Latest Consumer Trends To Inform Your Loyalty & Relationship Marketing Strategy

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This is a podcast episode titled, Latest Consumer Trends To Inform Your Loyalty & Relationship Marketing Strategy. The summary for this episode is:
Meet Your Hosts
01:44 MIN
Our Agenda For The Webinar
01:55 MIN
Email is STILL the #1 Driver of Revenue
01:47 MIN
Other Big Drivers of Loyalty
01:36 MIN
Consumers Want More Sweeps, Early Access
01:19 MIN
Privacy Concerns are on the Rise
03:12 MIN
What are Driving Great Brand Experiences?
01:25 MIN
How to Balance Segmentation and Personalization
02:15 MIN
How Vans & The North Face Create Great Experiences
02:35 MIN
How Brands get Experience Wrong
01:44 MIN
Top 3 Reasons Consumers are Loyal
00:50 MIN
Top 3 Reasons Consumers are Not Loyal
00:36 MIN
Why Relationships are Key to Success
02:05 MIN
What Consumers Want to be More Loyal
01:23 MIN
How to Address Service/Product Issues
02:16 MIN
Stats Driving Continued Loyalty
00:48 MIN
How Brands Should Embrace Continued Loyalty Trend
02:13 MIN
What Does 'Added Value' Look Like?
02:06 MIN
Why Consumers Leave Brands - Jodi Rausch
01:38 MIN
Which Data Will Consumers Share Most?
01:28 MIN
How Sweeps Can Collect Zero-Party Data At Scale
03:19 MIN
How American Airlines Personalizes Email For Revenue Lift
04:54 MIN
How Services Teams Deliver Great Results
01:40 MIN
Types Of Data Consumers Will Share To Brands
02:03 MIN
How To Start Small With Relationship Marketing
02:33 MIN
What Value Exchange Ideas Look Like
02:38 MIN
How To Get More Resources
01:18 MIN

Tim Glomb: Well, welcome, everyone. And thanks for stopping by our latest webinar with my guest, Mark Johnson, CEO at Loyalty360. I'm excited because I've been working on this Consumer Trends Index Report for three years now, and we're really starting to see some trends. Today's webinar that you're watching is titled The Latest Consumer Trends to Inform Your Loyalty and relationship Marketing Strategy. And as I mentioned, Mark Johnson's with me. Mark, how are you doing today?

Mark Johnson: I'm doing well. Thank you very much. Thanks for having me. Always a pleasure to speak with you and the team at Cheetah.

Tim Glomb: Yeah, likewise. We're always doing things with you, YouTube Lives and all kinds of round tables and everything, and your organization is great. So I'm excited we're doing this again. But for everyone who's watching, if you don't know me, I'm Tim Glomb. I'm the Head of Content here at Cheetah Digital. And yes, I work at a SaaS company and yes we try and sell software to brands or people like you. But I have been a 20 year brand builder. I've been in MarTech for about seven years but I've built brands, the Mark Cuban Company brands I've worked with, building audiences, engagement, and marketing strategies in the entertainment and the television space, and now I'm at MarTech. So I have some empathy for you, I understand you have goals to reach as a brand marketer. I've been there. So I promise to try and make this webinar and these stats relatable to you, not just some MarTech guy talking at you. And Mark, why don't you give us a little bit about yourself for those that aren't familiar with you and your role?

Mark Johnson: Absolutely. So I'm Mark Johnson, I'm the CEO of Loyalty360. We are a trade association for customer loyalty. We're a little unique in that we not only have the traditional pieces you would have in the trade association, conferences, insight research. We have an analyst report. We help brands with best practices like these, and really they have a very unique peer driven community where brands can engage with one another, understanding what's working, what's not working, what the challenges and opportunities may be around every facet of customer loyalty.

Tim Glomb: Yeah. Look loyalty360. org. It's a great organization. I was a member and getting your news. You have amazing email news feeds. I mean, tons of stuff to inspire. We're happy to be a partner here at Cheetah. And if you're not a partner, you should look at the opportunities there at Loyalty360. It's a great organization. A lot of our clients are members, and you're going to learn a lot. With that said, Mark, we're also going to hear from a few other faces today. We're going to hear from Ian Dewar at Vans and The North Face, we're going to hear from Erin Lomers over at American airlines. And we're going to hear from Jodi Rausch over at Concentrix Catalyst, which is an email and loyalty consultancy that work with some of our brands as well. So you're going to see some other faces. I do want to take you through our agenda today. We're going to go quick, promise you. I talk fast. We're going to give you a lot of information quickly. You can always come back and watch it. You can always download our full reports at cheetahdigital. com. So first off, if you're watching, you're probably watching at cheetadigital. com and over to the left, if you come back, we've got all kinds of chapters and takeaways. You can literally skim through this webinar without having to watch the whole thing, but here's the agenda for today. We're going to talk about the consumer trends index overview, there are five big takeaways that we cannot ignore from this third year of doing this, some of those trends. We're going to talk about building better experiences and what consumers expect there. We're going to talk about key loyalty drivers and quite a bit about loyalty. We're going to mention the value exchange economy in a short bit. We're also going to mention privacy and some other trends that we're seeing across industries. So that's what you can expect. And Mark, I'm going to explain a little bit about this consumer trends index. As I said, the third year. This index is basically a global study that was commissioned by us to [e-consultancy 00:03:40]. It has 5, 400 respondents across the globe this year, ages 18 through 75, and most of the respondents came from US, UK and Ireland, Spain, France, Australia, and Japan. But we're also going to note, a lot of US stats in this and I'll tell you which ones are US only. But remember, because you're here, you have access to the full global index, which I believe is 91 pages of great information. So Mark, enough of the pleasantries and setups, why don't we get into this? You good with that?

