Loyalty Cards Systems ? Beware, Some Should Be Avoided

Recently, I discussed a loyalty card system with a vendor who was selling quite a number of his systems to restaurants. I was shocked to discover the lack of detailed information that this vendor catered for, and the opportunities the system he provided squandered.

The way their scheme works is that whenever a restaurant customer is presented with a bill, they provide their loyalty card to the waiter, who swipes it at the till. If the customer has accumulated sufficient points from previously purchased meals, he/she is awarded a rebate on the price of the meal.

This is simple price discounting based on repeat purchases. No other marketing activities are carried out - either by the loyalty card company, or by the restaurant - to proactively influence the number of times the card holder frequents the restaurant - they rely solely on the meal discount to attract customers back for more meals.

This is a system that is woefully underexploited.

I asked about the level of detail that was transmitted to the card site - and was once again disappointed - only the total meal cost was transmitted. The customer profile that was being created was extremely superficial. My view was further confirmed when I asked whether the 'significant other', or other family members' details were collected. Once again, no.

The key things wrong with this service offering:

• Lack of transaction details. These days, with broadband communication and high volume data disks, there is really no excuse not to collect data at transaction level.
• The simple act of recording the bill at individual meal item level opens up a wealth of information:

  • Number of main meals - if there are children in the family unit (provided during signup), analysis of the bill will provide a clear indication of whether the whole family always eats out, or if on occaision the parents treat themselves to a quiet night on their own - possibly anniversaries, or birthdays, or just a regular night away from the kids.
  • Types of meals - red meat, fish, vegetarian - which could be used for special promotions
  • Beer, cheap wine, or expensive wine drinker

  If you had the above information at your finger tips, who would you rather focus your marketing efforts on to get to come back to your restaurant - the family of six that buys budget meals, and drinks beer and soda, or 3 couples ordering starters, high-priced meals, drinking quality wine, and finishing off with expensive liqueurs?

• Even recording the value of the tip could be useful. A usually-generous tipper who awards a low tip (possibly to a new waiter) is giving a clear indication of a bad experience. This information could be used by the restaurant owner to contact the customer within a few days to establish what was wrong with the meal or service, and to invite the customer back with an offer of a generous discount for the next meal.
• Not getting the details of the 'significant other' and details of any children prevents marketing to special days. Its pretty pointless merely getting the birthday of the cardholder - it's not that compelling to get an SMS or postcard suggesting that you treat yourself to a special night out. It's far more effective to receive a prompt to take your significant other out for that special meal. Children's birthdays are another opportunity to encourage the family to come out to the restaurant for a slap-up meal -but this is only possible if you take the trouble to collect the data...

Hopefully the above points have provided some ideas as to how basic transaction data can be used effectively by an information analyst or direct marketer.

If you are approached by a vendor to implement a loyalty scheme, or you are thinking about calling for proposals from scheme suppliers, make sure that you investigate the level of data detail that each supplier collects.

If data is recorded at line item level - i.e. product ID, quantity, and price - then you will have a wealth of sales data that you can start using for a variety of campaigns. If they only provide you with a bill total per meal, then I suggest you look elsewhere for a more effective loyalty card scheme.

© 2005 Intellinova (Pty) Ltd. - All Rights Reserved This article may be reprinted, provided it is published in its entirety, includes the author bio information, and all links remain active.

For the past 20 years, Jeff Walters has been actively involved in transforming raw business data into profit-producing strategic information. He has worked in various data intensive sectors- banking, insurance, gambling, medical, government - leading several data-to-information projects: ABC Costing, analytical CRM, datamart /data warehouse development, and Balanced Scorecard.

If you want to convert your raw data into strategic assets, contact Jeff Walters through the following sites: Customer Relationship Management, or Direct Marketing

