Executive interview with Chris Cobb reveals important tips for malls and outlets
Creating a customer loyalty solution for retail can take many forms. Solutions need to be tailored to meet the channel and business model of the individual retailer. For that reason, there really isn’t a single solution for “retail loyalty”, far from it, and in our view, one of the most challenging models is for shopping malls.
It takes specialization and focus to serve the multi-tenant marketplaces known to consumers as “malls or shopping centers” and Coniq is recognized by the industry as the pioneer and leader in helping growth minded shopping malls, outlets, and retail brands create business value from data, empowering clients to improve foot traffic, customer satisfaction and sales. Coniq was founded in 2011 by Ben Chesser and has built a client roster composed of a who’s who of the most prestigious retail destinations globally.
Coniq’s loyalty/CRM platform and solutions revolve around consumer data capture, utilizing the latest in technology to understand who is on property, where and when they’re shopping, what they’re spending, and their shopping preferences. These insights are then used for message personalization within CRM and loyalty programs, including free, paid/subscription, and tiered loyalty. The company has registered some impressive wins in North America lately, Mall of America and Tanger among them. Wise Marketer caught up with Chris Cobb, Coniq VP, Sales & Loyalty Strategy to learn more about the company, its solutions and expansion plans.
Wise Marketer (WM): Chris, thanks for taking time to talk with Wise Marketer. Can you start by telling us a bit about yourself and how you found your way into the loyalty business?
Chris Cobb (CC): Thanks for having me, as I’m always excited to talk loyalty and customer data. Not to age myself, but for over 30 years, I’ve been supporting retail brands to help them drive store traffic, sales, shopping frequency, brand engagement, and overall customer loyalty. For nearly two decades, I had the opportunity to work for the largest print advertising agency in the US, where we would marry retailers' customer loyalty data with syndicated demographic, purchase power and lifestyle data to drive advertising budget efficiency and ROI for their targeted print ad campaigns.
I then transitioned into the loyalty technology solutions space, where for 10 years I was working with retail brands on designing, building, and optimizing new or revamped loyalty programs. During that time, I had a strong focus on paid and subscription loyalty models. Now at Coniq, I have the opportunity to work with the most iconic shopping, dining, and entertainment destinations to help them drive increased traffic and higher levels of loyalty to their malls and outlets, while simultaneously increasing the success of the retail brands at their properties.
WM: That is actually a tall order, helping brands and malls succeed in reaching their goals in concert with one another. What have you taken from your time in the industry that influences your approach to serving retailers in the mall environment?
CC: From my early experiences in print advertising, I was able to observe the lifecycle of various marketing strategies. Being able to play a part in the front end development of ad campaigns and then seeing the outflow of results continually reminded me of the power of customer data. If you’re going to meet customer expectations today, you’ve got to manage data smartly and efficiently, while building trust with customers that you’ll protect that data as the precious asset that it is.
WM: You mentioned Paid and Subscription Loyalty. These are terms that have been attracting lots of attention and investment from retailers of late. What’s your view on this loyalty model and how does Coniq define these terms in its go to market strategy?
CC: Depending on who you speak with, you might hear the terms paid, subscription, membership, or premium loyalty used to describe what is essentially the same thing. When it comes to how retail brands define paid programs however, you may get many different answers based on their desired KPI’s for their program.
For example, Amazon Prime expects extremely high usage of member benefits, as the average Prime member spends nearly 3X more than the non-Prime member, so the membership revenue is poured back into funding the program benefits. The Best Buy Total program on the other hand is full of service and tech support related benefits (like piece of mind insurance) so there is the opportunity for that program to generate bottom line revenue should service and support not be necessary for these paying members.
Coniq’s experience in paid loyalty has been focused on providing a highly elevated, more valuable customer experience, with unique one-of-a-kind rewards, to mall and outlet shoppers. This includes both transactional, as well as experiential, benefits that are unique only to members. These programs are designed to bring loyal customers back to the shopping center more frequently, extend their dwell time, have them visit more retail brands, and increase overall spend while there.
WM: What are some of the best examples of paid or subscription loyalty that you see in the market today?
CC: There are so many high-quality paid loyalty programs in the market today, and I’ll mention a few in particular that I believe deliver incredible consumer value and have made me more loyal to their brand.
The Panera Sip Club is a simple program but delivers great value. Customers pay $11.99/mo. or $119.99/year and get endless free coffee, tea, lemonade, and fountain drinks as well as exclusive offers loaded onto their account. For the consumer, it’s incredibly straightforward for them to see the value - a member just needs to enjoy one drink per week to get the membership to pay for itself. Anyone can do that math quickly and decide if joining is right for them.
REI, a leader in outdoor apparel, footwear, gear, and services, has a unique coop model and offers a lifetime loyalty membership for a single fee of $30. Once a member, you get a gift card to use on your next purchase along with free shipping on all orders, discounts on merchandise, even campsites reservations, 20-30% off bike and snow shop services and rentals, free bike tire repair and ski waxing. Also, a very cool thing is that REI donates a portion of all membership fees to its nature preservation fund, a cause that makes a strong connection with many REI customers.
