I recently made a presentation at the Loyalty Expo in Orlando, Florida about Marketing to Millennials. Even though I was working from a research base that covered the past 12 months, I was unsure if my observations would gain traction with the audience.

You know the drill, everyone knows everything these days and original thoughts are as rare as the Blood Diamond. To my surprise, people put their forks down during lunch, set their Blackberry’s aside, and listened. From this experience I learned an important lesson, information circulates rapidly these days but the increasing velocity encourages razor thin subject matter expertise rather than depth of knowledge.

If there was ever a time when people were spinning towards identification as “jacks of all trades and masters of none”, it is now. I also embraced another reality, that I am not an expert on this topic, just the guy who is dedicating time and resource to understanding the space and trying to make connections between traditional customer loyalty best practices and the ways we must adapt to reach Gen Y.

A source of confidence for those of us trying to figure out how to reach the younger generation comes from Howard Lax, Sr. Consultant, Harris Interactive who stated: “the drivers of loyalty are not materially different across the generations – the difference is how we communicate and the impression we make”.

Every human being wants to be rewarded fairly for their brand patrongage and wishes to be recognized in a personal manner along the way. Customized interaction and personal service are concepts that cross generations.

I had a great coach who once told me that he could “train any monkey to finish an Ironman”. Though not the highest complement at the time, the message was clear. Follow the plan, do the work, be diligent and patient and you will reach your goal. The same holds true in the rapidly changing marketing world. The people who blend wisdom learned from experience with diligent study of new trends will reach the finish.

Oh yea, there is one more requirement – you have to possess the courage to do the training and step up to the starting line.

Al Gore may have “invented” the internet, but it wasn’t until the 2008 Presidential campaign that both Republicans and Democrats decided to logon in earnest.

In a previous post, I covered John McCain’s “Spread the Word” incentive program, designed to award points to volunteers for a variety of activities. Barack Obama isn’t giving away points or miles that I know of, but has made excellent use of social media to assemble a grass roots army of supporters. When Paul McCartney was quoted as saying “Think globally, act locally”, he could not have imagined how well the Obama camp would exploit the notion. Through the web site www.my.barackobama.com , the campaign provides tools to “make local organizing easy” and that is just the beginning.

In a recent survey of Chief Marketing Officers about the Millennial generation, 75% acknowledged that Generation Y will have a significant impact on their organizations over the next 3 years, while 54% admitted that they do not yet have a strategy for targeting, attracting, or retaining this group as customers.

Count Obama as one who has a strategy and is doing it right. He enlisted the services of Chris Hughes, one of the founders of Facebook, to be in charge of the campaign’s new-media strategy. According to a recent New York Times article, Mr. Hughes has contributed to “revolutionize the use of the web as a political tool”. Results are strong, as the campaign has raised more than 2 Million dollars in contributions of $200 or less and mobilized a ground force of hundreds of thousands to help in campaign grunt work.

Driving around town this past weekend, the success was obvious to me. The Obama camp had rights to a big intersection in the morning and covered all four corners with so many people that the police should have been called in for traffic control. When the McCain supporters took over in the afternoon, there was a light sprinkling of volunteers barely able to distract driver attention. The contrast between these two day-parts created a visual image in my mind of mosh-pit in the morning, followed by high tea in the afternoon.

According to Mr. Hughes, Obama was an early believer in social networks and created his own Facebook profile over two years ago. Putting a stronger stamp on his convictions, Obama has promised to hire a chief technology officer for the White House, if elected. Obama’s wise use of social networking will be fully validated if the youth vote comes out in force on election day. Historically apathetic, the current generation of Millennials feels more empowered than their predecessors and technology is their not-so-secret weapon.

For marketers residing in the Boomer generation and pondering the importance of Facebook, LinkedIn, Twitter and the lot to their business, I would advise pulling the plug on task forces formed to rationalize the channel and begin to play the game in earnest. It’s all about meeting your customers where they are.

If Obama wins this election, it will be partly due to the most effective loyalty program ever. The design breaks from “best practices” as recognition and emotion are everything, while no points were given away.

Maybe there is something to learn from politicians from time to time!

Watching the Vice Presidential debates, there was a lot of talk from both sides about bolstering the hopes and fortunes of the middle class. This struck a chord as I reflected on my shopping experiences that same day and realized that retail marketers rely on several promotional tactics that, in our opinion, aren’t truly designed with the customer in mind.

Extended Warranty Protection Plans, Same-As-Cash deals, and Mail-in rebates are all on the suspect list but Mail-In Rebates are the focus of this post. Designed originally as a deferred discount to distract consumer eyes from the “real” price of the product, mail-in rebates came into view years ago and continue to proliferate throughout retailing. Today, they have proliferated across product and category to the point where consumers can’t just rely on reading the “price” shown in big bold type, but need to look at the fine print to see what conditions apply to enjoy the stated price.

