BL-RLC 2015 Hearts Wallets by BrandLoyalty

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> Food for thought: Retail Loyalty Congress 2013 > From Behavioural to Emotional Loyalty > Who owns your data? > Whatâ&#x20AC;&#x2122;s really going on inside those little heads?

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IN AMSTERDAM

Drive traffic by making your promotions go mobile quickly Welcome to the second edition of ‘Hearts & Wallets’, which comes to you at the start of a new year filled with many intriguing new possibilities. A lot has of course happened since our RLC 2013 in September, in particular BrandLoyalty’s acquisition by Alliance Data Systems (ADS) in the US. 2 January 2014 marked the start of what will be a very close working relationship with ADS’s Canada-based subsidiary LoyaltyOne. Both of these highly data- and loyalty-driven companies have realised the value of making digital connections to promote retail growth, and are far ahead of the competition in terms of data capture, analysis and use. In our interview with LoyaltyOne President Bryan Pearson, he pinpoints how to achieve true Emotional Loyalty through intelligent use of data. Clive Humby – the architect of the Tesco Clubcard – talks further about this important subject, particularly in terms of who will actually own that data. But as both Bryan and Clive agree, there’s no point in collecting data unless you can interpret it in a meaningful way. The researchers at Groningen University are experts in this, as proven by their recent study showing how a seemingly subtle change can greatly influence the human motivations that make or break a loyalty programme. 50

In the middle section, you will find a synopsis of our speakers’ presentations at our recent Retail Loyalty Congress (RLC) in Amsterdam. We were glad so many people were able to attend, and it was a real pleasure to be able to speak to many of you in person. I hope you enjoy reading this issue, but most of all, I hope you will join with us in the thrill of being in this fast-paced, ever-changing retail world as it spins into a new digital dimension. Bright Promo is a digital promotion channel in which customers can discover offers with their tablet or smartphone. The products can easily

Robert van der Wallen

be added to a personal shopping list that you can edit anytime, anywhere.

CEO, Brand Loyalty International BV

Bright Promo is integrated quickly, will increase visibility, and drive traffic to your business.

www.icemobile.com/bright

“ The next few years will be a most exciting time for us.”

CONTENT 06 from behavioural loyalty to emotional loyalty Interview with Bryan Pearson

14 TEAM BRANDLOYALTY

CONTENT

32 food for thought Retail Loyalty Congress 2013

16 welcome to the virtual supermarket

NHTV

20 Gadgets

22 results that keep you going Groningen University

26 our partner across the atlantic

Are you giving female customers enough of an experience?

52 who owns your data? Marketing Analyst Clive Humby

58 creating a sustainable future together Interview with AndrĂŠ Kuipers

66 what's really going on inside those little heads? How loyalty programmes appeal to children

gadgets

35 bridging the emotional gap Philip Spanton

46 What women really want

34 do you want to compete or create? Magnus Lindkvist

Introducing LoyaltyOne

30 Dutch a-Z

RETAIL LOYALTY CONGRESS 2013

36 Understanding customers through data Clive Humby 37 beyond big data: give to get Andreas Weigend 38 get the details right Mary Portas 39 culture, values & loyalty a whole foods market perspective Walter Robb 40 Panel discussion 41 where exciting new ideas are born The Innovation Lab 44 winning over hearts & wallets drives ROI

INTERVIEW WITH BRYAN PEARSON

FROM BEHAVIOURAL LOYALTY TO EMOTIONAL LOYALTY As president of LoyaltyOne, Bryan Pearson specialises in leveraging data-driven insights to create relevant communications and enhanced shopper experiences for some of the world’s more effective loyalty programmes – including Canada’s AIR MILES Reward Program. He’s the author of “The Loyalty Leap: Turning Customer Information Into Customer Intimacy” and “The Loyalty Leap for B2B”. We sat down with Bryan to discuss how to build Emotional Loyalty in an information age.

INTERVIEW WITH BRYAN PEARSON

BRYAN, WHAT ROLE DO FEELINGS AND EMOTIONS PLAY IN OUR BUYING DECISIONS?

believe in the purpose of that organisation and it aligns with your

To ultimately achieve Emotional Loyalty, a company must

values. If that second retailer opened a store next to your house,

engage its customers through experience. It should be able to

In my book, “The Loyalty Leap,“ I share what I’ve learned about

a significant chunk of your business would move there.

understand its best customers’ main interests, assign value to

the distinct differences between behavioural and Emotional

them, and then connect with its customers in a way that says,

consumers will react differently to various offers in the market

OR IF THE SECOND RETAILER OFFERED ONLINE SHOPPING TO PROVIDE MORE CONVENIENCE?

and to communication based on a mix of these components.

Yes. Stores that rely solely on Behavioural Loyalty are often

Loyalty. And while these are distinct ideas, we do see that

For example, consumers are more responsive to incentives when

“I know who you are, and I understand your needs.” You must also watch for cues.

vulnerable because customers will switch as soon as a better

WHAT CUES?

alternative becomes available.

The fascinating thing about grocery shopping is that ultimately you are what you eat. You are what you buy in the store.

an expiry exists, meaning customers feel like they will miss out on something if they do not act quickly. Companies often capitalize

SO WHAT SHOULD RETAILERS BE DOING?

The grocer has an incredible value driver that’s inherent in its

on this “use-or-lose” mentality with specific loyalty program

Retailers need to make what I call “The Loyalty Leap,”

business – if it is tracking customer transactions.

messaging. A company might encourage a customer to use his

meaning they need to use customer data – whether it be

Because customers shop frequently, food retailers have a robust

or her loyalty card with messaging printed on till receipts such

transactional, survey etc. – to build Emotional Loyalty. In fact,

and constantly updated data file. And if, for example, a customer

as, “If you had used your card on this, you would have earned

Emotional Loyalty requires that the company motivate the

has a health issue or a dietary restriction that says he can’t eat

1300 loyalty points.” Both of these leverage an understanding of

entire organisation to use customer data to deliver experiences

gluten products, or he has a heart condition and needs to eat less

how the consumer behaviourally shops the store but ultimately

that are relevant. Relevance is what leads to customer intimacy

fat, it shows up instantly in purchasing data of that customer.

is tapping into other emotional cues to create changes in

and ultimately to Emotional Loyalty. This requires a shift in

That’s why the consumer shouldn’t be put into a static segment

purchasing patterns.

thinking. It means that retailers need to place the customer at

and left there. You need an analytics-driven environment that is

the center of their purpose -- above product and profit, and base

constantly rescoring customers.

REWARD RECOGNITION RELEVANCE

WHAT’S THE DIFFERENCE BETWEEN BEHAVIOURAL LOYALTY AND EMOTIONAL LOYALTY?

every decision on what is best for the customer. By being truly customer-committed, retailers will stand apart from their rivals

The path to Emotional Loyalty is to redefine what you’re going

Of course, creating meaningful interactions can be an around-

Behavioural Loyalty is typically motivated by rewards. It occurs

because they’ll connect with customers on an emotional level.

to do better than anyone else, identify customer segments and

the-clock job, especially since the ways in which we reach

when the customer is conditioned to visit a specific store

be as relevant as you can with communications (based on what

consumers are continually changing and multiplying. But there

or a business based on the motivators of price, promotion,

they’re telling you every time they come and shop). That’s a path

are some basics we should not ignore. For starters, customer

that needs to be refreshed and maintained, because it doesn’t take

groups are best addressed after they have been segmented based

a lot of irrelevant communications before you turn customers off.

on behavioral and attitudinal motivations. Then we can create

convenience or simply habit. But the problem with Behavioural Loyalty is that as soon as a more attractive alternative opens up nearby, consumers will shift brands. Emotional Loyalty is more deeply rooted. It’s gained when the brand proves itself by providing communications and services that are relevant and

“Stores that rely on Behavioural Loyalty are kind of vulnerable”

the appropriate experience for each.

HOW CAN RETAILERS MAKE SURE THEIR MESSAGING IS RELEVANT?

CAN YOU GIVE AN EXAMPLE?

If you want to maintain long-term customer loyalty, then you

Of course. There are certain purchasing patterns that are very

BUT HOW ARE THEY GOING TO DO THIS? DO THEY NEED TO GET THEMSELVES AN ARMY OF PSYCHOLOGISTS?

have to invest your talent and resources in creating relevant

predictive of someone who might be expecting a new child.

ways to interact with customers across all channels. Context and

An expert from the drugstore industry once told me that

content are critical and you need to be timely – it makes no sense

when a customer stopped buying contraceptives, on average

SO UNLIKE BEHAVIOURAL LOYALTY, EMOTIONAL LOYALTY IS A MUCH MORE NUANCED AND COMPLEX THING?

No – Emotional Loyalty will come, in my view, because retailers

to send diaper coupons to a mother who just sent her youngest

it was 14 months before she started buying baby products.

have already defined territories where they can be the most

off to college. A flub like this will not only cost you credibility,

Obviously, retailers can’t – at the 14-month mark – start saying,

competitive. For example, the U.S. grocery chain Whole Foods

it will erode the mutuality of value you promised, meaning that

“Congratulations on your new baby!”

Correct, and these are the two extremes. In fact, you might be

is focused on providing a wholesome, healthy approach to food

when a consumer agrees to share personal information with you,

behaviourally loyal to one store because it’s next to your house,

that is applied across the entire store experience. For another

she is doing so with the expectation that she will get something

Timing and tact is important. For instance, you shouldn’t send

but you might be emotionally loyal to another because you

grocer, it could be about convenience.

of mutual value in return.

the customer an email that only includes baby products.

specific to a customer’s needs, on a timely basis and without being intrusive. It’s a matter of gaining trust, which is hard won but worth it.

INTERVIEW WITH BRYAN PEARSON

Rather you should embed baby-related products in a suite of

and then make product recommendations. Do you want

enthusiast vs. hobbyist), you build a greater willingness from

other offers that may appeal to the customer and then wait for

to know the number of complaints we’ve received from

the consumer to engage in the details of the material and fully

the purchase to occur. Once the consumer responds, retailers

customers? It’s zero.

appreciate the value of the offer being presented.

We receive 20,000 emails or phone calls to our Customer

can then widen the offer base.

HOW DO YOU BUILD LOYALTY WITHOUT ANNOYING CUSTOMERS AND GETTING “UNFRIENDED”?

