The critical conversation of how to foster customer loyalty will be the focus of the upcoming CEB Financial Services Technology Summit April 20-22 in Boston. Bankers join colleagues from Starbucks to Delta Airlines struggling with the same issue.
In a recent article in the New York Times, Starbucks acknowledged that it has changed its points program from one that rewarded frequent shoppers – “designed to show our appreciation simply for stopping by” – to one that rewards customers based on the amount they spend. In other words, a complex five dollar coffee earns more points than a simple black drip coffee, even if the latter customer comes back four times a week. This means that the points program is now not really about customer loyalty, which is dedication by a customer to a specific vendor, but more of a cash-back program. United Airlines and Delta Airlines have also changed their rewards programs, giving points based on how much a customer spends on airfare. The frequent flyer “mile” is no longer directly related to distance traveled. High-spending corporate travelers receive more rewards than bargain hunters. American Airlines will make a similar change in July, the Times says.
This is just the latest change affecting customer loyalty in the travel industry. Aggregators like Expedia, Orbitz, and CheapTickets have eroded the connection between the customer and the airline. Credit card companies now provide points that can be used for travel, which reduces the uniqueness of the airline programs. In response, airlines are expanding their programs to allow passengers to pay for food, beverages, and entertainment with award credit.
And, in all industries, loyalty can be solidified when vendors meet the customer’s expectation to be always available, any time, anywhere, on any platform throughout the customer journey. In the competition to secure loyalty, providers will need to be able to address the customer’s desire to “know me” and “know my journey” regardless of channels, device, or touchpoint across time.
Bankers Fight Churn with Technology
In a world where disruptive offerings and the constantly morphing mobile platform are proving a challenge to all businesses, financial institutions have taken the lead in using technology to solve the loyalty problem. Bankers acknowledge that the laser-focus on loyalty is being adopted to battle churn and commoditization.
“Across financial services, relationships are becoming increasingly thin and fragmented,” the CEB Group says in the opening salvo of its conference website. “In fact, our data shows that since 2010, customers expanded the number of firms they use by one-third or more, putting significant pressure on profitability… Technology is a significant driver of this fragmentation… and must also be at the heart of the solution. This year’s summit will enable financial institutions to understand what ‘loyalty’ means in the digital era, and, in turn, how technology helps financial firms earn deep relationships through delivering more personalized, timely, and accessible offers.”
Mark Stanley, PMP, Genesys Senior Principal Business Consultant, will bring the Genesys view of customer experience into the conversation at the event during his session, April 21st at 1pm with Nicole Sturgill, Analyst, Corporate Executive Board, Battling the Data Disconnect for a Better Customer Experience. Follow the conversation on social media using @Genesys and #CEBSummit.