Two quick stories will have you nodding your head as they illustrate customer experience in mainstream retailing:

• Needing to replace a mobile handset for a family member, I called the “help” line to find out what deals were available. I was given the prices of specific phones that I was eligible to acquire and was told that a $75 early upgrade fee would apply. The phone we selected totaled up to $125. This price was in my brain when I walked into the wireless store only to learn that it was net of a $50 Mail-In rebate. End of story…..I paid $175 and walked out with a new handset and a rebate form to complete.
• My 19” computer monitor was on the fritz and I had no choice but to shop for a replacement. Prices for 22” monitors ranged from $179 – 295. When my frugal Irish eyes looked more closely at the $179 model, I noticed that the price was net of a $50 rebate. Next to it was a more attractive model with bigger brand name. Since the price was $249, I struggled with the wisdom of paying a higher price and not having to take my rebate “homework” with me. End of story……I am still shopping.

The attractiveness of Mail-In rebates for marketers is summed up in one word: breakage. The burden of cashing in on the rebate falls solely to the consumer. Completing the paperwork properly, including the right documentation, mailing before the expiration date, and spending additional money for delivery confirmation stacks up in favor of the retailer. It is a game that can be played successfully by consumers, yet many of us don’t have the discipline to follow through properly. The fact that Mail-In rebates continue to be a popular pricing tactic is testimony that breakage does benefit the retailer.

From what I have learned about Millennial (Generation Y) purchasing behavior, I wonder if breakage rates will go sky-high across this 80 Million person group. Maybe the only hope for this upcoming generation is out-sourcing. I’ve seen pet-sitters and dog-waste services advertised in the local paper along with cleaning and yard services. Maybe bookkeepers need to add rebate processing to their list of services.

Responsibility lies on both sides of the transaction and consumers need to be educated and disciplined when making purchase decisions. Marketers might consider this Loyalty Truth: whether this is the type of relationship they wish to promote with their customers over the long term. As they continue to employ tactics that force consumers to be detail driven in order protect their interests, the chances of building enduring brand loyalty will be diminished with each transaction……Bill Hanifin

How often have you seen trophies, plaques, and crystal featured in advertising as evidence that a product or service has received the “highest ranking” by the survey company? If you are channel or web surfing your haste might benefit the advertiser. Associating the award with the brand triggers a quick mental linkage between the two as you log a positive impression in your memory banks and move to the next channel.

If you pop the hood and investigate how these rankings are assembled, you’ll know why Gen Y (Millennial) consumers rely increasingly on recommendations received through social networking sites as well as word-of-mouth from friends and family.

The flaw in the system could not have been more clearly stated than in the sign next to where I was swiping my debit card to pay for car repairs at a local dealer.

“Did you know that a score of 9 or less is a failure? Please grade us “10” or tell us why you can’t.”

I paraphrased this a bit, but imagine if this customer satisfaction rating system were applied to kids in school or “us” at work. Try telling your child that anything less than an “A” is a failure and see how motivated they will be to climb that mountain. Or, imagine that the annual employee performance evaluation allowed raises only for those scoring a perfect 10 across the matrix of KPI’s (Key performance indicators) outlined by the boss.

Insisting on delivering a perfect 10 does nothing but dilute the scoring system itself. There are few customer experiences which are perfectly executed and there should be nothing wrong with being graded less than 10, especially if comments are provided to help interpret the score.

The proactive management of customer satisfaction scores continues “after the sale”. Every time I take my VW to the shop, I receive a phone call asking me to participate in a “short survey about my experience”. The first call comes within 3 days of my visit and the firm will continue to call every other day or so for up to 2 two weeks until I speak with them. Even though they tell me that participation is voluntary, it clearly is not, for they will chase me down like a hound-dog on a good scent trail.

Vladimir Putin might approve of this methodology. Consumers WILL participate in surveys and they WILL give us a rating of 10. Flip this around and imagine how the conversation goes between the sales rep from the survey company and a large auto dealer. Does the supplier go beyond assurances that they will manage the process and seek high participation levels, making promises to deliver the highest scores ever? Do they bring a catalog of award trophies to that sales meeting, encouraging the client to choose the one they will advertise before the campaign even kicks off?

Much has been written about how we have raised an entire generation of young people on participation trophies and certificates in fear of hurting someone’s feelings. We can argue that elsewhere, but I do not believe this approach helps consumers make better decisions about spending their hard earned money.

The appeal of recommendations made in social networking sites is the focus on content and not integers. I may not know the difference between a 9 and 10, but I can learn a bunch from reading a description of a post-sale service experience from another VW owner.

Marketers would be better served to change the game before their customers stop reading their survey results. Making the process more transparent will encourage more subjective input from customers. Don’t be afraid to learn what your customers really think about you. If you can’t stand this idea and stick with the old system, dissatisfied customers will leave anyway. I think anything less a 10 has the sound of a slamming door as they go across the street! …………. Bill Hanifin