Care Centre related to our programmes each day – and we’re

HOW DO YOU MANAGE TO BE RELEVANT TO SO MANY DIFFERENT CUSTOMERS?

sending out millions of communications, highly targeted, based

Companies need to follow the three R’s of customer loyalty.

on grocery and pharmacy shopping and virtually nobody calls

The first R is reward. It represents the tangible thank you

You do it by being transparent and reasonable. The more

to complain.

that companies give customers for changing their behavior

transparent and reasonable you are about the collection and

and providing personal information – it is known as a hard

use of data, the more engaged your customers will be. If they

As long as companies practice responsible data use by

benefit. The second R is for recognition. In addition to

understand in very simple language what you are trying to do

respecting and protecting customers’ privacies, this is an

providing a tangible reward, organisations recognise their

and what’s in it for them, then they will be more willing to

achievable result.

valued customers with gestures such as complimentary

share their personal information.

upgrades, preferred booking status or front-of-line access to special events – these are known as soft benefits. This

are obligated to deliver on that promise. Collecting data

WITH THE NUMBER OF COMMUNICATIONS MEMBERS ARE BOMBARDED WITH (SPECIFICALLY FROM OTHER LOYALTY PROGRAMMES), HOW CAN YOU DIFFERENTIATE YOURSELF?

without using it to benefit the customer can be annoying and

I mentioned earlier that to be successful, messaging and

some kind of value back on that data.” The value equation of

alienating. If a hotel frequent-guest program asks me what

communications need to address both content and context.

delivering relevance is a key to generating true loyalty to a

kind of pillow I want, then I expect it to go the extra mile

First, let’s look at content. You can start by segmenting

business.

and provide me with that kind of pillow. When a company is

customers based on purchase patterns and behavioural

open with its customer about its motives, is transparent in its

motivations – what the consumer has responded to before –

activities, makes a clear promise and delivers on that promise,

and then creating messaging for each. This helps to determine

then customers will not only tolerate data collection, they’ll

who to target, how to reach them and what to offer. Don't

embrace it because they will clearly see the benefits.

send the same offer to everyone – there’s nothing personal

SHOULD RETAILERS DO SOMETHING TO DEVELOP THEIR EMOTIONAL INTELLIGENCE? OR ARE THEY GOING TO HAVE TO RELY ON HAVING ENOUGH COMMON SENSE?

and therefore meaningful in that. For example, say my wife

Companies must adopt a filtering mechanism to their

and I were both invited to a special shopping event at a

communications. Just because the customers give you their

sporting goods store this weekend, but my message promoted

information, that doesn’t mean you’ve got a license to send

Just remember that when you enter into a data exchange with consumers, you have entered into a promise and you

“Collecting data without using it to benefit the customer can be annoying and alienating”

power-wicking workout clothing while my wife’s featured yoga apparel. It’s the same store, and the same household, but segmented messaging designed to appeal to what is important to each of us. The key to enhancing the content of your communications is

BUT DOESN’T THERE COME A POINT WHEN CUSTOMERS FIND YOU’VE GOT TOO MUCH PERSONAL INFORMATION?

context – the environment in which an offer is extended. You

LoyaltyOne operates programmes for half-a-dozen grocers.

the visual elements around the offer to reflect important

We target our messaging using consumers’ purchase histories,

characteristics such as life stage (families vs. seniors, sports

can take the same offer and place it in a contextually aware environment and double the response rates. In simply changing

brings us to the third R, which is relevance. Once a customer has opted in to some form of value exchange, it’s a case of “You share data with me, and in return, I’m going to deliver

REWARD RECOGNITION RELEVANCE

them anything you want. The onus is on the retailer to be deliberate and thoughtful in its communications. Twenty years ago, when companies were primarily using direct mail to communicate with customers, they had – and took – the time to really think about the messaging. The immediacy and comparatively low cost of the channels that exist today, including social media and mobile phones, has led to a sloppiness because the content is not necessarily curated as it should be. Most companies take a mass-market approach

INTERVIEW WITH BRYAN PEARSON

REWARD RECOGNITION RELEVANCE

ARE RETAILERS AWARE OF THE GOLDMINE THEY’RE SITTING ON?

sharing, consumers are going to turn to an organisation that is willing to act. Ignore the data at your own peril.

I’ll give you a couple of statistics that might be helpful.

privacy. From our study, we know that two-thirds of customers

WHAT’S THE BIGGEST MISTAKE YOU SEE RETAILERS MAKING IN REGARD TO COLLECTING AND USING CUSTOMER DATA?

would share even more data with brands if they knew that

Retailers should be sharing data throughout their organisation,

those companies would use that information to make their

but most of them are not. Traditionally, customer data has been

experience more relevant. There’s a relevance economy that

hoarded in the marketing department, where its revelatory

will grow gradually over time, and this idea of curating and

opportunities are limited. But by sharing customer data across

creating value out of consumer information and sharing is a

all departments, from finance to store planning and even with

powerful platform. However, the two-thirds number is falling.

the legal department, it can inform decisions all the way to

As consumers in North America become more aware, and

the front lines. We call this Enterprise Loyalty, and it allows

there’s more publicity around how much information is being

everyone to align their priorities against high-value, high-

captured, they’re becoming frustrated with the system.

potential customers, identify the critical customer encounters

Another interesting figure that comes from the privacy study is

that define the brand’s value, and change their activities to

how people responded to a question about whether it would be

better serve those customers.

LoyaltyOne is now in its third year of running a research study that measures consumer’s attitudes about data collection and

acceptable for a grocery store to send them information based decisions. More than 70 per cent of respondents said yes. So

HOW EASY IS IT FOR MOST RETAIL BRANDS TO WIN EMOTIONAL LOYALTY?

to their very targeted channels.

AND WHAT ABOUT BIG DATA?

within certain parameters or boundaries, done intelligently and

Exceptional brands are able to create these connections with

In addition to monitoring frequency of communication and

There’s a lot of media attention on big data but for

with the right level of caution, consumers are quite open to this

customers because they’re willing to step outside the norm

mutuality of value (which we discussed previously), here are

most companies, I think big data is too much of a stretch,

kind of an exchange.

and develop differentiated experiences consumers crave. The

three more tips for retailers:

because they’re not currently using the information that

on their health in order to help them make better purchasing

the wonderful thing about this data-based approach is that it’s a

create dramatic change in the performance of

BUT YOU SHOULDN’T DISAPPOINT THE CONSUMER, BECAUSE THEN THEY CAN GET FRUSTRATED IF THEY GIVE ALL THIS DATA AND DON’T GET IT BACK IN THE RIGHT WAY, TO SEE THE BENEFIT FOR THEMSELVES?

their business.

Exactly. Savvy consumers are recognising the value of their

customers at a desirable scale and cost. We now have the right

information and are now demanding relevance in their

channels and tools to communicate with the consumer; all that

relationships with businesses. If companies are not prepared

is needed is the willingness and emotional intelligence to make

to step up and act on the information that customers are

the most of them. It is an exciting time to be a marketer. ■

they have today. The reality is that if they just began to 1. Be Transparent and reasonable: I said this earlier but it

act upon their existing customer information with more

bears repeating. Organisations should explain their intentions

intelligence, not only would that set the foundation for

for the data in straightforward language and spell out what’s to

entering into these broader data pools, but they could

be gained by the customer. People are more likely to engage with companies that are transparent. 2. Give consumers a choice: Let consumers choose how to

With our Precima analytics product, we use customer

share their information. LoyaltyOne’s AIR MILES Reward

data as a basis to fully understand what is really going on

Program is permission based, and 99.99 per cent of our

at an individual level when it comes to making pricing and

customers opt to share their information with us.

promotion decisions. This puts a new lens on decisions that in the past were made solely on product data. By using this

3. Respect and protect data: Use the data collected only as

tool, we've proven that adding a customer view can result

promised and retain it only as long as needed. Don’t cross into

in dramatic savings that can be reapplied against other

very personal areas such as financial information or questions

marketing initiatives that may do a better job of building

about children, which can be perceived as creepy. And always

Emotional Loyalty.

destroy data with care.

reality is that it’s very difficult for a company to break out. But smartbomb – it’s stealthy. If you watch your competitors, you’ll see it manifest itself in social media. Just 20 years ago, we had no real mechanism to communicate directly with the consumer. Today, companies have the technology to be able to reach

“The reality is that it’s very difficult for a company to break out. But the wonderful thing about this data-based approach is that it’s a smartbomb - it’s stealthy”

TEAM BRANDLOYALTY

What on earth has a group of dedicated skaters got to do with a firm that creates loyalty programmes for supermarkets? At first glance, very little – it’s not as if the skaters are going to encourage shoppers to do quicker laps of the store. But take a closer look, and some startling similarities start to emerge. Coach Jac Orie explains why his most important sponsor is as close a fit as the aerodynamic bodysuits worn by his world-class team.

1. GLOBAL

4. Business intelligence

Skating is a global sport. This is great, because it raises the

My whole training programme is based on scientific research,

level of the challenge, but it also has drawbacks. My team

which is a big reason why the partnership with BrandLoyalty

spend about 125 nights per year in hotels abroad, and often

is such a good match – they work this way too. When I analyse

travel through time zones. I put them through lots of tests

races, I can see where the weak points are for each person,

to see how we can reduce jet lag. They need to be able to

and then we aim to overcome these. We are always searching

perform at their best, wherever the competition is.

for natural foods, because they give more nutrition and work

2. EXPERIENCED

OLYMPIC GLORY IS NEVER ACHIEVED BY CHANCE team

better than sport foods or drinks. And not all ovals are the same – in Calgary, the altitude means there’s less air friction,

Stefan Groothuis has already been a professional skater

so each lap is almost 1 second faster than in the Netherlands.

for 8 years, and he and his teammates are in good hands.

All such factors need to be taken into consideration.

Our sports doctor Gee van Enst was the first Dutchman to specialise in this field. We’ve also got two highly experienced

5. Tailor-made

physiotherapists: Willem Kruithof and Nico Hofman.

Normally, there are training programmes for whole teams,

Our guys rely on them, without a doubt.

but we do things differently by making an individual

3. Innovative

programme for each speed skater. We do a lot of blood tests and physiological tests to see how each person reacts best, and

I was one of the first coaches to use a wind tunnel to determine

that’s the basis for that person’s new programme. That’s what

the ideal skating position, and to analyse skaters’ performances

works best.

via Local Position Measurement. We try out new forms of training every year. I’m always looking for elements to optimise. We are constantly testing to develop speed, endurance and stamina. We work with physios, a medical doctor and human movement scientists to see what we can improve. For example, the opening or the 2nd lap could be someone’s weak point. I think the 1000m can be almost a second faster, and the 1500m a second faster. We are always going for the World record – that’s what we exist for.

NHTV

WELCOME TO THE VIRTUAL SUPERMARKET At Breda in the south of the Netherlands lies NHTV University of Applied Sciences, whose Academy for Digital Entertainment has gained international recognition for its high-quality research and development. It focuses both on leisure games and on ‘serious gaming’: fun interactions for business purposes. On September 25, Retail Loyalty Congress 2013 delegates taking part in BrandLoyalty’s Retail Tour saw the world première of the unique Virtual Supermarket made here by some of the most creative young brains in the gaming field.

The woman steps into her local supermarket and frowns. Something looks odd. Her favourite drinks brand seems a bit different today. She walks over to the shelf to take a closer look. The packaging on the bottle isn’t what she’s used to. The colours are darker and the typeface is bolder. Actually, it looks rather stylish. She decides to take 4 bottles this time, rather than her normal 2. But what’s this? She turns round to find the store layout has completely changed since a minute ago. She has to take a new route to find her washing powder, and her attention is caught by a promotion displayed on the end of the biscuits aisle. Free weekend return tickets to Mars for a family of 4? She smiles. Definitely worth collecting stamps for.

NHTV

Oculus Rift The Oculus Rift is a next-generation virtual reality headset designed for immersive (serious) gaming. It is not yet available for sale to the general public. Approved developers (such as NHTV) can create applications that integrate with the Oculus Rift’s open-source software. In this way, the university’s researchers are able to connect the view from the headset (i.e. what the wearer sees) to the images projected on the virtual supermarket walls, and to enable a variety of interactions.

The 'Cave' - Virtual Supermarket

Okay, we made up the bit about Mars. But all the rest is reality

The Virtual Supermarket has been developed over the last

to be polite. Here, we observe people’s behaviour, rather than just

Research possibilities

today. Welcome to the Virtual Supermarket. No, not the usual

four years by PhD researchers specialising in media concepts,

writing down what they say. That tends to give a more accurate

The Virtual Supermarket can be used to analyse:

online list of home-delivery products that you can’t be bothered

biometrics, persuasive communication, human computer

picture of their likes and dislikes. Also, it’s a pure environment that

• Packaging, retail, advertising and media strategies

to go out and shop for yourself. Instead, an amazingly immersive

interaction or research methodology. It has been subsidised by the

isn’t influenced by factors such as temperature, time of day, other

• Routing and shelf plans

research environment that gives retailers the opportunity to test

educational innovation alliance SIA (RAAK PRO), and is supported

people’s presence and so on. We can eliminate these variables.”

• In-store environments (music, lighting, etc.)

products, branding and store layouts before deciding whether to

by a group of commercial partners that includes BrandLoyalty.

implement them for real.

Over 1,000 people have already participated in different trials.

