With Andy Kulina, Head of Loyalty in EMEA at Cheetah Digital.
Some say that loyalty marketing is a marathon not a sprint. Well, that’s why in this week's episode of Uncaged Wisdom we invited a guest who has run 10 (ten!) marathons, 9 of which he can remember.
Some say that creating a truly meaningful loyalty program requires a background in physics! Well, we’re not sure about that but our guest did once have aspirations to be an aeronautical engineer. Today’s guest also has over 25 years of experience designing, implementing, and operating consumer engagement, growth & retention programs. He puts the "loyal" in "loyalty," it's in his DNA.
Today our pre-packaged subject, straight off the shelves, is the exploration of loyalty programs within the grocery and supermarket industry. To talk all about this, Julian and Kayla invited Andy Kulina to uncage his wisdom. Andy is the Head of Loyalty in EMEA, and host of Cheetah’s Loyalty Royalty Roundtable events.
03:50 - Andy sets up his experience and history in the loyalty game, including being a major player in the creation of Kroger’s — and the grocery industry's — very first loyalty program back in 1995. Today, Kroger Plus has become the largest loyalty program for supermarkets in the U.S., with 65 million households and 100+ million customers. It captured transactional data, turned customer groups into segments, and attempted one-to-one marketing. After such success, all roads lead to Paris for Andy and eventually to Cheetah Digital!
08:10 - A quick history of supermarket loyalty in the U.S. and Europe, including its (lack of) evolution. Keep in mind two key considerations;
- What does the customer want out of a loyalty program?
- What is the brand trying to get out of the program?
11:40 - Typically, grocery loyalty programs today are still built around the transaction, but *sound the key quote klaxon* rewarding someone only after they buy something is way too late in the digital age. You’ve got to incentivize them to think of you being the product or place they want to buy from and then reward them when they do. This is a seismic shift, shifting the point of interaction earlier, from transaction to much sooner in the customer journey — at the point of awareness and consideration.
Andy brings up a great example of this future vision in play today. Salling Group created a program that made digitally engaged, permissioned customers, by focusing on initiatives that made their lives better e.g. offering the best price on the things you buy today, via the app, and digital receipts for frictionless returns.
14:30 - Andy explores what makes for a good grocery loyalty program — both for the customer (what are they looking for) and for the brand (what do they get back).
You have to map what the consumer wants to what the brand wants — there must be a collaboration between the two. Perhaps most important of all — the consumer proposition has to be a no-brainer. Keep the proposition simple, fresh, and never lose sight of your customers' needs whilst reminding them of the benefit they are getting. Change consumer behaviours without them even realizing it.
18:10 - From the grocery brand's perspective, as a multichannel retailer, often handling customers both offline and online — they are always competing with somebody. How can they identify their customer each time they shop, wherever they are shopping, and create a Single Customer View across these different channels? This is where a loyalty program really comes into its own — they encourage individuals to identify themselves when shopping. Additionally, these programs allow brands to be front-of-mind for the consumer when it comes to the next purchase, by creating intelligent offers and interactive experiences. These value exchange experiences also allow the brand to collect timely and relevant permissioned based preference data they can then act on.
“A loyalty program is a tactic, not a strategy in and of itself.” Forrester
22:30 - If you have a legacy, in-house loyalty program, why use a loyalty provider? And if you use a provider, why should you use Cheetah Digital?
26:00 - "The Andy Kulina Cheetah Digital Customer Engagement Suite, Featuring Loyalty." Andy gives us his Cheetah CES elevator pitch which covers the core benefits of the entire Cheetah Platform. Strong Indiana Jones Raiders of the Lost Ark warehouse-at-end-of-film vibes going on here.
28:00 - How can stronger relationships be formed between CPG brands and Grocers, especially when it comes to digital loyalty programs? Somehow running the Paris marathon with a monkey comes up.
31:00 - For any marketers working for grocery and supermarket brands, Andy has the following message for you. Thinking from a consumer's perspective — what are the things that make you loyal. Value for money and the different meanings this has. What are you doing to make your customers loyal to you, to elicit a positive emotional response?
33:40 - To close out, we move away from grocery and supermarkets. What loyalty lessons can be taken from this sector and applied to other industries? Keep the value proposition simple, keep what you're offering to your consumers fresh and keep evaluating what you’re looking to get back from any program you run.