Monthly Archives: February 2021

Designing an Effective Fuel Retail Loyalty Program

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When it comes to garnering customer loyalty, Oil and Gas Retail companies face unique challenges. For one, fuel prices are highly regulated by the government and fluctuate with changes in the global crude oil prices, and so profit margins on fuel sales are slim when compared to other sectors. Interestingly, fuel retailers typically see profitability decrease as prices rise, and increase when prices fall, due to the volatility in the wholesale price of gasoline and the competitive structure of the market (according to the Association For Convenience & Fuel Retailing).

 

The Need for Diversification and Differentiation

Fuel retailers are also challenged by growing concerns of consumer impact on the environment and climate change across the world, and unfortunately, fuel-guzzling vehicles are viewed as a step in the opposite direction of progress. In February of this year, BP (formerly The British Petroleum Company) announced a new purpose – ‘to reimagine energy for people and the planet’ – supported by a new ambition to be a net-zero company by 2050 or sooner. BP isn’t the only brand coming to terms with the world’s diminishing carbon budget. Shell, one of the largest multinational Oil and Gas companies, is reinventing itself as an international energy company that aims to meet the world’s growing need for cleaner energy solutions, in ways that are ‘economically, environmentally and socially responsible.

 

Customers today crave personalized, convenient and emotion-fuelled (pun intended) experiences, and fuel retail brands that haven’t differentiated themselves in these aspects will find customers returning only for consistently low prices—not a great revenue strategy in the long term.

 

So how can fuel retail brands future-proof their business during unpredictable times? Firstly, brands must drive non-fuel retail sales from in-store food, beverages and more, and drive additional vehicle services, all of which can yield a much higher profit margin than fuel sales. For instance – on an average day, Shell serves customers on nine different shopping missions, seven of which are not associated with fuels. Secondly, if we are to take examples from leading brands like Shell and BP, fuel brands must have one finger on the consumer’s pulse, and make business decisions that keep in line with expectations.

 

We believe that an intelligent loyalty and customer engagement strategy have enormous potential to transform a fuel retail brand. Here are some key strategies and insights on how fuel and oil companies can implement a consumer-centric, future-proof loyalty program.

 

Best Practises For Designing a Fuel Retail Loyalty Programs

  • Be Accessible for the entire Spectrum of Customers 

Fuel stations are frequented by a diverse segment of customers – from time-crunched businessmen to unhurried grandpas. Keeping your loyalty program attractive to these diverse personas of customers is key to the success of your program. An omnichannel loyalty program allows you to do that. These programs facilitate an omnichannel engagement strategy by unifying customer data across multiple channels and building a Single View of Customer.

 

However engagement is only one part of your omnichannel strategy, the other is accessibility. By enabling digital cards and social media integrations, your loyalty program is always available from the mobile app. To state the obvious, this is a huge boon today since most people always have their phones, even if they forget their loyalty card. At the same time, brands should also enable customers to access the loyalty program using physical cards or key fobs, with support through channels like call centers, since less tech-savvy customers often prefer a human connection.

 

  • Offering Personalized Rewards for Each Customer Segments

Implement loyalty elements that go beyond simple discounts or points that blanket-target all customers. By understanding the psychology of various customer segments,  fuel retail brands can analyze customer behavior, and segment them based on their individual preferences, interests and missions, and finally reward them highly personalized, experiential rewards.

 

For this, it’s vital for brands to identify and understand customer mission and purchase patterns. Is the visiting customer an individual user, or part of a fleet service? Is he a high-frequency customer or a sporadic one? Will they be more inclined towards a free beverage as a reward or discounts on future refuels.

