Serving People Serving Coffee Since 2005
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IN THE MOVIE The Godfather , Don Vito Corleone asks the head of another family, "Do I have your loyalty?" Is he asking whether the man feels an allegiance, a compulsion to support Corleone's initiatives? Or is Corleone merely reminding the capo that he has no choice, and that the consequences of breaking with the Corleone family would far outweigh the potential benefi ts an alliance with another family? What does loyalty mean in the context of retail and hospitality to- day? Do today's loyalty programs encourage customers to embrace a single brand and pretend as if there aren't other options out there? Do loyalty programs promote canine-like dedication to a favorite shop or brand? Or are the mechanisms in the marketplace to promote loyalty just rewards programs that incentivize purchasing without strengthen- ing the relationship between a customer and your business? Nearly all modern loyalty programs fi nd their roots in gamifi cation, the concept of creating a set of rules by which points are awarded for transactions between a customer and a business, which stretch- es back to S&H; Green Stamps and other programs like it. Buying a cup of coffee? Allow us to punch another hole in your coffee club card. Have you been here 11 times this month? You advance to the next round of Muffi n Monopoly! Donate another pint of blood plasma and you get this T-shirt. We at Science hit the streets (and the Web, and the phone book) and looked into several of these programs, with an interest in how they differentiated themselves from one another, as well as how they responded to our most important question: Does it work with a fl ip phone? Several new apps and services, including fl ok, Spring Rewards, and LevelUp, are making inroads with specialty-coffee retailers, and each provides a unique take on customer engagement. They're all digital, and obviate the need for those plastic cards fi lling our wallets, or their mini-counterparts festooning our key chains. Each, however, has a unique take on how they interface with both the merchant (you) and the customer. FLOK One digital loyalty and engagement program fi nding its way into the market and onto customers' phones is fl ok (yep, no caps). Founded by a pair of Israeli entrepreneurs in 2011, fl ok has expanded its reach to approximately 100,000 businesses and their customers. In some respects, fl ok takes the place of the traditional "punch card" many of us may still have in our wallets. Each visit to a partic- ipating merchant gives the customer an opportunity to use the fl ok app on her phone and to gain another punch. The merchant decides on the incentive—whether it's a free cup of coffee, cool merchan- dise (imagine, customers visiting multiple times to win a T-shirt that advertises your brand to other potential customers), or some other reason to visit your shop. In addition to tiered pricing plans that allow merchants to scale their reach according to the success of the program, fl ok offers a few other features that are very friendly to the independent coffee- house. Beacons—little Bluetooth transmitters that trigger messaging to the mobile devices of any customer with the fl ok app—are pro- vided to merchants, therefore automating customer check-ins when they enter the shop. Also, fl ok's merchant signup process is not only simple, but also integrates well with social media channels such as the merchant's Facebook page, instantly personalizing and promot- ing your new program to followers and passersby. Once a customer has added a business as a "club," fl ok offers var- ious methods to reach those customers, including automated emails and more, depending on the pricing tier the merchant chooses. Can a customer with a fl ip phone use your product? "Any customer can sign up with their email, but to enjoy the full ca- pabilities of the fl ok platform, the customer will need a smartphone." LEVELUP LevelUp is quite possibly the best-known of the digital loyalty programs. Backed by $60 million in investments, and with a strong foothold in approximately 14,000 restaurants, the Boston-based company has differentiated itself through a broad national reach, integration with as many as 70 different POS solutions, and, perhaps most importantly, a very cool little white cube that sits on the counter at the point-of-sale and lights up every time a customer displays her mobile device's LevelUp app and QR code. An easy feature to overlook is the fact that LevelUp customers associate a credit card with their LevelUp user profi les, so that when a LevelUp customer swipes the app in front of the cube, he is actually paying with a credit card, but not fumbling through a wallet for it. Naturally, one might ask whether such a transaction is secure. Mimi Alperovich, LevelUp's director of emerging brand sales, offers a reasonably comforting response to this concern. "Paying with a LevelUp-powered app is more secure than swiping a credit card because none of the information is stored, and phones and apps are easily locked," Mimi tells us. "LevelUp takes security very seriously, and customer information is transmitted by SSL directly to a secure electronic vault. At no time is the credit-card information stored on LevelUp servers." Loyalty Programs Explained By Andy Freivogel L lt P E l i d 68 barista magazine