Loyalty's future is mobile

Twenty-three percent of the top 100 brands enable consumer outreach and engagement via mobile and social networks using phones, smartphones and tablets, according to a new report from Brand Keys.

Apple and Amazon dominate. You have to go to number 12 on the list before you are not dealing with a tech brand that has a natural fit into mobile.

The 16^th annual loyalty leaders gives the loyalty rankings for the top 100 brands out of 598 brands assessed in 83 industry categories in the 2012 Brand Keys Customer Loyalty Engagement Index.

Brand loyalty is driven primarily by emotional engagement. The brands that appear at the top of the list this year are there because of the high levels of engagement that consumers show with these brands as well as their ability to deliver on consumers’ expectations. No surprise then that Apple are top followed by Amazon, Samsung and gaming brands Call of Duty and Halo. Twitter leads the social networks.

Starbucks saw the greatest loyalty gains mainly because of its mobile loyalty strategy. Those brands that have unfulfilled customer expectations and not engaged with consumers, especially those that have failed to do so by mobile have declined in the rankings. Netflix, Bing, BlackBerry and facebook being four of the high profile losers

The results show that need to pay attention to what customer expectations are for mobile and for social outreach. Key is being able to deliver the instant gratification access consumers expect.

A great example of how one brand in the US turned to mobile to drive customer loyalty engagement is Jersey Mikes, one of New Jersey’s leading subs/sandwich retailers with over 570 stores across the US. It was looking for ways to reduce costs while improving engagement and came up with the concept of turning paper into mobile.

Since replacing its punch card scheme Jersey Mikes have signed up 650,000 members and increased all loyalty metrics.  The Shore Points Rewards program includes a mobile app for Android and iPhones, special offers delivered via text messaging as well as NFC stickers to simplify how members earn points. The mobile loyalty program is available at its 570 locations nationwide.

It’s available to all customers and its simplicity in a fast moving environment is key to its success and mobile is central to that. Indie Global is the parent company of SkyPop, San Francisco, whose mobile marketing platform is powering the Jersey Mike’s loyalty offering so successfully.

Customers are made aware of the program via in-store promotions and marketing through all customer  interaction points. Those who are interested in joining can affix an NFC sticker on their phones, enabling them to tap the phone at the store to earn points on purchases, which can be redeemed for free food.

In addition the Jersey Mike’s mobile app also enabled the members to easily view and track their in-store purchase points and awards. Customers can also earn bonus points, manage their membership profile and receive exclusive specials.

The program also includes a customizable smartphone ad manager dashboard as well as cloud-based message and notification delivery. The platform enables Jersey Mike’s to monitor usage on a real time basis throughout all its stores and quickly adapt to local conditions such as weather with special offers.

Brand engagement has increased with the mobile switchover with 93 percent of members – or more than 600,000 – having opted in to receive text messages with special local offers. This is far above industry averages and shows the depth of emotional connection customers feel for the brand.

Historically, 7 percent of all customers have come in three times or more per month. Among those who have signed up for the Shore Points Rewards program, 11 percent have come into the stores three times or more per month. That is a 50% increase in return on investment and dramatic increase in revenues directly linked to the new loyalty program.

Jersey Mike’s has been testing a “Double Points Thursdays” program in regional stores, which has generated double-to-triple the normal loyalty club traffic.  The chain will also be adding location-based services and targeted ad messages to the program.

The mobile program has numerous financial benefits. It eliminates fraud, enables Jersey Mike’s to learn more about their customers and deliver push messaging to them. It’s fundamentally simple to implement and very low cost. It’s a great example of the way loyalty programs are going. The future of loyalty is clearly mobile.