---

Google News Updated : Mon, 13 Oct 2008 05:51:32 GMT Manatee dies before reaching Florida - South Coast Today WHDH-TV Manatee dies before reaching Florida South Coast Today - 36 minutes ago By AARON GOUVEIA and KC MYERS EAST DENNIS - After a dramatic rescue Saturday morning, a wayward manatee known affectionately as Dennis died Sunday with just one hour before he reached SeaWorld in Florida. Manatee almost gave them the slip Boston Globe Cape Cod Manatee Dies on Way Back to Florida WLNE-TV (ABC6) My Fox Boston - The Associated Press - Cape Cod Times - SouthCoastToday.com all 542 news articles Publ.Date : Mon, 13 Oct 2008 05:14:57 GMT Worth the trouble - Boston Herald Worth the trouble Boston Herald - 39 minutes ago By Dan Duggan As Red Sox [team stats] fans shook out the cobwebs yesterday morning after yet another marathon postseason game, it would have been easy to forget some of the positive developments from the Sox’ 9-8, 11-inning loss to Tampa Bay in Game 2 ... Video: Tampa Bay Wins Slugfest on Sacrifice Fly AssociatedPress Rays win respect, too Washington Times USA Today - Sarasota Herald-Tribune - Wilkes Barre Times-Leader - SouthCoastToday.com all 3,671 news articles Publ.Date : Mon, 13 Oct 2008 05:12:18 GMT UPDATE 1-Tropical Storm Nana forms in Atlantic - Reuters Javno.hr UPDATE 1-Tropical Storm Nana forms in Atlantic Reuters - 8 hours ago MIAMI, Oct 12 (Reuters) - Tropical Storm Nana, the 14th of the Atlantic hurricane season, formed on Sunday in the Atlantic Ocean east of the Caribbean islands, the US National Hurricane Center said. Tropical Storm Nana forms in Atlantic eTaiwan News Tropical Storm Nana Forms Over Eastern Atlantic RTT News CNN - The Associated Press - eFluxMedia - Central Florida News 13| all 199 news articles Publ.Date : Sun, 12 Oct 2008 21:29:57 GMT Alaska ethics probe says Palin abused her power - Reuters BBC News Alaska ethics probe says Palin abused her power Reuters - 40 minutes ago By Caren Bohan CHILLICOTHE, Ohio (Reuters) - An Alaska ethics inquiry found on Friday that Gov. Sarah Palin, the US Republican vice presidential candidate, abused her authority by pressuring subordinates to fire a state trooper involved in a feud with ... Palin: Bad Guys vs. Good Guys FOXNews Palin talks economic worries in Appalachian Ohio The Associated Press International Herald Tribune - CNN Political Ticker - Columbus Dispatch all 1,431 news articles Publ.Date : Mon, 13 Oct 2008 05:10:53 GMT Television Review | 'My Own Worst Enemy' - New York Times New York Times Television Review | 'My Own Worst Enemy' New York Times - 56 minutes ago By ALESSANDRA STANLEY Most people sometimes wake up on the wrong side of bed. The hero of “My Own Worst Enemyâ€� on NBC wakes up on the wrong side of his brain. 'Worst Enemy' Just Isn't Bourne-Again Bond Washington Post Spy-vs.-normal-guy premise of 'Worst Enemy' doesn't work USA Today San Francisco Chronicle - Los Angeles Times - Boston Herald - Fort Worth Star Telegram all 101 news articles Publ.Date : Mon, 13 Oct 2008 04:54:37 GMT Doubling of Vitamin D for Children Is Urged - New York Times The Plain Dealer - cleveland.com Doubling of Vitamin D for Children Is Urged New York Times - 3 hours ago By AP CHICAGO (AP) - The country’s leading group of pediatricians is recommending that children receive double the usually suggested amount of vitamin D because of evidence that it might help prevent serious diseases. Pediatricians double vitamin D recommendations The Associated Press Pediatricians double vitamin D recommendations WLOS The Plain Dealer - cleveland.com - Examiner.com all 90 news articles Publ.Date : Mon, 13 Oct 2008 02:45:16 GMT Jennifer Lopez, Marc Anthony renew vows along with Carlos Beltran ... - New York Daily News New York Daily News Jennifer Lopez, Marc Anthony renew vows along with Carlos Beltran ... New York Daily News - 1 hour ago BY DAVE GOLDINER Just four years after saying "I do," Jennifer Lopez and Marc Anthony reportedly secretly renewed their vows in Las Vegas Sunday - and they had company at the altar. Inside Jennifer Lopez & Marc Anthony's Renewal Ceremony People Magazine J.Lo’s vows not staying in Vegas Boston Herald Singersroom News - AceShowbiz - United Press International - Actress Archives all 37 news articles Publ.Date : Mon, 13 Oct 2008 04:39:55 GMT Automated Blog and Ping RSS For Web Pages

PARLOT::Ebooks, Scripts, Websites, and more...

Adsense websites

The Exiler

THE EXILER (your search for true brand attributes ends here!)With... Read More

Massage Therapists Can Now Make More Money

As a massage therapist, your income is usually limited by... Read More

Questioning the Data of Demographic Off The Shelf Marketing Products

I have been working on a direct mail campaign for... Read More

Service Marketing - A Relationship Building Approach

Can we imagine a place in the world today without... Read More

Two Methods of Marketing Using Joint Ventures

Whether you're a contractor a local merchant with 150 employees,... Read More

The Process of Change in Marketing Approaches

In a world economy that is in constant flux and... Read More

How to Expand Your Target Markets

Are your products or services geared towards only one target... Read More

Consider Consumer Psychology

In your marketing efforts, be they on or offline, it's... Read More

25 Ways To Make Your Next Direct Mail Campaign Work

This list contains 25 powerful strategies to improve your direct... Read More

Like Brushing Your Teeth

What do the following things have in common: brushing your... Read More

Stretching Your Marketing Dollars--7 Cheap and Easy Ways to Market on a Budget

Just because you have to stretch your marketing dollars doesn't... Read More

Nice Guys Finish First

Volunteering your services can be an excellent way to form... Read More

Marketing - The One Marketeer

I'm regularly asked to speak to people, that have either... Read More

Cause-Related Marketing

Altruism. Corporate responsibility. Philanthropy. These are often used to describe... Read More

10 Beer Budget Event Marketing Tips

Are you planning an event or participating in a trade... Read More

Writing A Marketing Strategy

It is my belief that if anyone is to suceed... Read More

Marketing With Business Cards

Many businesses today overlook the importance of business cards as... Read More

Using a Contact List Profitably- Part Two

Besides a survey, your contact list can be used to... Read More

Pricing Strategies in Marketing

Price is an often overlooked marketing strategy, as many tend... Read More

Write Effective Fundraising Letters By Being Conversational (Includes Examples & Samples)

I am doing what you do, sitting at my computer,... Read More

Make Out Marketing

What is the single biggest fear of teenagers, business owners... Read More

Census Data Mapping for Small Business

When studying the demographics of an area for a business... Read More

Joint Venture Marketing: What and Why

What is a Joint Venture? A joint venture is an... Read More

Forward Thinkers Stay Ahead of the Curve

What is it like from a marketing perspective to be... Read More

Getting New Clients - When Only a Few is More Than Enough

Many of the business owners I speak with are looking... Read More