 

Rewards and engagement must be customized based on the desired behaviors from different customer segments, engagement varying with their location, age group, life-events (birthdays, anniversaries), and more. For example:

 

  • A driver fitting the ‘parent’ profile refuels their vehicle. Brands can trigger instant offers via bill, SMS or the app, like a limited-period discount on a popular snack for kids from partner stores.
  • For high-spending customers, or those fitting a ‘business’ profile, brands can upsell with higher-grade fuel, or higher-priced products with greater margins. For high-frequency customers, brands can offer a free service or product (like a car wash or a coffee in-store) after ‘x’ visits per month. Some brands offer greater savings with a higher loyalty tier. Shell Fuel Rewards has two tiers: Silver Status, which saves 3 cents per gallon on fuel purchases, and Gold Status, which saves you 5 cents per gallon. The disclaimer is that to maintain Gold Status, customers need to fill up six times with at least 5 gallons every three months.
    • Utilize concepts like gamification for fuel rewards programs to grant rewards to drivers who reach fun milestones. Offer scratch-and-win games for discounts on partnering brands or Non-Fuel Retail products. Double loyalty points for those who manage to stop at a round figure while refilling. Create in-app games during festive seasons that gift drivers free or discounted vehicle services. The American fuel retail brand Speedway offers exciting Speedy Rewards Sweepstakes running each month. It offered loyalty perks for fuel customers who could redeem their loyalty points for chances to win the Sweepstakes— 50 points grants them entry to win a $500 Speedy gift card, and customers can apply multiple times to increase their chances of winning.As a matter of hygiene, always track and analyze campaigns to understand their success and redemption rates.

      • Optimizing Service Times by Integrating Loyalty & Contactless Payments

      With on-the-go drivers sensitive to staying on schedule, the key to delighting customers is providing services that are timely. This can be accomplished by a fast, streamlined and convenient transaction and refueling experience.

      The ideal time taken for refueling a vehicle should not be more than 3 minutes. Digital technologies such as cashless payments help reduce valuable customer time while increasing transaction security and are already in steady use across the world.

      Repsol Mas (a Spanish fuel retail brand) offers a digital wallet and universal payment app that lets consumers pay by phone, earn points and save during transactions— all from a single app.

      As we enter a post-pandemic world, contactless transactions will continue to be popular with a wide audience. Fuel brands can introduce QR code scanning for payments, or prepaid wallets linked to their mobile app, both of which will save drivers valuable time.

      Fuel Retail brands like China National Petroleum Corporation (CNPC) have enabled “smart fuelling stations” which enables customers to fuel their vehicles without stepping out. CNPC claims that smart fuelling has cut down fueling time from six minutes to approximately two minutes.

      Fuel Retail Brands can further reduce customer time by enabling pre-booking services or meals through their mobile phone app.

      • Leveraging & Optimizing Fleet Loyalty

         

      A fleet Loyalty Program is a card management system through which a fuel retail brand offers a credit line and rewards for businesses with a fleet of vehicles. As an example, consider a cab service company leveraging a fleet loyalty program from a specific fuel retail brand. Not only does the program provide a convenient, quick mode of payment for fuel purchases for all drivers belonging to the cab service company, it also assures a steady stream of business for the fuel retail brand.

      While the program offers the cab service business fuel on credit by using the cards, it also rewards the loyal customers (either individual drivers or the business itself) for their spending.

      • Advanced Geolocation based Hyperpersonalization

      Based on advanced geolocation and beacons, fuel retail brands can trigger personalized offers to make people aware of fuel stations and stores near them. This is a great way to beat competing brands in a specific service area with a proactive approach, which can help shift customer behavior in your favor. However, brands must take care to not trigger communication intrusively—that will be the highway to losing customers.

      An alternative to the proactive approach is to enable customers to find the right offers and stores through your app when they require it.

      Exxonmobil has enabled a Speedpass+ loyalty app that also allows customers to search for nearby Exxon and Mobil stations, and pay for gas right from their phone using Samsung Pay, Apple Pay and other methods.

      Summary

      As consumer demands and trends change, fuel retailers need to fundamentally transform their approach to customer loyalty. They need to move towards a customer-centric business model to capture new product and service opportunities and incorporate digital tools and technologies to elevate the overall customer experience. The innovative ways in which they can achieve this will be the mark of their success.

Deepen Customer Loyalty with Mobile App Gamification

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The human mind loves games.

