THE ROLE OF A LOYALTY PROGRAM
IN CREATING CONTEXTUAL
CUSTOMER EXPERIENCE
It is a red ocean
Ability to create and sustain a differentiated value
proposition is at the core of a brand’s competitive
advantage. However, many brands, across
industries, have eroded their once numerouno
positioning, either because they failed to prevent
others from replicating their propositions or they
failed to continuously create even transient
advantages. When battle amongst brands are
reduced to just incremental functionalities or
additional discounts, replicating each other’s
proposition is not insurmountable for any! As a
result, in any given industry, strategy of top 25%
players don’t seem to be markedly different. In
many B2C industries, almost every strategic
iterations seem to end with “mark-down”!
According to an NRF study, retailers had lost about
USD 200 Bn in markdown, last year!
This competitive convergence has lead many
brands to direct their scarce resources towards
umpteenth futile product iterations and as an
aftermath significant shareholder value was
destroyed. Unfortunately, in this obsession towards
products and portfolio, many brands seem to have
missed “customer” as a central component of their
The role of a loyalty program in creating contextual customer experience
strategy! However, the ones who did not, have
generated disproportionate shareholder value,
despite operating under similar environmental
constraints.
So, what have they done differently? Successful brands
craft their unique propositions around aggregate
customer experience and not just around product’s
functional attributes. They constantly strive towards
knowing their customers intimately and engineer a
contextual experience, which is both a necessary and
sufficient condition for inducing attitudinal loyalty in
customers. Once created, attitudinal loyalty raises
perceptual exit barrier for the customer. This
“experience lead” differentiation is far more
sustainable than any form of tactical differentiation!
Experience is Contextual
Every shopper is different is his own rights. Some are
consistently looking for some great bargains, some are
early adopters where price is not just a consideration,
some need social acknowledgement and so on.
Clearly, the expectations from the brand tend to vary
quite significantly, depending on customer profile,
persona or behaviour. Every shopper is broadly
defined by both need and behaviour coordinates.
While, brand purpose broadly defines the user
need segments, defining the behavioural
segments is about interpretation of data and
facts lying across the enterprise.
As the customer starts to engage with the brand,
brands become increasingly more aware of his
persona and behaviour. Translating those specific
consumer insights into “engagement principles”
and incorporating them into “everyday interaction”
with the customer is contextualization. Needless to
say, the higher the interaction, the higher is the
potential of contextualization!
However, the scope and degree of contextualization
tend to vary quite significantly depending on firm’s
capability and industry in which it operates.
Broadly, the scope of contextualization includes the
following
+
Contextualized of fer: Brand makes
personalized offers / promotions based on
customer’s purchase history. Transactional data
is leveraged the most for making contextualized
offers.
+
Contextualized communication: Brand
makes personalized communications based on
specific interest and characteristic attributes of
various customer profiles. For example, a fashion
retailer might invite all early adopters for a fashion
show, exhibiting its new collection etc. Or, brand
might communicate the launch of its upcoming
products to specific user groups, who have the
highest likelihood of adopting them etc.
Contextualized communication also includes
exposing “contextualized content” to the customers
at relevant touch points.
+
Contextualized entitlements: Brand grants
entitlements to its consumers based on brand’s
understanding of their explicit (or even implicit)
need. Some airlines, proactively offer a free wheel
chair to a second time handicapped traveller,
without he having to fill out a special service request
etc.
+
Contextualized engagement: Brand engages its
customers in various capacities based on its specific
insights of him. It can range from social engagement,
affinity group formation to even co-creation!
Contextualized engagement is fast becoming an
important capability to create stickiness with the
brand.
Sum total of all of these contextualization effort
culminate in “customer centricity”.
The role of a loyalty program in creating contextual customer experience
It is a red ocean
Ability to create and sustain a differentiated value
proposition is at the core of a brand’s competitive
advantage. However, many brands, across
industries, have eroded their once numerouno
positioning, either because they failed to prevent
others from replicating their propositions or they
failed to continuously create even transient
advantages. When battle amongst brands are
reduced to just incremental functionalities or
additional discounts, replicating each other’s
proposition is not insurmountable for any! As a
result, in any given industry, strategy of top 25%
players don’t seem to be markedly different. In
many B2C industries, almost every strategic
iterations seem to end with “mark-down”!
According to an NRF study, retailers had lost about
USD 200 Bn in markdown, last year!
