The Triangle of Win

A classic example of Access Pricing - one of the most cost-effective tools in a loyalty marketer’s toolkit - offering a benefit only to selected, profitable, loyal customers.

by Brian Woolf (March 6, 2008)
 

You deserve a break away!

This paraphrasing of McDonald’s jingle (of almost four decades ago!) rang the doorbell to my memory while on a recent trip to Europe. As a perpetual student of how to use differentiation to strengthen a retailer’s brand, I was delighted to discover a creative loyalty builder, one that has been working successfully since the start of the century.

The concept is simple: a retailer offers qualified customers the opportunity to Take a Break Away at an Every Day Low Price (one lower than those offered by the well-known web hotel price discounters). It’s a classic example of Access Pricing, one of the most cost-effective tools in a loyalty marketer’s toolkit - offering a benefit only to selected (ie, profitable, loyal) customers.

In fact, the only cost to the retailer, I discovered, is promoting the Break Away. The behind-the-scenes, low-key program provider, Loyaltybuild, negotiates the volume supply of rooms from hotels and motels and operates the room-booking platform. The booking fee it charges the hotels and motels covers its costs and profit requirements.

It struck me as the Triangle of Win because:

1. The customer wins by taking a Break Away at a lower-than-regularly-available price,
    
2. The retailer wins because this sector-exclusive offering in its own name builds both customer and brand loyalty, and
    
3. The hotels and motels win by increasing their occupancy rates and contribution to profits.

And the program is not just for retailers. An insurance company offers the program as a nice thank you reward to its customers. I could imagine banks seeking to strengthen customer ties doing likewise.

Like Tesco’s clever but accurate understatement, Every little helps, this program, too, serves as yet another arrow in a smart retailer’s quiver of differentiated loyalty builders. As we all know, it’s not just one differentiated benefit that builds customer loyalty, it’s the combination of benefits, all easy-to-understand and executed well. You deserve a break away captured my imagination and fills that requirement.

About the author...

Brian Woolf is a global leader in loyalty marketing. In addition to writing three definitive works on the subject, Measured Marketing: A Tool to Shape Food Store Strategy, Customer Specific Marketing, and Loyalty Marketing: The Second Act, he spends his time helping retailers develop and strengthen their loyalty programs.

The techniques and metrics he has developed have become guiding principles for those operating some of the world’s most successful programs. He is the President of the Retail Strategy Center, and is a frequent speaker at conferences in the US, Europe and Japan.

Prior to his total commitment to loyalty marketing, his corporate roles included Deputy Managing Director of Progressive Enterprises, a major New Zealand retailer; Chief Financial Officer of Food Lion, a leading US food retailer; and President of One Price Clothing, a women's discount apparel chain. He has an M.Com. (Economics) from Auckland University, New Zealand, and an MBA from the Harvard Business School.

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