Mark Johnson: Absolutely, love to.

Tim Glomb: All right. Cool. Five key takeaways from a global perspective. The number one thing we have found, and this is the third year running in a row, email is still the number one driver of sales again. In fact, when we ask people," Have you ever made a purchase from any of the following in the last 12 months?" 41% picked email, 41%, and that is a 16% increase from 2021. So I don't care if we're talking loyalty. I don't care if you're building consumer engagement strategies et cetera, you have to have a loyalty strategy that's rooted in email. It has to be a big part of that.

Mark Johnson: When you look at those numbers, it's not a surprise that email is still the sales top driver, the top driver of sales should I say, because it's a technology brands are very familiar with. They understand it. But do you see brands who have effective customer loyalty strategies, maybe looking towards other channels for that holistic engagement, SMS, direct mail app, maybe push messaging, social, that may be able to ameliorate or accentuate some of their customer loyalty efforts?

Tim Glomb: Absolutely. Look, we've been talking omnichannel loyalty as a industry for years so of course. We were pleasantly surprised, since we're in the email business, that email was the number one. But the full report shows SMS is definitely still on the rise, although smaller when it comes to purchases. And then Mark, when you really get into the age data, you start to see the millennials, the gen Zs, they are mobile first. So across the board at a high level, email is still the number one driver, but absolutely. And I encourage everyone to download that report because we go in depth on all those channels you mentioned, and then even talk about how the omnichannel personalization across channels is really driving revenue. And you're going to hear that straight from American airlines a little later in this. But number two, we also learned in this trend in three years, appetite for loyalty is growing and that's great to hear. Furthermore, there was the largest increase, year over year from 2021 to 2022, was 110% of people said they want brands to understand them as an individual. That is huge. And 71% said they want you to use their data with respect when it comes to loyalty programs and engaging them. So loyalty is on the rise and 57% of consumers are actually planning to pay more to purchase from a preferred brand. So we're going to dig into that a little later, but there's definitely the appetite for loyalty is growing. And with that said, the consumer loyalty drivers are actually maturing. We'll talk about this a little later, but 73% increase from last year of people wanting more contests and sweepstakes from the brands they love. And there was a 58% increase from last year for the desire for more exclusive access and content. Now, Mark, you and I have talked about this before. I'm sure we're going to talk about it a little later in the webinar with some other stats. We know that's a growing trend and brands have to adopt it. The fourth large takeaway, we found consumers are ready to share their data. In this age of privacy and disruption and all this term oil and cookies, 92% said that they will trade personal preference data for loyalty points. That's an easy one. 86% said they would trade personal data for early access or exclusive access to products, content, et cetera. So if you want data, which you need, you have to give to get and they are willing.

Mark Johnson: So it's interesting you mentioned that. We, Loyalty360, we have about 140 members and growing. A couple of them are shoe retailers where they have exclusive offers, exclusive products, early drops, potentially for their customer loyalty members, sneakers potentially. If you're at a certain tier, you get this early access. So the push towards personalization, the push towards experiences is growing. Do you see this as something that could be of interest to all brands because offering that a unique benefit to their members, making them feel special? Or is it just for some brands?

Tim Glomb: No, no. I think it's for everybody. Look, loyalty is loyalty. And the one thing that I think we'll talk about a little later. Is it doesn't just have to be points. It doesn't have to be your product. If you sell shoes, you don't have to give away a free shoe. Who wants to water down their main product and service? Imagine what comes, what could build the experience around your product. So instead of a shoe, maybe give away a free run with a famous runner, or a trip to somewhere where they can run around the Golden Gate Bridge or something. So absolutely, people want earlier exclusive access to things. Content's an easy one. Maybe from some brand advocates or ambassadors that are creating great content. It's really, really easy to create that value add. And I think it's in every single industry. We're seeing it across the board. But great question. The fifth and last big takeaway, before we get into the real loyalty meat and potatoes here, is that privacy concerns are on the rise. So people are willing to give away their data if you're going to respect it and you're going to give them something for it, but there is an increase in privacy concern. There was a 50% increase over year over year for the adoption of incognito browsers, and if you advertise and use third party to reach people, that is a massive increase. And 48% increase from year over year of people actually using a PC cleaner wiping those cookies clean. So you got to look at your strategy. How are you reaching people? Do you have a robust loyalty strategy where you have a one- to- one communication in channels you own, like email, SMS, in- app, website? Or are you heavily anchored in third party? It's on the rise. It's the third year in a row that privacy concerns are on the rise and it's going to make it more difficult to continue to do that.

Mark Johnson: When you look at privacy, that's a very topical discussion point within our audience. We have small sided meetings every week on different topics and privacy is a big one, especially with regard to balancing data concerns as well. International brands who maybe have a GDPR concern. They have to balance the Virginia Laws, the Colorado laws, the California laws. A lot of them take a worst case scenario. So they balance for the worst case out there, but that could have deleterious effects on the customer loyalty efforts. So what are you seeing with regard to the balancing of the need for personalization, but also that need for privacy in different cities, states, or should say at least different states have different regulations here in the US, and then layering on GDPR, how do you look at that to make sure you are offering the most personalized and engaging experiences?

