loyalty management for nzsug

Nicole Wieberneit

Thomas Wieberneit

27.08.2009Loyalty Management

Loyalty?

Loyalty!

Thomas Wieberneit

2008 – CRM Practice Manager ANZ CIBER, ANZ

2008 – Executive Consultant & Project Manager CGI, Canada

2005 – VP CRM Development SAP, Germany & Canada

2000 – Quality Manager then VP CRM Quality Management SAP, Germany

1997 – Development Manager CRM Technology & Mobile Solutions SAP, Germany

1995 – CRM Developer Kiefer & Veittinger, Germany

Who are CIBER?

Over 8,500 employees NYSE: CBR - HQ in Denver 85 Offices in 18 countries 3 US-based Development Centers 3 Offshore Development Centers Growth and Profitability since 1974 ISO 9001 certified 98% Customer Satisfaction Rating

“CIBER is positioned as a solid alternative to the large ESPs; it is a smaller, more-nimble provider whose sweet spot is a more-flexible approach to client engagements.”

A US$1 billion Global IT services company that builds, integrates and supports applications

and infrastructures for business and government.

http://www3.gartner.com/RecognizedUser

CIBER ANZ

Established in 2005 Subsidiary of CIBER, Inc. (NYSE: CBR) Offices in Auckland, Sydney and Melbourne 100+ CIBER full time employees (30+ in NZ) ANZ SAP Support Centre based in Sydney & Auckland

HAgenda

Loyalty Management in Retail

The SAP Loyalty Management Solution

Demo

Successful Loyalty Programs

Improve the existing customer relationship by offering relevant rewards that reinforce the brand values

Identify, maintain, and increase the yield from best customers through long-term, interactive, value-added relationships

Performance is judged with a combination of behavioural and attitudinal measures

COLLOQUY, 2006, BuildingBrands, 2009

3 distinctive models Coalition 2 main program types

Cashback Points based

Loyalty technology Smart Cards E-Coupons (e.g. Safeway)

Active program participation rates are modest: ~40% Signs of maturity and boredom Process models

Personalization Improved loyalty analytics WOW! factor and soft benefits

Loyalty Management in Retail – Where are we now?

Retail Market Environment: 3 Distinctive Models

Relentless focus on lowest category prices that leads to Low customer service Low In-store experience Unimportance of customer

relationships

Membership clubs with de facto retail loyalty program Membership fees Members only wholesale-

pricing

Focus on differentiated customer relationships via Recognition and rewards Identifying customers Tracking their behaviour Mining data for marketing

insight

EDLP Loyalty Model Hybrid Model

Focusing solely on the lowest price in your sector is a pathway to disaster

(If your are not the low-price leader ...... and there can be only one!)

Mem

ber R

eten

tion

& An

nual

Spe

nd

State of the Art Loyalty Relationship Chain(TM)

DialogueEngage-

ment

Increase Member

Value

Sustain-able

Retention

Redemption ROI

COLLOQUY, 2009

How to Increase Loyalty Program Participation

WOW!-Factor – Attractiveness of Value Proposition

CRM Loyalty Analytics

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Brand Linkage

One Face to the Customer

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Building a Customer Strategy based on SegmentsSome market analysis demonstrates how crucial it is for a retail company to manage their loyalty program in an innovative and aggressive way

80% of shoppers use their loyalty cards regularly 20% of loyalty program members generate 80% of a

retailer's profit It costs 5-10 times more to acquire new customers than

keeping existing ones 5% - 20% of loyalty program costs can be saved

through better prospect targeting Increase of customer retention by 5% can increase

profits by 20% to 40%

Potential Business impact of Loyalty Management

Same store sales could rise two digits over trend after short time

Gross profit percentage could rise significantly Two digit Sales and profit growth could be achieved Significantly increased shopping basket size Increased store count in double digit percentage range

Given the profit contribution of loyalty card buyers , it is vital for retailers to continuously recruit new members into their loyalty program

Loyalty Customer Strategy

Elite Urban Singles & Couples

Small Town Executive Families

Young Middle-Class FamiliesM

on

etar

y V

alu

e

Frequency and Recency of purchase Low High

High

Low

CustomerSegments

Segment BSegment A Segment DSegment C

Empty NestersMobile

Singles & Couples

Mid-Level Urban Couples

Young Mobile Singles

Single-Parent Families Middle Income Young Singles

Older, Rural Couples OlderSingles & Couples

Older Families in Isolated Areas




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Brand Linkage


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Retail Requirements for the Customer Strategy

