The CEO of LoyaltyOne has spent the last 25 years in the industry, and never shys away from the next loyalty challenge. During his time as CEO of BrandLoyalty Hearts & Wallets caught up with him to find out more about the man behind loyalty.
Five ways brands must act to survive and thrive in the consumer age
#1. Be inspirational
Winning as a brand demands a climate where creativity can thrive, where diversity is standard, and where ideas fly in all directions all of the time. This means building environments that physically and emotionally inspire everyone in the brand’s orbit.
#2. Be participatory
Smart brands ride the power surge to consumers. Connectivity, creativity and collaboration are the road to victory. Brands that put up walls will die. The new ROI is Return on Involvement.
#3. Be Visual
People today are aesthetically adept; they process images thousands of times faster than text, and love to share cool imagery. We are drawn to beauty and universality. In Lovemarks, this is the vision button. The visual story of a brand is its life journey.
#4. Be fast
Priceless value arrives on time, and whether we’re talking curing killer diseases or simply feeding the kids, there is less time available for people than ever. Across production, distribution and communication, brands have a need for speed. “Test fast, fail fast, adjust fast” could just be the business line of the century.
#5. Be intimate
Brands are becoming human relationships, and the strongest relationships are intimate. The more social that brands act, the more friends they make, the more they cultivate their friendships, the better they do. The more empathy, trust and love that brands stream out, the more comes back.
Brand loyalty catalyst: Creative Leadership
The more unremarkable brands get, the more valuable ideas become. Cultures that have the most ideas are best placed to win, because creativity has unreasonable power.
Companies have to be very active about having ideas. The classic top-down leadership model is not flexible enough or fast enough for our high-speed connected age. It can’t meet the innovation standards that both new and loyal customers now demand. Future leadership has to be based on creating a culture where the production line generates one thing, day after day: ideas that solve everyday consumer problems. The CEO’s challenge is to inspire the creative people (the pirates, the mavericks, the free thinkers) who love the enterprise, and let their passions scale the company.
Pushing ads at brand-weary audiences is dead. The business of communications is about partnering to create and execute ideas bigger than advertisements. This demands agile teams across advertising, technology, design, media, PR and the audience itself. It requires rapid response in everything from curating content to crowd-sourcing ideas.
Emotion is the driver of sales
The more embedded that quality, service, distribution and performance become, the more the degree of emotional experience is the difference. A premise of Lovemarks is that they come from a bigger place than ‘selling stuff.’ Regardless of category, Lovemarks aim to make the world a better place with what people care about, not jog people’s memories with what they care less about. Consumers are asking, “How does this brand improve my life?” and “How do I feel about this brand?” These questions are a call for emotional engagement from brands.
When emotion makes people feel something deeper, it makes them want to share it. Emotion leads to action. Sharing emotions – especially online – leads to increased brand perception. In B2B, personal value (based around emotion) has twice as much impact as business value (based around logic/ reason).
Big data needs love
We have entered an era of data mining, excavating, crunching, modelling, measuring, predicting, visualising, automating, tracking, sensing, monitoring, targeting and deciding. Big Data plays at every decision point in every industry, from purchase through to performance. Data is in the midst of everything. It is a dream scenario for brands to find their audiences, know individuals backwards, discover what counts for them, and deliver at warp speed.
But Big Data needs Big Emotion, because algorithms will never read and respond to humans the way humans do. The Big Data machine can read the lines, but not between them. Until data is flesh and blood, it will be the incalculable factors, the unexplainable pulses and the mind-blowing ideas that fly the machine over the line.
Love wins on all levels
Winning as a brand is not just about selling more. Notably, it’s also about selling for more. As brands become more commoditised, the ability to charge a premium grows more valuable. Emotion is the key to premium returns. Lovemarks drive premium margins.
With the rise of emotional expectations, value-for-money is but a factor of the consumer value equation. A Lovemark delivers ‘priceless value’, which answers a thirst for purpose, experience and community. Being able to access that feeling by coming back to a brand again and again is a key to success.
Five ways to win
Brands are in a tougher era from the one they grew up in. While consumers expect more from brands than ever to earn their loyalty in the technological century – from offers, rewards and time-saving methods to empathetic interfaces and unique experiences – and can switch brands faster, the potential for a brand to deliver on heightened emotional demands is greater than ever.
The irony is that while loyalty was never easier to lose, it has never been easier to win for a brand that is emotionally wired. The opportunity – not just to drive repeat sales but also to command premiums, build share and extend range – is great for a brand that understands its audience and can unlock Mystery, Sensuality and Intimacy to meet their emotional expectations. The evolved brands we call Lovemarks have always done this. People love them, buy them and come back far more consistently because these brands respond to what people care about. They are emotionally-tuned, emotionally-capable and emotionally executed. This is the new standard.
Believing it is special
A brand may not be your soulmate, but a great brand – a Lovemark – can be your best friend, earning your trust, affection and enduring loyalty. The kind of loyalty that’s based on an emotion so strong that it becomes a belief. Lovemarks are special. They’re irresistible, irreplaceable, and they can be created if you believe in them enough. To put it simply: “To make anything special, you have to believe it is special.”
Hearts & Wallets is the official magazine of BrandLoyalty. It is a magazine for people working at the highest levels of the food retail industry. The goal of Hearts & Wallets is to come up with real insights on - and answers to - current issues, while offering its own individual interpretation as food for thought.
First published in April 2015.
Learn more about our vision and our loyalty family, including Alliance Data and Loyalty One.Go to overview