Tim Glomb: Yeah. It is tough. And look, as I mentioned before, when GDPR hit the market, I was a brand marketer. I was in a private equity company overseeing seven brands and we had to tackle this. We were global brand. So GDPR, as you mentioned, CCPA, all these other things. The great news is most marketers, I'll start by saying, most marketers think this is a giant task they have to overcome. And it's something they have to overcome. The great news is there's technology out here that can make it easier, especially for the enterprise marketer. There's companies like Cheetah that have these awesome tools that allow you to segment and look at geo and keep things compliant. But I think it also goes back to creating that one- on- one contractual relationship. A lot of brands still have not done that. They've got mass segments that opted into a ubiquitous marketing program. Well, when you get that one- to- one zero party data and you get someone to say, yes, I love red or I love the mountains, or I love this offer, and you have that at a one to one level, you can now personalize your communications to them and also use that information and be compliant. So it's a blend of technology. It's a blend of asking people what they care about so that you're not casting and blasting everyone and getting yourself in trouble by coming up against these laws with this cast and blast mentality. So the value exchange, I think we'll talk about that a little later, and we'll dig into how you can get started there if you're not able to do that right now. But great question. Great question. Well, with that said, why don't we get into the brand experience? I'm going to move pretty quickly through this section. It's a great section. And if you're building a loyalty strategy, it's all about experience. It's not just points for purchase and points for rewards. You have to build a great experience. So we asked people, when thinking about their favorite brand over the past six months, what creates a positive brand experience? And here are some of the answers. 85% of them said," My favorite brand provides a consistent experience." Very important. 82% said," They reward me for my loyalty." A little recognition there. 80% say," They treat me like an individual." Very important, were all individual people with individual names. 76% said," That brand strives to develop a relationship with me." 44%," Communicate as, and when necessary." Right? Send me something when I need it, when I want it, based on what I said, not when the brand manager feels he's got to blast everybody and make his quarterly sales goals. And lastly, 27% said," We have a good relationship and the brand understands me." So when it comes to brand experience, clearly you've got to factor in all these different things. And this is how consumers are looking at it. And by the way, those stats are US data. The full global report breaks down all the different regions that we looked at, if you're a global enterprise looking to see how attitudes change in other countries.

Mark Johnson: Tim, when you look at communication preferences, having a preference center is another area of interest for brands. Not many have that. So being able to listen to and respond to the preferences of customers is a big challenge. So there's some work to be done with that. So when you look at that 44%, customers are still having positive brand interactions, but they believe that customers only communicate as is when necessary. How should brands balance the communication cadence, the segmentation, getting the message out, obviously to drive loyalty, to drive sales, drive engagement, while also disparate perspectives from consumer?

Tim Glomb: Yeah, absolutely. Look, every brand has to communicate and they have to communicate to everyone. When you launch a new product, you got to tell everybody. Or if you've got a big, special, or a discount or a shopping season promotion, you got to tell everybody. That's the push mentality. That's the campaign cast and blast. I'll put it under there, even though some are more sophisticated. However, ever getting into a trigger based communication level. Mark, if you and I were sitting in the same room, working independently and all of a sudden, after 30 minutes, I looked over you and said," Hey, Mark, you want to go to lunch?" You would answer me because I asked you a question. There would be an answer and a communication. So I think asking customers things like," What do you want for lunch? What products do you need? Do you need something this fall? Are you looking for a summer clothing for your kids?" Look at your brand and figure out what five questions could I ask that person, every one of my consumers, my target audience. And if they gave me the answer back, when and how would I communicate to them? And that's the trade booth mentality. If you're in a trade booth and you're selling one on one, you're going to ask a bunch of questions, learn what they need, and then tell them what they need. Do the same thing. I don't care if you have tens of millions of customers, go out, ask those questions with surveys, sweepstakes, all kinds of things. Use that intelligence to in when to trigger, ascend, and when to cast and blast your big mentality. And also look at web actions. Did they open your app? Did they come to your website three times this month? That should trigger a response, not you just casting them and beating them overhead with a club. So that's my attitude. That's what I've done as a brand marketer, it's worked well for me. And we're seeing great results with clients here at Cheetah Digital. Make sense?

Mark Johnson: Absolutely, thank you very much.

Tim Glomb: Enough of you and me talking. Really me talking. I want to throw to a clip of Ian Dewar, who was head of analytics at Vans and North Face. I recently spoke to him and he explains how the VF Corp and their brands really build that brand experience and communication layer from the first touch all the way through a brand loyal advocate. I want to roll this clip right now, check it out. In the consumer journey and the customer journey there are different stages, right? You've got the awareness stage, the interest stage. Maybe they're visiting a store, maybe they're comparing products they're going to purchase. They're going to use, reuse, cycle, et cetera. A lot of things you mentioned. Which of the customer stages do Vans and the North Face really focus on to get that core intelligence?

Ian Dewar: That's a great question. So, part of what's important for us with our loyalty programs is to be able to engage with the customers at all points in the customer journey. So the answer to your question, at a start is yes, yes, they're important. But Vans Family and XPLR Pass both allow us to begin the conversation with our customers really early in that process. We believe there are key opportunities in the interest, search, and compare points that you've noted to begin this personalization process. This is again why behavioral data is so important. We can start personalizing messaging and increasing relevance before the customers even make their first purchase with us. Beyond purchase, we also want to have our customers understand how they use the product. So the post purchase engagement is equally important. The customer buys something from us. Doesn't use it properly. Doesn't like it. They're not coming back. So it's in our absolute best interest to make sure our customers understand our product and use it to explore and express their originality. Happy customers definitely become repeat customers.

Mark Johnson: Yeah. That's very interesting to hear a marketer's perspective with regard to how they are seeing things. A lot of times how the technology or how they're being approached may not necessarily be in sync. So, and that can lead to some dissonance in the channel. And I think one of the things that Cheetah does very well with their array of products and services they have, not to make it a pitch, but you guys do a great job of putting yourself in the shoes of the client in a manner that's very conducive and beneficial and inaudible to that brand, versus putting them in a product or service that really doesn't drive the results or understand what they should be driving. So I think that's a very unique perspective from Ian and what they're doing.

