The Logic Group Blog

As a consumer we place our trust in retailers to provide the services and products we require to a service level that we expect. A retail store provides a slick and well presented mechanism to deliver products to the public in a fast, effective and secure manner. However, behind the scenes the technology that underpins this process can be woefully insecure.

 

It is reported that a major European retailer is breached every week and the reason we do not hear about it……the retailer does not know about the breach themselves. In the past five years there have been a number of high profile cases of card data theft from retailer systems including security breaches of high profile businesses resulting in data loss. These breaches have resulted in large fines being imposed and a loss of reputation for the business in question. However, the impact to us as the consumer is often more painful. The thought of your personal details being used by fraudsters to gain benefit because the retailer you trusted has failed to protect you in the most basic way, can be frustrating. That basic principle is to keep your personal information, your credit or debit card secure and safe from prying eyes and with over 165 millions cards in operation in the UK alone that proves a significant challenge.

As the social media frenzy spirals on, the challenge for businesses trying to incorporate social networks into their overall marketing strategy intensifies.

 

Fuelled by mobile devices, which give users access wherever they are and whenever they want it, social networks will continue to become an integral part of our lives. And with it, our expectations will grow. Consumers will expect a unique experience, offers, rewards and games in return for their engagement with a brand through social networks. Although this presents a challenge to organisations, the opportunities to reach their consumers and target them with relevant communications at the right time, opens up further. Facebook is already allowing retailers to offer customer promotions specific to location when users “check-in” via facebook places. Not only does this make the offer more significant to the consumer’s location, the message is far reaching, as users also broadcast the offer to friends through the network.

Well as usual, I attended PCI London this week, which is probably my fourth or fifth one over the years. As always it was very well attended, which was encouraging as it demonstrates that merchants, schemes and service providers continue to treat security seriously, even in these difficult times.

 

It has been interesting to see the changes in approach.

 

Initially at my first one, the event had an educational bias. “What is PCI DSS, who does it impact, what does it mean?”

 

Then it moved to a more supplier centric focus, with many presentations talking about technology and solutions which would allow a merchant to meet a variety of controls within the standard.

Recently I saw an example of a business using social media to provide outstanding customer service and enhance its brand image. The Dutch airline KLM presented gifts to customers who had mentioned KLM to the world via Twitter prior to boarding the flight. These customers seemed pleasantly surprised that KLM airport staff not only knew they had tweeted, but also knew their interests and the type of gift they would like. They knew all of this because they had a team of people monitoring social network feeds for mentions of their brand. They then looked up the social network profile of these brand advocates to establish their interests, purchased the gifts and presented them to the customer within hours of the tweet or facebook post. The fitness enthusiast was more than pleased to receive a GPS heart rate monitor watch, and the music aficionado an iTunes voucher. One would assume this then lead to more tweets about the “KLM Surprise”, and a very happy customer who would most likely pick KLM as their airline of choice in the future. So, for KLM, mission accomplished. A happy, loyal customer and free positive PR for the brand.

Our latest research for The Logic Group shows that, of those of us who are members of loyalty schemes, an impressive 69% are satisfied with them and only 5% dissatisfied.

 

What the research also finds is that the British consumer is a contrary creature who at once accepts the rewards that loyalty schemes bestow on them, while rejecting the mechanisms that make these rewards useful.

 

So the question remains: will consumers ever be happy with loyalty schemes?

Like many people out there, I stood on my bathroom scales a few days after Christmas, and after pushing my belly to one side in order to read the dial, decided that this year has got to be the year that I do something about shifting those excess pounds. Yes I’d promised myself in previous years that I would lose weight and get fitter, but never really got round to it, always finding other ‘More Important’ things to concentrate on. But this year I simply have to act.

 

I wonder how many IT Directors or Heads of Finance are wondering the same sort of thing regarding PCI compliance? Having put it off for a few years in the hope it will just ‘Go away’, this year may just be the year they decide to face this challenge head on.

 

It’s a daunting prospect, and whilst for me, there is no more frightening word in the English Language than the word ‘Diet’ many business leaders may feel the same way about the word ‘Audit’.

 

So how do I go about it?

It’s not news that the advent of technologies such as social media has given the brands that we use unprecedented access to our lives.  Gone are the days when our only contact with a brand was on the high street.  These days they are emailing us, texting us, writing to us (but only if we’re ‘old school’) and even ‘reaching out’ to us via social media.

And many of us have happily jumped on the bandwagon, joining, for example, the Facebook groups of our favourite brands.  For instance, at the time of writing, 408,959 of us ‘like’ Marks & Spencers’ Facebook site, and 74,692 of us ‘like’ Debenhams.  We get to know more about the brand and its products, and if we’re lucky we get some useful discounts and offers for the products we like.  Most of us know that the trade-off for these ‘perks’ is the brand knowing more about who we are, and what kind of products/brands we like.   Brands that engage with us in this way are effectively offering financial incentives to gain greater proximity to our lives.

An individual, specialised in a certain field, would probably perform better when part of a group or a team with the same expertise. When a charity organisation launches a new campaign, often the catch phrase used is “together we can make the difference”. In group sports, like rugby, people play different positions, each of which require different skills. If the coach can successfully coordinate these different skills, the unit has the potential to become greater than the sum of its parts. But does the same apply to Loyalty programmes?

Loyal customers are the Holy Grail of the supply world; finding them is the topic of a mountain of business manuals.  But when we stop to think about it, is it really loyal we want?  The dictionary definition of loyal is ‘faithful to one’s friends, country or government.’  Honourable?  Yes.  Emotional?  Yes.  Maybe even a little old fashioned.  But in today’s aggressively consumerist world, these are notions which hardly seem to apply.

 

Take the example of banks/building societies and supermarkets: at first glance, recent research that we carried out on behalf of loyalty scheme consultants, the Logic Group, shows that banks/building societies and supermarkets seem to be doing rather well in the customer loyalty stakes.  Two-thirds 66% of the British public said they feel loyal to their bank or building society and 60% said the same of their supermarket.

Brussel Sprouts, hated them. These evil little green things just wanted to ruin a perfectly good dinner. After the joy of Christmas morning, playing with toys (I am talking about my childhood here, and yes, I can still remember it) and finally getting the “GET TO THE TABLE” call. Crackers pulled, reading the jokes (yes, still the basis of my humour till today) and putting on funny hats – laughing with grandparents. And then dinner is served, and it’s like the uber Sunday lunch! Added extras, cocktail sausages with bacon wrapped round (they weren’t called pigs in blankets back then!) – what genius came up with that? Freshly made stuffing and gravy, the turkey (we did have goose a few times) lots of roasties, good old veggies, and then, there it would be, the sprout. Now I never cheated per se, I was a good boy (at this time) and always did what my Mum told me to. So I would eat the sprouts, but only by dissecting them into the smallest possible size, and then trying to disguise the foul taste with a forkful of nice, tasty food.