Latest / Leaders in Customer Loyalty, Powered by Loyalty360 / Loyalty360 Loyalty Live | Kim Welther, Baesman

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Loyalty360 Loyalty Live | Kim Welther, Baesman · Leaders in Customer Loyalty, Powered by Loyalty360

• 0:04
  Speaker 1: Good afternoon, good morning.
• 0:05
  Speaker 1: It's Mark Johnson from Loyalty 360.
• 0:06
  Speaker 1: I hope everyone's happy, safe and well.
• 0:08
  Speaker 1: Welcome back to another edition of Loyalty Live.
• 0:11
  Speaker 1: In this series, we speak to lead agencies, technology partners and consultants and customer channel and brand loyalty about the technology trends and best practices that impact the ability of brands to drive unique experiences, enhance engagement but, most importantly, impact customer loyalty.
• 0:28
  Speaker 1: Today's focus is going to be on the trends that will likely shake the customer loyalty industry in 2024 and beyond.
• 0:34
  Speaker 1: We have the pleasure to speak with Kim Welter she is the vice president of CRM and Loyalty for Basement about some of the challenges and opportunities in the year ahead, what they're seeing.
• 0:44
  Speaker 1: So, kim, thank you very much for taking the time to join us today.
• 0:47
  Speaker 2: Yeah, awesome, very happy to be here.
• 0:49
  Speaker 1: Absolutely.
• 0:50
  Speaker 1: First off, for those who may not know, can you tell us a little bit about yourself and all your current role at Basement and a little bit about your background?
• 0:57
  Speaker 1: It'd be great to know.
• 0:58
  Speaker 2: Yeah, sure.
• 0:59
  Speaker 2: So I've been at Basement.
• 1:00
  Speaker 2: Actually, this month will be 13 years that I've been working there and I lead our CRM and Loyalty Agency division.
• 1:07
  Speaker 2: As you mentioned my former life, I was on the brand side I spent about eight years working for Victoria's Secret but at Basement we really work with brands to help them better understand their customer data, how to build a more personalized relationship with them, really unlocking the journey of that one to many to one to one.
• 1:22
  Speaker 2: We have a lot of retail clients, but we also have home service healthcare and do a lot of the brand's data work, as we have a lot of the data in-house and it's critical for the work that we're doing.
• 1:35
  Speaker 1: Okay, and over the last 12 months we've seen and heard and discussed with brands about their interest in improving or revamping their customer loyalty efforts.
• 1:43
  Speaker 1: You know there's an interest in additional adding functionality, changing program structures, looking at the customer value propositions and change of benefits for the members you know.
• 1:52
  Speaker 1: Is that something you're seeing and, if so, you know what changes are your clients most focused on?
• 1:58
  Speaker 2: Yeah, absolutely Lots.
• 1:59
  Speaker 2: I would say change is good.
• 2:01
  Speaker 2: Please don't be afraid to change in your loyalty program.
• 2:04
  Speaker 2: I think that that's probably one thing that a lot of people lock in on and don't change.
• 2:09
  Speaker 2: So we are seeing it a lot more often, Brands shifting from the focus used to be, you know, creating and launching loyalty, to now that a lot of brands have loyalty.
• 2:19
  Speaker 2: It's okay.
• 2:20
  Speaker 2: Is it working?
• 2:21
  Speaker 2: How are we growing?
• 2:22
  Speaker 2: Are we optimizing?
• 2:23
  Speaker 2: How do we make it better?
• 2:24
  Speaker 2: So I think that's the biggest change right now is that brands are starting to realize that maybe they need to change a little bit faster and a little bit more.
• 2:32
  Speaker 1: Okay, and what are some of the program changes and enhancements that you think brands should be focused on in 2024?
• 2:39
  Speaker 2: I think the biggest enhancement we really are going to be seeing is that connection outside of the transaction, whether that's emotional loyalty, experiential loyalty.
• 2:48
  Speaker 2: Once you've created kind of that perceived value of the program and that hard, tangible benefit, I think it's important that we really start to look to driving engagement in those softer benefits, engagement within the brand, customers wanting you know, early access, stay in the know, making sure that the program is developing more of that brand loyalist and not focus so much on the tangible hard benefit.