Tim Glomb: Yeah. Look, we appreciate that. And that's why our loyalty platform is not a one size fits all. You don't just take a logo and throw it in and get the same experience as our other blaring clients. It is completely bespoke. It's completely custom. And the Vans Family app is a great example of that. I thought we'd move on though. We talked about the good from brand experience and what consumers thought. There's also the ugly. So we also asked of the brands that communicated with you in the past six months what were your frustrations, when it came to brand messaging, email outreach, et cetera? Now, 55%. This is huge. 55% of respondent said," The brands are sending me irrelevant content and offers," and that's a 34% increase. And this is US data we're talking about right now. We're going to have mostly US viewers today. They also said," 44% of the messaging that I get does not reflect my wants and needs." And that's a 42% increase from last year. It's getting worse. 39% said," Messages are based on personal information I did not share directly with the brand." Think about that. If you're buying, selling data, bartering data with other companies, and all of a sudden you're getting into this creepy zone of knowing something about someone and they don't even know your brand, that's bad. 25% increase on that one from last year. 35% said," The messages they get do not recognize my shopping or loyalty history." That's the easiest thing to fix ever, right? If you've got the technology to sell to them or product registration, if you're not the direct seller, direct to consumer, you have to make that match. You have to know what they're consuming with you, and you have to reach out and understand what they're buying and what they like about it. 13% increase there. So some stats on how brands are getting messaging wrong. Now, I say we move into what are the key loyalty drivers? Because there are quite a few stats here, Mark, that I think are right in your wheelhouse for driving brand loyalty. First to start, the top three considerations we found that kept consumers loyal to their favorite brands. And here are only three stats, there's far more in the full report. 53% said," They're loyal because they have great products or services." That's an understood. I call that table stakes. If you don't have a good product or service, in fact I think this number should be larger, quite frankly. 41% said," Those brands have great customer service and support." So clearly people are leaning on that post purchase brand experience. And 38% said," Because I like their loyalty program and they provide extra value to me for my loyalty." Now, those are three. Only three. Where do brands need to work harder to keep customers loyal? Well, only 19% answered that the brands align with my values or environmental or political issues. So still a hot button issue for people. They want to align with them through a values perspective. Only 19%," The brand seems to understand what I need." That's a problem. Sounds like you're talking at them, not listening to them. And only 12% say that the brands work hard to build a relationship with me. And that's sad. I know it's a inaudible number, only 12%, but that's a sad number. What are your thoughts there, Mark?

Mark Johnson: When you look at that stat, only 12% of the brands are actually working hard to build that relation, or at least that's from a consumer perspective. What do you see that's working? What are a few ways that brands can adapt to improve that metric, to enhance the value proposition with the consumers, so they think that they're actually doing more to build that relationship?

Tim Glomb: Yeah. Well, number one, I mean, this is where we're going this year at Cheetah Digital. We are telling the relationship marketing story. And the idea is as we ween ourselves off these diets of cookies and tracking and technology that was apparently connecting us with our consumers. And look, I put myself in that bucket. I was a brand marketer doing it. I was using third party. We were talking at people. We were inferring things based on their behavior, which we were probably getting from third parties and other sites. It wasn't really a relationship. It was as if we were snooping on consumers. And I think the brands that are winning... I know the brands that are winning are building relationships and relationship marketing really is a acceptance that your consumers when they first meet you are unknown to you. And you're probably unknown to them to some regard. Then stage two is getting to know each other. It could be as simple as a transaction, getting their credit card. Number three is asking them more questions." Hey mark, do you like motorcycles? Do you like cars? Do you want to go to the beach? Do you want to go to the mountains?" Getting that information back consumers. And then once you have that information, as we mentioned, you can send messages, you can send offers that align with their wants and needs that are received in the timeframe and at the time of year that they actually want them when they need those products and services. And that's what leads to loyalty. So I think brands need to start scratching their head right now, if they're not doing this and say, how do we build relationships with consumers at scale? What technology do we need in our stack to literally go out and find these signals that aren't inferred? They're not bought or bartered, they're literally between consumer and brand. And if you do that and you make that investment, you're going to reap the rewards. And you're going to see that with American Airlines in a little bit here. So moving on, we also asked people this question with the statement," I buy frequently from the same company but I don't feel loyal to the company." So what would make you feel closer to that brand? And there's four stats here. There's more in the report. 45% said," Provide extra value to me to remain loyal." And there's a lot of things about loyalty and value we can define. 34% said," I want better customer service and support." We saw that earlier as well. 33% said," Better products and services." So even though that's one of the main drivers to loyalty for attraction, you still got to keep that up. And 18% said," Work harder for me to build a relationship." So not only did we see what was working, but we're also seeing what's not working and what those people want. It aligns right back up to the main one. And then the fourth stat here, in the loyalty driver section I'll say, is consumers that have moved away or become less loyal to brands that they previously liked. What were those reasons? 35%, the number one," Issues with quality." So again, you can't discount your product and service. You got to keep that quality up. 30% said issues with customer support have driven them away. 27% said" Other brands have better products or services." 19% said," I don't feel valued as a customer." So we're seeing the same numbers. We're seeing the same trends through different lenses of different ways of asking that question, but we're constantly getting the same kinds of answers.

Mark Johnson: Excellent. When you look at some of the challenges that kind of been ubiquitous for brands recently, buying online, picking up store, technology challenges, not having the right products in store, not having the right employees necessarily. Some of these problems have been endemic that all brands have had to deal with, but some brands have done a really good job of creating unique engagement. They bounce back from some of these issues and they're keeping their customers more loyal than ever before, and some of these service issues may not be as challenging. But how should brands be looking to address some of these service level issues that seem to be ubiquitous in the market, at least for some?

