Loyalty Stories 36: The Loyalty Anatomy – Bill Hanifin

Gabor 

Hi and welcome to Loyalty Stories, that is Antavo’s podcast on customer loyalty and loyalty programs. I am Gabor Vigh, one of the Partnership Managers at Antavo, and Antavo is a technology vendor that empowers loyalty programs all over the world. We help various great businesses such as KFC, Benefit Cosmetics, and very well known global automotive and fashion companies and airports, and so on.

In this episode, we dive into the trends around loyalty programs and customer loyalty. We talk with industry experts all around the world to pick their brains, to learn what’s next and what’s new for loyalty programs. Today’s guest is Bill Hanifin, the CEO and Managing Editor of The Wise Marketing Group, the leading global resource for professionals interested in customer engagement, customer loyalty, customer relationship management, and the broader category of digital marketing. 

Furthermore, they are the owner of the Loyalty Academy, the only professional certification body in the customer engagement and loyalty industry. The population of the global academy professionals who have been certified so far are more than 800 people in 46 different countries. 

And I am very proud because I am one of them in March 2023. I had the chance to attend their in-person training in Amsterdam, where I got CLMP certified. So this is so exciting to me to interview you, Bill. So let’s start. How are you?

Bill 

That’s great. Gabor, I’m doing great. Really good to be here with you, and congratulations on getting that certification. It’s great to have you part of the group.

Gabor 

Thank you and thank you very much for joining us today, Bill. Would you mind just doing a quick brief introduction of yourself to our audience?

Bill 

Absolutely. A very quick overview is my background originally was in financial services and I somehow found my way into the marketing industry and so I ran a consulting business for about 15 years and ultimately some other people myself came to acquire The Wise Marketer and we’ve been operating that for about five or six years. We felt like there was a very large gap in the business of this very large and significant business, which we all know attracts a lot of investment. 

And we didn’t have a source of news and research and opinion really that was independent and unbiased and could be trusted by the industry. So I feel like I’ve spent the last five years in service of the industry and trying to elevate all of those around us, Antavo included. Antavo has been a tremendous contributor of content and just thought leadership really has helped us in the work that we’ve done over the last couple of years.

Gabor 

Thank you, Bill. As you have been working as an expert for a long time, and also this is a question that we ask from everyone, this is kind of expected. What is your favourite loyalty program and why?

Bill 

You know, that is always such a difficult choice. I could tell you, okay. Like a typical consultant, I’ll say it can’t be just one, but here you go. In a certain part of my life, I absolutely love something called Cumberland Farms. It’s a convenience store chain in the United States. That’s quite large. Why do I like the program? Because they have a customer experience that’s unparalleled in that space for me. 

They have an ACH discount program for gas and it’s all fueled by a mobile app. That means connecting your checking account to the loyalty program. And when you purchase gas, Cumberland Farms avoids the charges for MasterCard Visa, Discover, AMEX, all the credit card processors, they can pass along a fuel discount. So when I use the program, I get a 10 cent discount. 

It’s fantastic, but more than that, when I come up to the gas pump, I can activate the fuel dispenser itself with the app and I can pay with the app. So I can literally, except for having to get out of the car or truck and pick up the handle and put it in my tank, everything else is automated for me. It works very well. And as I’m fueling up, I can look at offers. They have a card linking type of feature.

So they have offers in the wallet that I can look at while I’m fueling. So that’s number one. And that’s kind of in my daily life. The other one, like as a business person, for me has to be Marriott. Over the years I’ve spent so much time in Marriott hotels. And, I think you’ve heard us talk about the psychology of loyalty, like the, the more you build equity in a program, sometimes the more dedicated you become to that program and, I’ve built up that equity in Marriott where, you know, I see the the way they treat you when you’re on property, they’ve developed their app in a very nice way where you can check in before your arrival, you can enter your own room using the app, all sorts of other benefits and things. So it’s just become a very comfortable thing that when I’m making plans to travel, I’m predisposed to think Marriott. 