• 3:12
  Speaker 1: And how should brands be defining and measuring success of these program enhancements?
• 3:17
  Speaker 1: Because that's a big concern, right, CFO?
• 3:20
  Speaker 1: The auditors are looking more and more and more kind of the return of the program.
• 3:24
  Speaker 1: At least we see that.
• 3:25
  Speaker 1: How should they be defining success?
• 3:28
  Speaker 1: Thank?
• 3:28
  Speaker 2: you.
• 3:28
  Speaker 2: Yeah, I think this is one of the biggest challenges for brands as they look at program changes.
• 3:34
  Speaker 2: Most people will set kind of here's where we're at pre, here's what we're looking to be post from a KPI perspective.
• 3:41
  Speaker 2: But I think what's important understand is there are a lot of outside factors that are going to play into that.
• 3:46
  Speaker 2: That maybe not be the loyalty program.
• 3:48
  Speaker 2: So you have to be really careful as you're measuring results really align the success metrics to the goals of the redesign.
• 3:55
  Speaker 2: You got to make sure that you're aligning those program objectives.
• 3:59
  Speaker 2: If you pull back on your funding rate, your goal shouldn't be to increase your reward demand sales because those aren't aligning.
• 4:06
  Speaker 2: So you really got to make sure that that financial model is pretty solid, to make sure that your metrics and you're hitting the right goals, to make sure that you those enhancements improved versus kind of put a detriment to the program.
• 4:18
  Speaker 1: That makes sense.
• 4:19
  Speaker 1: So when you look at the measurement of programs as mentioned, it's a big focus, interesting to your perspective, on funding rates and maybe kind of the unintended consequences that may have.
• 4:30
  Speaker 1: What do you believe are the top three or four metrics?
• 4:33
  Speaker 1: Branch is focused?
• 4:36
  Speaker 2: on.
• 4:36
  Speaker 2: I would say, from a loyalty program perspective, definitely number one is that active membership and that retention rate.
• 4:42
  Speaker 2: I kind of think those go hand in hand.
• 4:44
  Speaker 2: The reward redemption rate is important at measuring kind of engagement, but if it's not a reward redemption, whatever that top perceived value benefit is, we really need to be looking at that engagement level.
• 4:56
  Speaker 2: And then I also think there's a metric around, kind of an activity engagement score.
• 5:01
  Speaker 2: I think that's the newest thing that we're seeing.
• 5:04
  Speaker 2: A lot of brands want to understand.
• 5:05
  Speaker 2: Well, outside of the transaction, how are active members engaging with us?
• 5:09
  Speaker 2: Are they opening emails, are they writing reviews, are they getting points for activity?
• 5:13
  Speaker 2: That's an important metric that I think isn't talked about enough.
• 5:18
  Speaker 1: Okay, interesting.
• 5:18
  Speaker 1: I think that's something we see as well and also the whole idea around initial onboarding the program to that first transaction or subsequent transaction as well, and looking for the kind of the most optimal journey for the customer, absolutely so.
• 5:36
  Speaker 1: Are your clients asking you for different metrics now than they may have in the past?
• 5:41
  Speaker 2: I think it's two parts.
• 5:42
  Speaker 2: One is there's still a lot of metrics that we've had in the past that are still important.
• 5:47
  Speaker 2: So the study metrics we just talked about within the KPI is very important, but we do see some new things.
• 5:54
  Speaker 2: I think some of the newer things around how do we stack up against other programs has been an interesting kind of conversation lately, as businesses might be a little bit more challenging in 2024.
• 6:06
  Speaker 2: There's always that interest of how are everyone else doing so?
• 6:08
  Speaker 2: I think that's a good benchmark as well.
• 6:10
  Speaker 2: And then layering on that engagement score and that we just talked about, I think that's critical in kind of a new way of thinking of metrics.
• 6:18
  Speaker 2: So always, the old is still important but the new is just as important.
• 6:24
  Speaker 1: When you look at your current clients, maybe sales prospects, what are they asking you for regarding your customer experience, customer loyalty efforts?
• 6:32
  Speaker 1: Is it the same as last year, a little bit different and, potentially, how do you see that change again in 2024?