 

Around us, from millennials playing CandyCrush for hours on social media to gamblers losing all their money in casinos, there are plenty of examples of how games can be addicting. In fact, gaming is the most popular habit of the digital age. A report by Statista that there are over 1,651.66 million active mobile gamers worldwide as of 2020, and this number is expected to rise to 2,220.8 million by 2025. Even while looking at apps on the Apple App Store categories in 2020, 21.86% of apps belong to the gaming category, followed by business, which is only 10.11%.

 

So it does not come as a surprise that businesses across industries have been borrowing game strategies for marketing and motivating customer behavior with game elements like badges, scoreboards, points, levels, and more. Gamification can be used to cultivate high engagement with existing customers, and even attract potential customers. Take the example of Autodesk, a leader in 3D design and engineering software, that tested gamification concepts in their software. Using an intriguing storyline and a variable reward system, they incentivized users to finish the trial and learn how to use the software. They found that using gamification in customer engagement strategies resulted in a 54% increase in trial usage, and a 15% increase in buy clicks.

 

How To Gamify Your App To Deepen Loyalty

 

 

Before using gamification to enhance engagement, brands must understand the two types of motivation that make people take action: extrinsic and intrinsic.

 

Extrinsic motivators are tangible, like offering monetary credits, discounts, or freebies. Intrinsic motivation relies more on emotions and desires. Extrinsic motivators are more commonly found in marketing strategies, partly because they are extremely effective in attracting new customers and triggering initial adoption. However, they can lose effectiveness over time.

 

Extrinsic motivations like points and discounts are easily replicated or out-done by competition, but to create sustainable engagement, intrinsic motivation is essential.

 

One way to better understand Intrinsic motivators is by using the Self Determination Theory, a universal concept that claims three factors create emotional motivation: autonomy, competence and relatedness.

 

  1. Autonomy: Consider ‘autonomy’ as the freedom of internal will. No one likes to be forced to do something. When a person is autonomously motivated, their performance, wellness, and engagement is heightened rather than if they were told what to do
  2. Competence: Competence is the motivation to control the outcome of a game and experience mastery
  3. Relatedness: This is the need to interact with others, be connected to, and experience caring for others. People who are primarily motivated by ‘relatedness’ will seek out communities or other individuals to share their experiences and progress with

 

With this knowledge, let’s dive into some game mechanics to implement in your mobile app:

 

  • Badges or Performance charts: It is important to have design elements in your app that complement your game’s objective. Badges are a visual representation of users’ achievements and can indicate their journey and performance within the app. Performance graphs show how the player performed in comparison with their previous results. These are intrinsic elements that can motivate users to grow their competency
  • Levels: Levels are implemented to create layers of complexity within the game, challenging the user to reach further. Reaching a new level is rewarding an earned proficiency
  • Scoreboards or Leaderboards:  Scoreboards and leaderboards rank the players of a game to define the best performing for every activity. Unlike performance charts that show the performance of one user within a certain time period, a scoreboard shows the performance in relation to the performance of others. They allow users to gauge their performance against peers, and this encourages competitiveness among users.
  • Community: Companies that share the same values with their customers can build a community that improves the member’s trust and sense of belonging. However, for companies to build a community, they must build emotionally relatable products.
  • Goods: In an app economy, users earn points to spend. The goods purchased with points can have real-world value, but digital goods that have no value outside of an app are also satisfying to users. For example, digital goods that allow the user to express their creativity, like allowing a user to change the color themes of the app or uploading a custom background.
  • Uncertainty: While most companies today are already using some form of reward systems in both customer and employee engagement strategies, not a lot of companies are adding the element of uncertainty to it. A recent study in neuroscience reveals that making rewards variable skyrockets our dopamine and supercharges attention stating that it’s not about pleasure from a reward but the anticipation of pleasure. Simply encouraging consumers to engage with an app in return for standard points is a dull game.
  • Challenges and achievements: Challenges are generally represented by goals. Users like to feel like they have a mission when using an app. Achievements are proof of completing a challenge. Digital badges or trophies don’t have monetary value but are effective when shared via social media.
  • Gifting: Gifting is a prodigious game mechanic that can be applied to almost any sort of app. Being able to send a digital gift, such as points you’ve earned, encourages a relationship between the giver and the receiver, and pulls the receiver into the app to redeem the gift.