• The impact of a Loyalty Programme execution

Test. Retest. Change. Retest. Adjust. Launch.

(where/what to communicate)

He adds, “We can configure all the visual elements to reflect

• Effects of supplier-funded communication • Opportunities for LBA (location-based advertising)

Situated within a darkened room known as the ‘Cave’, the visible

The prototype of the future

retailers’ brands, their store layouts, shelving types and

part consists of 4 white walls, bearing images of a supermarket,

“This is in many ways an ideal test environment,” explains Marnix

other essentials. It’s extremely costly and time-consuming

that surround the participant. Less obvious is the range of vision-

van Gisbergen, the Academy’s Research Manager. “People get used

to make changes to these in real life, as it involves lots of

Partners supporting the NHTV Virtual Supermarket

capture and motion-sensor technologies that ensure that the

to it very quickly, and are soon interacting with it in a natural way.

manufacturing, reconfiguring, printing, and so on. You can’t

BrandLoyalty is one of a group of partners working with

partipant’s view of the supermarket changes – just like in real life –

They function like a living joystick. They can walk around, point

possibly close off a real supermarket for weeks for research

the university to further extend the capabilities of the

depending on what they look at, the direction they walk in and the

to and select products they like, and place them in their virtual

purposes, or install a Wi-Fi network wherever you choose to

Virtual Supermarket. We find it already offers an exciting

moves they make. Tracking software detects and records the route

basket (on their smartphone or tablet). And it has lots of advantages

analyse how certain groups of customers react to different

range of research possibilities enabling retailers to

they choose to take through the store, how much time they spend

compared with research done in normal focus groups, where

LBA (Location-Based Advertising) proposals.” That may be

develop, refine and launch products more quickly and

in each aisle, how long they look at a particular item, and which

you often get one or two participants with strong opinions who

obvious, but how can retailers be sure that the way people

with greater confidence than ever before. In addition,

products – including how many of each – they select.

influence the others, or people saying nice things because they want

behave in the Virtual Supermarket will be mirrored in real

research carried out in the Virtual Supermarket allows for

life? Marnix smiles. “We are academics, so we’ve done a lot of

easier comparability of the results via digital analysis.

research into that aspect – which we call ‘congruence’ – with

“Amazon and Google – in other words, non-retailers – are invading your stores. This gives you the opportunity to regain control of your store.” Hans Bouwknegt, Associate Professor at the Academy for Digital Entertainment.

validation studies, and have found that the results are very similar. Through methods including validated questionnaires, we know that over 90% of people like to participate, feel involved in their role as a supermarket customer, and consider the environment a believable supermarket.” ■

GADGETS

PETCUBE

Like the idea of seeing and talking to anyone ringing your front

doorbell – even if you’re not at home? Interested in an intelligent

Nest Protect

smoke alarm that communicates with you instead of alarming the entire neighbourhood? Wish you had a simple way to avoid getting sky-high bills from your telephone provider after a trip abroad?

Fire and carbon monoxide deaths are

We’ve found some great gadgets for a fun, fully-functioning future.

frequently caused because people get so annoyed by over-sensitive or beeping alarms that they disconnect them. The Nest Protect

Do you remember the Tamagotchi and the Furby? Well, thanks to the Petcube,

BIOLITE KETTLEPOT

won’t ‘cry wolf’ the moment it notices

portable and digital ‘pets’ are going walkies to the next level. This smart and

something ‘strange’. It will locate the problem

sleek little box – in combination with your smartphone – makes it possible to

and tell you what to do – by speaking to you.

play with, talk to and watch your dearly beloved pet at home.

The immensely popular BioLite CampStove has a new travelling companion: the BioLite

Price: ¤ 96

Price: ¤ 110

KettlePot. As the name suggests, it pours like a kettle and cooks like a pot. Place it on the Ready to go? Pop the CampStove safely inside the KettlePot to travel light. Price: ¤ 38

THE

Finding a huge invoice from your network provider when you get back

world that uploads and stores your photos instantly.

DOORBOT

They go into TheQ Lab – an unlimited, secret online

Now you can be in while you’re out.

hideout for your personal pictures.

Thanks to a special video doorbell which

Taking pictures is probably one of your most important holiday activities. TheQ is the first social camera in the

Price: ¤ 150

Knowroaming

CampStove to boil water or cook a complete meal (while charging your smartphone).

is connected to your home Wi-Fi network, your smartphone lets you see and talk to whoever rings your bell.

from travelling is not really good for your health. The Knowroaming electronic sticker makes sure this never happens again. It switches you to the best-value local network almost anywhere in the world, saving you up to 85% on your roaming charges. Price: ¤ 26

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RESEARCH

At the halfway point, should you look forward or back? “Overestimating how far you have come acts as an incentive and encourages you to continue.”

For insights in marketing, look north

Every reward programme, just like every long-distance race,

In the north of the Netherlands lies Groningen

has a beginning, a middle and an end. The first and last of these

University, whose Faculty of Economics and Business

are clear locations. At the start, participants are enthusiastic

is one of the top 20% of business schools in the world.

and excited about their journey. At the end, they’re proud of

It was here that PhD student Jacob Wiebenga and

what they’ve achieved. It’s in the middle that they tend to slow

Professor of Consumer Behaviour Bob Fennis explored

down, lose motivation, confidence – and even their sense of

how subtle variations in the way that information

direction. But new research has uncovered how people can be

about progress is provided can motivate consumers to

encouraged to continue: by focusing on how far they’ve already

continue saving via a reward programme.

come, rather than on how far they still have to go.

HOW TO AVOID GETTING STUCK Wiebenga and Fennis focused their study on the phase halfway through a reward programme, when participants hover somewhere between the starting point and their final goal. “Consumers tend to develop a ‘stuck in the middle’ feeling during this phase. This is known to be the point at which people lose their motivation to continue,” says Wiebenga. The research methodology revealed how to pull people out of this psychological impasse and encourage them to continue collecting.

RESEARCH

The punched-out card proved less motivating than the stamped card

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FOCUSING ON ACHIEVEMENTS IS KEY

To check whether ‘abstract’ thinkers might react differently

The researchers conducted several experiments to determine

to the tests than ‘concrete’ thinkers, the researchers identified

the best solution. In one experiment, two groups of test

the different ways of thinking using proven categorisation

subjects saved for rewards in two different ways. One group

methods at the pre-testing stage. They found that motivation

had a reward card on which 5 out of 10 symbols had already

to continue the promotion was on average 30% higher in

been stamped to show how many points they had already

‘abstract’ thinkers who were encouraged to focus on the results

earned. The other group had a reward card on which the

they had already achieved.

5 10 ask please

ils for deta

symbols representing the points already earned had been punched out, thereby visually emphasising the remaining

THE POWER OF OVERESTIMATION

points. At the halfway point, the first group’s card showing

Wiebenga continues, “Our research indicates that people who

how many points had been earned appeared to be more

relate progress information to their starting point or final

motivating than the second group’s card showing how

destination tend to overestimate the distance. Overestimating

many points still had to be earned.

the distance you still have to travel is demotivating and

And make a donation to support our primary school in Gulu, Uganda

increases the risk of giving up. However, overestimating how This same effect was also apparent in another experiment in

far you have come works as an incentive and encourages you

which participants were told they were about halfway through

to continue.”

a reward programme in which they had to collect 1,000 points. Their progress was shown on a specially created website page.

IMAGINE THE IMPLICATIONS...

For one group, this was indicated by an arrow at the starting

The results of Wiebenga and Fennis’s research are not only

point and the middle point to show how far they had come.

relevant to companies offering reward programmes, but also

For the second group, the arrows were at the middle point and

to other situations where people are working to achieve goals.

the end point to show how far they still had to go. Again, the

As Wiebenga suggest, “Halfway through a marathon, for

first group’s representation of what they had already achieved

example, it would be better to realise how far you have come

For the past year, BrandLoyalty has been working together with SOS Children’s Villages to

proved the most motivating.

than to think about just how far you still have to run.” Equally,

support the newly opened primary school in Gulu, Uganda. Uganda is slowly recovering from

people trying to lose weight could be motivated to continue by

DIFFERENT WAYS OF THINKING

a civil war and is relatively stable, so this is the perfect time for us to invest in Uganda’s children

focusing on how many kilos they’ve already lost.

and help them take their future into their own hands. BrandLoyalty’s own charity organisation

These effects were particularly noticeable in people who tended to view the promotion as a whole, rather than just

Like to know more about how stores can encourage customers

focusing on it one point at a time. This ability to think of the

to ‘go the distance’? Wiebenga and Fennis’s article ‘The Road

promotion in broader terms was described by the researchers

Traveled, the Road Ahead, or Simply on the Road? When

as an ‘abstract’ rather than ‘concrete’ way of thinking. Can’t

Progress Framing Affects Motivation in Goal Pursuit’ will be

see the wood for the trees? In simple terms, ‘concrete’ thinkers

published in the American Journal of Consumer Psychology in

see lots of trees, while ‘abstract’ thinkers see the whole wood.

January 2014. ■

(the Brand Charity Foundation) has taken up the challenge to help the school and hopefully create a bright future for Gulu’s schoolchildren. So follow your heart and support BrandCharity!

Caring for children’s welfare worldwide

Deutsche Bank Nederland, Stichting Brand Charity Bestuur Plus Rekening, Account: 0575437979, IBAN: NL20 DEUT 0575 4379 79, BIC: DEUR NL2N

LOYALTYONE

ENRICHING THE RELATIONSHIPS BETWEEN COMPANIES AND THEIR CUSTOMERS LoyaltyOne is recognized as a global leader in the loyalty industry. Over the past two decades, we’ve helped clients get closer to their customers by understanding what really motivates them and by using those insights to build stronger, more profitable relationships. We’re constantly innovating and expanding our range of services as the needs of our clients and potential clients evolve, and we’ll continue to develop cutting-edge solutions that further our clients’ strategic goals. Three ways we help our clients build richer relationships:

WELCOME TO LOYALTYONE.

CUSTOMER ANALYTICS

LOYALTY SERVICES

Through the use of sophisticated analytics generated through our Precima retail analytics solution, we work with clients to optimize their marketing, merchandising and operations – then provide flexible desktop tools and programs to enable our clients to continue fine-tuning every area of their organization in response to changing customer insights. Our analytics services range from Pricing & Promotion Optimization, to Assortment & Merchandising Optimization, to Targeted Marketing & Communications development and execution, all designed to help clients boost profitability and build engagement. We offer a range of expert services from optimizing a client’s existing loyalty program through our loyalty strategy and program design capabilities, to customer experience design development, to insight driven marketing and engagement strategies. Our insights, approach and recommendations are designed to improve program performance and ensure program investments are directed towards the right customers – tailored to meet our clients’ specific business challenges and opportunities.

We create powerful, cost-effective, multi-partner solutions that deliver more comprehensive customer insights, accelerated impact and proven, sustainable returns.

We’re excited to welcome BrandLoyalty to the LoyaltyOne family. We look forward to working hand-in-hand to build our presence in loyalty around the globe, while delivering tremendous value to our clients, vendors and associates. BrandLoyalty’s market leadership and depth of campaign-driven promotional loyalty programs for leading European and Asian grocery retailers align nicely with LoyaltyOne’s focused strategy to create lasting consumer engagement. Bryan Pearson, President & CEO, LoyaltyOne

COALITION LOYALTY Visit loyalty.com to learn more about LoyaltyOne. Our track record speaks volumes about the loyalty opportunity across the globe. Having access to the analytical, marketing and digital platforms at LoyaltyOne will allow us to compete even more effectively in both our core European markets as well as new markets. My team and I are believers in our approach and our ability to deliver strong, sustainable growth. Robert van der Wallen, Founder and CEO of BrandLoyalty

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DUTCH A-Z

The lowdown on the lowlands

DIAMONDS The opening scenes of the 1971 James Bond film Diamonds are Forever were shot in Amsterdam.

