Strategy : Transpromo’s Evolution

The targeting technique moves beyond discount coupons

• From 2006 through 2008, loyalty club membership in the U.S. increased from 1.32 billion to 1.81 billion. This is a whopping annual growth rate of nearly 25 percent.
• Seventy-five percent of consumers are members of loyalty or rewards programs, and 25 percent belong to two or more.
• For every 12 loyalty programs, only about 4.7 are used by members on a regular basis.
• Although marketers continue to spend more than $1 billion on these loyalty campaigns, many have not defined clear and precise strategies for optimizing revenue potential through them.

What do these stats mean for your business, and what do they have to do with transpromo?

These highlight that loyalty and rewards programs are not currently being optimized to their fullest potential despite the great increase in membership during recent years. There is extensive information that can be deciphered through loyalty club transactions. And by implementing high-quality data analytics tools, companies almost seamlessly can use this insight to retain and engage customers. In this instance, a transpromo campaign can signify a quick and consistent return on investment.

Beyond the Coupon
Most customers find it valuable to learn about cost savings, especially in regards to a recent purchase. Despite popular belief, these promotions do not always necessarily have to be discounts or offers. For example, if a customer purchases shampoo at a certain price, a promotion can be delivered pointing out that selecting another brand would have saved money. Although this isn't a direct coupon, it shows the customer that you have her best interests in mind. The software components of transpromo enable this personalized data to be generated and shared.

In this same vein of sharing relevant information, B-to-B companies can offer best practices documents or white papers that provide general ways for customers to save money as a means of helping drive loyalty. Customers often are drawn toward companies that prove they are not only interested in sales, but in bettering their brands' awareness and keeping customers happy. Best practices and white papers are influential ways to prove this case.

Outgrowing 'Transpromo'
In August 2009, my company commissioned a survey of 1,000 U.S. men and women to learn more about their feelings toward loyalty programs and marketing campaigns in general. The results were not surprising, but rather reassuring, that our assessment of the achievable marketing possibilities via loyalty programs was correct. Nearly four out of five respondents stated they would consider using relevant coupons received from their rewards clubs over the clubs' competition. But what was startling was more than 60 percent of responders said they might stop purchasing from a company that marketed irrelevant materials to them.

With all of these points to consider, it is simply inconceivable for a marketer not to take advantage of the data already on hand from these loyalty and rewards programs. In today's times, consumers are understandably looking out for "what's in it for me." It now is a company's job to prove that it knows what consumers are looking for and that it already has the solution.

Transpromo was the term of yesterday. This is much more than targeted coupons on bills; it's a deep look into customers' habits.

Precise marketing is the term of tomorrow.

Lee Gallagher is manager of direct marketing solutions at Boulder, Colo.-based InfoPrint Solutions Co., a joint venture between IBM and Ricoh. The company is a provider of output solutions. Gallagher can be reached at (303) 924-9348.

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