This competitive convergence has lead many
brands to direct their scarce resources towards
umpteenth futile product iterations and as an
aftermath significant shareholder value was
destroyed. Unfortunately, in this obsession towards
products and portfolio, many brands seem to have
missed “customer” as a central component of their
The role of a loyalty program in creating contextual customer experience
strategy! However, the ones who did not, have
generated disproportionate shareholder value,
despite operating under similar environmental
constraints.
So, what have they done differently? Successful brands
craft their unique propositions around aggregate
customer experience and not just around product’s
functional attributes. They constantly strive towards
knowing their customers intimately and engineer a
contextual experience, which is both a necessary and
sufficient condition for inducing attitudinal loyalty in
customers. Once created, attitudinal loyalty raises
perceptual exit barrier for the customer. This
“experience lead” differentiation is far more
sustainable than any form of tactical differentiation!
Experience is Contextual
Every shopper is different is his own rights. Some are
consistently looking for some great bargains, some are
early adopters where price is not just a consideration,
some need social acknowledgement and so on.
Clearly, the expectations from the brand tend to vary
quite significantly, depending on customer profile,
persona or behaviour. Every shopper is broadly
defined by both need and behaviour coordinates.
While, brand purpose broadly defines the user
need segments, defining the behavioural
segments is about interpretation of data and
facts lying across the enterprise.
As the customer starts to engage with the brand,
brands become increasingly more aware of his
persona and behaviour. Translating those specific
consumer insights into “engagement principles”
and incorporating them into “everyday interaction”
with the customer is contextualization. Needless to
say, the higher the interaction, the higher is the
potential of contextualization!
However, the scope and degree of contextualization
tend to vary quite significantly depending on firm’s
capability and industry in which it operates.
Broadly, the scope of contextualization includes the
following
+
Contextualized of fer: Brand makes
personalized offers / promotions based on
customer’s purchase history. Transactional data
is leveraged the most for making contextualized
offers.
+
Contextualized communication: Brand
makes personalized communications based on
specific interest and characteristic attributes of
various customer profiles. For example, a fashion
retailer might invite all early adopters for a fashion
show, exhibiting its new collection etc. Or, brand
might communicate the launch of its upcoming
products to specific user groups, who have the
highest likelihood of adopting them etc.
Contextualized communication also includes
exposing “contextualized content” to the customers
at relevant touch points.
+
Contextualized entitlements: Brand grants
entitlements to its consumers based on brand’s
understanding of their explicit (or even implicit)
need. Some airlines, proactively offer a free wheel
chair to a second time handicapped traveller,
without he having to fill out a special service request
etc.
+
Contextualized engagement: Brand engages its
customers in various capacities based on its specific
insights of him. It can range from social engagement,
affinity group formation to even co-creation!
Contextualized engagement is fast becoming an
important capability to create stickiness with the
brand.
Sum total of all of these contextualization effort
culminate in “customer centricity”.
The role of a loyalty program in creating contextual customer experience
At its core, contextualization is really about
connecting the dots of various facets of customer
behaviours! As customers engage, transact and
interact with the brand through multiple touchpoints, they tend to expose many facets of their
behaviours. Following are some of the typical facets
of customer behaviours which collectively represent
a customer persona.
+
Explorative: It broadly represents the specific
interests of the customer. Explorative behaviour
often indicates intent to purchase both implicitly
and explicitly.
+
Consumptive: It represents what, how
frequently and how much products / services the
customer consumes. It explains the intensity and
affinity of consumption. To a large extent,
consumptive behaviour drives underlying
profitability of customer.
+
Inertial: It represents the underlying tendency of
the customers to repeat a certain combination of
products / services. Inertial behaviour is useful
in optimizing cost to serve a customer
+
Adoptive: It represents the overall engagement
of the customer with the firm through both
financial and non-financial activities. Adoptive
behaviour to a large extent drives attitudinal
behaviour.
+
Sensitive: It represents the price sensitivity of the
customer. Customers, exhibiting very high
sensitive behaviour are likely to get defected
easily.
+
Attitudinal: It represents the state of loyalty
customer is in. Very strong attitudinal behaviour
represents ambassadorship or wiliness to refer.
These behaviours, are often independent of each
other, and if left un-joined, brands can never unravel
the true persona behind them. The primarily role of
loyalty (in facilitating brand’s effort towards
contextualization) should be to help brands link
these various facets of behaviours and derive the
“true persona”, a capability, which is foundational
The role of a loyalty program in creating contextual customer experience
to contextualization. Loyalty grants brands the basic
capability to uniquely identify customers at each touchpoints. Once the customer is identified, his transactions
and interactions across all touch-points can be
aggregated to uncover his persona, albeit over time.