AMSTERDAM Amsterdam started life as a 12thcentury

fishermen’s

settlement

known as Amstelredamme, socalled because of the dam (Dam Square) that closed off the River Amstel. One of its most famous residents was Audrey Hepburn who was half-Dutch. During World War Two, the beautiful film star lived in Arnhem where, as a child,

BICYCLE

In fact, the city has long been

HERRING

associated with diamonds. It’s even possible to visit one of its factories and see diamond-cutting and polishing craftsmen at work. Try Gassan Diamonds, a historic diamond factory dating from 1897. Nieuwe Uilenburgerstraat 173-175, +31 20 622 5333, www.gassan.com

The Dutch love raw herring. Look out for street stalls serving it; hold the fish up by the tail, throw your head back, slip the fish in and take a bite! Need some encouragement? They’re rich in omega-3 fatty acids.

Going Dutch This well-known Dutch expression means to evenly split

she would deliver messages for the Dutch resistance.

There are around 881,000 bicycles in Amsterdam – more than the city’s

the cost of a group’s expenses, which is useful when the

She lived in Amsterdam

population – compared to around 263,000 cars. Traditional Dutch bikes

bill at a restaurant arrives. It’s also known as a ‘Dutch

from 1945-1948 and her

are known as opa (grandpa) and oma (granny) bikes and are typical

date’ and ‘Dutch treat’. Unromantic, but practical.

first film role was as a KLM stewardess in Dutch in Seven Lessons

(1948),

five-minute tourism film about the city.

examples of Dutch design: simple and functional.

Cheese

ERTWENSOEP

The Dutch eat 14.3 kilos of cheese

Also known as Snert, this is a very

per year on average – and are

thick - and very delicious - pea

nicknamed ‘cheese-heads’. Edam

soup. It’s traditionally eaten during

and Gouda are the most famous

winter and served with rye bread

cheeses, and both are named after

topped with bacon.

towns in the Netherlands. Also very much associated with the Dutch are Clogs (or klompen, as they’re

FEBO

Dotted around town, Febos are fast-food outlets with a difference.

known). In fact, the oldest

Imagine a wall of coin-operated vending machines that work a bit

surviving

like ATMs – but instead of cash, you get hamburgers, croquettes

pair

these

traditional wooden work

and French fries. Fries with mayonnaise is another phenomenon

shoes in Europe was

here. In fact, Quentin Tarantino famously referred to it in his

found in Amsterdam –

1994 film Pulp Fiction; he worked on the script when he

and date from around

lived in Amsterdam.

1230.

FOOD for THOUGHT Ingenious innovations and future trends, consumer engagement methods, data use and misuse, emotional value creation: the RLC 2013 covered all these topics, and more. Revisit it over the next few pages as we summarise the presentations of our inspirational speakers.

“Bridging the Emotional Gap”

“ Do you want to compete or create?”

PHILIP SPANTON MANAGING DIRECTOR BRANDLOYALTY When the going gets tough, it’s easy to neglect relationships and

in Germany to radiate a unique atmosphere that attracted its

just pursue the sales figures. Wrong. As BrandLoyalty’s Managing

target market: households with kids. How strategically deploying

Director emphasised during his speech, consumer engagement

multiple Loyalty Programmes built on authentic French values

is more important today than ever. The continuing economic

so delighted shoppers in France that BrandLoyalty was about

recession is reducing already thin margins, forcing retailers

to launch Auchan’s 4th LP there. And how Russia’s first-ever

to rationalise their product ranges and focus on the scale of

BrightStamps promotion attracted 25% extra spend. Programmes

their business, rather than on each store’s relationship with its

such as these strengthen the 1-to-1 relationship that customers

customers. Today’s consumer has felt the emotional distance

want to have, thereby bridging the gap between emotional and

growing and has responded accordingly.

transactional loyalty. In other words, winning over hearts and

Will a keypad on your hand soon replace the phone in your pocket?

As Philip Spanton explained, “Relationships require constant

wallets.

Could internet trivia such as ‘Cats That Look Like Hitler’ be the

work.” And, of course, an individual approach, supported by

innocent, furry face of a global friendship movement? In a thought-

intelligent use of data. This means getting to the heart of the

Philip concluded,

provoking talk, futurologist Magnus Lindkvist explained how

matter, providing a relevant offer that strikes a chord, shows

“Consumer engagement is a balance between Transactional

unthinkable or impossible developments have become banal, everyday

real value, and engages consumers in a way that appeals to their

and Emotional Loyalty. The stronger the relationship, the

phenomena – or even superseded by yet another paradigm shift.

deepest feelings. He showed how using Stikeez had allowed Lidl

stronger the business and the stronger its growth.”

MAGNUS LINDKVIST TRENDSPOTTER AND FUTUROLOGIST

How should we react? As the Danish philosopher Søren Kierkegaard once said, “Life can only be understood backwards; but it must be lived forwards.” Dynamic thinking, rather than copying or discounting, will be key. In a competitive business environment, the way to stand out will be to create something new – even if the initial reaction is negative. By experimenting, and not being afraid to fail initially, companies can use patience and persistence to surprise the world – and achieve the success they desire.

IBM’s 305 RAMAC 5MB portable hard drive in 1956. It cost over 10 million dollars.

“Today a 5MB data storage is a crappy giveaway on congresses and events. Innovation is only real innovation when it reaches the masses.”

When the commercial mobile telephone was introduced in the 80s, it took thirty years to start a revolution The Ericsson mobile phone produced in 1979

Name Clive Humby Home London Work Director at H&D HoldCo Relation Married for 31 years with his partner in life and business Edwina Dunn Family 2 kids

“Understanding Customers through Data”

“Beyond big data: Give to get ” ANDREAS WEIGEND DIRECTOR SOCIAL DATA LAB, STANFORD UNIVERSITY ‘Big Data’ is the new oil. Like crude oil,

each item on each shelf in a supermarket

“The focus has moved from better

we need to refine it to make it useful.

and in each shopping trolley. And on the

algorithms to better data... and lots of

Unlike oil, we are not going to run out

granularity of individual customers, how

it.” This is how Stanford University’s

of it. People make decisions. In the past,

they are feeling, what they are looking

Andreas Weigend sums up the

we based them on many assumptions

at, and who their friends are. ‘Big Data’ is

monumental shift now underway in

since we only had little data. We now

the mindset to turn mess into meaning,

how the retail business is learning

have lots of data, on the granularity of

and data into decisions.

to understand, model, predict and influence consumer behaviour. One manifestation of ‘big data’ is the emerging social graph, a mapping of connections individuals have with each other. Consumers depend on the social graph to make purchasing decisions;

CLIVE HUMBY DIRECTOR H&D HOLDCO

they draw on the experience of their graph-neighbours. For marketers,

Is there any point in the UK government holding another 10-year census to

understanding the relationships

understand its population when the Tesco Clubcard does it so much better?

between individuals is becoming

Marketing analyst Clive Humby described how the use of customer data

more important than the attributes

is changing the face of retailing in the UK. Tesco’s loyalty card has turned

of individuals. We are witnessing the

around the fortunes of the underperforming supermarket chain in an

transformation from e-commerce to

increasingly polarised sector, where discounters and upmarket specialists

we-commerce. New business models

are leaving food retailers fighting over the middle ground. Clive pointed out

are emerging, enabled by new models

that retailers must make better use of the data they collect – for example,

of trust and identity. The anonymity

to target customers more effectively or to give the most valued ones better

of the ‘good old Web’ has disappeared.

in-store service. But he also urged the audience to “be cool, not creepy” in

Playfully remixing the famous New

using it. Data provision should be a fair exchange, rather than irrelevant or

Yorker 1993 cartoon, Andreas Weigend

indiscriminate. Value models will develop in which customers own the data

summed it all up “On the Internet,

and choose who they share it with. Retailers will therefore need to build trust,

everyone knows you’re a dog”. Even in

relevance and consent to win data – and they need to start now.

food retail! Today we have a lot of individual tracking data, which does not demand a lot of assumptions.

Culture, Values & Loyalty: A Whole Foods Market Perspective

“ GET THE DETAILS RIGHT”

WALTER ROBB CO-CEO WHOLE FOODS MARKET Loyalty is cultivated by your customers identifying with your

including Fair Trade initiatives and ethical purchasing, with

‘true north’ values. That’s the message Whole Foods Co-CEO

third-party certification. “Transparency and traceability in the

Walter Robb brought home in his laid-back but persuasive

food supply are the most important developments in the food

way. Experimentation is essential in the retail business, but

industry in thirty years,” Walter observes. For example, Whole

your company should always remain true to its ethical values.

Foods decided to stop selling red-listed (endangered) fish,

Whole Foods now counts some 365 full-service supermarkets,

despite the loss of short-term business, thereby demonstrating

in which the company has put this far-reaching philosophy

its commitment to sustainable practices. “The decisions you

into highly successful practice. “We are not retailers with a

take about what not to sell are as important as the ones you

mission,” says Walter, “but rather missionaries who retail”.

take about what you will sell”. Adhering to your principles is

The Whole Foods vision is of a circle of active stakeholders

how you win the profound loyalty of your customers.

encompassing investors, employees, customers and the

The key to Whole Foods’ mission-based strategy is having a real

ecosystem. The company adheres to the highest standards,

purpose for the business, beyond making money.

MARY PORTAS FOUNDER OF PORTAS, THE RETAIL AGENCY Leading British retail and branding expert Mary Portas confronted the audience at the RLC with some provocative insights. “80% of supermarkets are run by men,” she observed, “but women make 92% of the family shopping choices.” She thereupon offered a stark warning: “Most women feel vastly misunderstood by retailers. Most women don’t think you ‘get’ them.” As as result, supermarkets don’t genuinely comprehend what makes women shoppers loyal, and most women don’t feel true loyalty to a supermarket.

Quality

Support

Community

Partners

We Sell the Highest Quality Natural and Organic Products Available

We Support Team Member Happiness and Excellence

We Serve and Support Our Local and Global Communities

We Create Ongoing Win-Win Partnerships with Our Suppliers

Delight

Growth

Stewards

Education

We Satisfy, Delight and Nourish Our Customers

We Create Wealth Through Profits & Growth

We Practice and Advance Environmental Stewardship

We Promote the Health of Our Stakeholders Through Healthy Eating Education

How do you win the loyalty of women shoppers? Get the details right! “Details speak volumes to women”, says Mary. To improve the shopping experience for women, you do need to “sweat the small stuff”. Men are transaction-oriented, women emotion-oriented, and small aesthetic details are key to triggering those positive emotions. Does your retail business have a Director of Detail? It should, says Mary. Details aren’t sexy but when fighting for market share they are key to loyalty. “You may have all the data in the world, but you still don’t know me. Don’t lose sight of the human dimension,” she vigorously reminded the audience.