 

Brands can learn more about what incentivizes consumers by understanding their behavior to extrinsic and intrinsic motivators. Understanding customers’ behavior and inclination to specific game mechanics can be better understood using A/B tests; for example, understanding a customer’s motivation by offering the choice between a Discount versus a Spin-The-Wheel chance to win event tickets.

 

The fascinating study of games on our psychology shows that there are multiple reasons why people are addicted to games.

 

  • An element of self-determination. Games allow the user to take control of their journey
  • An element of curiosity. A good game will motivate the user with curiosity. The user will keep moving forward and engaging with the game
  • An element of competition. Humans are social creatures and are often driven by competition. Games that offer interaction and competition with other players motivate users to master the game.

 

In this article, we will explore how brands can deepen customer loyalty by enhancing gamification on their mobile apps. Our focus on mobile apps stems from the fact that more than 50% of online purchases today are happening on a mobile device. 

 

An increasing number of brands are rightly taking a mobile-first approach to loyalty programs— that is, starting product design from the real-estate restricted mobile interface, before expanding features to tablet and desktop versions. Growing engagement on mobile apps is often a direct indicator of revenue, and the time users spend on the app has a direct correlation to the bottom line.

 

Examples Of Mobile App Gamification

 

Zamzee

Zamzee Kids uses an activity tracker to track kid’s steps and health, with a fun website to get people motivated to move more. Zamzee’s ingenious solution – a portable accelerometer and matching gamified social online system – is getting otherwise sedentary kids to exercise the equivalent of an incremental marathon per month. Zamzee does this by offering patently extrinsic rewards (points, badges, leaderboards, free stuff) that feed a core intrinsic desire: every kid’s craving for agency and self-determination – not necessarily the drive to be fit.

 

Goibibo

Goibibo has gamified their app with India’s evergreen love: Cricket. The app introduced goCashFest, where users can earn GoCash by keeping their Goibibo app open during all Mumbai Indians matches. By using the app while the team plays, users win GoCash for each 4s, 6s, 50, 100, wickets, and wins during the match. This goCash is valid until the next Mumbai Indians match and can be used to make bookings on Goibibo.

 

Bakmi GM

Bakmi GM* is a marquee fast food chain that serves over 30,000 customers per day in Indonesia. Bakmi GM built a microsite and a mobile app that uses gamification to obtain enriched customer data. In return for completing their profile information, customers/users receive a chance to #SpinTheWheel and win gifts, cashbacks, or offers in exchange from the brand. Strategies like this allow brands to drive greater personalization and create more meaningful micro-segments of customers based on product affinity, billing history, profile information, etc. In addition, Bakmi also has a rich rewards catalog available on the mobile app, allowing customers to easily select their rewards.

 

*Capillary is proud to partner with Bakmi GM for this initiative.

 

Starbucks

The coffee chain has done an excellent job of keeping customers engaged with challenges and achievements. They use challenges like getting customers to check-in at different retail stores in order to unlock an achievement. The loyalty app sends customers push notifications when they’re close to reaching the next tier of the program. By using reminders like “you’re only two coffees away from a free muffin this week”, Starbucks encourages customer engagement with a subtle sense of urgency.

 

Candy Crush

Candy Crush offers customers the capability to share their loyalty status and “achievement badges” on social media, which led to heightened awareness about the game and leading to its massive popularity. One of the key contributors to the success of Candy Crush was the free social media promotion the game experienced through existing players posting their scores. Retail brands can use similar strategies like photo competitions, offering rewards, or unlocking discounts when customers share their love on social media.

 

Wrap Up

 

Mobile gamification can efficiently improve stickiness, and repeated engagement by creating different challenges to encourage different consumer behaviors. Trends in brand loyalty and customer retention are constantly evolving and advancing — yet the history of games and its close ties with human psychology makes it clear that ‘gamification’ is more than a buzzword. It is here to stay.

