The Future of Loyalty Programs is More Starbucks, Less United Airlines

20/12/2017 - I flew over 100,000 miles on United last year, qualifying for1K status in their member rewards program, so you might think I am a loyal customer.

But while my behavior is loyal, I have no emotional loyalty toward the airline. I fly United because they have the most flights into SFO, my nearest airport not because I have warm feelings for them.

Loyalty programs have been the laggards of the Membership Economy. One of the first business tactics, alongside subscription pricing, to formally support a long term relationship with consumers, these programs tend to be more of a financial arrangement. You get upgrades and free flights in exchange for depth and frequency of purchase. There is not a real relationship, and limited personalization in the frequent flier experience.

Compare the airlines' program with that of Starbucks. I have been impressed with Starbucks' loyalty program for a long time and featured them in my book The Membership Economy focusing on a key element of their card's success:

"The card is tied to payments. Unlike the punch cards of old, Starbucks cards usually start as gift cards, which the member connects digitally to a personal account from the Starbucks website. The member can add money to the card, either electronically or at the register. Why is this important? First, because it removes a layer of friction, in that members only need their Starbucks card and not two cards or a card plus cash. Second, and more importantly, gift cards can serve as the gateway to membership, bringing in new users all the time. You don’t even need your card to use your card. You can connect your card to your mobile phone through the Starbucks app, so it’s even easier to pay." (p141)

This week, Barron's cover story focuses on how Starbucks has changed the way consumers pay, which is changing consumer behavior. You don't even need to talk to a barrista anymore--you can pay (and order) with your phone, and then just pick up your order in the store, removing nearly all friction in the buying process. According to recent reports, in Q3 of 2017, 30% of all purchases are mobile, through member accounts. Not only does membership contribute to growth, it creates the data that allows Starbucks to get to know the preferences and behaviors of its customers, creating insights for future investment.

Businesses with loyalty programs need to think about how their programs remove friction from the customer experience, making it easier for members to get value for their time and money. It's not enough to provide a discount for volume and frequency of purchase. Consumers expect--and deserve--more in exchange for their loyalty. #linkedinlearning

Robbie Kellman Baxter is the founder of Peninsula Strategies LLC, author of The Membership Economy, and and a LinkedIn Learning course author. Check out her courses: Create a Membership-Based Business and Develop a Service Orientation

Her clients have included large organizations like Netflix, SurveyMonkey, and the National Restaurant Association, as well as smaller venture-backed start-ups. Over the course of her career, Robbie has worked in or consulted with clients in more than 20 industries.

As a public speaker, Robbie has presented to thousands of people in corporations, associations, and universities. She has an AB from Harvard College and an MBA from the Stanford Graduate School of Business. Find Robbie on Twitter, @robbiebax.

- Robbie Kellman Baxter

Fonte:https://www.linkedin.com/pulse/future-loyalty-programs-more-starbucks-less-united-airlines-baxter/?trackingId=IaIIxPjMv3tLPjef9ZLOuw%3D%3D

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