The values of Whole Foods

Where exciting new ideas are born:

Walter roBB Co-Ceo Whole Foods market

litoo e m Cargalad ess re residendtBusin P Foo ari tah a m

The Innovation Lab

Bryan Pears on Pr

es C eo l i d e n t a n d oyalt yone

PANEL DISCUSSION

The RLC had its own Innovation Lab, where retailers could not only see some of the

r o B e rt e n all Van der W

approach in action but also actively take part.

g shoppin e r u t a N

dloyalty C eo B r a n

“It sparked momentum, encouraging

have been in food retail many years,”

This philosophy is encapsulated in

people to think freely without the

comments Karlijn, “and they definitely

the Innovation Lab, which now

normal constraints,” says Product

have some great ideas.”

serves as a cross-company platform

Director Karlijn van den Berg. “The aim

“Can you grow a concept and make it real enough to touch?”

to spark creative thinking. “It will

The new consumer has more choice than ever before, with

But who will this new consumer turn out to be? A man, thrilled

was to give everyone a peek into the

different shopping channels and a widening experience

to be able to shop in innovative new ways using a range of

creative process: how we experiment,

chain. How can retailers live up to his or her expectations?

high-tech gadgets? A woman, delighted to see an increasing

how we prototype, how we share

The panellists agreed on the need to innovate rather than

emphasis on feminine values fostered by marketing and

ideas and get feedback.” Delegates

simply compete, while using business intelligence to get

communications directed towards her? Or a child keen to

brainstormed together or came up

According to BrandLoyalty, the answer is

he explains. “The idea is that you are

closer to individual customers. The investment involved

collect the latest hype before an exciting promotion ends? No

with their own ideas. An illustrator

yes. “Part of what makes us successful is

given the freedom to try things which

could easily be limited by simply starting small and building

consensus could be reached – just going to prove that retailers

was on hand to render these as quick,

a willingness to experiment, to try new

may not yet be technically possible,

up – or by retailers being smarter in mining the data gold

will need to keep engaging in a meaningful dialogue with all

compelling drawings, which were then

ideas,” states Sander Ejlenberg, Chief

for which there may not yet be a

that they already possess.

their customers to serve them successfully in years to come.

put on display. “Some of our clients

Creative Officer (IceMobile).

business case.”

become a physical location in the new Den Bosch headquarters, as part of The Loyalty Experience, but more importantly it’s also a state of mind,”

Visit the Loyalty Experience Centre

Teleporting for fresh food

Meeting of minds

Are you looking for tailor-made solutions for your business? Like to co-create

The long tail on a small scale

Fresh tower

them with us? If so, tell us your idea, and we’ll see if we can use our expertise and knowledge of market developments to give it shape. We’ll be glad to invite you and your marketing team for a creative and inspiring session at our new Loyalty Experience Centre in Den Bosch.

READY, STEADY...THINK!

Karlijn van den Berg (IceMobile). “The aim was to give everyone

Interested? Please send an email to loyaltyexperience@brandloyalty-int.com.

Change is the only constant, as the saying goes, and embracing

a peek into the creative process: how we experiment, how we

We look forward to our meeting of minds.

change within an organisation means getting everyone on

prototype, how we share ideas and get feedback.” Delegates

board. “For us, the Innovation Lab is a place where you spend a

brainstormed together or came up with their own ideas. An

short period of time – and then return to your regular activities,”

illustrator was on hand to render these as quick, compelling

Sander says. It’s also a way of percolating fresh thinking through

drawings, which were then put on display. “Some of our clients

the business. All employees take part at one time or another.

have been in food retail for many years,” comments Karlijn, “and they definitely have some great ideas.” A selection of these are

“Part of the process of innovation is embracing failure,” Sander

shown here.

continues. “That means not being afraid of making mistakes. You have to ask: what can I learn from a failure? It sometimes

FLIGHT OF FANCY OR NEXT BIG THING?

takes many iterations to get it right.” He cited the story told by

All sorts of suggestions filled the air, from very concrete proposals

Swedish futurologist Magnus Lindkvist at the RLC 2013 about the

which could be implemented in the short term to highly futuristic

pop song that, after being re-recorded several times, in different

ideas which won’t be realised any time soon. “Lots of people believe

languages, by different artists, over a period of years, eventually

the supermarket is evolving into a place which you primarily visit

became a huge hit. “Things are never perfect the first time

for fresh food and experience,” explains Karlijn. “You’ll order non-

around,” Sander points out philosophically.

perishable products online and have them delivered to your home or a pick-up point - the long tail on a small scale”. Products will

POP-UP INNOVATION LAB

become smarter, letting you know when you are running out. The

The RLC had its own Innovation Lab, where retailers could not

supermarket will become a Fresh Tower, where cows graze and

only see some of the approach in action but also actively take

produce can be directly picked. Or you print your own food, based

part. “It sparked momentum, encouraging people to think freely

on your dietary wishes. Yet another idea: getting teleported to

without the normal constraints,” says Product Director

Italy to pick fresh tomatoes from the vine yourself. ■

WINNING OVER HEARTS&WALLETS DRIVES ROI

Behind the Loyalty Bar

During the RLC 2013, BrandLoyalty’s Business Intelligence team, consisting of analytical, digital and

“For example, at our charity booth where we were collecting

to the consumer. “It is much more personalised,” says

donations for BrandCharity, which supports primary education

Lourens. “You can do things like push-messages tailored to

in Uganda, we quickly saw that on the first day more funds

the individual.” The helpful little app is in fact a powerful

were raised when a woman was standing at the booth than

continuous link between the consumer and the retailer. It

when a man was,” relates Product Manager Lourens Keers.

connects all the shopping information and communicates

“So on the second day, we had just a lady there. It’s just a

this to the retailer, who is then able to develop attractive,

small example of the kinds of things you learn when you are

personalised offers to send to the consumer in return:

collecting and carefully analysing data in real time. These kinds

a win-win situation.

of insights – the ‘business intelligence’ – enable retailers to react very quickly to emerging trends and so forth.”

GIVING CONSUMERS A PUSH When we recently developed a smartphone app for the Russian

EVERY DAY, EVERY WAY

luxury supermarket Azbuka Vkusa, one of the most positive

“Retailers gather loyalty data on a daily basis, just via

findings was how well push-messaging worked. “Just one push-

transactions involving regular product sales, but they

message can have a surprising impact,” observes Ruud. While

don’t always know how to act upon this potentially highly

smartphones aren’t yet ubiquitous, they are getting common

valuable data,” adds his colleague Ruud Jansen, a Senior

enough to make loyalty apps a very attractive strategy.

Commercial Business Analyst. A major retailer gathers

research specialists, were available at the Loyalty Bar

millions of lines of data on a daily basis, he points out, and

to answer delegates’ questions. Our experts also shared

you need more than something like your standard Excel

INDIVIDUAL RELATIONSHIPS IN THE DIGITAL AGE

sheet to analyse them. “We have the expertise and the

“In the old days, you might have entered

their expertise on various topics, such as transactional

tools to analyse these kinds of enormous data resources.

the shop of your regular butcher, who

For instance, we can determine the precise effectiveness

knew you by name, and he might

and Emotional Loyalty analysis, risk management and

of loyalty programmes by analysing the transactions

have said, ‘Hey John, I saved a special

the tools required to set up a loyalty programme. What’s

and measuring the difference in penetration, frequency

cut for you,’” Lourens explains.

and basket size that lead to a higher Share of Wallet.

“We are now moving towards the

more, there was also a real-life demonstration of the

Transactional loyalty analysis, combined with strong brand

day when it is your smartphone

preference research to measure Share of Heart, determine

app that brings a product to your

what drives ROI in a loyalty programme.”

attention based on your tastes and

“Long-term loyalty tends to be based on emotional factors,”

shopping history. It is automated,

Lourens points out. “And the way you determine that is by

but it is personalised. We call it

intensively analysing and connecting information. Setting a

mass personalisation, in fact. We

baseline. Surveying the same group before and after. From

gather data from the consumer

Bright Stamps dashboard, and the results displayed were translated into actionable insights.

Traditionally, giving out paper stamps during a loyalty

REAL-TIME INTERACTION

careful research, we do in fact know that loyalty programmes

in order to give something back

programme has been a one-way transaction. But now

Delegates attending the RLC 2013 had an exciting opportunity to

boost long-term loyalty. Once a shopper gets in the habit of

to them.” That ‘something’ will

there’s a much more interactive way of doing things. Called

see Bright Stamps in action. As guests checked in, they were given

going to a certain supermarket, they tend to remain a shopper

of course include a reason to

Bright Stamps, it’s an app that enables customers to collect

an iPod Touch containing the Bright Stamps app, which they could

there, even after they have redeemed their rewards.”

return to a particular store.

digital stamps on a mobile device. As well as being more

swipe on a reader at various points, such as when getting lunch

convenient for shoppers, it provides retailers with lots of data,

or ordering a coffee. At the Loyalty Bar, set up at the centre of the

What makes mobile apps so powerful for the retail loyalty

reason could well be

revealing individual shopping patterns and providing more

Congress, data analysts tallied the results in real time, providing

business is that large amounts of useful data on shopping

as individual as each

opportunities to steer consumer behaviour.

some fascinating insights into how powerful these systems can be.

behaviour can gathered, as well as providing useful information

customer. ■

And in the future, that

CUSTOMER EXPERIENCE

WHAT WOMEN REALLY, REALLY WANT Are you giving female customers enough of an experience?

Everyone knows that women like shopping. (Well, non-food shopping, that is.) Men simply can’t believe how many hours their beloveds spend browsing through crowded stores. Aren’t all skirts and tops more or less the same? Obviously not. The gender divide manifests itself not only in the time women spend shopping, but in the things women regard as important when choosing their purchase. While men tend to go for technical specifications, women go for experiential aspects such as smell and colour – matters that men tend to dismiss as being mere details. But if details are what sell the product, they’re not trivial or ignorable. And there’s actually no reason why food shopping should be any different.

“It’s just a fabulous experience and makes you want to eat everything.” - Jessica Scott, UK

“I got clothes from Abercrombie and I can’t stop smelling them” - tweet from Hannah Weiss

DISSECTING THE SHOPPING EXPERIENCE

Emotional – an aspect that matters a lot to women. According

women shoppers loyal, and most women don’t feel genuine

to Temkin, most companies have a long way to go before

BOTTOM MARKS FOR UNDERSTANDING THE FEMALE SHOPPER

What make a good retail customer experience? The term covers a myriad of details and factors, some highly subjective.

they’ve mastered customer experience. “While any company

While Functional and Accessible have clear objective

win the loyalty of women shoppers? Get the details

Let’s try to unpack some of them, and try to find out how

can improve portions of its customer experience, it takes

dimensions, Emotional is of course more subjective, and it is

right! “Details speak volumes to women”, said Portas in

they trigger purchases and cultivate store loyalty. According

more than ambition and superficial changes to create lasting

here where many retailers fail. Leading British retail expert

Amsterdam. It’s all in the details, the tiny aesthetic or helpful

to Temkin Group, a leading US Customer Experience

differentiation,” the researchers say. Why should this matter?

Mary Portas, who spoke at the Retail Loyalty Congress 2013 in

touches which trigger women’s positive feelings. She cites

(CX) research and consulting firm, there are three aspects:

Because, according to Temkin, “Our research shows that

Amsterdam, insisted that women are still misunderstood.

Whole Foods as particularly successful in this regard, with

functional, accessible, and emotional. They tested 246

customer experience correlates to loyalty. If your customer

The findings of Dutch market research firm NewCom confirm

its sumptuous food displays and spacious but cosy stores that

companies across 19 different industries, asking consumers

experience falls behind, then customers will switch to your

this. They find there’s a big gap between what marketers

appeal to both men and women. Another is Abercrombie &

to rate their most recent interactions with a given company

competitors.”

think they know about the female shoppers and what women

Fitch, whose loud music, dim lighting and attractive young

loyalty to a supermarket. As a food retailer, how do you

themselves feel. Some 57% of female consumers surveyed say

staff impress male customers, thrill female ones and instantly

TOP MARKS FOR FOOD RETAIL

that the advertisements they see on TV, hear on the radio,

express the values behind the brand’s casual, all-American

Functional: Were you able to accomplish what you set out to do?

The good news is that food retailers dominated the high

and read in magazines don’t speak to them. In particular, they

clothing. A quieter but consistently inspirational customer

Accessible: How easy was it for you to interact with the company?

ground in the Temkin Group’s 2013 research results. Publix

object to rampant stereotypes of the ‘housewife’ that they don’t

experience is to be had at John Lewis, the department store

Emotional: How do you feel about the interactions?

