Should We Set Points Free?
If Points Become More Fungible, Do They Still Drive Consumer Engagement?
This week I was talking with a new DCA member – Points4Purpose – about setting consumer rewards “free.” Old-school loyalty programs often issued rewards in a currency akin to Chuck E. Cheese tokens – in a totally closed system. I mean Mr. Cheese no disrespect: those tokens have been collected and, of course, studied in detail. But they really only worked in one place. Rewards that can only be used in a narrow space are simply not as valuable, making them less potent in driving consumer behavior.
On The Other Hand…
Many consumer rewards are now redeemable beyond the original issuer, but there’s still a reticence to truly set points free so consumers can use them as they please. What if it drives up the cost of the program? What if it doesn’t increase loyalty to our program or brand? All due respect to Sting, even if we love points programs, should we really set them free?
Questions DCA Members Are Asking:
- How motivated are our customers by redeeming within our program?
- How much “breakage” do we see – where consumers abandon points or disengage from the program? Would it help if they could make use of their points elsewhere?
- What would our best customers want to be able to spend their rewards on?
- What redemption options could be brand-reinforcing for us?
- Is there a way to pilot an expanded set of points redemption options with a subset of our best customers?
Related DCA Resources
Do You Have Social-Media-Enabled Employees
Work and Life are Blurred in lots of ways. Social Media is part of that.
I used to work in a bike shop. You know what I had a lot of? Bike stuff. You’re surrounded by it, you know more about it than anyone, you’re excited about it, you get a discount. You’re going to spend your meager income on bike parts and eat Ramen noodles to make up for it. In my case this was decades before the dawn of social media, but if I were 19 and working at a bike shop now, I’d be taking my interest in the newest, coolest carbon fiber bits and pieces to Instagram, Twitter or Snapchat.
More recently I worked in the land of lawyers. The idea of employees posting about their employers’ products or services on social media makes lawyers’ heads explode. One simply cannot control what they might say! Not a few conferences have been convened just so lawyers can discuss how to prevent such terrible things from happening.
Seizing the Opportunity
We all know that social media in its many manifestations is a deeply powerful tool for commerce of all kinds. People respond to other people, and particularly to recommendations by others they identify with. And a company’s employees are the people best positioned to advocate for its brand, experiences, solutions. They are also by far the best people to advocate for others to come work at the company. Labor markets are tight and employment brands matter.
So how do we manage the messy, risky space of employee social media engagement? I had a great conversation on Commerce Code a few weeks ago with Mike Garsin of Brand Networks, a DCA member. Brand Networks has worked with Walmart to make it easy for their associates to post on social media in a way that manages brand consistency and captures the value of employee advocacy.
So – there are companies that provide solutions here, but leaders still have to keep their eyes on the ball when it comes to something as fundamental as this. Employees engaging with the brand on social media touches a lot of critical areas for the company. So – what questions are leaders asking when it comes to activating employees on social media? Here are a few starters.
Seizing the Opportunity
- What’s our “baseline” – how much employee activity/advocacy do we have now? If we don’t know what it is, how do we figure it out?
- How do we identify the constructive messages we want to amplify? What are their characteristics?
- How do we make it fun? (Is it fun already? And if not – why not???)
- What platforms do we start on? And how can we stay agile to shift platforms as the social media landscape shifts?
- Is it possible to sell too many subscriptions, or is our fulfillment capability unlimited?
- What’s the positive impact potential if we get employee social media advocacy and enablement right?
- What’s the worst thing that could happen if we get it wrong?
EPISODE 154: Opportunities and Risks in Digital ID
- Recent changes in identity verification – and what breakthroughs are ahead.
- Privacy, data ownership and consumer control – where we are now on these key digital I.D. issues, and where we’re headed.
- The role consumers play – how aware and bought in are they to the kinds of initiatives these two companies are undertaking now.
Digital Commerce Alliance members include the largest and most innovative companies in fin-tech, payments, retail, e-commerce and mobile wallets. Members include Microsoft, Rakuten, UBS, RBC, Mastercard, Discover, Valuedynamx, FIS, Sam’s Club, TransUnion, Augeo, Bank of America and many more in 17 countries and 4 continents.
We are bringing their insights from around the world straight to you in an informative podcast called Commerce Code. The podcast features insights, interviews and the latest news from DCA members worldwide. Stay connected and subscribe to DCA’s Commerce Code.
New Member Spotlight
Please Welcome Points4Purpose to the Digital Commerce Alliance!
Points4Purpose (P4P) leverages the combined power of choice and giving to align your customer’s purpose with that of your business. By supporting worthy causes and participating brands, P4P enables businesses to personalize your offering to consumers and in so doing, grow your bottom line. And we package this all up through a true partnering agreement such that your success is our success!
With P4P, your customers ‘get more and give more,’ increasing their engagement with your brand, and in so doing, drive your internal objectives. We drive your business by providing your valued customers with a wider range of earning and redemption options through cashback – all without changing their behavior – or yours!
DCA Virtual Events
Open Banking’s Business Opportunities: Creating New Use Cases & Eveluating Value Propositions
Virtual | Wed, May 10th
12pm – 2pm EST
This interactive workshop will explore specific opportunities and best practices that leverage open banking and open data standards to engage with consumers. Safe, secure access to data is at the core of enabling the next generation of consumer experiences and card linking is a key enabler. During this working session, we’ll explore 2 topical areas through a practical lens:
- Communicating consumer value propositions around open data (related to retail, loyalty, marketing, etc.)
- Best practices for ensuring strong user protection around accessing banking or related data