Modular architecture provides flexibility and accelerates success in customer loyalty
Editor’s note: True to our role as the Global Voice of Customer Loyalty, The Wise Marketer invests itself to learn what brands are doing to engage customers and build loyalty. We also actively survey solution providers to understand the technology available to bring strategy to life. Our Provider Profile series focuses on specific solution providers that build a bridge between strategy and execution. Here we take a closer look at Exchange Solutions (ES).
The diesel engine is one of the most efficient power plants invented. Once it is running at full steam, it produces more power and fuel efficiency than those powered by other fuel sources, including gasoline, compressed, and liquefied natural gas. The one drawback to enjoying this above average performance is that diesels don’t start well in the cold and take a bit of time to get rolling at full capacity.
Even if you’re not a fan of fossil fuels, we couldn’t find a better metaphor for loyalty program start up than the diesel engine. The combination of strategic planning, solution sourcing, and implementation required to launch a customer loyalty program traverses a long, steep ramp. Once launched, program return on investment may take eighteen to twenty-four months. Fortunately, once this threshold is breached, the positive contribution to profit margins increases briskly.
Patience is key when laying the foundation for customer loyalty
In other words, it typically requires patience to realize the full benefits of a customer loyalty strategy, but the impact to your organization is significant and gains traction over time. The benefits of reduced attrition, increased visit frequency, and annual customer value coalesce to create this value.
With loyalty programs in play across all forms of retail, hospitality and more, many brands have mature programs and have long since amortized their initial investment. At the same time, every brand is facing the need to deliver communications and offers through new methods of engagement to connect with customers, whose buying patterns have exhibited step-change over the past two years. That means brands are on the hunt for technology to meet highly focused needs.
Exchange Solutions has built its technology product suite using the concept of modular technology. Their solutions address the specific and urgent needs of retailers, while minimizing the need to “rip and replace” existing platforms to add functionality and respond to market changes.
Of course, some brands have outgrown their current platform, have needs that have evolved holistically, or are disappointed with service levels of the current provider. In these cases, seeking a replacement platform is the right decision to make. The anchor of ES’s tech suite, ES Loyalty, meets this need.
ES Loyalty is a comprehensive, fully-featured loyalty delivery platform that is supported with the ancillary services you would expect, strategy and program development, analytical work, creative and communications, account management, and technical support. True to the modular architecture approach, ES has developed ES Loyalty to expand and contract to their clients’ needs. A fully featured program management console can be leveraged by clients themselves or be managed by Exchange Solutions' SMEs. The same applies to developing promotions and strategy management.
We’ve seen current research reporting that over 50 percent of brands operating loyalty programs do so with 5 or less full time employees. Wise Marketer research also has found that most loyalty program teams are understaffed. Technology designed to address resource issues to optimize the program experience can be a difference maker in the success of a new or growing program. Exchange Solutions’ adaptable approach seems built to meet this need.
Back to the topic of modular loyalty architecture
There may be an element of your program performance needing improvement or turbocharging. A unique element of the Exchange Solutions offer is its ability to meet specific needs and add functionality that isn’t available from your current vendor. ES’s employment of modular architecture throughout its product suite provides solutions to achieve measurable consumer loyalty faster. Here is what we found through review of ES Loyalty, ES Loyalty Boost, and ES Engage.
Promo Enhance is a SaaS based loyalty module within ES Loyalty. The module can be deployed quickly, reducing time to launch, and avoids the need to “rip and replace” an entire platform. ES clients can use Promo Enhance to target personalized offers for improved results. The module leverages available insights from analytics to increase the efficiency of offer targeting. Insights and execution tools include real time offer deployment capabilities and up to the minute trend reports, all at the clients’ fingertips.
ES Loyalty Boost delivers automated personalized offers that add to program performance. In our opinion, the promise of personalization has been only partially fulfilled and customers can disengage with brands when the data they contribute to a loyalty program seems to go unnoticed. ES Loyalty Boost is a technology solution that can be activated quickly, and which carries multiple benefits.
The product allows marketers to configure 1 to 1 promotions at broad scale. Executed properly, member engagement accelerates and deepens, while program promotional expenses are optimized by sending the offers that matter to the people who want them. ES reports that its clients have realized 15% lift in incremental margin, higher redemption rates up to 85%, and 200% return on promotional spend across individual campaigns.
ES Engage is designed with a focus on delivering personalized offers but has a further focus to benefit ecommerce businesses. The solution recognizes purchase intent in real time and capitalizes on this insight to deliver offers that increase conversion among first time customers, reduce shopping cart abandonment, and grow basket size where possible.
Product ROI is earned by fine tuning how promotional dollars are allocated for e-retailers, allowing them to reduce reliance on margin-eroding discounts extended to general customer populations. It is common that every site visitor encounters a percent off discount and much of this promotional money is wasted on customers who would have purchased anyway.
The secret sauce of ES Engage is that it recognizes customers based on past behavior and current activity to formulate offers in real time that leverage purchase intent into purchases made. For more information, you can quickly watch their 2-minute overview video.
The ES product suite is compelling as a consideration for marketers as it offers the ability to meet customer needs and improve performance without having to make a time-starving technology decision. Both ES Loyalty Boost and ES Engage can be integrated into an existing loyalty platform to increase return on loyalty program investment.
Something we have not observed to date in the loyalty tech space is practical application of the modular approach. ES is leading in this area of micro-solutions that can complement their core loyalty platform or be appended to a third party platform. With marketers playing catch-up to respond to customer needs, the ability to add new features with quick speed to market holds distinct advantages.