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19/09/2011 / loyaltymarketingnews

Loyalty’s power to help grow your triple bottom line

The truth is, when enough people jump on a bandwagon, it becomes a best practice. Office recycling efforts grow into green-building initiatives; company-sponsored weight-loss efforts become enterprise-wide wellness programs; and sustainability practices turn into strong recruiting tools. Companies are increasingly building social responsibility into daily operations, as we see Verizon, CVS, Merck and many other industry leaders issue annual corporate responsibility reports. Dow Jones has tracked an annual “sustainability index” since 1999. The days of greenwashing and other lip-service efforts are behind us—this bandwagon has turned into a Formula One race car.

Your management team may already be talking about the triple bottom line, otherwise known as “people, planet and profit.” But does it recognize the power that loyalty has to invite customers into the social responsibility initiative?

For example, Virgin HealthMiles has proven that employees can be incentivized to better manage their health care. RecycleBank awards points to members for curbside recycling. DailyFeats.com rewards members for small acts of social change that include volunteering and carpooling. And at AIR MILES, we’re building a prototype partnership in Canada that combines our loyalty expertise with a major grocery chain and a non-governmental organization, focused around encouraging healthy foods and diet. We have created the right rallying point for three very different constituents, in a way that gains strong consumer participation. The future for the role of loyalty in these types of partnerships is very promising.

The loyalty advantage
Loyalty practitioners know how to offer value and engage customers by establishing relevance. We know how to mix incentives with a personalized dialogue for each customer, and build trust. We can apply these powerful levers to implement social change. A strong program can move customers from simple behavioral loyalty (shopping at the same drugstore, for example) to full-on attitudinal or engagement loyalty—trusting the pharmacist and store brands, and making a special trip to shop there because the experience improves their lives.

In wellness, for example, we’re talking about reaching people who usually realize they have a serious health issue, but aren’t motivated for treatment. We’ve seen studies that indicate when someone is told they will die unless they change unhealthy behavior, they usually change their behavior. Otherwise, as with a chronic condition like diabetes, it’s a daily struggle. Loyalty has a unique ability to motivate customers to make a meaningful but challenging change like this.

Avoiding consumer skepticism
There is a risk that jumping into any type of social change with your loyalty program can look insincere. The critical definer is whether your program is a good fit with your brand, core business and customer. Companies must align themselves with social causes in which they can show a track record of commitment. Otherwise, the program can look opportunistic.

The wellness program we created at AIR MILES focuses on healthy eating. For the grocer, the program rings true with a customer base that’s very family-focused. For the wellness agency, healthy eating is exactly the type of behavior they were established to create and foster. The program feels comfortable to customers because it doesn’t encourage them to shop more—just shop more intelligently.

Mandate for the future
The total benefit an individual accrues from a behavioral change may be profound—say,  stopping smoking, losing 30 pounds, or incorporating daily exercise into his or her life. But from a corporate or community perspective, this type of change must happen in volume to make a difference. Loyalty coalitions have proven their ability to motivate large numbers of members by offering a rich combination of incentives and the economies of scale that large partnerships possess. This ability allows loyalty to be a powerful catalyst for large-scale change.

Strong social agendas affect a company’s relationship not only with customers, but also with employees and new hires. Today’s university graduates are looking for socially responsible employers, and this factor will become an increasingly important differentiator in attracting and retaining talent.

Wellness, the environment, education and other issues affect us all, socially and financially, and loyalty has the tools to address them. It’s time for loyalty practitioners to follow the examples set by Virgin, RecycleBank and others, by finding creative ways to apply our skills via partnerships or company-based initiatives and boost that triple bottom line.

 

(via Colloquy)

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