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Reinventing the Customer-Brand Relationship

Creepy. That’s how two-thirds of US consumers describe many brand interactions today. The use of cookie tracking to retarget digital ads, the lack of transparency about how customer data is used and sold, the faceless algorithms that drive messaging have combined to damage the customer-brand relationship and make customers question whether they should be loyal to brands.

Winning customer loyalty in this environment means brands must engage customers as partners in a mutually rewarding relationship. The data speaks for itself: 79% of consumers would rather brands spend less time sending them ads on Facebook and focus more on winning their loyalty.

Reach CEO and customer loyalty veteran Mike Ribero sat down with Cheetah Digital CMO Richard Jones and discussed how brands can build a new kind of customer relationship.

In an age where consumers place premium value on data privacy yet still want personal connection with brands, Mike explains how brands can reinvent their relationship with their customers, moving beyond the loyalty program model, which has changed little in decades.

How Technology Muddles Brand-Consumer Relationships

The robust economic growth after the 2008 recession paved the way for the rise of marketing technology. But marketers became so enamored with martech, they became complacent and failed to nurture direct customer relationships. Mike puts in perspective how a customer’s mind works this way:

“The thing consumers want most from brands is human contact. The last thing they want is to talk to an automated attendant.”

With so much technology sitting between the consumer and the brand, the personal connection between the two has been forsaken to a certain extent. This ran counter to the original design and intent of customer loyalty programs, which is to “facilitate and build” these connections.

Martech: Winning Customer Loyalty or Disrupting Privacy?

Personalization is crucial to earning customer loyalty and building lasting, fruitful relationships with customers. Equipped with the latest martech, brands are able to personalize and reach out to customers on a deeper level.

However, because of technology, brands became more invasive. Thus, they aren’t winning customer loyalty anymore. They risk hurting their relationships with their customers.

“In most cases, brands are using consumer data unbeknownst to consumers, and how that data is being used is also unknown to them.

The thing is, many brands have thrown consumer privacy out the window to power up their marketing strategies. It’s a delicate balance for brands; being able to personalize and provide consumers relevant, positive experiences, while making sure they are not overstepping boundaries when it comes to consumer data. Of the latter, most brands fail.

Rebuilding Loyalty in a World Without Cookies

In response to the call for intensified data privacy and security measures for consumers, Google has announced the discontinuation of third-party cookies.

Third-party cookies have been instrumental to many marketing successes and Google stopping its use will mean tremendous difficulty for marketers, advertisers, and brands to effectively deliver personalized services to their consumers.

“How are you going to incentivize consumers to connect with you as a brand?” Richard asked Mike. “How do you think this is going to escalate now?”

For Mike, the answer rests on two things – building and strengthening brand-consumer relations by connecting to people on a deeper, personal level and applying a reinvented loyalty model.

“Yes, brands are going to build better relationships with customers. But brands are not going to be successful doing it with existing loyalty standards.

Zeroing on The Customer

Traditional customer loyalty programs are monolithic, where rewards and experiences focus on a single brand, limiting the utility and value of the relationship. Brands are not winning customer loyalty with this strategy. This model won’t fly in a business landscape where consumers are now thinking, “What’s in it for me?”

“A value exchange can be a very productive way in driving the kind of behavior that brands need.” Mike emphasizes that modern consumers are now aware of the value and power of their data, thus brands must put their customers in charge of how they want to be rewarded. In addition to sharing data proactively, customers should also be incentivized for their actions.

“With today’s technology, consumers can do so much to add value to your brand–writing reviews, referring friends and family, becoming an advocate, or even an influencer on social media. All that can be harnessed. But it has to start from a really solid foundation.”

That solid foundation is going to be built on a value exchange where consumers feel they are getting what they believe is great value for their data.

Want to hear more from Mike and Richard and learn about how loyalty programs are shifting, as well as how the consumers themselves are now the key to better personalization? Listen to the whole episode here.


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