Tim Glomb: Yeah. Look, the number one recommendation I have is own it. If you fail or your product's deteriorating for a short period of time, or you have supply chain issues or support just isn't there, you have to own it. And I don't mean own it when someone calls and complains, you have to own it outright. And I'll give you a great example of that. You and I may have talked about this before, I've certainly said it on another webinar. I am a huge fan of Pendleton shirts. I'm a Denver, Colorado guy. I know you're from Denver. We're Western guys. I like my button up original wool shirts. They're they're pricey, but they're high quality and I've got dozens of them. I did not even know that Pendleton's website went down for a day on e- commerce. Didn't know it. But in the mail, physical mail, I got an envelope from Pendleton with an apology and it was a note from the CEO on a card that said our e- com went down. We know that you've purchased from e- com. We respect you. We appreciate your business. Here's a coupon code for 30% off up to three items and it expired six months from that. I didn't even know they had an issue. I wasn't buying at that time. But the CEO owned it. He sent it out to their high value customers. Trust me, I've spent thousands with them. I didn't have an issue, but I got that extra value. He owned it and I'll tell you this. It made me even more loyal to the brand and proud that brand takes their high value customers very seriously. So that's just one example. It probably cost them some money, some discounting, but it won me over. And my loyalty went through the roof on that one. So that's just one example. I think you just got to think through your industry, through your products, what can you do to make things right when things aren't there? Continuing on, we look at the propensity to become more loyal to brands, and we ask people," Are you more likely to engage in a brand loyalty program?" 52% said they are more likely to participate in a loyalty program than they were the previous year. And that's a 15% increase year over year. So great news for those of you in the loyalty space, including yourself Mark, loyalty's on the rise. We asked highly profitable customers that were being handed to your customers, why are they leaving? And 57% said they are prepared to pay more to purchase from a trusted brand. So trust is a factor there. Do you build that trust with your consumers? Do they trust you? Like Pendleton, I didn't even know they had an issue, but I trust them to take care of when I have a next sale, or if I'm going to have an issue.

Mark Johnson: Quick question, Tim, when you look at the stat that stated that customers are more likely to participate in a customer loyalty program this year versus last year, how should brands embrace that trend? Customer loyalty, we believe, is more important than ever before. Understanding what's working, what's not working, not only getting it from research like this, but from a peer- based community. But what do you see as reasons why customers are more loyal or more interested in customer loyalty programs today than they were maybe a year ago?

Tim Glomb: Yeah. Look, I think COVID had a lot to do with that, personally. We've seen a lot of data from our clients that COVID affected sales, right? For some, it was great. It went through the roof. If you had a digital transformation plan in place, you could reach people. For others, service based, airline industries, hospitality, et cetera, it went down considerably just because of the nature of it. So I think consumers being caged up and completely changing the way they consume, purchase things. I mean, I know 60 year olds and 70 year olds that never used e- commerce that that's all they do today. I mean, my father is one of those. He never knew how to buy things online. He buys everything online right now. So I think understanding that your consumer's behavior has changed and the channels has changed has opened up consumers to the idea that they can get loyalty. And loyalty doesn't mean just points, right? It's not just grocery store of stacking up points for gas rewards or whatever. It can be more than that. It can be emotional. So I believe that consumers are consuming a different way and they want to have better relationships with those brands. We're seeing that. We're seeing that with loyalty programs we're rolling out here at Cheetah Digital, and there's a lot of value add that you can have that's going to get those people into your programs that weren't necessarily in it before. Bloomin' Brands, Outback Steakhouse, another great example. A lot of people who never bought for takeaway or delivery from those brands, older people have become fiercely loyal to their brands. And they get an eight times return on this older generation that's now buying through curbside pickup or delivery. So completely changed in landscape and can change in a consumer behavior. Sorry, I should have given you a chance to get in on that slide. I'll start slowing down maybe. But to continue, how do you drive long term loyalty from frequent shoppers? Well, there was a 66% year over year increase in consumers who would feel closer to a brand if they provide extra value for them to stay loyal. And I thought you probably have some thoughts on this one.

Mark Johnson: Yeah. When you look at easy wins, surprise and delight is a big area of interest as well. And not just points, not just rewarding for recency, frequency, or monetary spend, but being able to personalize delights, especially creating engagement early on in the customer life cycle. What are you seeing that works aside just giving discounts or additional discounts? Early access we talked about earlier, what are a couple of examples that you see that can really drive engagement early on in that process?

Tim Glomb: Yeah. There's a ton of things and the report, there's a whole nother section. I wish I included it here, but everyone's going to have access to it. We ask them, what do you want to see as extra value? Some of the answers were as simple as recognition. I just want to be recognized. I don't want to be recognized and have a thank you email every time I make a purchase, I want to be recognized on social media. I want to be recognized when I post a picture. I want to be recognized when I come to your website or open your app. So those are things. Del Taco does a great job of this. When you open the app, you get some triggered emails that recognize that and say," Hey, maybe you're ordering for the big game this weekend," you open the app on a Sunday morning or something. So it can be as simple as recognition. Again, back to the sweepstakes and surveys. You don't even have to just give away your products and water down your product value. You could say, hey, if we're a running shoe company, give away a sweepstakes to run, or give away a tracksuit from another brand, or give them a gift card to go shop at their favorite retailer to enhance their running experience. So those are examples of added value, but you have to have the listening signals. You have to be able to understand when Tim comes to your website, opens your app, does something on social media, you got to have those signals there, but tons of opportunity for extra value. And again, the report has a bunch of different answers and stats in there. Mark, I want to move to what's driving customers away from brands. Well, 21% of consumers have left their favorite brand because they didn't feel valued as a customer. So again, I think it goes back to recognition, are you creating a very transactional relationship with your customers? Is it going beyond? Is it getting emotional? If it's not, you're going to lose them. They're going to go to other brands and Jodi Rausch, who's the managing director at integrated loyalty solutions at Concentrix Catalyst. I did a webinar with her recently and she has some great thoughts on this, especially what people are doing with the younger generation. So I want to roll this clip right now.