It’s no offense to any other hotel chain because I’m sure, you know, I do stay a lot of other places, but it’s one of those things where, and I guess in each case that I’m describing to you, it’s where the loyalty program becomes part of my whole experience. And so it’s more than just the fact that I get a certain amount of points or a fuel discount. It’s that it’s this experience that’s making my life easier. It’s saving me time and becoming convenient for me.

Gabor 

Oh, that’s great. I think I should subscribe to the Marriott Loyalty Program because you are not the first person who I interviewed telling me that’s their best. And because you have seen a lot in, you know, wearing your professional hat on, what would you say, what is the work that you are the most proud of?

Bill 

That’s very interesting. In my professional career?

Gabor 

Yes, for example when you did an implementation or designing program, what was the most breathtaking invention that you tried to implement?

Bill 

There are two examples that I can think of and they’re similar models. So I was involved in the launch of two coalition or multi-partner programs. And one was very, very early in my career. It was in Peru. And I worked with Shell Oil and the largest grocer in the country of Peru and a franchisor that had KFC and Starbucks and some other restaurants.

We were there to launch that program. We helped design it, launch it, and I saw it go into the market and be very successful. It’s called Bonus. There’s been a lot of transition over the years. Believe it or not, we launched that program in 1998, dare I say, and it’s still working today. It’s still on the market. It’s still working today. It’s no longer Shell as a fuel provider. It’s another company that bought all the assets of Shell in that country.

So that was very exciting and it was my introduction to the loyalty business. And then many, many years later, this is probably now just about five years ago. We had the opportunity to work with a company, which is the largest in Jamaica and one of the largest in the Caribbean. It’s a 100-year-old company named Grace Kennedy. And we helped, plan, design, launch, and for a while operate a multi-partner program, the difference in this case.

is that Grace Kennedy owned multiple businesses of different types. So they owned a food business in a bank and an insurance company. They had a Western Union franchise for the country and also a hardware franchise that you would be familiar with the name. So they had very diverse businesses and wanted to have a program that would reward people for patronizing all the different businesses under the corporate umbrella. 

And that was about a three-year planning process. It’s still running today and doing quite well. But those two are very, very memorable. There are many other programs in between that we’ve worked on and helped to launch. But those two, you know, are very challenging. If you notice, they’re both outside the United States, which made it even more interesting. And so, yeah, those are the two I think of.

Gabor 

That sounds very interesting. And because you receive a lot of information and you do a lot of research on your own within The Wise Marketer,, what would you consider the big changes in loyalty space in the recent years?

Bill 

I think some of the biggest changes are a realization that customers are looking for so much more. Like all of us as consumers have changed a lot. And some of the changes were on the way, but the pandemic maybe accelerated some of our behaviors, the change that was happening, and it accentuated the way we think. I know from your report in 2023, the Antavo Global Loyalty Survey, it talks about the impact of inflation and increased interest rates. 

And I think, you know, those are the sort of influences along with the way people are thinking that have really forced brands to change quickly. So what I see is that loyalty is a little bit less to me about the reward and it’s a little bit more about the experience. So it’s the customer experience, it’s the recognition, it’s all of their, and they’re not intangibles, but they’re an aspect of the program that I think are very, very important. 

I’ll give you a quick example. You know, people are very, they’re not nearly as tolerant as they used to be with the way a brand will present their loyalty program. So someone just told me a story recently about being in a department store in Canada, opening up their mobile app at nine o’clock in the morning, they were in early to shop and they received a message saying, good afternoon.

And why? Because the company delivering this program is in the UK, they’re in Europe, and so they had set their time from a European base. It’s an easy mistake for anyone to make, but I find that consumers are less tolerable of those types of mistakes. They expect, it’s almost as if you look at Amazon in the subscription space and the consumer expects every subscription program to be as rich and wonderful as the Amazon program. Well, we know it may not be possible, but still consumers are having that expectation. 