Programs should encourage and incentivize customers
to identify themselves regardless of when they
engage, where they engage and how they
engage with the brand, which is the Omni channel
approach.
Store/Branch
Social
Website
The role the loyalty has to play is to maximize the
“exposed interaction” of the customer with the brand
across every touch-point! The whole program design
philosophy should be built around that. The process of
contextualization is iterative and eventually program
should shape the customer behaviour in the best
interest of the brand. That is how brands can gain top of
mind support and growth in market share.
Voice IVR
Framework for connecting the dots: Aggregating
different facets of customer behaviours across physical
and digital channels through transaction, navigation
and interaction would help expose the right persona!
Following is the illustration of which touch-points might
potentially bring out which behavioural aspect of the
customers
Direct to Rep
MobileApp
Once these behaviours are exposed to a reasonable
extent, they can either collectively or individually
facilitate various contextualization interventions of the
brand.The diagram below demonstrates which
behavioural aspects of customers might be leveraged
for which intervention
Consumer behaviour
Explorative
behaviour
Brand Intervention
Role of loyalty programs
Consumptive
behaviour
Sensitive
behaviour
Adoptive
behaviour
Attitudinal
behaviour
Contextualized
communication
Contextualized
Offer
Contextualized
Entitlement
Contextualized
Engagement
The role of a loyalty program in creating contextual customer experience
At its core, contextualization is really about
connecting the dots of various facets of customer
behaviours! As customers engage, transact and
interact with the brand through multiple touchpoints, they tend to expose many facets of their
behaviours. Following are some of the typical facets
of customer behaviours which collectively represent
a customer persona.
+
Explorative: It broadly represents the specific
interests of the customer. Explorative behaviour
often indicates intent to purchase both implicitly
and explicitly.
+
Consumptive: It represents what, how
frequently and how much products / services the
customer consumes. It explains the intensity and
affinity of consumption. To a large extent,
consumptive behaviour drives underlying
profitability of customer.
+
Inertial: It represents the underlying tendency of
the customers to repeat a certain combination of
products / services. Inertial behaviour is useful
in optimizing cost to serve a customer
+
Adoptive: It represents the overall engagement
of the customer with the firm through both
financial and non-financial activities. Adoptive
behaviour to a large extent drives attitudinal
behaviour.
+
Sensitive: It represents the price sensitivity of the
customer. Customers, exhibiting very high
sensitive behaviour are likely to get defected
easily.
+
Attitudinal: It represents the state of loyalty
customer is in. Very strong attitudinal behaviour
represents ambassadorship or wiliness to refer.
These behaviours, are often independent of each
other, and if left un-joined, brands can never unravel
the true persona behind them. The primarily role of
loyalty (in facilitating brand’s effort towards
contextualization) should be to help brands link
these various facets of behaviours and derive the
“true persona”, a capability, which is foundational
The role of a loyalty program in creating contextual customer experience
to contextualization. Loyalty grants brands the basic
capability to uniquely identify customers at each touchpoints. Once the customer is identified, his transactions
and interactions across all touch-points can be
aggregated to uncover his persona, albeit over time.
Programs should encourage and incentivize customers
to identify themselves regardless of when they
engage, where they engage and how they
engage with the brand, which is the Omni channel
approach.
Store/Branch
Social
Website
The role the loyalty has to play is to maximize the
“exposed interaction” of the customer with the brand
across every touch-point! The whole program design
philosophy should be built around that. The process of
contextualization is iterative and eventually program
should shape the customer behaviour in the best
interest of the brand. That is how brands can gain top of
mind support and growth in market share.
Voice IVR
Framework for connecting the dots: Aggregating
different facets of customer behaviours across physical
and digital channels through transaction, navigation
and interaction would help expose the right persona!
