Seeking a shared purpose in loyalty partnerships

Seeking a shared purpose in loyalty partnerships
Dec 19, 2019

Beyond the promise of relaxation, exploration, or adventure, one thing that can help push a vacation from ‘great’ to ‘totally awesome’ is to earn points through an airline or hotel loyalty program.

Take it a step further and earn points by linking to a partner ride share company, (like Hilton Honors and Lyft), and then charge the entire trip on an affiliated credit card and earn double or triple points!

That tingle of dopamine in your brain—the neurotransmitter surges when you're anticipating a reward—is one reason why loyalty programs are here to stay. And why partnerships where customers receive additional benefits (points, miles, exclusive offers, access to products, or even joint ventures) across two different programs simultaneously are the new frontier for driving customer loyalty.

But how do you know which brands to partner with and what rewards to offer your customers? What actually goes into creating a successful partnership that’s good for your customers and your bottom line?

The key to answering both questions is determining a shared purpose.

Brand is key

Outside of your customers, your brand purpose is one of your business’s most important assets. Every company needs to define what their brand stands for and to regularly adapt and evolve based on customer expectations and needs.

If you’re going to link your brand to another through a partnership, it’s crucial to pick a partner whose brand is complementary to your own. Look for brands that align with your core values, so you can build a sustainable and strategic relationship that not only benefits customers, but also benefits both businesses. Use caution in joining your brand to one with a negative public perception or whose brand story is diametrically opposed to your own.

While airlines and hotels are a natural fit, great partnership opportunities exist outside the hospitality sector. An excellent example is Nike. Their partnership with Spotify allows runners to create custom playlists using Spotify’s catalog of songs. Users can access the program through either the Nike+ Running app or the Spotify app, which is key to appealing to both brands’ key segments. To mark the launch of the new partnership in 2015, Spotify gave Nike+ users a free weeklong trial of its Premium tier.

Nike also partners with the mindfulness app, Headspace, to create audio-guided runs and holistic coaching tools. Both partnerships make sense for a brand that encourages runners and athletes to lace up their sneakers and “Just do it.”

Customer-centric partnerships

The partnership model allows brands to think holistically about what their customers need—even outside of established brand parameters and touchpoints. As customer expectations shift at an unprecedented rate, companies constantly ask, “what are our customers’ unmet needs?” and “how can we reward them at various points on their journey?”

It can also mean changing how you view your customers altogether. We helped our client, the mobile network Three UK, to think of its customers not merely as accounts, but rather as an audience. An audience, after all, is there to be engaged. And an engaged audience, whether on an app, loyalty or CRM program, provides brands the opportunity to talk to and build more meaningful interactions with their customers.

After helping Three UK develop Wuntu—the first iteration of its offers and rewards platform exclusively for customers—we set about creating the right strategic partnership ecosystem, which was key to the customer experience.

Another successful partnership example with Three was its desire to build awareness for its Go Roam feature, which allows customers to use their plan in over 70 destinations around the world at no extra cost. Because this feature is most valuable to customers who travel frequently outside the UK, they partnered with well-known UK low-cost carrier easyJet.

The joint Hands Free partnership gives Go Roam users free checked bags and priority boarding. Because both companies knew that they wanted to get their brand in front of young weekend travelers, the partnership allows each company to push different elements of their value proposition to these potential new customers.

Expanding your brand’s influence

This particular partnership works so well because Three and easyJet have a shared purpose in making travel easy and affordable. The best potential partner for your loyalty program is a company whose brand is complementary to your own.

Brand partnerships create new marketing opportunities to expand your brand’s influence beyond the typical touch points. Each partner gets to make its case to the other’s customers.

For customers, their participation is recognized by both partners and they get additional if not double the benefits. A loyalty partnership that becomes a reason for the customer to choose both brands more often is how we define success.

For more insight and information about driving customer loyalty through partnership, experience, and emotion, tune into our on-demand webinar featuring Hilton and Forrester Research Inc.

ICF’s global marketing services agency focuses on helping your organization find opportunity in disruption.
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