Channel the Power of Communication

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With every brand trying to sell you something, it’s no surprise that the Internet is chock full of content and marketing messages.

 

But which messages or ads do you really remember?

 

If you spend some time thinking about it, you’ll notice that it’s usually something that you connected with at a personal or emotional level.

 

Unfortunately, very few brands have mastered this art. Here are a few examples that became popular because of effective communication that people could connect to.

 

Burger King’s Day Without Whopper campaign to support McDonald’s Children with Cancer Day promotion appealed to the emotional senses of the people. This helped Burger King gain a lot of publicity where they focused on being a humane brand rather than sales.

 

Dove’s  “Real Beauty Sketches” Campaign created an empowering ad for women to look beyond their perception of themselves. The focus of this ad was not to sell the product but to make women feel great about their looks. It was so powerful that women connected with the brand at an emotional level.

 

Communication, if done in the right way, can spark revolutions, break cultural barriers, prevent wars, and inspire millions.

 

At Capillary, we believe effective communication is the key to building long term brand-customer relationships. To this effect, we have released multiple features this month to help you communicate effectively with your customers and increase conversions.

 

 

Capillary has always focused on providing the right platform for brands to effectively communicate through the channels that strike a chord with their audience. After the recent enhancements to LINE, we have now added Viber as a communication channel within Engage+. Viber enables brands to interact with customers in a secure way using messages and stickers.

 

Viber is a cross-platform voice over IP (VoIP) and instant messaging (IM) app used by more than 1 billion users worldwide. Marketers can easily form one to one connections with their customers (especially millennials and Gen-Z) by making the conversations more personal and creative, leading to high engagement rates.

 

It is immensely popular in Russia, the Philippines, Vietnam, etc. The low-cost acquisition model that is priced less than the traditional SMS makes it a great channel for businesses to go after while engaging the audience with rich content.

 

 

Understanding a friend better will require us to know their personal details, likes, dislikes, interests, etc. The same approach works for businesses as well. And hence the need to capture data from customer activities, touchpoints and brand interactions. This helps them to know their customers better and personalize their communication to make it more effective. The brands can form relationships with their customers at a personal level by leveraging this data in a secure way.

 

Capillary has added a new feature of creating and adding custom labels to customer communications based on their interactions with your brand. It goes beyond standard message customization labels by adding custom labels using the data captured and shared with Capillary. It will enable you to personalize and make every customer conversation relevant inline with their shopping experience.

 

Use Cases

 

  • Brand Y can send a personalized message to all customers who have clicked on Notify Me for the Out Of Stock products. The message can contain the specific product item they had shown interest in with a link to complete the purchase journey.
  • Brand X can create a custom label for customers who wishlisted a specific product online. This label can be used to personalize communication with an irresistible offer to encourage them to make the purchase.Communication, as we know, is essential in every area of the organization – to build loyal customers and motivate employees to work better and achieve the organizational goals.We have added new features within the Storemax app that are tailored to each store employee to showcase their performance and encourage them to sell more with engaging games.Gamification – An achievement-based badges game can be used to award different badges to the store employees based on their performance within a specified time such as 30 days. The movement from one badge to another keeps the staff engaged and motivated.Leaderboard – A rank-based list is another addition to elevate employee productivity and automate their rewards and recognition. The leaderboard displays each employee’s sale numbers, keeping the ones who have made the highest sale at the top to promote healthy competition between staff.Reporting – The reports app within Storemax app has been enhanced to view the progress by each store for a specified duration of time – day, week, or month. This enables marketers to understand the busiest days of the week based on the data and make key business decisions to allocate the right staff and provide a great experience to the shoppers.

    Conclusion

    A very few things can match the sheer transformative power of communication. Marketers are the brand’s flag-bearers to promote the products/services with not just push selling but getting into a customer’s shoes to understand their feelings and emotions. Remember, conversations win the hearts, mere content does not.