Following is the illustration of which touch-points might
potentially bring out which behavioural aspect of the
customers
Direct to Rep
MobileApp
Once these behaviours are exposed to a reasonable
extent, they can either collectively or individually
facilitate various contextualization interventions of the
brand.The diagram below demonstrates which
behavioural aspects of customers might be leveraged
for which intervention
Consumer behaviour
Explorative
behaviour
Brand Intervention
Role of loyalty programs
Consumptive
behaviour
Sensitive
behaviour
Adoptive
behaviour
Attitudinal
behaviour
Contextualized
communication
Contextualized
Offer
Contextualized
Entitlement
Contextualized
Engagement
The role of a loyalty program in creating contextual customer experience
Design principles of Loyalty Programs: Loyalty
programs should be an integrated platform for
continuously capturing input necessary for
contextualization, deploying contextualization
output and monitoring those for necessary
iterations. Brands need to carefully identify all the
activities or the actions which are required from these
perspectives and influence them through appropriate
features and functionalities. Below diagram
demonstrates an illustrative configuration of loyalty, to
both seek input and deploy output frompotential
contextualization perspective.
Guest recognition based on value
Preferential trade policy-sales preview, return policy
Till slip with savings comm.
wi-fi, co-brand card
Store/Branch
Advanced self service functionalities
Differential accural rule for
online transcation
Combined currency tansaction
Preferential policy
Affinity Gruops
Gamification
Social currency
Social accural framework
Website
Social
Incentivization based on
Feedback
CTI
Prioritized issue resolution
based on loyalty score
Incentivization based on
Feedback
CTI
Prioritized issue resolution
based on loyalty score
Direct to Rep
Voice IVR
MobileApp
Advanced self service functionalities
Mobile wallet
NFC
NBO
The role of a loyalty program in creating contextual customer experience
The role of a loyalty program in creating contextual customer experience
Design principles of Loyalty Programs: Loyalty
programs should be an integrated platform for
continuously capturing input necessary for
contextualization, deploying contextualization
output and monitoring those for necessary
iterations. Brands need to carefully identify all the
activities or the actions which are required from these
perspectives and influence them through appropriate
features and functionalities. Below diagram
demonstrates an illustrative configuration of loyalty, to
both seek input and deploy output frompotential
contextualization perspective.
Guest recognition based on value
Preferential trade policy-sales preview, return policy
Till slip with savings comm.
wi-fi, co-brand card
Store/Branch
Advanced self service functionalities
Differential accural rule for
online transcation
Combined currency tansaction
Preferential policy
Affinity Gruops
Gamification
Social currency
Social accural framework
Website
Social
Incentivization based on
Feedback
CTI
Prioritized issue resolution
based on loyalty score
Incentivization based on
Feedback
CTI
Prioritized issue resolution
based on loyalty score
Direct to Rep
Voice IVR
MobileApp
Advanced self service functionalities
Mobile wallet
NFC
NBO
The role of a loyalty program in creating contextual customer experience
The role of a loyalty program in creating contextual customer experience
Technology imperative
Analytical CRM: Contextualization starts with firm
pulling together various islands of customer
information from various sources and creating a single
view of customer. Once the single view is created,
analytical engine should look for best fit of the customer
into the one or more pre-defined segments and
subsequently contextualization guidelines of that
segment would apply. Degree of contextualization
would however depend on firm’s ability to create
relevant micro segments and differentiate the rules of
engagement based on that. For highly distinctive
behaviours, contextualization principles should apply
to just one individual (n=1).Analytical capability
should strive towards uncovering those distinctive
behaviours and progressively driving the organization
towards singular contextualization capability.
Technology has to play both operational and
analytical role in enabling brand’s
contextualization effort. While the operational role
should enable the overall contextualization
processes, analytical role should focustowards
sharpening the contextualization framework
progressively. The continuum for contextualization
should start with brand creating a “single view of
customer”. In the recent past, thanks to disruptive
technologies and proliferation of channels,
interactions are fast shifting from physical to digital
channels. So much so that, in the advanced
economies, traditional channels of engagement, atbest expose 50% of the customer persona!
In the diagram below, we have tried to demonstrate
how analytical and operational CRM can come
together to enable iterative contextualization
process!
Analytical CRM
Contextualization effort should be continuously
iterative. After each contextualized intervention system
should evaluate it for ongoing relevance and provide
feedback to the existing framework. The most optimal
framework could take time to emerge, depending on
system’s iteration capability.
To make this iterative process more effective, firms
should encourage a two-way communication with the
customer in addition to system’s capability to interpret
relevance of any contextualization effort (made
towards a particular persona). Operational system
should facilitate this feedback capture process and
funnel it back to the contextualization rule hub for
appropriate calibration.
