麦肯锡－案例库Design a low risk rewards program.pptVIP

SUMMARY Can create significant benefits through introduction of a rewards programme Usage Retention Support of targeted retention programmes Countering competitive threat But reward programmes can also easily lose money Insufficient change in customer behaviour Over-ambitious and expensive programme design Uncertainty over value created Major risks can be mitigated by following a conservative design and rollout approach BACKGROUND Duopolistic mobile telecoms providers Growth in contract customers stagnating Losing market share in prepaid customers Churn rates of 2-3%/month and rising Estimated value of 25% churn reduction would contribute an additional 8% to EBIT p.a. (steady state) PROJECT APPROACH 3 KEY QUESTIONS 1. 2. 3. UNDERLYING ANALYSES 1 700 face-to-face mobile telecom customer interviews (weighted by value and type of contract) Key questions on: Interest in reward programmes Preference for type of reward and redemption frequency 3 KEY QUESTIONS 1. 2. 3. WELL-DESIGNED LOYALTY PROGRAMMES CAN LEAD TO SIGNIFICANT IMPROVEMENTS IN USAGE AND CHURN UP TO 60% OF HIGH VALUE CUSTOMERS ARE INTERESTED IN REWARDS PROGRAMME MOBILE TELECOM PROVIDER SURVEY A REWARDS PROGRAMME CAN COMPLEMENT OTHER CRM INITIATIVES VERY WELL A REWARDS PROGRAMME ALSO PROVIDES THE MOST PRACTICAL COUNTER MEASURE TO A REWARDS PROGRAMME LAUNCH BY A COMPETITOR 3 KEY QUESTIONS 1. 2. 3. SEVEN KEY DESIGN PRINCIPLES 1. APPLY THE BASIC ‘RULES OF THUMB’ Rule 2. MAKE REWARDS ALIGN ACCURATELY WITH VALUED CUSTOMER PREFERENCES Customer research feedback (mobile telecom operator) 3. ENSURE EARNINGS STRUCTURE IS LINKED ‘BEYOND DOUBT’ TO CHANGES IN CUSTOMER BEHAVIOUR ONLY A VERY SMALL PERCENTAGE OF CUSTOMERS WILL BE ABLE TO REDEEM BASE POINTS FOR HIGH VALUE REWARDS CUSTOMERS THAT PARTICIPATE IN THE BONUS PROGRAMMES WILL EARN POINTS MORE QUICKLY BONUS POINTS CAN ALSO BE USED TO STIMULATE CUSTOMER BEHAVIOUR DIRECTLY IN OTHER WAYS ‘Sign on a friend’ Speed up penetration of new technology (e.g.