Customer Driven Experience

CustomerSegments

Kio

sk

Inte rn

et

IVR

Mes sa g

ing

Fax

Ph

on

e

Lett er

Co

un

ter

E-m

ai l

Sto

reMultiChannelInteraction

Customer Management

Customer Loyalty Management

Segment DSegment CSegment BSegment A

Memberregistration

Member activitysales transaction

Member activity service transaction

Member activity campaign driven

Member activity tier upgrade




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Word Of Mouth Marketing

WOM

Participation

Dialogue Engagement

Increased Member Value

Profitable Long-Term Relationship

Identification

Value Exchange

WOM Acquisition

WOM Facilitated

Multiple Exchanges

Champions

Sustainable Retention

COLLOQUY talk: The New Champion Customers, January 2009

Mem

ber R

eten

tion

& An

nual

Spe

nd

WOM enhanced Loyalty Relationship Chain

DialogueEngage-

ment

Increase Member

Value

Sustain-able

Retention

Higher ROI

Co

st

Rev

enu

e

COLLOQUY, 2009

HAgenda



Demo

Loyalty Management – A Complete Solution

Loyalty Management – Overview

Transactional Data Master Data

PointTypes

TierLevel

Rule

Membership

CardPointAccount

Member

MemberActivity

LoyaltyProgram

RuleGroup

LoyaltyCampaign

TierGroups

ProgramPartner

Independent Affiliates

3PL Service

stations Other B2C

business

Loyalty Processing Engine

Communication

CustomerSegments

Intern

et

IVR

Fax

Ph

on

e

Lett er

Co

un

ter

E-m

ai l

MultiChannelInteraction

Membership Handling

Back-O

ffi ce

Web Shop Interaction Center CRM UI Web-Services

Customers External Applications/POS system

Program Management

Pro

cessing

En

gin

e

MemberActivities

Points / BonusDetermination by

Rule Engine

Rew

ard R

ule M

anag

emen

t

PointAccruals

Point Account

PointRedemption

PointExpiration

LoyaltyManagementCRM Marketing

Functional Overview

Integrate / Analyze / Collaborate

ProgramManagement

MembershipHandling

Program Partners Management

Points Management

Tier based Point Expiration

Dynamic Attributes

Tier Management

Program Creation

Point Expiration Processing

Online Member Activity

Processing

Batch Member Activity

Processing

Simulation of Rule Processing

Scalable Engine Component

Tier Evaluation Processing

Point Account Management

Member Tier Management

Member Activities

Basic Membership Card

Handling

Membership Types and

Registration

Member Profile Maintenance

ProcessingEngine

Sales Order Integration

IC IntegrationLoyalty API

ConnectivityWeb Channel

Integration

Reward RulesManagement

Version Management

Template & Expert mode

maintenance

Partner Sponsorship

Robust Rule Modeling

Rule Scheduling

Campaign Integration

Key Take Aways

EDLP is not a viable loyalty strategy for most companies

Consumers expect being addressed with messages relevant to them

Well managed loyalty programs have lower cost at a higher return

SAP CRM can help you achieve this

HAgenda



Demo

Retail Loyalty Dashboard Overview

Multi-Channel Analysis

Analysis by Tier and Region

Champaign Analysis by Product Category

Dashboard – Loyalty Campaign Details

Detail Analysis by Tier and Campaign

Campaign Analysis Overview

Loyalty Program Overview

Loyalty Program Hierarchy

Loyalty Program General Data

Several Component:1. Events – Loyalty Campaigns

2. Reward Rule Groups – e.g. for campaigns, sales orders, tiers3. Reward Rules – How many Points

Membership in Loyalty Program I

Membership Overview

Tier Changes

Membership in Loyalty Program IIMember Activities:

Tier Change, Accrual, Redemption, …

Multiple Members and Cards to a Membership

Possible

Point Balance – Several Point Types per

Program Possible

Loyalty Campaign

Loyalty Campaign – General Data

With or Without Enrollment

Enrollment by all Members or Target

Group Based

Reward Rule

Reward Rule Details

Easy Maintenance of Reward Rules via the

Formula Builder

Web Channel – My Account

Consumer – Account Area with several Options

View of all Loyalty Campaigns

Browse Catalogue and Earn Some Extra PointsBrowsing in the Product

Catalogue

Extra Points if Buying Long Chairs

Web Shop – My Loyalty - Transactions

Earn 3x Points by Buying the Chair:

• Standard Points (Qualifying)• 2 Loyalty Campaigns

Points are Added to the Balance

Web Shop – Redeem Points

Costs in Points Shown

Redemption Product Catalogue

Shopping Basket View

My Transactions after Redemption

All Member Activities are Happening in Real-Time

Call Centre Support Specialist Overview

Mr. Baker calls in

Confirmation of Account and Membership Details

CIC – Membership Overview

Membership General Data

Activities Visible: Sale and Redemption from Web Shop

Donation and Transferring of Points

Donate or Transfer Points

Selection of Destination Membership

Number of Points

Manual Up- or Downgrade

Possibility to Up- and Downgrade a Membership from the Membership Overview

loyalty management for nzsug

Documents