So it’s a way of saying, I think the expectations for loyalty are much higher. And I think they’re more, the value is expected to be delivered around the experience and everything’s supposed to work very well and be seamless.

Gabor 

Yeah, it’s sometimes, as you said, really annoying to find glitches in personalization. And for example, you disclose a couple of your details with the brand and when you receive the invoice, something doesn’t look good over there and some of these details are wrong, or just receiving an email with “hi, first name” or just simply “hi there”. 

Bill 

That’s right. Yeah.

Gabor 

And how and regarding the future, because hopefully the future is really bright for loyalty, what do you think will be the biggest trends or maybe the two biggest trends in the upcoming years?

Bill 

Yeah, so just to set you at ease, I do think the future for loyalty will be very bright. I think that the business that we’re all working in, Gabor, is so important to marketers, to CMOs, to everyone in the C-suite. Why? Because it’s becoming more difficult to acquire data for customers, consumers. 

And I think brands are realizing that, I mean, this whole topic of zero and first-party data. Brands are realizing how important the data is, one, and how consumers are a little bit more hesitant to give it up. They’re looking for value in exchange. They want their data to be protected. So the burden is much more on the brand. How do we do this correctly? How do we do this very efficiently? 

And interestingly, loyalty programs, I can’t think of a better way than some kind of an opted-in structured program with a value proposition with great technology that works across different channels, the best way to create trust with the customer and have a conversation with the customer. So I think the business is going to continue to be important. 

One of the most important things for us to think about for the future is to start to gain more access to the C-suite and to be able to be convincing of them that loyalty is a business, that loyalty is not something to be relegated to the marketing department only, that it’s a campaign or a promotion or something that maybe this year we like it, maybe this next year budget is tight, we don’t like it so much. 

But, I think that the burden is probably on all of us in the industry to make the case, but the case needs to be made that when you’re talking to the C-suite, they’re thinking about what’s my strategic plan? How will I become truly customer centric? How will I achieve these big objectives that I have for my shareholders, my stakeholders? And I think that loyalty will be in that conversation more and more.

So it’s treating loyalty as a business, it’s gaining access to the C-suite. And then probably tied to that is to have more operational integration across the enterprise for loyalty. So we realize that loyalty as a design strategy, as a marketing program is one thing, but it doesn’t work unless it works across the enterprise. So these examples we’ve been talking about, everything has to work down to the level of when I’m standing at the electronic cashier or I’m standing at the fuel pump or I’m on your website. 

All these connection points have to work really, really well. And they have to work consistently for the consumer to be convinced that it’s not a loyalty program, like an add-on thing, you know, a satellite going around your globe, but it’s actually just a natural part of your business. It’s just like, you know, as I expect your shopping cart to work, your loyalty program should work and it should seem like it’s nicely integrated. 

So we’re doing much more work in creating steering committees at the executive level, inviting cross functional collaboration of executives and to do planning for loyalty at that level. And we found out when we do that kind of work, the implementation is smoother. You have shared objectives across an entire executive team, and you end up getting better results and definitely more buy-in from the entire enterprise. So those, I think, are one or two of the most important things that we could be thinking about for the future.

Gabor 

100% agree with you Bill. What we see is, especially on the integration side, is that sometimes loyalty is kind of like siloed from other business units or departments within the organization and if someone wants to come up with an idea, come up with a strategy, then they might see pushback from a different department.

Yeah, definitely. It’s like a learning curve, I would say. Yes. And in terms of technology, and of course, technology, like, it needs to be like, integratable as well. But on top of this, what do you think? What would be the best features? Not just the nice to have, but they have to have features of a loyalty technology company to support all of these trends evolving in the market.