Super Markets and Trader Joe’s speciality grocers earned the

identify with.

regularly voted Britain’s favourite retailer. Their secret?

according to the following dimensions:

top two ratings, and in total, grocery chains gained seven of

Knowledgeable, helpful, well-spoken staff who are all

COULD DO BETTER

the top 19 spots. According to Temkin’s metrics, shopping

IS MALE THINKING TO BLAME?

partners in the store and share in its success. You can be sure

Although a number of companies achieved ‘excellent’

experience is improving in general: 37% companies earned a

Portas points out that 80% of supermarkets are run by men,

they’ll take the same good care of you, whether you’re placing

scores (80% or more) for their Functional and Accessible

‘good’ or ‘excellent’ rating, which is a 9% increase over 2012

but women make 92% of the family shopping choices. As a

your entire wedding list there or only want to buy a needle

components, not one of these 246 companies managed this for

and a 21% gain since 2011.

result, supermarkets don’t genuinely understand what makes

and thread.

CUSTOMER EXPERIENCE

potentially great customer experiences that went wrong because of men not paying

What do women want? Ask them!

attention to details. The luxurious new car with leather seats that smelled of stale

Insights into the female brain often appear via the mouth. So as Mary suggests, why

cigarette smoke, rather than leather, thanks to the delivery driver. The car radio set to

not ask women – on the shop floor, in the street, in the bus queue – what they do and

his football station, rather than hers (which the garage could have established simply

don’t want when they come to shop in your store? You may not wish to fulfil every

from one phone call to her secretary). And in contrast, the female friend who took

request, for financial or other reasons, but at least you’d have a better understanding

delivery of a new car and discovered a bouquet of flowers when she opened the boot.

of what women want.

The auto industry is of course traditionally a male preserve, but it’s also a prime

WHAT MIGHT WOMEN WANT FROM YOUR SUPERMARKET?

NO MALE DETAILS, THANK YOU VERY MUCH Every woman listening to Mary’s presentation no doubt related to her tales of

CUSTOMER EXPERIENCE

example of one in which women’s concerns are under-addressed. According to Auto Alliance, women now purchase 60% of all new cars and 53% of used cars, annually. Yet less than a third of visitors to motor shows are women, and the

A BETTER IN-STORE (AND CAR PARK) EXPERIENCE:

A BETTER PRODUCT EXPERIENCE:

innovations most often trumpeted are the technological specifications that don’t

• A crèche

• Flour bags that don’t burst open

A BETTER INTERPERSONAL EXPERIENCE FROM STAFF WHO:

interest most women.

• ‘Baggers’ to help you pack your

• Easy-to-open jars

• Are friendly

• ‘ Sell-by’ dates that you can easily

• Look you in the eye when speaking

and influence a huge 85% of all car purchases – worth more than $80 billion

purchases

Woman influence a huge

85%

off all car purchases

What small details might make all the difference to a woman looking for a mid-

• A children’s entertainer

priced, averagely sized family runaround?

• A TV corner for kids

• (Free) large carrier bags

find and read

• Checkouts without sweets

• Less excess packaging on produce

HOW ABOUT THE FOLLOWING:

• Wide trolleys with 2 child seats

•M ore information about food

• A

• A ‘carry to car’ service

security box or belt to hold your handbag on the front seat and stop it being

seized by a smash-and-grab thief • A

plastic glove and tissue dispenser, integrated into the petrol flap, to keep

your hands clean when filling up • A

door handle on the interior of your boot, to enable you to close it without

getting your hands dirty • A

discreet pocket to hold your ice scraper handy (can be used for an extra pair

of sunglasses in summer) • Truly

wipe-clean seat coverings – maybe removable ones that can be washed

• Designer • Mirrors

interiors that appeal to feminine tastes

to show you what’s really happening in the toddler seat immediately

behind you • A

proper rubbish bin

• Multidirectional

water jets to deter pests

Most of these features aren’t that unreasonable or impractical, and they’ve all been requested by real women. So why aren’t they here already? Maybe because men consider them unnecessary. Could it be that in the food retail industry, we’re making the same mistakes? ■

origins

• Lead you to the product you can’t find, rather than just telling you which aisle it’s in • Ask their colleagues for help if they can’t help you themselves

• Ample, well-lit parking

• More organic choices

• Don’t carry on their own personal

• More recycling possibilities

• A calorie counter app

conversation and expect you to

• In-store toilets, including children’s toilets with lower seats

wait till they’ve finished • Seem to believe in what they’re doing • Know about the products

MARKETING ANALIST CLIVE HUMBY

“The Tesco Clubcard knows more about people in the UK than the UK Government.” - Clive Humby

Who owns your data? Your customer will!

MARKETING ANALIST CLIVE HUMBY

In his presentation at the RLC 2013, marketing analyst Clive Humby urged retailers to tread

How data changed Tesco from unappealing to unique

carefully down the new avenues that business intelligence is opening up for them.

only share it with companies they trust.” It’s a radical claim,

Although technology has changed the rules of retailing, this

the ranks of discounters such as Aldi and Lidl, mid-market chains

Who’s in control?

doesn’t mean that there are no rules any more. Rather, there’s

such as Tesco, Sainsbury’s, Morrisons and Asda are competing

Embarrassing party photos and anyother user-generated

For decades in the UK, Tesco was the dreary,

a new, invisible set of rules, a kind of etiquette that will prevail

for customer preference in a very tough economy. They already

content that’s shared on social media sites can be

downmarket cousin of more successful

in the information age. As Clive Humby points out during an

offer real-time price-matching, enabling customers to buy

disseminated further, so that’s no longer under the

stores such as Sainsbury’s and Safeway.

interview after his talk, it’s one in which the power balance will

items at the same price as in other stores, so price is no longer a

individual’s control. But consumers will soon be able to take

increasingly shift in favour of the consumer.

differentiator. Smarter use of data, on the other hand, could make

ownership of the rich tapestry of data that companies have

A new marketing strategy, based on the Tesco

all the difference by enabling retailers to establish why people buy,

created: supermarket transactions, credit card purchases,

“ If you want real loyalty, buy a dog.”

rather than just how much they buy. Instead of just looking at the

bank account payments, flights taken, insurance histories

Clive Humby is both humorous and realistic in his analysis of

profitability of each customer, retailers should use the data they

and so on. Instead of only getting back what companies

the loyalty business. As the architect of the Tesco Clubcard, he

collect to work out the motivation behind their shopping

decide to offer them (such as a standard-format annual

understands perfectly how a loyalty programme can capture,

behaviour – and act accordingly.

credit card summary), they will be able to access far more.

loyalty card, Tesco put it into 12

Apps are now being developed to sort through and manage

stores

segment and utilise customer data. In fact, the Tesco Clubcard

so how will it work in practice?

Clubcard, revitalised the retailer’s fortunes. Here’s how they did it: • In 1994, to test out the idea of a

does it so well that it knows more about people in the UK than

Data is cheap. And data is everywhere.

information according to personal preference. If an app is

the UK Government – including that there are 2 million more

A loyalty programme is a big investment, but can yield

accepted as reliable, someone could then say “I’m a regular

people living and shopping there than the Government is even

invaluable new data, Nowadays, data storage, synchronisation

restaurant-goer, my phone proves it, and you’ve only got to

aware of. So what’s going to happen with this wealth of data that

and transmission are easy, low-cost operations, so the question

scan my Visa history to know that I’ve been to restaurants

retailers capture every day, and how should they use it?

is really how you use this data to your advantage. Especially

30 times this year, so would you like to make me an offer?”.

as it’s not the only source of customer data available: there are

Or, instead of wearing a good suit to the airport and hoping

now web-based social and spatial data available too. And lots of

for a flight upgrade, you could just flash your smartphone

summaries per department, the researchers managed to use

different companies have a different data set. Where this can

app at your airline’s Customer Service desk.

the data to understand why people made choices

“What scares me about this is that you know more about my customers after three months than I know after 30 years” T esco Chairman Lord MacLaurin at the start of his collaboration with DunnHumby

lead to is inaccurate consumer profiling. Clive himself is a good

• Within these stores, turnover increased by 4% compared with other stores • Tesco asked Clive Humby’s firm DunnHumby to work out what was happening • Alhough internet bandwidth was limited, only allowing

• By working collaboratively with suppliers and sharing the

example of this: “Unfortunately, my business has offices in 30

This could work for or against retailers. On the one hand,

data, Tesco was able to develop a better understanding of

countries, but I couldn’t find an airline that went to more than

a supermarket could see that a customer shops in 4 different

shopping preferences, shopper profiles, regional and local

4 of them. So I was a Bronze member of all of them, never a

stores, and decide to send them an offer to become their

Gold member. But actually if someone looked at me, they’d

main source of family shopping. On the other hand, Clive

say that this person is an immensely valuable frequent flyer and

warns, “You need to think what the world will be like when

would treat me differently if they wanted more of my custom.”

your relationship with your customer can be seen by your competitor after they’ve tempted them in with a promotion.”

From separate silos to joined-up thinking

differences, and other segmentations • They gradually improved each range of products, benefiting the store, suppliers and customers • Tesco was able to make more relevant offers tailored to customers’ lifestyles and degree of loyalty • As Tesco Clubcard members were early adopters of new

Will competitive companies volunteer to share the customer

Shifting perceptions; shifting values

products, Tesco could use this community to test out

information that they guard so jealously? Unlikely – it’s

With this new customer-centric data repository, new models

receptiveness to new products, eg. Tesco credit cards and

Motivation is key

worth money. But soon, they will probably have to. Why?

of customer value will emerge that go beyond the traditional

mobile phones

Firstly, it’s crucial to understand more about the motivations

Because in the digital age of Facebook pages, swipeable loyalty

‘Sales = Points’. Apart from someone’s own purchasing

behind a customer’s purchases. This is particularly important for

cards, Foursquare location-based tracking, Twitter feeds,

history, what will their network, background, career history

food retailers – for example in the UK – who are, in Clive’s words,

Amazon searches and multi-channel purchasing, the only true

or family structure be worth? Retail business models will

“fighting over the middle ground”. Without the kind of specialist

information hub is the consumer. And in Clive’s opinion,

have to evolve to cope with these additional dimensions –

proposition that Whole Foods has, and without wanting to join

“In the near future, the consumer will own their own data – and

and to accommodate both digital and non-digital customers.

• Tesco gained competitive advantage from understanding customers better, and became a fully integrated part of consumers’ lifestyles • Tesco is now the largest food retailer in the UK, and 23m UK households have a Tesco Clubcard

WHAT DOES THE DATA SAY?

MARKETING ANALIST CLIVE HUMBY

With a more complete picture of customer behaviour,

Clive confirms this advantage. “I believe that supermarkets’

organisations could also avoid making the mistakes that so

purchasing data is actually much more powerful than they realise,

irritate consumers today. For example, if someone moves home

because you can read people’s motivations from their shopping

or is looking for a camera, they’re likely to be bombarded with

baskets. Not just one basket, but from a series of baskets.”

The customer shops with you every weekday morning at about 9.30, but only 40 weeks a year.

A regular customer suddenly reduces their purchasing level by 30%, and entirely stops buying crisps, soft drinks and a particular brand of shampoo.

ads – for estate agents or lenses– for months after completing the transaction, simply because they’ve typed search terms into

‘Give to Get’

Google or Amazon. The actual transactional information is

In this changing world, organisations will have to have more of

held by their lawyer, mortgage company or local camera shop,

a dialogue with consumers, rather than a one-way conversation.

but it’s not linked to their online search. On another occasion,

What’s more, consumers will increasingly realise the commercial

they may be buying a present for someone who likes fishing, or

value of their own data, both to firms they deal with and to

researching a disease such as diabetes for their work, but as the

themselves. So why should they provide it for free?

motivation behind their search is unknown, they will be targeted

Data provision should be a fair exchange, not a one-sided

with inappropriate information and offers. As Clive points out,

arrangement in which the repayment is made in the form of

“Every organisation has a series of silos of knowledge, and the

irrelevant, intrusive or indiscriminate communications.

only person who can join up the data about themselves is you.”

