NYU Panelists: Loyalty Starts With Basics

NEW YORK — Customer loyalty is not necessarily about points or programs, though it can include them, but starts with adhering to marketing fundamentals, panelists said at a direct marketing discussion yesterday at New York University.

The panel discussion, “Connecting With Customers: How to Increase Loyalty in a Turbulent Economy,” was the fifth semiannual “Dialogue on the Future of Marketing” sponsored by NYU's Center for Direct and Interactive Marketing.

“There is a lot of discussion about customers being less loyal. They're not less loyal. They have more choices,” said Michele Bartram, chief Web officer and vice president for e-commerce, Brylane Inc.

After the dot-com bubble burst, many marketers breathed a sigh of relief and said “phew, now we can go back to business as usual,” she said. “But what they forgot is that their customers are not customers as usual.”

Bartram cited a study released in September by Arbitron Inc. in which one out of five U.S. consumers said the Internet was the most essential medium in their lives. In the study, 46 percent of 12- to 34-year-olds chose the Internet as the most “cool and exciting” medium. These are vocal consumers who communicate with one another, she said.

“If you don't get your basics right, they will know about it, and they will talk about it,” she said. “Today, customers vote with their voices as well as their feet.”

As to the often-debated topic of whether consumers want the so-called relationships marketers covet with them, Jordan Rednor, president of marketing consultancy Rednor Group LTD, said, “Yes, they want relationships, but they're so inundated with junk mail, whether it's spam or paper, they want targeted messages.”

Rednor is also former president/chief operating officer of DraftWorldwide, Chicago.

To determine current marketing trends, he said, it helps to look back — in this instance, to the dot-com boom, or what he called cybermania.

“A lot of basic marketing tenets were not being practiced with Web marketing [at the height of the boom in 1999],” Rednor said. “There was no ROI in a lot of projects people were getting involved in.”

With the growing popularity of cable and the Internet, “the audience wasn't just fragmenting in terms of what they were watching, their loyalties were fragmenting,” he said. Meanwhile, marketers were sinking money into questionable “customer relationship management” programs and into buying impressions rather than “demand generation,” he said.

Marketers “after the bubble” should focus on targeting their ad messages and on marketing basics, he said. “If we do that well, we create demand generation, which in turn creates sales.”

As for whether to start a loyalty program, panelists recommended talking with customers first.

“People are going to use your product in ways you didn't foresee,” said Gareb Shamus, chairman/CEO of comic book and action figure marketing firm Wizard Entertainment Group, New York. “Find out what your customers need from you. If you don't know, don't start a loyalty program.”

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