I’ve had many discussions with students lately about how essential it is for a viable Ecosystem player to include all ‘related’ or ‘adjacent’ categories. Amazon, fb, Google and Apple all play in several of these: file storage & sharing, photo storage & sharing, social media sharing, home security & home device monitoring, interactive voice recognition queries & trivia, home audio speakers, mobile shopping, personal banking, mobile payments,…
I’ve also had discussions with them about Macro (multi-channel) loyalty programs– Aeroplan, AirMiles, PC Optimum. Loyalty players, in contrast to Ecosytem players, need not be present in every category, but typically must tether to 2 anchors:
- a partner providing the ‘dreamer’ in you an ‘aspirational’ indulgent incentive (a vacation); and
- a low value frequent-use anchor that helps ‘rational you’ keep that loyalty tag/card on hand day to day.
Case in Point: Aeroplan lost both its Dreamer anchor- Air Canada- and its Rational anchor- Esso- but quickly regrouped, securing an Amazon partnership to fill a role on both ends.
But maybe this doesn’t describe the full list of success criteria for Ecosystem players or Loyalty programs.
What made this more evident lately? Evidence of their need to AVOID something- Leaks. And evidence they need to SHOW something- Respect.
iCloud leaks, fb leaks, Equifax leaks, etc make some consumers leery of ever joining a loyalty program. And undoubtedly cause others, to drop out.
Loblaws’ ‘transitioning’ of their trusting SDM Optimum & PC Plus loyalty members to a newly consolidated and – ahem- more efficient(!) loyalty program has been awkward for customers they should have respected & valued. A few years ago, AirMiles not only accelerated point expiry; they also imposed a needlessly complex, restrictive new 2-tier- award redemption structure. The 407 famously de-certifies members who spend $3,000/year on their service, via a rude letter (“You no longer qualify….”). I received one such letter; it provided some laughs with its inept wording (a new ‘Hall Of Shame’ candidate, according to nearby CRM experts).
Loblaws, AirMiles and the 407 violate a basic principle of Loyalty programs: treat longstanding customers with some respect.
If you soon encounter press releases or Investor explanations about how tough the Loyalty industry has it, or how consumers are being more difficult, etc, feel free to join me in a laugh or two at their deserved expense.
Of course I could be wrong.
I’d welcome any comments!