• 6:39
  Speaker 2: I think what we're really seeing in 2024 is most are looking for that differentiator, Like how was our program not just a spend and get and looks like everyone else?
• 6:49
  Speaker 2: I think that's the biggest thing from the past that we're seeing right now is how do we kind of harness a differentiator and make that roll through our loyalty program and make it more successful?
• 7:00
  Speaker 1: How can customer loyalty and kind of a brand's commitment to their customers address some of the potential challenges?
• 7:08
  Speaker 2: I think brands really need to recognize how they meet their customers in 2024.
• 7:12
  Speaker 2: I think value is going to be something that's going to be critical and value is going to be delivered in price.
• 7:18
  Speaker 2: It could be customer service, it could be convenience in service, but I think it really needs to be around brands' loyalty in 2024 to put the customer first and we try and create that value in all ways possible.
• 7:33
  Speaker 1: When you look at customer loyalty programs.
• 7:35
  Speaker 1: One of the things we saw last year in our loyalty trends report is this whole idea of seeing a sameness kind of an overused kind of moniker.
• 7:43
  Speaker 1: But differentiating your customer loyalty, customer experience offers programs can be challenging.
• 7:49
  Speaker 1: Is this something that you see in the market as well?
• 7:53
  Speaker 2: Yeah, as more and more brands have loyalty that main hard benefit it's hard to get that differentiator.
• 8:01
  Speaker 2: You really want to look to your program and answer do we have a good program?
• 8:05
  Speaker 2: Is it not only driving retention in the next purchase, but is it also building brand loyalists through our products, our customer experience?
• 8:12
  Speaker 2: The top programs are going to be able to do both of those and you really want to put yourself under a microscope to make sure that you're doing both of those things.
• 8:21
  Speaker 1: Okay, and when you look at advice suggestions you may give to a brand who are looking to differentiate their customer loyalty rewards, their programs or their strategy, what do you suggest?
• 8:34
  Speaker 2: Yeah, I think people probably make that a bigger challenge than it really is.
• 8:38
  Speaker 2: As we work with a lot of brands, it's really interesting how we can find a way to focus on a brand's uniqueness and the value they can bring.
• 8:45
  Speaker 2: I think a good example of that is Sephora.
• 8:47
  Speaker 2: I think Sephora has done a really good way of creating a community of makeup tips, tricks, tutorials.
• 8:54
  Speaker 2: They offer something that really helps their customer and that you really need to be able to take that and harness that uniqueness and bring value to the customer.
• 9:03
  Speaker 2: There's a lot of brands that have done that pretty well and I think anyone who doesn't feel like they have that differentiator needs to work and spend time in really optimizing that.
• 9:12
  Speaker 1: Okay, what do you see as the next big thing in customer loyalty, customer experience?
• 9:17
  Speaker 1: What do you see?
• 9:19
  Speaker 2: I think the next big thing in loyalty is that personalization having the right technology and the program to personalize the right program for each individual customer.
• 9:29
  Speaker 2: As I'm sure many of our marketers know from market research, customers value different things, and so that is really how we harness the differentiator and the customer.
• 9:39
  Speaker 2: So we could see one segment that values experience above all, one that values price, or one that values recognition and exclusivity, and I think the next big thing in loyalty is really building and delivering a program that allows the customer to choose the benefit that they value the most.
• 9:55
  Speaker 2: And so, just to give another example of a brand I think that does this really really well.
• 10:00
  Speaker 2: Rei is one who, if you haven't looked at their loyalty program, you should definitely check that out.
• 10:05
  Speaker 2: They deliver on experience, profit sharing, extended returns, satisfaction guarantees, free shipping for all their members.
• 10:14
  Speaker 2: They've really created this community of customers who are loyalists and passionate about the brand, and I think it's really about delivering that customer value in a unique way that it's valuable to them.
• 10:26
  Speaker 1: Excellent.
• 10:26
  Speaker 1: So when you look at the role of marketers, there used to be kind of a divergence between that kind of the left brain, right brain, the creative and the strategy, or creative and analytics.
• 10:35
  Speaker 1: They were somewhat divergent.
• 10:37
  Speaker 1: There's a coming together of that as well and they're both very integral into loyalty program design and management.
