Companies are being urged not just to collect data from customers through loyalty schemes, but share it with them and even tell them how much they are selling it for, by one of the world’s leading experts in customer loyalty.
Grant Harrison addressing the Retail Marketing Summit this morning
Grant Harrison, CEO of The Future Customer, told the Mumbrella Retail Marketing Summit in Sydney this morning that business needed to break away from the idea that the data it collected should be hidden from customers.
“Coming to a new area this information is opening up a passion area for people,” said Harrison. “The way the use of data has been changing is in permission.”
Harrison, who created UK supermarket Tesco’s popular Clubcard loyalty program, cited the example of running and cycling app Strava which allowed its users to tap into each others data and use it to improve their own experience and turn the utility of a tracking app into information that helped to feed their passion.
“Strava has a trillion data points and making it totally transparent. It’s not just your data its everyone’s data,” he said.
“Changing the culture within the business. If we are working this way in the end its is going to be a benefit for the customers. We are going to be seeing total transparency and thinking and more and more about being absolutely happy with what customers are seeing.”
Asked about the way in which Australia’s supermarkets were collecting and using data, he warned there needed to be a sea change in the way they thought and operated – even down to consumers being told how much their data is being sold for.
“Instead of supermarkets holding on to the stuff because they think its really valuable and screwing the suppliers … we have to be more open with the data,” he said.
Ultimately, Harrison said that brands need to move they way they thought about customers from merely being a functional utility – something bought and used – to one of passion where brands can tap into why people are using their products and build a direct relationship.
“The passion loop is a mix of the utility of rational benefits plus increasingly the passion side of it,” he said.
Harrison said one of the keys to making loyalty a success was not to use it to offer discounts – the dead end he accuses Marks & Spencer of going down with the launch of its loyalty scheme – but to use it for customers to connect to each other to create a community.
“Marks and Sparks is just paint by numbers loyalty,” he said.
He said it was creating a “Kudos Economy” where passion was fueled by people praising each other through apps like Strava and on LinkedIn.
“This idea of a kudos economy, and LinkedIn, is a fantastic example kudos is a new loyalty currency that works,” he said.