer run, there is the opportunity for delivery of relevant offers that will lead to higher share of wallet and incremental profitability.

Have you ever had a retail experience that starts with a bang and ends with a thud?

That’s what happened to me recently at Wachovia Bank, and I share it as it illustrates a core practice of Customer Satisfaction surveys that needs re-engineering.

I had occasion to open an account at Wachovia and the experience was the best I have had in retail banking for many years. It was influenced by two key factors:

• To my good fortune, the branch was in a small community and oriented to personal service
• The staff were all old school bankers who take time to know their customers and listen to their needs

The very next day, I received a call at home (yes, it was at dinner time) as a follow up to my visit to the branch. Impressed with the quick follow up, I agreed to participate in a live survey that was to take “3-5 minutes“. The questions were general and asked for rating on a 1-7 scale.  I made a mental note that many questions were repetitive and, like many Customer Satisfaction surveys, seemed to be crafted to elicit as many “7’s” as possible.

When we wrapped up, the operator asked me if I would be willing to participate in an additional “3-5 minute” survey that would hone in on branch specific questions. I agreed as I wanted to give props to the branch personnel. As the automated survey devolved into no more than a digital repetition of the first survey and did not provide me an opportunity to recognize the people who provided such good service in the branch, I disconnected.

Just like on Gilligan’s Island, when they started out for a “3 hour tour, a 3 hour tour”, I felt that I had been invited to spend 3-5 minutes and then duped into a 12-15 minute experience that was artificial and frustrating.

I really do not understand how corporate executives continue to be lulled into attaching importance to Customer Satisfaction surveys. Most surveys are prefaced by indicating that “only a 10 or 7 will indicate full satisfaction” and the questions are too generic to allow any real insight to be collected. When consumers are lulled to sleep with too many questions and too little discernible differences, responses become less and less meaningful. Face it, in that circumstance, consumers just want to wrap it up and could care less what number rating is offered up.

This is one more item of evidence that cements my conviction that Customer Satisfaction surveys are not reliable indicators of future customer loyalty or intent to repurchase. The survey I would like to conduct would be to gauge the level of skepticism associated with Consumer Satisfaction awards, the ones you often see as part of automobile advertisements. Given the customer experience I had with survey execution,  why should we really think that one of those trophies means that the car next to it is worth our hard earned money?

It is time to rethink, restructure, and rewrite how these surveys are executed if they are to continue to have relevance in the market.

Speedbumps are everywhere.

They’re in my neighborhood, at the mall and also on the internet.  If you’re in new environs, speedbumps can by definition be mileposts of learning. Ever fly down the street in an unfamiliar area only to discover speedbumps the hard way? It’s not pleasant for you or your passengers and can do damage to your vehicle depending on your velocity at impact.

Web 1.0 had its share of speedbumps, coming in the form of viruses, phishing schemes, and deals that seemed too good to be true from deposed Nigerian princes. Web 2.0 has a different set of annoyances and the more comfortable we get with building virtual networks and storing data in the cloud, the more vulnerable we will be to connectivity outages.

My modest goal in joining the social media landrush is twofold:

• Understand how to best incorporate the social media tool-set to communicate with customer loyalty program and frequent shopping club members
• Reach the Millennial generation in an effective way to build brand loyalty

If you are paying attention to the space, you will understand when I say that there are an inordinate number of social media “experts” and others who claim to be able to build brand awareness and increase customer engagement, all leading to greater customer loyalty for profit. If you’re not involved but observing from the sidelines, trust me on this one – they are ubiquitous to say the least.

In my book the “experts” you want to associate yourself with, and trust your future online loyalty marketing efforts to, are the ones who have been playing the game, taking some lumps, and learning by doing. I’ve been at it long enough to hit a few bumps and thought it was time to share a short list of cautions to consider as you build a corporate or personal social media marketing strategy:

• Concerning your blog, Facebook, and Twitter, add value with everything you post. The criticism that Twitter is a waste of time because all people do is update about their last meal shouldn’t bother you because you won’t be posting this sort of garbage (will you?).

• Remember that everything digital has a life similar to a cockroach, i.e. longer than most of us will live. Be ever so cautious about posting anything that you might regret later. My SM muse told me at the outset to write,read, proofread, and do it again, before pressing the update button. You’ll sleep better and won’t get fired when your legal department reads your Facebook page.

• Reveal personal information with the same care you take with your wallet. Would you let strangers look through your billfold while checking out at Walmart? Didn’t think so. Why then would you post highly personal information online in the interest of being more “human”? There are others ways to accomplish this goal.

• Speaking of being human, do attempt to create conversations, don’t just blast information at the ether and expect people to respond positively. If you equate SM with digital public relations, you are missing out on better tools for that purpose, and are inviting attrition from your fans, followers and customers.

• Balance openness and immediacy with common sense. You are fully within your rights to moderate comments on any blog you are responsible for, and the practice is highly sensible. You are not obligated to approve comments that have only tangential relationship to the topic or are little more than personal rants.

This list is equally applicable if you are building a personal brand, establishing yourself as a subject matter expert for your firm, or are the corporate officer responsible for setting social media policy across your associate base.

Some brands have adopted the viewpoint that they will hold-fire on their social media marketing strategy until they have it all figured out. Surely this approach will mean that they will have less scars than yours truly, but I’ll also be willing to be that they will be so late to the game that they will wish they had started earlier.

Be cautious, use common sense, and learn from others. If you do this, you’ll achieve your objectives with social media and also be able to recognize a true expert when you see one.