+
Map the right contextualization aspect (content ,
communication, offer, entitlement, engagement
etc.) with the right channel
+
Ensure consistent contextualization across
channels
Operational capability should ensure that all the
touch-points are being fed off a central
contextualization hub which stores both the single
view of customer and the entire repository of
contextualization rules.
Operational CRM
Create contextualization
framework
Derive Persona
Create single view of customer
Operational CRM: Operational CRM, on the other
hand, should enable the firm to identify the
“persona” of the customer across every touch-point
at the very instance of interaction and apply the
contextualization principles, as appropriate. It
should also help close the feedback loop and
sharpen the contextualization principles for tighter
engagement in the future. The key to this capability
is to
Operationalize the framework
• Contextualized engagement
• Contextualized offer
• Contextualized communication
Iterate the framework
Data aggregation to persona definition to Contextualization
Profitability
s
C-C Relations
t
e(
LTV
)
Partner Preference
Segments
al P
our
avi
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Propensity to buy
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Revenue from P
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• Contextualized offer
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The role of a loyalty program in creating contextual customer experience
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Revenue from P
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the customer erson le (RF
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Contextualized content
• Contextualized interaction
• Contextualized offer
• Contextualized communication
Propensity
The role of a loyalty program in creating contextual customer experience
Technology imperative
Analytical CRM: Contextualization starts with firm
pulling together various islands of customer
information from various sources and creating a single
view of customer. Once the single view is created,
analytical engine should look for best fit of the customer
into the one or more pre-defined segments and
subsequently contextualization guidelines of that
segment would apply. Degree of contextualization
would however depend on firm’s ability to create
relevant micro segments and differentiate the rules of
engagement based on that. For highly distinctive
behaviours, contextualization principles should apply
to just one individual (n=1).Analytical capability
should strive towards uncovering those distinctive
behaviours and progressively driving the organization
towards singular contextualization capability.
Technology has to play both operational and
analytical role in enabling brand’s
contextualization effort. While the operational role
should enable the overall contextualization
processes, analytical role should focustowards
sharpening the contextualization framework
progressively. The continuum for contextualization
should start with brand creating a “single view of
customer”. In the recent past, thanks to disruptive
technologies and proliferation of channels,
interactions are fast shifting from physical to digital
channels. So much so that, in the advanced
economies, traditional channels of engagement, atbest expose 50% of the customer persona!
In the diagram below, we have tried to demonstrate
how analytical and operational CRM can come
together to enable iterative contextualization
process!
Analytical CRM
Contextualization effort should be continuously
iterative. After each contextualized intervention system
should evaluate it for ongoing relevance and provide
feedback to the existing framework. The most optimal
framework could take time to emerge, depending on
system’s iteration capability.
To make this iterative process more effective, firms
should encourage a two-way communication with the
customer in addition to system’s capability to interpret
relevance of any contextualization effort (made
towards a particular persona). Operational system
should facilitate this feedback capture process and
funnel it back to the contextualization rule hub for
appropriate calibration.
+
Map the right contextualization aspect (content ,
communication, offer, entitlement, engagement
etc.) with the right channel
+
Ensure consistent contextualization across
channels
Operational capability should ensure that all the
touch-points are being fed off a central
contextualization hub which stores both the single
view of customer and the entire repository of
contextualization rules.
