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Thursday, February 7, 2013

Article in Review: Success with Social Loyalty

Brett Hannath, from the TIBCO Loyalty Lab writes about why social media can be a successful tool for businesses and social loyalty marketers alike in the article Success with Social Loyalty. Hannath finds that social media's rise, and other medium's fall, is key to why it can be so successful going forward. The article includes a more evidence based view of why social media is currently, and will continue to, play a key role in marketing strategies, including loyalty programs.

Within the past 5 years there has been a dramatic decline in the ratio of time spent on print media and television as compared to digital media correlating to a decline in ad revenue for printed adverts. Social media now makes up the virtual location where people spend the largest portion of online time.

And there is a reason for this: "Media whose capabilities are limited to one-way communication are in decline, while those that enable two-way communication are rising. This is good news for loyalty marketers, because it’s two-way communication that enables the interaction and engagement at the heart of all successful loyalty programs. For companies seeking to move their customers from mere buyers to loyalty program members to brand advocates, the opportunities have never been greater."

However, there are two concerns. First, that marketers fail to utilize the two-way communication which makes social media so unique and advantageous. And second, that even well funded social media programs are not guaranteed to work, large investments based on program's social engagement have failed. However, well defined objectives and plans mitigate these risks.

There are three social media devices considered.

The first is the potential in email. With 85% of people using it, it provides access to a larger variety of consumers than other devices, including Facebook! And further it is important that email should be seen as a form of social media. There is the capability to share, through forwarding messages, to engage in two-way communication via polls or replies to messages, and site sourcing and emailed coupon codes can provide the data that many desire on the success and reach of marketing campaigns. Spreading information about deals and loyalty programs, and tasks that can be completed to get further rewards, can spread rapidly and effectively through well designed emails. However, there are also a couple drawbacks to the use of email. The first being that the younger generations are not as active on email, and the second that there is no third party viewership of activity or as powerful of a viral effect generated by this medium as there is on Facebook and Twitter.

Facebook, when utilized properly can be intensely effective in increasing company reach and brand loyalty. However, many make the mistake of making their page on Facebook a perpetually changing billboard that simply posts sales, deals, and products - limiting it to one-way communication - completely missing the point of the medium. A great way to avoid this problem is to create pages for the products or programs that one's company wishes to promote, encouraging individuals to post their stories, experiences, and appreciation for the product. Providing that personalized, customized, two-way communication that is currently trending.

Twitter also has its potentials in user engagement. Its ability to allow for viral skyrockets, the "trending" feature, and the simplicity of "retweets" gives twitter the capability to reach a broad audience quickly. However, this is limited by Twitter's simple nature and character restrictions. The medium is better used for rapid sales lasting only a few hours or information and loyalty rewards of similar nature. Perhaps a rapid reward program where reward points are given out if a link is followed, but that will only be valid for 15 minutes after the tweet is posted. Loyal followers will gain an advantage and be rewarded for their attention to the brand. Further it gives people a reason to constantly return to that page, increasing viewership and building a broader relationship.

Here again we return to loyalty programs. Where traditional programs are limiting in their approach, based solely on what the consumer does, social media rewards consumers for connecting with other, sharing content, and increasing the viral nature of the brand. This then develops a community around the product or services provided, increasing trust and the chances for a long term relationship.

Using social media sites in combination, and, perhaps more importantly, with mobile devices, furthers the possibilities and connections that the brand can receive. Potential rewards could be given for following the brand on all of its online pages (Brand Website, blog, Facebook, Twitter), signing up for newsletters, filling out surveys, submitting to texting notifications, and more - and the rewards can be just as engaging for the company, giving those following the company virtual rewards, advantages or hints about its upcoming products, a free app (or a feature in one that you might normally pay for), again the possibilities are endless.

Changing demographics and electronics usage has been key to the recent surge in social media. Its potential for two-way communication makes it unique among marketing mediums and allow for more potential in community and trust with consumers, and potential in loyalty rewards programs with targeted products and rewards that can be more personalized to achieve a closer relationship.

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