Janet Kraus
Sept., 2005

Most business and marketing leaders agree that a critical attribute of a great brand is its ability to tap into the emotions of consumers. The question most ask, however, is how do you create these emotional bonds?

The answer, in a word, is experiences. Because every interaction you have with a company impacts your perception of that brand, the opportunity for brand building is to capitalize on every one of these interactions --- thinking of them not as mere customer contact points, but rather as opportunities to deliver truly meaningful experiences.

Some companies have been promoting “the experience” as a core part of their value proposition for years (think Starbucks, BMW, Walt Disney, Harley Davidson); others are just now beginning to harness the power of experiential marketing. For instance, this past holiday shopping season Saks Fifth Avenue launched its first ever RSVP Reward Packages – a collection of eleven unforgettable experiences that could be purchased only with SAKSFIRST points. Offered exclusively to Saks’ most loyal customers, the program provided once in a lifetime opportunities that included VIP treatment at the Cannes Film Festival, Haute Couture Week in Paris, a personal “Wardrobe Revival,” and a holiday weekend in New York, complete with a behind the scenes look at the acclaimed Saks Fifth Avenue holiday windows.

In an attempt to differentiate and enhance their customer loyalty programs, a growing number of companies are joining Saks in incorporating experiences into their redemption portfolios. Research has shown that customers have grown bored with the sameness of loyalty programs. What ignites their emotions (and loyalty) are awards that appeal to their dreams and desires: a sunset hot air balloon ride, VIP treatment at an exclusive fashion show, the opportunity to drive a NASCAR-style stock car, or, in some cases, creating their own “personalized” rewards such as hosting a lavish holiday party, complete with personal chef and clean up services – paid for entirely with points. Customers choose the rewards that are most meaningful to them, thereby promoting redemption and strengthening the bond between your customers and your company.

To successfully “experientialize” a loyalty program, it is critical to capitalize on your brand's strengths and assets, your partners' abilities, and knowledge of your customers' lifestyle needs. This is also where a partnership with a proven player in experiential marketing is vital.

Companies such as Circles, providers of experiences, concierge services and promotional programs, typically work behind-the-scenes, allowing leading brands to offer their customers an amazingly broad array of experiences. Because of the very personal nature of these interactions (e.g. helping to plan a unique wedding proposal, making arrangements for a very important business dinner, helping with family travel arrangements) virtually every one of them is an opportunity for that company to deliver a brand-enhancing experience.

But do these services truly create business value? The answer is a resounding yes! Some companies have seen over 30% increases in customer spend levels and up to 50% reduction in attrition levels for concierge users. In fact, in controlled tests some companies have even found that simply offering concierge services as a benefit drove increased spend levels of 10 – 20% even for those customers who never took advantage of the service.

Concierge and other loyalty solutions also offer incredibly powerful insight and information that can be used to drive a company’s one-to-one marketing efforts. Many interactions are so personal that they offer a great opportunity to gather customer information that can't be captured in any other way. Individual life stage information, hobbies and personal passions, important dates and personal influences, and business needs are all revealed during these interactions.

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Offering customers the ability to choose personalized experiential rewards provides opportunities to create meaningful and lasting memories. Each time the customer looks back on the experience, he will relive the emotion of the award and appreciate the company that gave it to him --- strengthening his bond with the company.

Janet Kraus is CEO of Boston-based Circles, a leading provider of experiential marketing services. Circles creates and delivers concierge services, events and experiences for some of the world’s leading brands. Janet can be reached at 617-622-6200; www.circles.com.