Retailers will therefore need to build trust, relevance and consent to win data – and they need to start now.

But will you really want to do it all yourself? Probably not. Enter the new wave of intermediaries: data management firms

Be cool, not creepy

and apps, which will join the dots and – for instance – tell

Clive estimates that consumer ownership and selective

everyone who needs to know that yes, you have moved home.

distribution of data will be a given within the next 5 years.

It’s then up to the relevant organisations to revise your profile

Technologies will probably spring up to make this easy: for

from ‘house-hunting’ to ‘may be interested in a new kitchen’.

example with a ‘traffic light’ system that enables us to mark

WHAT’S THEIR MOTIVATION? Convenience. She’s probably a mother who’s dropped off her children at school, and passes your store on the way back.

One of their children has gone to university or has moved out entirely.

individual firms or types of organisations as Red, Amber or

Food retailers: the key to hearts and wallets?

Green. Firms that you don’t like, that misuse your data, or act

However, supermarkets are in a unique position when it comes

in a creepy way (such as by selling your details on) could be

to assembling the jigsaw pieces of customer information into a

marked as Red, whereby only the basic minimum of information

complete picture. Unlike Amazon or fashion retailers, who may

is shared (name and delivery address). Ones you love and trust

only interact with consumers a few times a year, most people do

would be Green (‘share all’). On the road to improvement?

their food shopping every week – or even several times a week.

Amber. This could be the most powerful way yet to enhance

This allows food retailers to quickly spot changing behaviours,

true corporate social responsibility – how many Greens would

and gives them a real sense of what’s driving customers’ purchases.

your own company get? ■

“I can see the day when data will be readily delivered back to you as part of the rich tapestry of data about yourself. You will be able to manage that data and then use it to good effect.”

WHAT’S YOUR RESPONSE? Tempt her in for the other 12 weeks with a special offer that makes it worth the trip. Look at her basket to work out how old her kids are, and base your offers around them.

FOR FREE

-80%

This customer is likely to suddenly have extra money for fine foods and wines. Promote these to encourage the establishment of a more upmarket purchasing pattern.

INTERVIEW WITH ANDRE KUIPERS

CREATING A SUSTAINABLE FUTURE TOGETHER Dutch astronaut André Kuipers has gained a unique insight into

the impact of man-made changes to the only planet inhabited by

humans. From his two missions to the International Space Station in 2004 and 2011, he saw for himself the destruction that we’ve

caused and continue to cause to the earth. Now an ambassador

for the World Wildlife Fund, André shares his ideas about how we could – and should – work and live more sustainably.

“From space, you see how fragile our little home is”

INTERVIEW WITH ANDRE KUIPERS

ANDRE, YOU ARE ONE OF THE FEW PEOPLE WHO HAS VIEWED THE EARTH FROM SPACE. HOW DID IT MAKE YOU FEEL?

WHAT ABOUT FOSSIL FUELS?

After my first flight, I was already worried about the planet. It’s

but also to make products like plastics and medications, so it’s

a beautiful planet but it also feels very fragile, it has a very thin

smart to start thinking of alternative ways of making energy

layer of atmosphere; you feel that if you blow hard enough,

for transport. You can do it with technologies that are smarter,

you’ll blow it right off. It feels very unprotected against the darkness of space, which is true: sometimes you have big

The same applies: they don’t just cause the greenhouse effect; they’re also limited. And we need oil, not only for transport,

more in balance with the environment, so we have something

André Kuipers returns to Earth

in the future as well. If you are a good businessman, you make

asteroids hitting the earth and they do a lot of damage. This

sure that you have an income next year as well. If you are a

is something we need to prevent in the future. But we need to

farmer, you don’t exhaust your land, because you need the land

protect the planet in other ways too.

again next year. But with the planet, we’re totally emptying the oceans, we’re cutting all the forests away, and we’re running

HAVE A LOT OF OTHER ASTRONAUTS ALSO BECOME INTERESTED IN ECOLOGICAL MATTERS?

out of phosphate for fertiliser. And then we won’t be able to feed 7 billion people any more. I hope with new technologies

Yes. My Brazilian colleague Marcos Pontes started a foundation

coming up we can be more in balance with the planet, with the Pictures taken from space reveal how deforestation is eating into the Amazon

to protect the Amazonian rainforest. And my Russian colleague Sergey Krikaljov, who heads the cosmonaut centre near

forests, with the oceans, and with the atmosphere, so we can still have a good planet for our kids.

Moscow, is an ambassador for the WWF in Russia. And my

like an unprotected baby. Very beautiful, but totally without

LOTS OF COMPANIES PRIDE THEMSELVES ON THEIR CORPORATE SOCIAL RESPONSIBILITY. DO YOU THINK THEY’RE GENUINE ABOUT WANTING TO MAKE THE WORLD A BETTER PLACE?

protection. And very limited: before you know it, you’ve orbited

I think it’s more about their image, but it doesn’t matter. You

around the Amazon already. There are also so many people on

know, a few years ago nobody was talking about sustainability,

Dutch colleague Ockels is Professor Aerospace for Sustainable Science and Technology nowadays, so a lot of astonauts are concerned. Because you feel how fragile the planet is – it feels

it – our numbers just keep growing and growing.

green energy, electric cars, FSC wood or MSC fish. But

The launch rocket

companies know it’s important that people want to buy their

OVERPOPULATION’S A BIG TABOO THOUGH, ISN’T IT?

product. So if they become green because they are afraid to lose customers, that’s not so bad.

I think we should change the taboo, because things are going we’d need 3 to 4 planets. But who are we to tell other people

WILL NEW TECHNOLOGIES BE ABLE TO SAVE THE WORLD?

that they cannot live like us? And of course, till the 1800s, the

I strongly believe in new technologies and in smart young

population stayed the same because people died. There was a

people who come up with brilliant ideas. I work with lots of

lot of child mortality, a lack of hygiene and medical care. And

ministries, concentrating on outreach to get young people

now people stay alive, but we don’t stop producing children.

into science and technology. We have a big shortage of

So we have to do something to be much more in equilibrium

good technicians, and space flights are a good platform

with the planet. That means we have to find new technologies

to show how exciting science and technology are. In fact,

to make food, and eat less meat, because meat has an enormous

technology is everywhere: in energy, transport, medicine,

effect on our ecological footprint. Companies should start

food, communication, but in space all these things come

trying to make a profit with artificial meat or other alternatives.

together as we use all these different parts. And the technical

the wrong way. If the whole world lived like us in the West,

Bubble in a drop of water. Enjoying the last days of weightlessness

The Alps, viewed from the ISS

INTERVIEW WITH ANDRE KUIPERS

Time to meat less The UNCCD (United Nations Convention to Combat Desertification) states that it takes 7 to 10kg of cereals to produce 1kg of meat. According to the IWMI (International Water Management Institute), 1790 litres of water is needed to produce 1kg of wheat, while 9,680 litres are required to produce 1kg of beef. So what’s the alternative? Actually, there are plenty – and tasty new ideas are appearing on store menus all the time. Meat substitutes: • Tofu burgers (made from soybean milk) • Tempeh X (a traditional Indonesian food made from fermented soybeans) • Seitan (a wheat derivative often used as a chicken substitute) • Quorn (made from mycoprotein, with egg white as a binder) Over Europe at night. Dark down below and sun on the ISS. At this moment the ISS is visible from the ground

Comet Lovejoy by Cdr Dan Burbank @astrocoastie, on launch day. One of the first who spotted it

world will change. 100 years ago, people in New York were

replace them and let them come back. And then you leave

very worried because they couldn’t handle the amount of

something behind. That’s how you build a colony: slowly.

WILL RETAILERS LEAD THAT CHARGE, OR CONSUMERS?

horse manure any more. But all of a sudden there was new

If you leave people without the proper tools to survive,

Consumers. If they ask for it, retailers will react by providing

technology and it was no longer an issue. So I think that

it won’t work. I do believe there will be people on Mars in

it. People get the information from TV and newspapers, and

with new technology we can solve the whole issue - although

the future, but it’s not a solution to overpopulation.

they need to have a place to buy it. So if there’s a tendency for

population is another matter. In terms of what will happen,

You would have to launch 200,000 people per day.

people to want to eat in a much more sustainable way, or use

I always compare it with a plague of locusts: they eat

Impossible!

FSC wood or MSC fish, there is a market. And I think that’s

• Veggie burgers and bacon (made from vegetables and textured vegetable protein, bound together with egg and milk)

1790 litres

1kg

9,680 litres

7 to 10kg

happening. Nobody thought of sustainability 10 years ago,

everything they can find, and then it’s gone, and they die. And the same thing will happen with humans if we consume

HAVE YOU BECOME MORE PHILOSOPHICAL?

the whole planet.

Yes, in the sense that you feel you are part of something much bigger when flying around the globe: part of the cosmos, part

but it’s a big issue now.

1kg

SO YOU THINK THE SOLUTION LIES IN A TWO-PRONGED APPROACH: THE QUICK ONE OF DEVELOPING TECHNOLOGIES TO SOLVE PROBLEMS, PLUS A SLOW CHANGE IN CULTURE.

Good sources of protein:

1kg

SO GETTING A ONE-WAY TICKET TO MARS IS NOT A SOLUTION? SEEMS LIKE A LOT OF PEOPLE HAVE ALREADY SIGNED UP FOR THAT.

of the solar system, while on earth, you feel the world is flat

I understand the obsession, but first of all it’s not very wise

Yes. population growth should be stopped somehow, but

• Whole grains and legumes (peas, beans, lentils, seeds)

it’s a slow process. Not in my lifetime! Here in our western

• Nuts

shelter underground against radiation, find water in enough

IS THE RETAIL INDUSTRY CONTRIBUTING TO THE PROBLEM BY TRYING TO CONVINCE PEOPLE TO BUY MORE?

world, we are totally overdoing it, while in a lot of other

• Cheese

quantities to make oxygen, grow your crops, without any little

Yes, but we are using up our resources in the wrong ways, so

countries, you get shortages. How long can we maintain that?

• Eggs

fungus destroying them... and if it goes wrong, you can’t go

we should be more sustainable and recycle much more. We eat

Everybody in India or China wants to live as we are – it’s

• Fish

back. I think we can go to Mars as an international effort, with

too much meat. But we can switch to eating things that don’t

impossible if they all have the same environmental footprint

• Soy protein

all the agencies working together, send people for 6 months,

have such a big impact on the environment.

as us. Then the earth is finished. ■

• Mushrooms

to go with an expedition of 8 people and expect to find

and the air is unlimited.

DUTCH A-Z

RICE

LIQUO

The Dutch eat more liquorice

per capita than any other nation

NEE

in the world! Known as drop, it

comes in all shapes and sizes but

there are basically two different

types: zoet (sweet) and zout (salty). Not only is it tasty, but

The Dutch word for No. It’s pronounced as ‘nay’

it’s great for sore throats!

REMBRANDT

Ice-skating In February last year, the winter was

in Dutch history, Rembrandt

PANCAKES

so cold that several of the city’s

Harmenszoon van Rijn (1606-1669),

No visit to Amsterdam is complete without a trip

famous canals completely froze

lived in Amsterdam from 1631 until his

to a pancake bakery. But don’t play safe: try one

death in 1669. You can even visit the

with cheese, ham and... syrup. It’s surprisingly

house in which he lived: it’s now the

delicious. Poffertjes, a small fluffier variety

Rembrandt House Museum.

of pancakes, are also a Dutch delight.

The greatest painter and printmaker

scenic waterways, stopping off at

KING Willem-Alexander

hastily set-up stalls to warm up with

The Kingdom of the Netherlands –

hot chocolate or ertwensoep.

which not only includes the

Ice-skating is a national passion.

