Sears Turning Customer Loyalty into Profit; CRM in a Multi-Channel World

The rise of multi-channel communication, especially in those channels predicated on peer-to-peer discussion, has raised the stakes for customer loyalty efforts.

Newly-created opportunities are significant, ranging from more avenues for gaining valuable customer insight to easier means of cultivating customer advocates. The costs are also higher; competitors have increased access to the audience, and if the appropriate experience is not delivered, the resulting word-of-mouth can be harmful.

Sears, however, has committed itself to not only strengthening loyalty but using it to drive actual business results. The key, according to VIP and Clubs Loyalty Marketing Manager John Perrone, is more comprehensively evaluating the level of customer engagement.

Perrone, a featured speaker at the upcoming Customer Insight Week (see details below), specifically identifies proper engagement metrics as a cornerstone of a successful loyalty strategy.

"I think a new metric that we’re also going to look at is really an engagement factor and the different ways that a member can interact with us," explains Perrone in an exclusive podcast with CustomerManagementIQ.com. "They’re giving up their email or their mobile phone number to interact with us, and as long as we, the brand and the loyalty program, reply back with relevant information and information in the channel that this customer prefers, it’s a very successful engagement and interaction with that customer."

According to Perrone, maximizing multi-channel customer loyalty therefore banks on the value of the trade-off. If loyal customers are expected to convey worthwhile information on their consumption and advocate on behalf of the brand, they need to see a "return" on that loyalty.

Adding value to customer engagements is not always easy, especially as multi-channel customers grow to have varied, less certain expectations for their interactions. But if the engagement is valuable and if loyalty is created, companies will gain the insight it can use to drive profit via strategies like up-selling.

When up-selling and cross-selling, two necessary practices in a "more with less" environment, Sears first looks at purchasing customers and asks, "Where do they go naturally and gravitate towards another related product?"

"Once we have that information," adds Perrone, "[we] then look for look-a-like members [in our loyalty program] that are purchasing similar first products and…usually with an offer, try to entice them to move on to that natural up-sell or cross-sell product that we’ve seen happen with other members."

The strategy has been working for Sears, and Perrone shares detailed insights on how his organization attracts and mobilizes loyal customers, how it shapes its program for multi-channel, and how it gets "one-time buyers" to spend more money with the organization in the exclusive CustomerManagementIQ.com "Customer Creation" podcast.

[inlinead]