Bill 

You know, I might answer it a slightly different way as opposed to naming specific areas of capability or functionality. I think one of the most important things about loyalty technology these days is it has to be available in small bytes. So I’ve heard people use the term modular loyalty. They also use the term microservices, but the idea that you don’t have to look at a loyalty technology as a comprehensive end-to-end platform. If I want a new service to be added, maybe I have to make a really big change and enter into a big technology transformation. 

I think that these days, if a provider is able to be flexible and to offer specific areas of service and capability and through APIs, through I think you even use the term headless technology, there are different terms for all of this. But the ability to be able to plug in functionality, and like bring things into the marketplace in a short uptime, in a cost efficient manner. And maybe even to convince the brand that, hey, we can test this thing and we can show you how it works. 

We could even support you in a campaign and maybe it converts into something bigger as a result. I think that approach with loyalty technology today is consistent with the way CIOs, CTOs are looking at all of their technology stacked in different areas of the business. 

So I’m glad to see loyalty and many loyalty providers starting to align with that idea. So now we become not like a project that gets thrown on top of the other tech debt that exists, but it’s something that we can adopt and we can put into play and we can prove an ROI in a reasonable amount of time and then make a decision after that.

Gabor 

Thanks for sharing this, Bill. Is there anything else that you have in mind that you want to share with the audience but we haven’t touched upon that yet?

Bill 

You know, I think we’ve talked about customer experience, which I really do believe is important. I would say this, I think our industry needs to come together in even a more unified way than we have in the past, and there could be opportunities for all of us to collaborate, to lobby for regulation, for legislation, maybe to advocate for causes that make sense for all of us. 

Because if you think about it, every average loyalty program, the ones that are mature, like big airline frequent flyer programs or that Marriott program I mentioned, have tens of millions of members. And so these people have some shared interests and common values to some extent. I think more can be done with the loyalty communities for greater good. And so that’s something that would be interesting to explore.

I think also like the leadership that I mentioned when we talk about lobbying can be a bad word, but just showing leadership on sensitive topics. So, I’ll give you one example, data being so important. And then we know that we have data regulations, privacy regulations in every country in the world now just about, so GDPR and our CCPA in California and the United States, things like that. 

I feel like we should be coming together as an industry to create some proposed standards for how we manage data, to demonstrate that we’re the ones that really are as expert as anyone in the world on these topics, and that we could have a greater voice in how these regulations are formed, which guess what that does? It helps the customer, it helps us. It also elevates what loyalty really means to the business world. 

So I think there’s some significant opportunities like that and they’ll work really well if we can all join together and work in a collaborative way to advocate for those things, whether it’s at the European Union level or in the United States, at the Congress, something like that, but I’d like to see us do more of that over the next couple of years.

Gabor 

Yeah, I’m hoping to see it as well. Previously you mentioned when I asked you about the technology capabilities, you mentioned CIO or CTO. We come across them as typical stakeholders when we talk about loyalty. What is your experience so far, Bill? When you work with a company, who owns the loyalty projects the most? Or who are your key stakeholders?

Bill 

That’s a very interesting question. And that’s tied to how we get better traction across the whole C-suite, like I was talking about earlier. I think the first book that was handed to me, one of the first books when I came into the loyalty business and actually worked for a dedicated loyalty agency, well, there was two. One of them was a book from Fred Reichheld about his first book about loyalty. And then it’s called the Loyalty Effect, I believe.

The second one was a book called Strategic Selling. And so it alerted me to the fact that this was a complex, quote unquote, complex selling process. And we needed to gain the approval of multiple types of buyers. And it’s true to this very day. So, you know, if you have the support of the CEO, you’re in the best position that you could be. Because if you have that advocacy at the very top, things become easier, right?

And so I guess I hesitate to say that there’s one person who’s most important, but that is very, very important. If you can reach that level and you can’t always, but if you can reach that level, you’re going to have success more times than not. I think if, if you have limited access to the CEO, whoever he or she is, I think the smartest thing to do is to gain that acceptance across the entire group. 