• 10:42
  Speaker 1: And how do you see that transformation going on in the marketing side and how can brands better align data with the creative pieces, the content, to drive more engagement?
• 10:57
  Speaker 2: Yeah, I think that's actually a very unique kind of conversation that's going on, mark, especially where 10 or 15 years ago you saw creative and marketing very separate and now you see creative and marketing usually coming under the same umbrella, the same leader, and so I think there was that recognition that those need to work in lockstep with each other.
• 11:15
  Speaker 2: And it's more important now than ever that the data, the strategy, is helping drive the creative and creative, goes through just as much testing and learning as the strategy and data.
• 11:26
  Speaker 2: So I think it's critical that they are talking to each other, that they understand the synergies and the energy that they can bring when they're working together.
• 11:34
  Speaker 1: Absolutely.
• 11:35
  Speaker 1: When you look at the role of data in marketing, what's essential or what should the essential function of data be in marketing optimization or in optimal marketing outreach?
• 11:44
  Speaker 2: Yeah, I think looking at customer data is critical and making that move to that more personalized marketing strategy.
• 11:51
  Speaker 2: It's as you mentioned.
• 11:53
  Speaker 2: It's the way to look through and create those customer journeys, start to build and look a little differently where segmentation comes to life and creates that one to one strategy.
• 12:01
  Speaker 2: So I think you always need to be thinking of data in a way of how do we talk to our customers better and how do we leverage data to do that?
• 12:11
  Speaker 1: When you look at the amount of data, the cleninless of data, it gets to be a challenge.
• 12:16
  Speaker 1: A lot of times Consultants come in and try to sell them a huge transformation process that makes it very difficult to measure.
• 12:23
  Speaker 1: But how can marketers determine whether a given dataset is valid or how much data they should have or they need?
• 12:32
  Speaker 2: Yeah, I agree there's a fine line between no data and then too much data and analysis paralysis.
• 12:38
  Speaker 2: So I think it's really important to you know any data is better than no data.
• 12:43
  Speaker 2: However, you need to be able to understand early indicators versus rollout indicators.
• 12:47
  Speaker 2: When do we need to retest?
• 12:49
  Speaker 2: When is the wrong data in the wrong hands dangerous?
• 12:52
  Speaker 2: So we always go through you know, triple-tech your data.
• 12:55
  Speaker 2: Make sure that you are telling the story of what the data was intended for and what we can pull from the data.
• 13:01
  Speaker 2: You can't go wrong when you that need to know critical data is being used to drive strategy, but also understand kind of the dangerous pitfalls of too much or looking at it in the wrong way as well.
• 13:13
  Speaker 1: When you look at customer loyalty offerings today, what do you think the biggest challenges that you see?
• 13:21
  Speaker 2: Well, probably based on my previous answers, you can probably guess what I'm going to say, but I do think consistently, technology is the biggest challenge by far for brands.
• 13:31
  Speaker 2: A lot of other challenges are in the metrics strategy, lack of resources, but those can be supplemented with partner.
• 13:38
  Speaker 2: I think that internal technology constraints are the biggest challenge for a lot of brands.
• 13:43
  Speaker 2: I think the brands need to really commit to a brand strategy of loyalty above all else and allocating the team the resources to allow for a flexible and ever-evolving loyalty program and don't let the hurdles of technology stop the strategy from being done.
• 14:02
  Speaker 2: That's what I would say is probably the biggest challenge.
• 14:05
  Speaker 1: Well, thank you very much, Kim, for taking the time to speak with us today.
• 14:08
  Speaker 1: It's a pleasure to speak with you.
• 14:10
  Speaker 1: As always, you have a very unique insight into the market, and one thing I'd like to talk with you is not only you're smart, but you also are very succinct in how you approach the questions.
• 14:20
  Speaker 1: There's not a lot of it extra, and so I think that makes the interviews with you more impactful for sure.
• 14:26
  Speaker 2: Awesome.
• 14:26
  Speaker 2: Thanks for having me, Mark.
• 14:27
  Speaker 1: Absolutely.
• 14:28
  Speaker 1: Thank you everyone for taking the time to listen and make sure you join us back for another edition of BulletLive soon.
• 14:33
  Speaker 1: Until then, have a wonderful day.