Operational CRM
Create contextualization
framework
Derive Persona
Create single view of customer
Operational CRM: Operational CRM, on the other
hand, should enable the firm to identify the
“persona” of the customer across every touch-point
at the very instance of interaction and apply the
contextualization principles, as appropriate. It
should also help close the feedback loop and
sharpen the contextualization principles for tighter
engagement in the future. The key to this capability
is to
Operationalize the framework
• Contextualized engagement
• Contextualized offer
• Contextualized communication
Iterate the framework
Data aggregation to persona definition to Contextualization
Profitability
s
C-C Relations
t
e(
LTV
)
Partner Preference
Segments
al P
our
avi
• Contextualized offer
• Contextualized communication
Segments
Channel
Preference
Sur
vey
Da
sty
ta
le P
Beh
ref
e
avi
r
e
nce
our
s
al P
att
ern
eV
alu
ven
• Contextualized content
• Contextualized offer
• Contextualized communication
att
ern
nce
Propensity to buy
Usa
ta
Da
ere
ey
Sur
v
Life
sty
le P
ref
Usa
C-C Relations
Propensity to buy
s
al P
att
ern
nce
our
avi
le E
Beh
er V
alu
Pro
e
Revenue from P
fi
the customer erson le (RF
al D
M)
ata
tom
Cus
ge
ta
Da
ere
ey
le P
ref
Sur
v
sty
Life
s
our
al P
att
ern
nce
avi
Beh
tom
er V
alu
P
e
from
rof
Revenue
P
ile
e
er
r
tom
cus
s
the
(RF
ona
M)
lD
ata
Cus
C-C Relations
Propensity to buy
Usa
ge
ta
Da
ere
ey
ref
Sur
v
le P
Life
sty
Beh
er V
alu
Pro
e
Revenue from P
fi
the customer erson le (RF
al D
M)
ata
tom
ge
Cus
Usa
C-C Relations
Propensity to buy
tim
Segment Affiliation
cyc
Life
x
Propensity to leave/churn
Life
nde
le
Partner Preference
er
Campaign
Response
Intent
LTV
)
tom
nI
i
rof
t
Channel
Preference
Cus
y
alt ata
Loy ram D urn)
g /B
Pro Earn
(
ven
eV
alu
e(
Segments
3rd party data
tim
Segment Affiliation
Life
le E
x
Propensity to leave/churn
er
cyc
• Contextualized engagement
• Contextualized offer
• Contextualized communication
nde
le
Life
Campaign
Response
The role of a loyalty program in creating contextual customer experience
tom
nI
i
rof
Interaction
LTV
)
Cus
ctio
Demographics
Cu
& Lifestyle
Inte stom
Data
res er
ts
P
ial
anc
Segments
Partner Preference
isfa
Fin
e(
t
Sat
Service Preference
y
alt ata
Loy ram D urn)
g /B
Pro Earn
(
ven
eV
alu
Channel
Preference
Propensity to leave/churn
tim
le E
Segment Affiliation
Life
Campaign
Response
er
cyc
x
le
Life
nde
i
rof
Transaction
tom
nI
P
ial
LTV
)
Partner Preference
Cus
ctio
anc
e(
isfa
Demographics
Cu
& Lifestyle
Inte stom
Data
res er
ts
y
alt ata
Loy m D rn)
gra /Bu
Pro Earn
(
t
Channel
Preference
Propensity to leave/churn
ven
eV
alu
Segment Affiliation
Campaign
Response
tim
le E
x
file
Life
cyc
nde
Pro
er
Life
ial
anc
Demographics
Cu
& Lifestyle
Inte stom
Data
res er
ts
nI
Sat
Service Preference
Fin
Fin
tom
ctio
ctio
al P
isfa
Profitability
Demographics
Cu
& Lifestyle
Inte stom
Data
res er
ts
i
anc
Sat
Service Preference
y
alt ata
Loy ram D urn)
g /B
Pro Earn
(
Cus
Profitability
isfa
Fin
Profitability
Sat
Service Preference
Life
Contextualized engagement
Contextualized proposition
Contextualized offer
er V
ge
alu
Pro
e
Revenue from P
fi
the customer erson le (RF
al D
M)
ata
Contextualized communication
Cus
tom
Contextualized content
• Contextualized interaction
• Contextualized offer
• Contextualized communication
Propensity
The role of a loyalty program in creating contextual customer experience
Architecture for execution
Conclusion
Following is the conceptual blue-print of how these operational and analytical capabilities would come together
for flawless execution.
While most firms acknowledge the growing
importance of contextualization, they often fall
short in both strategizing and executing it. Brands
should not limit loyalty programs to just a mean for
instant gratification. Instead they should leverage it
for driving holistic contextualization interventions.
Tomorrow, the extent of contextualization capability
would potentially determine the strength of
competitive advantage!
Multi Channeldelivery
Business Process Layer
Research to Consider
Content
Marketing
Consider to Purchase
Product
Development
Campaign
Management
Purchase to recommend
Loyalty
Management
Few players have already identified contextualization
as a powerful force and started to reconfigure their
loyalty program towards that objective.
Woolworths, South Africa is a case in point. They
are on a journey to continuously trying to steer their
market leading loyalty program “WRewards”
towards an integrated contextualization platform.
By linking historical data of customer transactions,
interactions
and by leveraging analytics,
Woolworths is able to discover multiple customer
personas and create appropriate contextualization
framework to engage customers beyond just
transaction and the results are already prominent! In
their industry, they are already beating the best in
loyalty penetration, customer attrition and
acquisition cost amongst other metrics.
