Articles from Loyalty Marketing Blog

Microsoft to acquire Jellyfish.com
2007-10-02 21:47:23
I just came across a blog post on ReveNews, found here, that reported on a recent announcement from Microsoft that they are acquiring Jellyfish.com for an undisclosed sum. Jellyfish is a comparative shopping website based out of Madison Wisconsin. They’ve done some interesting things with affiliate marketing and ReveNews goes into some of it on their site. The amazing take-away for me is that somebody like Microsoft would be interested in making small acquisitions in the online advertising space in their effort to augment their “Live Search” functionality and user experience. I honestly don’t know enough about this to comment on exactly how it will be helpful to Microsoft’s Live Search but I am very curious to see what other large players will start acquiring similar integrated marketing companies over the coming months to strengthen their market positions. ...
Microsoft

Can retailers capitalize on spending power of low-income shoppers?
2007-10-02 21:31:52
I recently read an article on The Wise Marketer from Information Resources, Inc. that mentioned low income shoppers as providing a future growth opportunity if retailers could capture loyalty from that segment in the right way. I’m having trouble with this concept. Here’s my take… I think that existing retailers for the most part all have core customer demographics. I just don’t see Nordstrom or GAP changing strategies to cater to low income shoppers. The study referenced on The Wise Marketer mentions how these consumers have different needs. The funny thing is that the list they provide contains many things I think wealthy shoppers would want as well. Presently, retailers compete for share of this low-income market with price breaks, but many retailers are learning that deep discounts are not the good solution. According to the article, low-income shoppers are looking for: A need for smaller packaging; A need for shorter buying cycles; Improving variety and s ...

Affiliate marketing 101
2007-09-28 10:09:36
As many of you know, I’ve become a regular reader of the Affiliate Marketing Blog. It’s got some great insights into affiliate marketing. In a recent post, Shawn Collins discusses via video how a merchant can calculate the ROI on an affiliate marketing campaign. You can check out the rest of his post here but the gist of it is quite simple. A merchant’s ROI is calculated by taking revenues generated from the program and subtracting from it these three costs: 1) Cost of personnel managing the affiliate marketing program 2) Cost of commission to the affiliate marketer (the one driving the sales to the merchants) 3) Cost of affiliate marketing network or software While it might seem straight-forward, I think it’s a great idea to provide this clarity to merchants. Affiliate marketing isn’t a widely understood discipline, especially by traditional marketers. So everything Shawn and his affiliate marketing followers can do to shed some light on this very effect ...
Marketing

Vesdia Corporation joins Performics’ VIP Club
2007-09-27 09:47:43
Vesdia Corporation recently announced that DoubleClick’s Performics online affiliate network has invited Vesdia into its ranks of VIP publishers. VIP, or Very-Important-Publisher, is a positive recognition for Vesdia’s success in driving affiliate sales for Performics and its retail advertisers. Vesdia, as many of you know, recently sold its flag-ship school fundraising program, SchoolPop, to Linkshare for an undisclosed amount of money. Vesdia is moving its focus away from costly direct consumer marketing and more towards building online loyalty / rewards malls for large financial institutions (they currently run the program for Citibank) and other large affinity organizations. Their decision to be a technology provider rather than consumer marketer is smart. I think that this new strategy will pay off in spades, especially since they have been invited inside the velvet ropes of the online affiliate networks and are receiving royal treatment (i.e. higher commissions) from ...

Does breakage hurt or help loyalty marketers?
2007-09-26 22:01:42
As many of you know, breakage is often a core part of any loyalty marketing program. People don’t all define breakage the same way, however. For purposes of this blog post (and my own personal definition), breakage refers to all the unused points, airline miles or other non-cash rewards that are left unused by consumers. Many of you probably have unused rewards points from Citibank or Chase or airline miles from American Express. Each point or mile unused translates into approximately $0.01 for the loyalty / rewards provider. As you can see, that adds up quickly. I recently came across an interesting article on breakage over at r-Dialogue that discusses some ideas for why it is actually a bad thing for businesses (banks, retailers etc.) to focus on breakage as a core money-making strategy for their loyalty programs. Check out the blog here. This is a great post and very relevant. I’m a huge fan of loyalty programs that allow members to earn cash-back only for in-store merc ...