Jodi Rausch: That's a great question. So, really we're seeing that points, some people are still keeping a hold of them because they tend to be table stakes, and you don't want to cut people off at the knees and you don't get points anymore. But what's more appealing, and what we're especially hearing from younger audiences and emerging demographics is that they like that emotional connection. I want to engage with you as a brand. I want to have an experience. I want to feel like you know who I am and that you're not just talking to me like you talk to everybody else who shops at your store. So there's really creating that emotional connection and giving me new opportunities of how to engage with you or create a community, and I can engage with other people who love your brand the same way that I do.

Mark Johnson: So very interesting to hear what Jodi said. I know Jodi personally, she has a great deal of experience in working with some very powerful and marque level brands. What's next, Tim? How to do we bring this all home?

Tim Glomb: Yeah. So per our agenda, I want to get into the value exchange economy. I'm not going to go deep. I love talking about this, but we're just going to glaze over a couple quick stats we found. We asked people," In exchange for sharing personal data, which benefits are deemed highly valuable?" So again, the idea here is brands need more data directly from consumers. They psychographic data as well. Not this inferred stuff, not my age, not my postal code. That stuff's easy to get. So what are the things that would really be high value? Well, good news, discounts or coupons. 65% of people in the US said," Give me more discounts and coupons." It's up to you as a brand marketer to decide whether you want to water your brand down by constantly discounting, but it is a 22% increase year over year in a request for that perk. 60% said loyalty points or rewards. I fly a lot and I love it when I get extra surprise and delight rewards from my airlines that I travel. I love it. So I fall into that bucket. 17% increase year over year in America. 47% said early or exclusive access to offers. We talked about that before. That's kind of easy things to create and offer to your audience. 23% increase year over year, it's growing. 42% said a chance to win something. So not only did we hear earlier that they want a chance to win something from their favorite brands, but to exchange data, give me a chance to win something. And again, it doesn't have to be a product, could be something that enhances your product.

Mark Johnson: When you look at sweepstakes real quick, that's another area we see some interest in. Making sure that obviously they're set up in a way that gets to that zero party data. Because the whole idea is either to get some points off the books, create unique engagement, or to get some data that you can action at a later period in time. When you look at a brand who may be looking to introduce a sweepstakes or give members an opportunity to win, what are the amounts? Should it be a nominal amount? Should be always a large amount? Obviously, that requires more potential setup. What are some best practices that can give brands a inaudible opportunity to grow and learn, and see some success around sweepstakes?

Tim Glomb: That's a great question. And I think I'm pretty well qualified to answer this because this is where I really cut my teeth. Before I landed at Cheetah, I was using all kinds of technology to make those offerings. When I was working for Mark Cuban at AXS TV, as television, music network, we would give away signed guitars or signed ukuleles or signed paraphernalia from bands, and it didn't matter whether Metallica or the rolling stones or somewhere in between. So the idea was the more, the better. And what I mean by that, is it's not always more money, more people. If you give a hundred people a chance to win something, you're probably going to get more adoption. Because people feel like," Oh, there's a better chance to win." So that's one strategy but there's also value. Discovery Communications got a hundred million entries where everyone had to answer five to nine questions on their home ownership and what they were going to do around their home. They got a hundred million entries on the giving away a million dollar home in Florida. So opposite ends of the spectrum, right? Give away a guitar or some drumheads signed by the band or give away a dollar home, both have value there. So look at what are you trying to get out of it? Are you trying to get mass scale and mass reach? Maybe a big ticket item's going to get a lot of people in there. Are you looking to start with zero party data and understand how the information you're asking in a sweepstakes, Tim, what's your favorite destination? What color, what size, all these things. Maybe you start with a lot of prizes to a smaller pull. Learn, cut your teeth, how are you going to use those answers and data to actually effectuate triggered emails or offers back to those consumers? So I think both approaches work. I think if you're looking for mass adoption, big blast of volume, customer acquisition, give away a home. If you're looking for some information, give away a lot of smaller prizes to a lot of smaller people. And the one thing I will say is be very strategic in the questions you ask, do not ask a question that you can't use that data to help better the experience. Don't ask a question just because you, as a brand marketer, want to know it from your audience. That's called product marketing. Build a relationship, get someone to take three or four surveys before you then make the ask of like," Hey, we're thinking about building a new product. What would you like?" That's like filling out a medical form rather than a cool brand engagement form. So that's my result there, and we have a ton, as you know Mark. We have a ton of resources at cheetahdigital. com around this. We do thousands and thousands of surveys and sweepstakes across every single vertical. So tons of resources there, but great, great question. Moving on. I want to give you an example of zero party data in action. Because we hear a lot of customers saying," Hey, I've got loyalty members. We want to drive more loyalty. How can we use zero party data, and how can we use our own communication channels to get a lift in revenue or more engagement?" I sat with Erin Lomers who's a senior manager of marketing communications for both planned and owned channels at the global brand marketing team at American Airlines. This is a giant global brand moving 200 million people across the globe per year pre COVID time. But they're very sophisticated. We went out and created a short zero party data engagement strategy that was focused on their highest value American Advantage loyalty members that asked them a few questions. They took the data, gleaned it, created personalized offers for them, and it lifted revenue considerably in my opinion. But here, let's roll tape and hear it straight from Aaron on how it rolled out, how they effectuated it, and what the results were. Can you tell us, just a high level overview, what was the offer you were making to these people via email to even kickstart the journey?

Erin Lomers: Yeah, so we were engaging our customers in a promotion where we gave them status for a certain timeframe. And during that timeframe, if they continued to fly at the expected levels that we thought they could meet, they would earn status for the rest of the year.

