The Future of Loyalty. Rupert Duchesne President & C.E.O. Groupe Aeroplan Inc.

Transcription

1 The Future of Loyalty Rupert Duchesne President & C.E.O. Groupe Aeroplan Inc. 1

2 Today s Talk Trends that are shaping our collective futures The Rise of the Datarati Credit Card Rewards under Pressure The Evolution of Best Customers 2

3 Groupe Aeroplan Now more than an FFP Proprietary Loyalty Services Data Analytics Coalition Investments New Ne... New Ne... GA Ownership GA Ownership GA Ownership GA Ownership 75% GA Ownership 60% GA Ownership Loyalty Marketing services Events and Entertainment Reward program operations Decision Sciences Over 2000 employees Territory: Global 2007 Long term relationships with Sainsbury s & over 100 FMCGs participants New CVS relationship in US Over 130 based in 7 countries Territory: UK, US with international expansion plans 1984 Over 4M active members, Over 75 earn / 150 brands Over 600 non-air rewards More than 1,200 Employees Customer level insights Multi channel communication M collectors / over 50% UK HH 14 earn partners & 450+ online 16 burn partners Unique 360 customer insight Multi channel communication M 1 st swipes by end of year 23% of Italy HH 8 earn partners (now Unicredit) Grocery, gas, bank, electronics, financial, car rental Strong estores proposition and Quixa (insurance) 2001 Operating in 7 countries 130 partners HSBC core partner and 40% shareholder Multi channel communication Minority GA Investment Operating in Mexico Grupo AeroMéxico partner and majority shareholder Major Amex relationship 2.5M members 3

4 Global Business Portfolio Over 3,500 people in more than 15 countries Aeroplan Canada Groupe Aeroplan Retail & FFP Carlson Marketing 4

5 The Rise of the Datarati Datarati are companies that have the edge in consumer data insight Data is ubiquitous & cheap, analytical ability is scarce Hal Varian Google Chief Economist The sexiest job in the next ten years will be statistician Why is data so important to Google? your query bid pricing data gathered about you ad with highest click through 5

6 The Rise of the Datarati Aggregating your behaviour Other companies are hot on Google's heels 6

7 The Rise of the Datarati Why is this trend so important for airline loyalty marketers? If you do not use your data to talk to your customers, others will. Good News Other companies envy the amount of customer data available to an airline Unlike Facebook and Google, airlines have permission to use their customers data Bad News Airline legacy systems make it difficult and expensive to aggregate The Datarati companies are already considerably further advanced in the application of consumer insights Do not remain on the sidelines. 7

8 The Rise of the Datarati Want to become a Datarati? Invest in the aggregation of all your airline s data in a customer centric manner Hire many, many more sexy statisticians (No, really!) Use data in day to day decision making: Meaningful customer segmentation Behaviour prediction Product design More relevant offers 8

9 Credit Card Rewards under Pressure Three converging trends Innovation Regulation Recession 9

10 Credit Card Rewards under Consumer Revolving Debt Pressure Recession May Retail Sales -9.6% -10.5% (Annualized) June MC Usage 2010 vs % Credit Cards -13% 3.1% (Annualized) Debit Cards 10.5% Source: MasterCard annual report, US Federal Reserve All data for the United 10 States

11 Credit Card Rewards under Pressure Regulation 2004 regulation % annual fees on rewards cards Changing reward value propositions Potential 2010 consumer protection guidelines more transparency reasonable fees further government evaluations Shift in preferred payment form Anticipate & mitigate potential regulatory changes 11

12 Credit Card Rewards under Pressure Innovation Efficient new forms of payment cutting out credit card infrastructure Transfer money via phone using only a PIN Virtual currencies for virtual services On-line purchase charge to mobile phone bill $50bn / y payments outside traditional networks 12

13 Credit Card Rewards under Pressure Implications Don't be shy investigate new payment method opportunities Work with financial partner to strengthen relationship with your collective customer Evolve co-branded products with unique soft benefits Expand coalition value proposition Evolve your financial card strategies 13

14 Evolution of Best Customers Loyalty in the hands of your customer Redefine who your most important customers are: Value = RFM + social influence Identify, attract and reward customers based on proximity to points of sale Track online / offline conversion Use smartphones for relationship building Clare M. in Glasgow City: wrote a Boots: Always busy. Be prepared to wait at least 10 mins for a prescription, but the staff are lovely Recognize word of mouth, reward promoters and monitor detractors 14

15 Evolution of Best Customers Implications Don't forget the basics Loyalty marketing has 30 year track record and its principles remain true today Temper innovation with strong measurement Social media activity alone does not bring revenues Demand solid plans and KPIs, not just concepts Focus on customer experience Re-engineer your business Compelling member experience through all channels Listen to your customers' reaction! 15

16 The Future of Loyalty Next 25 years won't be more of the same! Keep pulse on changes Keep finding innovative ways to use your FFP currency Remain flexible and nimble Join the tribe of the Loyalirati! Spot new behaviours through correlations in your data and use them to predict your customers future behaviour 16

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