Linkshare is paying affiliates more frequently
2007-09-24 22:22:32
In a recent blog post by Shawn Collins over at Affiliate Marketing Blog, found here, I found out that Linkshare is going to increase the frequency with which they pay affiliates. Linkshare is one of the largest online affiliate networks and often is criticized by publishers like large rewards companies (Upromise, Ebates, iBakeSale, iGive, SchoolPop etc.) for not paying them often enough. Large rewards programs are the biggest winners from this announcement. Currently, rewards programs that offer their members merchant offers using Linkshare have to wait a while for merchants to pay Linkshare and for Linkshare to pay them. This time lag puts strain on the consumer relationship because consumers hate waiting around to get their shopping rewards promised to them by the rewards programs. Often, the rewards programs have to dig into their pockets and come up with the cash to pay members their rewards to keep them happy. That means the rewards programs often need to borrow that money until L ...

Can you buy customer loyalty?
2007-09-19 22:09:25
This might seem like a trite question. But I have been thinking quite a bit about this lately since getting back from my honeymoon in Hawaii. I’ve had varying levels of customer experiences at hotels, retail outlets and restaurants, I am still uncertain as to whether these establishments can actually buy my loyalty. Let me explain. Many establishments (retailers, hotels, restaurants, etc.) do try to bribe customers with price incentives (discounts) for buying their services or merchandise. This works only part of the time. Other times, merchants try to offer you an incentive after they’ve made a mistake. For example, The Hyatt in Maui offered us a $300 room credit after they gave away the room we had reserved. This numbed the pain temporarily but didn’t solve the problem. So you may wonder, can you buy customer loyalty? My answer would have to be NO. Merchants cannot obtain customer loyalty through economic incentives. While addicting, a big discount is only good unti ...

Seth Sarelson quoted in Adweek
2007-09-17 09:35:10
My co-founder at OnCard Marketing, Seth Sarelson, was recently quoted in an Adweek article by Joan Voight titled ‘Total Rewards’ Pays Off for Harrah’s. The article, found here, describes Harrah’s new membership rewards program with special focus on what industry experts have to say about the program. Great job Seth! ...

Airline customer service… does it exist?
2007-09-14 00:00:11
I recently flew on US Air to and from Hawaii on my honeymoon. Without even seeing the new report ranking the country’s worst airlines, I could tell you that US-Air was #1. Here’s the history… We flew from NY through Phoenix to Maui and then back again and spent two weeks in paradise, although the trip to and from Hawaii was far from perfect. After one lost bag, two delays, no food, uncomfortable seats and 24 hours of flight time, I wasn’t too happy with US Air. On the way back to the mainland after our amazing two weeks in paradise (it really was a great trip I promise), we were given vouchers for agreeing to stay an extra night to accommodate other stand-bye passengers. We are glad to get the two $400 vouchers and an additional night at the 5-Star Marriott from US Air. We sort of figured it was the least they could do… Here’s where the customer service nightmare begins. After two weeks of being home, I realized I lost / misplaced the vouchers and ...

Interview on B2B Marketing Blog with Tom Pick
2007-09-10 07:45:26
Yours truly, Jonathan Treiber, was recently interviewed by Tom Pick over at B2B Marketing Blog about our experience so far running OnCard Marketing, or OnCard, and iBakeSale.com. I tried to match his insightful questions with my own answers and think that overall it was a very solid interview for the company. Please check it out if you’re interested on Tom’s blog by clicking here. Thanks! JT ...
Marketing

Do you accept… points?
2007-09-09 18:45:43
CardLine Global just reported on one of the coolest stories related to credit card rewards I’ve read in a long time. Hyundai Card Co. in Seoul has opened a shop where its credit cardholders can redeem card rewards points for goods. What makes this such a cool news story is that this marks the first time that a credit card company has opened an actual brick & mortar to allow cardholders to redeem rewards points for merchandise. Now beyond this being a cool way to allow people to get their credit card rewards, let’s look at the details. First off, it’s only one store and it’s in Korea. So for anybody who thinks this is coming to the U.S. anytime soon, keep dreaming. It’s simply an experiment to see if consumers will be receptive. After thinking about it a little more, I think U.S. consumers may actually like this. The problem is that having physical stores for rewards redemption adds significant expense to a part of the credit card business that is alrea ...