Tim Glomb: Oh wow. So an instant upgrade, so to speak, into your loyalty program.

Erin Lomers: Yeah.

Tim Glomb: Oh, okay. Great. And you need a value exchange, right? Because you really wanted to get some psychographic data. Look like most companies, you have tons of third party data, you have tons of first party data. But the zero party data layer that you were trying to get to, the psychographics in their head was really the catalyst in between and that value exchange. So offering the reward and the status upgrade, what happened next? Did you email everybody an offer?

Erin Lomers: So this is inaudible, we email everybody an offer. We say," Hey, we've got this great opportunity for you. Do you want to engage with this?" And they opt in and say," Yes, we'd like to register." And that's where that starts. But then we continued the journey, and this was really the key to this pilot program, was how do we continue that journey? So once they registered, we then made another offer that said," Hey, tell us a little bit more about who you are, and we'll give you 500 miles." And so really asking them, like you were saying earlier about that psychographic data, who are you? Where do you want to travel? And so that was the next step where we continued that engagement beyond just register for the promotion. So from there, immediately after they answered first question, they got a second question about what view you want to see out your window when you wake up in the morning, and it was a beach or a mountain. And again, really fun engagement. But from that, they immediately got a destination recommendation based on the answers that they gave us. And so that was a big thing for us, that sort of instant gratification, where do you want to go? What's a place that we go to? And that was fun too because we talked to the Cheetah team and said, here's all the destinations that we have and they did the backend coding and the algorithm behind creating that destination recommender and spitting out that recommendation for the customer. But then it continued. So we had the first destination right away. But then, we sent a second destination recommendation, I think it was 30 days later. So 30 days later we sent them a second destination and said," Here's another place that you might be interested in." So it was really about getting customers to think about maybe something different than they would've thought of within the same area or realm of possibility based on what they answered, but also getting them think about some new destinations that they may not have thought about before.

Tim Glomb: Yeah. So take that psychographic information per individual. Not in aggregate, not in lumps, not," Oh, the male said this, the female said that," take it as an individual person. You're collecting their individual opt- in, their individual identifier, email, et cetera. That's great. And I understand you had some amazing results. 84% success rate when someone started the survey, they actually finished it and got that instant gratification, unique destination based on their answer.

Erin Lomers: Yeah. Yeah. It was great. I mean, we saw that this is a pretty engaged group of customers. We knew that already. So in terms of email open rates, we were still getting them to open the email which is great.

Tim Glomb: But you were above 50% open rates on these emails.

Erin Lomers: But above 50%, which is great, rights?

Tim Glomb: I mean email's a great channel.

Erin Lomers: Yeah. Yeah. Which is more than our average open rate. So that's fantastic. But I think it was the key of once we get you in there do you continue your journey through that survey? and 84% completion was big. we got lot of information from a lot of customers. Important customers to us. Ones that we've identified should be on a promotion. So it was great to get just a little bit more of their own information about who they are.

Mark Johnson: So Tim, interesting to hear what Erin and American Airlines are doing. One of the things that we see a big challenge around is the size of the organization, and creating simplicity and creating actionability is a big challenge. So how did you help American Airlines create that simplicity? Take all these disparate data sources they have, layer on some zero party data and they have credit card data, they have transactional data where you've flown, what you like, and how did you do that in a way that drove such amazing results for such a large organization in a short period of time?

Tim Glomb: Yeah. It's a great question, Mark. And we deal with enterprise brands here at Cheetah Digital. They're all complex, big, they've got so many departments and all kinds of things going on. It was pretty simple. It was just getting them to say," Yes, we need to try this." And then they literally, they gave us the keys. They said," You guys have to do this. You have to execute for it. You got to come up with the strategy. You got to come up with the execution plan and then you got to push it." So kudos to the strategic services team here at Cheetah Digital. Yes, we have amazing technology and a platform that powers everything we've been talking about and our other client successes. But our strategic services team said," Got it. Give us two months, we'll go run this program for you." So now we're in that phase of education and integrating, or onboarding them so that their internal teams can activate it. So sometimes you just got to lean on the strategic services team to go do the work for the brand. And that's a great example of American taking the chance and seeing the rewards by letting us show them the light. So that's my advice to brand marketers, take a chance. Let somebody else help you. You don't have to do everything in house. Well, Mark, we are in the final stretch here. I've got three slides left for you, but just some really good information. Again, reminder, go get the full report. There's far more than this webinar alone. This last one we asked," What are the types of information consumers are willing to share in exchange for better service or value?" We talked about the value exchange. We talked about the need for brand marketers to get data, whether they're building that loyalty or just driving revenue, and here's some of the findings. 45% said that they were willing to give up details about my identity, such as my name, my age, address. Kind of table stakes, all right. 49% said my location. What I think is important to have context here on that one, in the age of mistrust and geolocation third party tracking, 49% are willing to give their location in exchange for better service or value. So don't go buying that geo and snooping on them and tracking on them. That's a creepy factor and we have more stats in the report about that. So make it clear, we're going to use your location responsibly, and for this reason, we're going to give you something in exchange. Now, 46%, carrying on said, other details about me, like my clothing size, my family makeup. 33% said my photograph. Additionally, we said," Over the past six months, which industries have provided the best customer experience?" I've got two slides here for you. 32%, they're the winners in food and grocery. I agree. I'm at the grocery store all the time, multiple times a week. They're doing a great job. 28% beauty and fashion. 25% restaurant. 21% home improvement or garden and pets area. 17% travel hospitality are doing a great job. 15% financial services. 12% furniture. 12% household. 11% sports and entertainment. Maybe that's related to COVID, people weren't in stadiums and things like that. And then 8% gambling gaming. That's always been on the lower. But your industry's in there. That's how they're stacking up. Let's close it out. Do you have any closing thoughts or any last questions on those last stats I had?