WM: Any others that you can mention?
CC: While I’m a bit biased on this one, I’d be remiss if I didn’t mention Mall of America’s MOA Insiders program, which includes both free and paid tiers. Yes, Coniq supports this program, and it is truly innovative. The free tier allows members to access discounts and deals at Mall of America retail, food and beverage and entertainment tenants, while also earning points on purchases that can be used to unlock even more offers and experiences.
When upgrading to the paid tier ($35/year), not only do you get access to countless higher value deals, discounts, and experiences as well as earning 5 points for every $1 spent at the mall, but members also get exclusive perks like a pass to Nickelodeon Universe amusement park and Climb Zone ($57.99 value), member only parking, free stroller rental, and early access to the many events always happening at the Mall of America. For most families visiting MOA, the annual membership more than pays for itself within the first hour of arriving at this must-visit shopping, dining, and entertainment destination.
WM: What kind of results are you seeing from this and other paid loyalty programs you have worked on to help clients achieve their goals?
CC: In nearly all the paid loyalty programs that I’ve worked with brands on, the results they’ve driven for those brands share many similarities. It’s typical to see members of the paid program increase their annual purchase frequency with that brand by 20-35% and their annual spend increase in the 30-45% range. Not surprisingly, these tend to be the biggest brand advocates, so when the brand introduces a “VIP type program,” they become early adopters and power users.
WM: Using tiers adds a layer of sophistication to a loyalty program and allows for more individualized treatment of members. How do you blend the use of tiers with the paid loyalty model?
CC: Coniq and our clients understand it’s important to engage, reward, and value ALL customers in some way and we are realistic that a paid membership may not make sense for every shopper. For example, there’s always going to be a percentage of low frequency customers who may only visit once a year, and there is little chance of increasing that frequency, perhaps due to the significant distance to the shopping destination. For those consumers, the free loyalty tier might make sense as they can still gain some value during that visit by being a member, and the benefits can still drive higher dwell time and spend.
With most existing free loyalty programs that you see from retail brands, if they have tiers, they are generally based on spend levels, with a very small percentage of customers achieving that top “Platinum” level. I think it’s important to recognize and reward your most loyal shoppers based on their commitment to your brand, whether or not that is spend-based, engagement-based or being a brand ambassador. However, many paid programs allow the consumer to gain immediate access to those exclusive “Platinum” benefits that might otherwise take them 8-12 months to achieve. You can still work tiers into the paid level based on spend, giving an accelerated level of points earnings and more rewards, perks, and experiences to those most active members.
WM: What is the role of technology in making tiers work for a loyalty program? Is tiering about technology, communications, or the value proposition?
CC: Keeping up with the latest technology is critical for any successful loyalty program, regardless of whether it’s a tiered program or not. For Coniq, it all starts with technology, which allows us to help make a personal connection with consumers, capturing insights, shopping/brand preferences, and purchase data. Accumulating, organizing, and leveraging this data enables for more pertinent, compelling, and customized marketing and communications with shoppers, driving them to higher levels of engagement with the malls and retail brands. With the personalization of messages, offers, and deals, customers can then maximize the perks, benefits, and overall value of being a loyalty member.
WM: What are you able to share about your recent announcements with Mall of America and Tanger?
CC: Mall of America launched MoA Insiders in Feb. 2023 and in the first 3 months, we worked together to onboard over 300 retail tenants for transaction tracking and had 35,000 users join the free or paid program. And as I had mentioned for most loyalty programs that I’ve worked on that had a paid component; the results have been incredibly strong. MOA’s paid program members generated a 208% increase in transactions per visit compared to free loyalty program members. Not a surprise, given the incredibly cool benefits and rich rewards that Mall of America has included in their paid tier.
The TangerClub loyalty offering is powered by Coniq, and we enable Tanger to improve its ability to support retail partners with more access to customer preferences, patterns, and spend to drive customer engagement. Tanger’s new TangerClub rewards guests every time they shop, play, and dine at any of Tanger’s upscale, open-air shopping centers in the U.S. and Canada. The program’s benefits are available through a tiered program structure, with increasingly differentiated offers and benefits at each level.
I personally love how Tanger has worked with us to structure their tiered reward program, delivering value to include ALL their shoppers. And for those who choose to join the Gold tier, based on the increased value and volume of retail deals available to those members, the subscription quickly pays for itself after just a few purchases.
WM: Thanks for spending time with us today. We are interested to see how paid and subscription loyalty continue to evolve.
CC: Thanks again for having me. Years ago, I think many felt that subscription loyalty was a trend, but it’s become a core model that can be applied by many brands to connect with their key customer groups that show a strong affinity for their brand and are looking for an elevated shopping experience. Of course, you need to have the data to support that conclusion and that’s what I’ve been focused on and been passionate about throughout my career.