Performics affiliate network creates VIP club
2007-09-08 23:29:43
In a blog post from Shawn Collins over at Affiliate Marketing Blog, I learned that Performics, the #3 online affiliate marketing network, announced the creation of a VIP club to top publishers. You can check out his blog post here. My initial response to this news is that Performics should recognize top affiliates with special perks like personalized account managers, increased visibility/recognition, and invitations to special events. This is a good thing for top affiliates. However, based on this information, it really doesn’t sound any different than what Linkshare and Commission Junction, Performics’ two top competitors, have been doing for quite some time. I guess DoubleClick has finally realized that to compete for top affiliates, Performics needs to offer the same perks that the two other big guys (#1 & #2 in the industry) are already offering. Yes it will add additional costs to the business, but I think it will be worth it in building long-term relationships wi ...

LifeSpring Health gains distribution for new rewards card
2007-09-08 14:26:18
LifeSpring Health recently announced a partnership with National City, a prominent commercial and retail banking and mortgage finance provider in the Midwest, to provide its LifeSpring Health rewards Visa card to National City customers. This is a great announcement for LifeSpring Health because they are starting to gain consumer distribution channels for their rewards credit card. The card, referenced in a previous post, found here, allows shoppers to earn reward points that can be used for Health Savings Accounts (HSA), insurance premiums, health services, prescriptions, elective medical procedures, gym memberships, and wellness products. LSH has a great card program, especially in today’s day and age of rising health-care costs. National City can only benefit from pushing customers to the LSH card because it costs them nothing and probably involves some type of revenue sharing based on the interchange revenue collected by LSH on each transaction. LSH wins from this deal becaus ...
Health

Are all your customers the same?
2007-09-07 08:42:32
In a recent white paper by the Peppers & Rogers group, it seems as through companies who adopt a “single customer view” often win out. How can one customer view-point work for all customers? Well, I don’t think that’s exactly what they mean. A single customer view argues that companies have to start communicating with any given customer as if that customer is the only customer. That customer needs to feel special, like the company really understand his/her wants, needs, aspirations. Is this at all realistic, especially for a company with millions of products and customers around the world? The answer: probably not. But they can try harder. The white paper argues that company communications, where possible, should be targeted better for each customer. Right now, we are still in a world of mass media. Targeted marketing exists online, but 1-to-1 marketing is still quite a ways from being commonplace. Peppers & Rogers claims that a single customer view, mo ...

Breaking news in affiliate marketing industry
2007-09-06 08:37:41
Rakuten USA, the US division of the Japan headquartered Rakuten, has purchased CauseLoyalty.com. Shaking the corporation tree for those who aren’t aware, Rakuten USA owns LinkShare and CauseLoyalty owns SchoolPop and OneCause. I’ll go into why this may not be such a good thing for Linkshare (think conflict of interest). However, this is the second time LinkShare has acquired one of its affiliates. In June of this year, LinkShare acquired TrafficStrategies.com. The M&A activity in this industry has been heating up recently as ValueClick has made similar acquisitions, most notably the purchase of PriceRunner and MeziMedia. Google is buying Performics, the #3 affiliate network owned by DoubleClick. The SchoolPop announcement is unbelievable. Here’s why. Vesdia Corporation, the previous owner of SchoolPop, acquired the program years ago in an effort to build up their portfolio of affiliate rewards programs. To date, SchoolPop remained Vesdia’s crown jewel (and it ...
Marketing

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