So the CFO has to understand, has to buy in, has to believe your financial model that you propose. That’s critical. Usually you have maybe the CMO or somebody in the marketing area who’s maybe your initial content, they brought you in. So assume that they’re mostly on your side already, but you must go get the support of CFO. And then the other person is either like an operational executive or somebody who’s running all the retail business. 

If you’re talking to a retailer, but somebody who’s actually at that level where they’re rolling up the sleeves, managing districts and stores, you know, down to that level, maybe has training budgets so that we can train the frontline staff in a company, things like that. So, you know, it’s to say that you really would like to have a CEO. 

If you can’t get there, make sure that you have across the board, you know leverage your initial support from the CMO and try to gain access and conversation with operations, with technology, and with finance. And I think if you’re very conscious about that and go after it from the very beginning, that you’ll end up in the best place possible.

Gabor 

Great, thank you Bill. I’ve got one final interesting topic in mind. So because you started off on a different career path and then you ended up in loyalty, if you were giving advice to a young person, let’s say coming out straight from university, starting off as a loyalty manager, but that person wants to become one day head of loyalty. What would you advise to that person?

Bill 

I’d probably advise them to realize, somebody once told me that when you’re the person who’s connected to the revenue, then you have a lot of potential and you’re in a reasonably safe place. Because if you’re the one who’s either responsible, the so-called rainmaker, or the person who’s responsible for clients that represent revenue, that’s really important. So in our business, there’s the customer base, which is undeniable of importance. 

It should be the asset that is of greatest importance to every company. So I would tell somebody coming out of college, university to realize if they believe that model is right, that the customer is everything and drives revenue and in turn that drives the fortunes of the business, realize that a career in loyalty is very meaningful, right? And you can come to that career through multiple means. 

You could be an expert in finance and understand the liability and budgeting and all those areas of the business, you can demonstrate to the board of directors the value of driving more value in a customer portfolio. Or you could come through an agency way, be highly creative and have a strategic mind. So I think there are many ways you can also approach it from technology, of course. 

There’s so many brilliant technologists that have changed the game in the loyalty space. So there are multiple paths and I think we just need to probably raise awareness that loyalty is a career actually. I think some people fall into it or they start somewhere and then transition into it. 

So it would be interesting to see if we could get more recognition at the university level and have younger smart people thinking about, oh, this is actually a career I would consider from the very beginning. It would be interesting to see that transition.

Gabor 

Yeah, I agree with that Bill. Because I started off my career completely differently and then I ended up in loyalty and I just love this space. So I think after a long thought I found my destiny, hopefully.

Bill 

So you’re a great example of that then. That’s great.

Gabor 

And great stuff, Phil. Thank you very much for being here with us today and sharing your thoughts. I really enjoyed our conversation. My personal favorite of today’s conversation and my key takeaway is when we were talking about the bright future of loyalty programs, how it can be a career path, and the importance of data. And also, it’s a great tool to be customer centric, and collect first party, zero party data. I really enjoyed this session. Thank you very much, Bill, for being here with us today.

Bill 

It’s really been my pleasure. It was a great set of questions and a great conversation. I really appreciate the opportunity to be here with you and keep doing your great work at Antavo.

Gabor 

Thank you, Bill. And for the viewers, wherever you listen to us, be it on podcast platform, YouTube or LinkedIn, please like us, like this podcast and subscribe to our channel to see what’s new and get notified when the next episodes are out. And also tell us about what you think of loyalty here in the comment section below. Visit antavo.com to discover your next loyalty software.

Antavo is a next-generation loyalty program technology company used by global companies like KFC, Benefit Cosmetics, Global Automotive, fashion and airports all over the world. 

Also visit the Wise Marketer’s website at thewisemarketer.com or Bill’s LinkedIn page to find out more of his exciting details of work. 

Thank you and see you on the next one. Bye for now!