Netherlands but also Curaçao,

over – a rare phenomenon. It seemed as if the whole city took time off work to go skating over the

QUEEN

Aruba and Sint Maarten – has its first king in 123 years! Willem-Alexander, the son

Beatrix

of Queen Beatrix, became king on 30 April 2013.

At the end of January 2013,

OLIEBOLLEN

Queen Beatrix announced she

Deep-fried doughnuts that are

MIFFY

was abdicating, making way for

traditionally eaten on New Year’s

her son Willem-Alexander. The

Eve but are much appreciated

popular royal had reigned as

throughout the long Dutch winters.

The world-famous cartoon rabbit –

queen of the Netherlands since

Mauvries / Shutterstock.com

JENEVER

The forerunner to gin, this typically Dutch

drink was developed in the 17th century by a doctor from the city of Leiden who was looking for a cure for stomach disorders. Want to sample some? Head to one of the city’s proeflokaalen (tasting houses) such as Wynand Fockink.

known as Nijntje here – was created by Dutch artist Dick Bruna in 1955. More than 85 million Miffy books have been sold since then.

30 April 1980. Schalke fotografie | Melissa Schalke

INSTANT LOYALTY PROMOTIONS

What’s really going on inside those little heads? How loyalty programmes appeal to children Child psychology is a fascinating field. All adults have once been children, but as we grow, we learn to behave in different ways – and it’s easy to forget how important our earlier thoughts and feelings once were. Even if we regain access to the world of children by becoming parents ourselves, we can still be amazed at the popularity of certain loyalty programmes. Why should a simple series of colourful figurines, paper cards or small fluffy toys hold such appeal? Why is it so important to collect all of the items? And why do they create such strong memories?

INSTANT LOYALTY PROMOTIONS

easy opportunity to nurture her child by giving something he or she wants. It enhances the parent-child bond, and confirms that her mothering role is valued and respected.

About an ILP

It’s an easy, appreciated – and an increasingly expected – way for her to make her

With an ILP, shoppers receive a free

children happy. For a child, a loyalty programme is equally meaningful: it’s not only fun,

instant reward for every €X spent in a

but also a way of confirming their own desired identity within their peer group.

supermarket. The main objective of ILPs

The need to be popular

is to increase turnover by attracting

Just like other social animals, children need to constantly re-establish their position

new customers (e.g. households with

within a group. There’s an ever-changing dynamic based on sudden likes and dislikes,

kids), and increasing the share of wallet

the children’s different ages and capabilities, the social situation (school / home /

of regular customers. They also create

playground) and outside influences (“Time for tea!”). This complex interaction is further complicated by the fact that children are all individuals, with their own

excitement in-store, stimulating your

personalities.

customers to visit more often. ILPs targeting households with children

Trendy today; gone tomorrow The importance of up-to-date research is confirmed by Sylvie Verbiest of SMALL

have proven to be a very successful

Think small

are part of. But it’s changed immensely rapidly over the past 50 or

kids and youth and consultancy. “Although there are various studies carried out into

tool worldwide, as children are strong

To immerse yourself in children’s experiences, it helps to come down

60 years. In general there’s been a move towards more democratic

children and young people, these are often just ‘add-ons’ and not very thorough.

influencers of shopping behaviour. By

to their level. Just as a good teacher will crouch down to make close

decision-making, instead of rigid hierarchical structures. This of

Trends and hypes for youngsters appear and disappear increasingly quickly. You need

eye contact with a schoolchild, we need to understand the world

course has also implications for retailing, as Emeritus Professor

to keep watching and listening regularly to understand what’s happening.”

actively collecting and through their

from a child’s point of view. To begin with, it’s all about Me.

Fred Bronner of Amsterdam University explains:

desire to get the complete set, children

She also notes that parents are prepared to ‘join the trend’ – if they approve of it.

influence the shopping behaviour of

A child’s place in the universe

“Parents believe that a child has as many rights as they do

“We see that kids’ programmes like ILPs are much more of a network activity than

their parents, grandparents, neighbours

A very young child is like the sun: the world revolves around

themselves. Parents therefore first ask themselves what the child

exclusively for kids. We see mothers posting on Facebook to complete their child’s

it. Food, warmth and comfort are provided, there are lots of

would like, and act accordingly. Just take the research that we

album, and fathers trading cards at work.” She adds, “Instead of viewing parents as

and friends, encouraging them to shop

interesting toys, and waste products are quickly removed. It’s a

conducted recently. We used a camera to observe parents and

‘gatekeepers’ for ILPs, we see them as ‘gate openers’, provided the programme meets

at a specific retail chain. Children love

great life! As the child becomes older, it becomes less egocentric

children on the shop floor. The children used all sorts of strategies

their criteria.”

taking the items they have collected to

and more aware of the people around it. It realises that it’s only

to influence their parents, such as pointing to a product, putting

one of the planets in several different but interrelating social solar

an article in the trolley, nagging…You could see that most children

Sowing the seeds of future loyalty?

systems consisting of family, school and friends. However, it’s

get what they want from their parents, either fully or partially. The

Long-term research still needs to be done to establish whether the positive emotions

natural for a child to want to continue to be the centre of attention,

classic image of a screaming child who doesn’t get his own way at

generated by an ILP lead to children developing a preference for certain brands and

effect’ spreads the programme wider via

or at least to command attention whenever it wants, and that’s as

all is clearly passé. Parents cannot bear arguments – they want to

retailers, but it seems a reasonable assumption. Children love receiving gifts, and tend to

peer-to-peer endorsement.

true in the supermarket as anywhere else. To gain this attention

create a positive atmosphere and treat their children with respect.”

remember whom or where they came from.

negotiating skills, which are usually first tested on its parents before

Loyalty programmes: more than just a bit of extra shopping

Tracking mechanisms linking parents’ purchasing habits to their children’s own

being tried out on its peers.

Throughout these far-reaching changes of childhood, one factor

shopping decisions in the coming decades may reveal interesting patterns, although

is likely to remain constant: mum will still be shopping for her

the linking mechanisms themselves will require careful development. However, given

The parent-child relationship

family. Women are the primary caregivers, and their regular

the amount of data being collected nowadays, and children’s increasing commercial

As old as time itself, this central relationship is hugely influenced

supermarket trips reveal a lot about this identity. For a mother,

awareness, reliable analysis should be possible. For all we know, short-lived ILPs may

by sociological factors such as where we live and which culture we

a loyalty programme focusing on kids provides an

prove to have a far longer-lasting effect than we ever realised.

school, showing off and trading with

(or the products/rewards it wants), the child learns to use various

their friends. The ‘school playground

Peer relationships Instant Loyalty Promotions (ILPs) usually focus on children of junior-school age: those aged 4-5 to 11-12. Peer relationships grow in importance as these schoolchildren grow older, and Dutch research bureau IPM Kidwise has identified 3 key phases of interest to marketeers:

1. The age of wonder

2. Back to reality

3. All grown up

are suddenly exposed to contact with

realistic phase’ for children aged 6 to 8.

phase’. Between the ages of 9 and 12,

far more other children – and for longer

Fantasy is now separate from reality, and

children don’t want to be treated like

each day – than they have probably been

the reality is that most kids want to fit

kids any more. Oversensitive to the

used to before. Between 4 and 6 years old

in. Social approval becomes increasingly

trends and opinions of others, they

is also ‘the magical phase’: fantasy and

important, because it’s important for

have a strong urge to belong to certain

reality are mixed, and children are eager

kids to be accepted by their peers. In

groups. The family is no longer the

to discover more about both. They are

fact, the trends and preferences of their

most important frame of reference, and

becoming more and more independent,

classmates and friends play a major

there’s a growing independence from

and exercising an increasing influence on

role in children’s attitudes towards

the parents. The differences between

which products are purchased. Socially,

products. This leads to children exerting

the sexes are increasing, with boys

they are developing too, choosing which

an increasing influence on product

more interested in computer games and

friends they want to have and being

purchase – including when their parents

music, and girls focusing on jewellery

increasingly influenced by their teachers,

buy products because they know their

and make-up, although clothing is

peers and environment.

child will like them.

important to both sexes. ■

When children reach school age, they

The next developmental stage is ‘the

Next comes the ‘no longer a child

DUTCH A-Z

WINDMILLS

STROOPWAFEL

Amsterdam has eight windmills. Windmill van Sloten (Akersluis 10, +31 20 6690412, www.molenvansloten.nl) is the only one that’s open to the public.

A delicious caramel-like, syrup-filled

biscuit originating from the city of Gouda, also renowned for its famous cheese. More biscuit goodness comes in the form of the Speculaas, a spiced

VAN GOGH When Vincent Van Gogh (1853-1890) lived in Amsterdam he probably had no idea that one day a whole museum would be dedicated to his work. It’s now one of the city’s top tourist attractions.

TILES

shortcrust biscuit.

X X X

This cinema (Prinsengracht 452,

Amsterdam’s coat of arms includes three St Andrew’s crosses. You can spot them around town on flags or Amsterdammertjes – reddishbrown traffic bollards.

There are only 22 official words in the Dutch alphabet beginning with Y and most of these – like yankee, yoga, yoghurt, yeti and yukka – have been adopted from other languages. Instead of Y, the Dutch commonly use IJ. In fact, the waterway to the north of Amsterdam’s Central Station is called the IJ.

ZOO

Artis, short for Natura Artis Magistra (Latin for ‘Nature is the teacher of art’) is the oldest zoo in the Netherlands. It opened in 1838 for

+31 20 2232426; www.uitkijk.nl)

Delft tiles, typically Dutch hand painted

members only, before opening to the public in 1851. Even then, it

dates from 1912 and is not only

blue-and-white tiles, have been made

was only open in the month of September. That’s why, to this day,

the oldest cinema in Amsterdam

in and around the city of Delft since

September is traditionally ‘discount month’ when entrance prices

but the oldest in the Netherlands.

the 16th century.

are reduced to attract more visitors.

Credits We would like to thank the following people for their contributions to this edition of Hearts & Wallets:

manager Magazine: Chantal van Wijk

art Direction: Lieke van Gorp

Design Team: Lieke van Gorp, Marinda Ruis, Mariëlle Spermon, Renate de Vries

illustrations:

After specific permission from the publisher, articles from this issue may be

Marco van Bilsen, Karla Heeren,

republished and/or reproduced, provided that the source is mentioned.

Roxanne Snijders

The publishers have done their utmost to identify all persons or organisations

Printing: Graphic Support

Karlijn van den Berg, Sander Ejlenberg,

other way whatsoever without prior written permission from the publisher.

by means of printing, photocopying, transmitting digitalised data files or in any

Pip Farquharson, Chantal van Wijk,

Cathy Scott, Colin Lim, Olav van Dam,

Nothing from this publication may be copied, transmitted and/or made public

Editorial Team:

Hearts & Wallets is a publication of Brand Loyalty International BV

Machiel van der Heijden, Esther Keim

About this Publication

Photography:

105

René Kouwenhoven

who own the rights to the visual images used. Should a person or organisation be able to prove that their permission was required for any images we have used, we hereby ask them to contact us as soon as possible. This publication has been developed with the greatest of care. However, the authors and publisher disclaim any responsibility in the case that any information it contains may have been reproduced incompletely or inaccurately.

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Should any such omissions or inaccuracies come to light, the authors and publisher will be pleased to receive suggestions for amendments.

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WE TAKE CASUAL SHOPPERS AND TRANSFORM THEM INTO LOYAL CUSTOMERS BRANDLOYALTY WORLD’S LEADING LOYALTY COMPANY IN FOOD RETAIL We design, organize, implement and evaluate innovative and tailor-made loyalty concepts for food retailers worldwide. BrandLoyalty is operating in over 40 countries and has 14 offices throughout Europe, Asia, Africa and America. A FULL SERVICE APPROACH BrandLoyalty’s unique value lies in our ‘full service’ approach. From initial strategic advice through to management, logistics and analysis.