Mark Johnson: Yeah. I think a couple questions that would be nice to summarize this. When you look at opportunities to impact or improve customer experience, a lot of times brands get oversold, very complex, boil the ocean type opportunities, where it makes it very difficult to measure. What are some opportunities you see for brands to simply improve their customer experience?

Tim Glomb: Yeah, you're so right. Sometimes they do get oversold, or companies like us go out and try and sell the world to them and they're like," Look, man, we just need to onboard and educate and learn something quick." I'm going to point back up to the American Airlines clip with Erin. Giant global brand. I mean, they operate a massive scale and we created a very small pilot program that was incredibly effective and efficient. And what they did was say," Yes, we're going to take a chance." So, but the crux of what American Airlines did, which they've never really done before, was ask questions. So it goes back to that relationship marketing strategy. How are we eventually going to know 10, 20 super important psychographic data points about our entire audience? Well, you got to start. If that's your goal in 2, 3, 4, 5 years, you got to start somewhere. So go out, run a sweepstakes. We just saw 74% of 5, 000 respondents said they like to get more chances to win things. Run a sweepstakes survey. You can do that without embedding new MarTech. You can do that and pump it into your existing CDP or CRM. I mean our Cheetah Experiences platform is incredibly nimble. You can do all kinds of things. So my suggestion is a better customer experience comes from knowing your customers on a one to one level. And if you don't have that technology today or the budgets today, or the bandwidth and knowledge, start there. Run a small sweepstakes, ask some questions. What'd you learn? Run another one. Maybe run an always on monthly sweepstakes, and maybe only do it with your loyalty members instead of your whole audience. Start there. So learn small. But if you don't start building relationships, the way that... Mark, you and I know each other over the years now, I mean, I know you live in Cincinnati, you're from Denver, you like to be outside. So do I. It's comebacks to human nature. How can your brand start asking questions of your highest value customers and then go wider and wider and wider and wider? And if you do that, like companies like Starbucks, which I'm sitting down with later this month and there's going to be a webinar about that later the summer, you're going to learn how they do this at scale, and that's what you want to achieve. So my suggestion, start asking small questions in small batches, grow from there, and then eventually change your strategy and make it everything you do.

Mark Johnson: Excellent. Now the last question I have is, it was mentioned earlier about the stats, the lower stats, that having that value exchange reciprocity between the consumer and the brand. Brands obviously feel that they have inaudible maybe a higher level of value exchange, but the consumer's inaudible 12%. What opportunities are there for brands to increase the benefit with the consumers, and does it vary from vertical to vertical? Does a consumer package goods entity have the same thing as a fast casual restaurant or maybe even American Airlines? What are the opportunities for brands who the value exchange with the consumer?

Tim Glomb: Yeah, absolutely. You're right, it does change by industry and it changes by for example, are you a passion driven product that the person just lives, breathe, and is dying for? Maybe they only use it a couple times a year, but they just love it. You're going to have a better chance of getting your customers engaged and giving them more value to enhance their experience. But I love Health- Ade kombucha. It's just my favorite kombucha company. I buy a couple a week and it's transactional many times a week. They also have the opportunity and they also give me content. They give me great suggestions on things. So you're going to have to find your industry and your levers. What can you give away that's not going to give away the farm or hurt your bottom line, but it enhances the experience your product or services gives? And that's where brand marketers, I don't have the magic bullet for everyone, but brand marketers literally have to reflect on that and say," What can we provide that enhances the experience?" If it's discounts and points and loyalty, all right, maybe start there. But I believe it's all going to be about the experience. But again, if I'm buying cups and plateware from you, I buy it once. Maybe that's the ultimate dinner, the ultimate Thanksgiving dinner. You got to think outside the box. And then you got to find the incremental value that you can give month over month, whether that's, again, recognition. Can you run a social campaign? Can you enhance your emails? Can you give them early access to recipes, or things that you know you're going to put in market anyway? Can you give them to your loyal customers a week in advance? The answer is yes, it's a matter of will you do it? Will you put the skills in place, will you put the strategy in place, will you put the technology in place to give those value adds? So you got to get creative and look, we have a great strategic services team here at Cheetah Digital. It has great ideas because we do this day in day out across many, many verticals for companies of all sizes. So give us a call. Maybe we'll talk about it.

Mark Johnson: Well, Tim, thank you very much. Very impactful. The passion is always in your voice is great to hear. So say there's a brand out there who are having some of the challenges that are addressed within the research that you most timely brought to the market, how do they engage you? How do they reach out? What's the first steps for them to reach out and get some of the solutions that you offer?

Tim Glomb: Well, number one, just like this. I'm the head of content. My job is to create content. We have a ton of content you can download, read, view, watch on cheetahdigital. com. We have a new website. You can go consume it there. You don't even have to talk to us. Do a little bit of light reading or research before you talk to us. You can always reach out to us, there's always a request a demo or reach out button. And then look, come see us at events. We're definitely going to be at the Loyalty360 event this fall. Come to an event like that. Check out Loyalty360, we have a ton of content on loyalty360. org. You can also check out my Thinking Caps podcast, which is on LinkedIn, Constantly, or Apple Podcast. So tons of ways to reach out to us, tons of ways to have ideas exchanged. Mark, I can't thank you enough for coming to the webinar. I appreciate you talking with us. As always, insightful. You've got great questions. You always push me to the limit. And for everybody's watching, I appreciate it. Mark, I will see you on the next one. How about that?

Mark Johnson: Thank you very much, Tim. Thanks for the great insight as always.

Tim Glomb: All right. See you next time.