Reputation
Management
Member
Service
Business Services Layer
Browse
Search
Selection
Contextualized content
Rule based
decisioning
Activity
monitoring
Checkout
Self-service
Track
Contextualized engagement
Contextualized offer
Business rule
management
Feedback
Analytics
Session
Management
Community
Management
Contextualization Hub
Single view of customer across all attributes and an integrated rule engine
Information Layer
DW
Customer
Product
Content
Knowledge
base
For the company
For the customer
Adapted from Oracle reference CX architecture
The top layer shows various devices and touchpoints those are supported by customer experience
reference architecture.
The contextualization hub is the central repository of
single view of customers across all attributes and all
contextualization rules.
Business process layer demonstrates the processes
provided by the solution from both customer and the
brand perspective, all supported by Business
Process Management capability.
Information layer illustrates the information required to
support a consistent, seamless contextualization across
all perspectives.
Business services layer also shows the necessary
capabilities from both customer and the brand
perspective. Underlying business services is the
data and the service integration capability that
provides the glue that brings all the data and
services together into a comprehensive, unified
solution.
The role of a loyalty program in creating contextual customer experience
The role of a loyalty program in creating contextual customer experience
Architecture for execution
Conclusion
Following is the conceptual blue-print of how these operational and analytical capabilities would come together
for flawless execution.
While most firms acknowledge the growing
importance of contextualization, they often fall
short in both strategizing and executing it. Brands
should not limit loyalty programs to just a mean for
instant gratification. Instead they should leverage it
for driving holistic contextualization interventions.
Tomorrow, the extent of contextualization capability
would potentially determine the strength of
competitive advantage!
Multi Channeldelivery
Business Process Layer
Research to Consider
Content
Marketing
Consider to Purchase
Product
Development
Campaign
Management
Purchase to recommend
Loyalty
Management
Few players have already identified contextualization
as a powerful force and started to reconfigure their
loyalty program towards that objective.
Woolworths, South Africa is a case in point. They
are on a journey to continuously trying to steer their
market leading loyalty program “WRewards”
towards an integrated contextualization platform.
By linking historical data of customer transactions,
interactions
and by leveraging analytics,
Woolworths is able to discover multiple customer
personas and create appropriate contextualization
framework to engage customers beyond just
transaction and the results are already prominent! In
their industry, they are already beating the best in
loyalty penetration, customer attrition and
acquisition cost amongst other metrics.
Reputation
Management
Member
Service
Business Services Layer
Browse
Search
Selection
Contextualized content
Rule based
decisioning
Activity
monitoring
Checkout
Self-service
Track
Contextualized engagement
Contextualized offer
Business rule
management
Feedback
Analytics
Session
Management
Community
Management
Contextualization Hub
Single view of customer across all attributes and an integrated rule engine
Information Layer
DW
Customer
Product
Content
Knowledge
base
For the company
For the customer
Adapted from Oracle reference CX architecture
The top layer shows various devices and touchpoints those are supported by customer experience
reference architecture.
The contextualization hub is the central repository of
single view of customers across all attributes and all
contextualization rules.
Business process layer demonstrates the processes
provided by the solution from both customer and the
brand perspective, all supported by Business
Process Management capability.
Information layer illustrates the information required to
support a consistent, seamless contextualization across
all perspectives.
Business services layer also shows the necessary
capabilities from both customer and the brand
perspective. Underlying business services is the
data and the service integration capability that
provides the glue that brings all the data and
services together into a comprehensive, unified
solution.
The role of a loyalty program in creating contextual customer experience
The role of a loyalty program in creating contextual customer experience
Authors
Indranil Das
Associate Partner and Global Practice Head
Loyalty Business Consulting, ITC Infotech
Pieter Twine
General Manager
W Rewards and My School, Woolworths South Africa
Anupama Kavoor
Associate
Loyalty Business Consulting, ITC Infotech
About ITC Infotech
ITC Infotech, a fully owned subsidiary of USD 7 billion ITC Ltd, provides IT services and solutions to leading global
customers. The company has carved a niche for itself by addressing customer challenges through innovative IT
solutions.
ITC Infotech is focused on servicing the BFSI (Banking, Financial Services & Insurance), CPG&R (Consumer Packaged
Goods & Retail), Life Sciences, Manufacturing & Engineering Services, THT (Travel, Hospitality and Transportation) and
Media & Entertainment industries.
For more information, please visit http://www.itcinfotech.com | Or write to: [email protected]