Diana Sinclair – A Loyalty Leader who believes 1% incremental optimisation of a loyalty program leads to long-term success

An interview by?Adam Posner?with Loyalty Leader –?Diana Sinclair, Senior Loyalty Manager?of My Dan’s Membership at Dan Murphy’s

This is the 35th interview in the series on Loyalty Leaders that I continue to have the pleasure and privilege of doing.

This one was motivated by a brilliant presentation Diana made at the 2023 Australian Loyalty Association conference where I heard her speak about 1% optimisation for loyalty program success.

Diana Sinclair is a Loyalty Leader with an extensive career (15+ years) across agency and client-side.

Today, Diana continues to provide an innovative mindset and a passion for incremental improvements of loyalty programs underpinned by the reality of driving retail sales.

Enjoy!

1. So, who is Diana (outside of work) + a little on your work biography

It's not been a straight journey into loyalty. I have 15 years’ experience in the customer marketing field, working across customer experience, loyalty, CRM and direct marketing back in the day.

I started my work-life in 2008 in Sydney where I was on client side working with Vodafone and Three Mobile in marketing, which was an interesting space.

And then I would say I got sidetracked by agency land. It looked really appetizing. In 2012, I leapt into agency land and worked for some powerhouse creative agencies like DDB, Clemenger and CHEP. That's where I had the opportunity to work with some great blue-chip clients like Mercedes Benz, AAMI and Telstra.

In 2019 and based in Melbourne, I decided to move back into client side working for T2 as CRM and loyalty manager.

And then for the last five years it's been Dan Murphy's, as? Senior Loyalty Manager leading the My Dan’s program. for the business

Personally, outside of work I’ve got a gorgeous family along with our 2 dogs - a Happy go lucky Greyhound and a Bossy Schnoodle…they make the perfect duo. Weekends are walking around? Richmond and Collingwood checking out the latest foodie place that’s opened, wine bar that’s hidden down a laneway or art gallery that has a show opening.

2. Tell us about the My Dan’s Membership program. Any stats you can share?

I'm most proud of how the My Dan’s Membership program over the last 5 years has gone from strength to strength based on a strategy around, as I call it - 1% optimisation. It’s like tinkering away on a car with a spanner rather than just buying a new one.

Back in 2019 My Dan’s had a lower than ideal scan rate of less than half where we are today. It was quite a stagnant program. We now see over 80% of members scanning? whether by card or mobile number or via our online channels, which to me is world class.

We have over 8 million members and 5.4 million of them are active members, spending on average almost twice as much as a non-member in every shop.

It's important to show the value the program brings. Incremental spend is still very relevant, however my advice is to consider it as an annual view. Alternatively, measuring the performance of the program based on a member versus a non-member metric provides a view of your engagement levels at any moment in-time. Plus, using engagement levels is easier to gain business advocacy and foster comradery around as all team members can understand and get behind this.

3. What is the most unique element of the program?

When we started the program back in 2015, we launched with member pricing and member exclusive offers. We only started with ten offers in the beginning and now have over a thousand products on offer in store and online. Back then it was quite innovative for its time. Since then we have continued to optimise the program with our offering - for example highlighting the value to the customer with? ‘Gold Tickets’ at the shelf showing member versus non-member price and that really changed that game.

We provide tangible and instant value.

We also offer events and experiences and can do this across our 270-store network.

4. If you had to choose the most important measures of success for your program, what would they be?

The most important measure of success for the My Dan's program is its ability to drive value for both the business and our members.

Metrics such as incremental sales, profitability, and a positive annual P&L are crucial indicators of success, ensuring the program's costs are justified by the benefits.

Equally important is the impact on Customer Lifetime Value, which reflects how well we nurture long-term relationships with our members, so we closely monitor member versus non-member behaviour and purchase patterns.

We also evaluate customer engagement through retention and acquisition rates, with feedback metrics such as Net Promoter Score (NPS) and customer sentiment.

5. What are some of the challenges you face on an ongoing basis to keep the program relevant/fresh/thriving (internally and externally) and how do you overcome these?

Specifically, I would say it's technology advancements. Our team is focussed on being on the front foot with technology to enable a better member experience.

Then it’s about understanding customer preferences and market trends and ensuring that we're continuously getting feedback from our customers. We have a Voice of Customer (VOC) eDM program sent to customers post-purchase. However, when you look at generational cohorts, our younger Gen Zs are not typically utilising the email channel which can create a disparate view of the VOC. The challenge here is making sure we understand the channels they engage with and show up there in an authentic way.

6. What advice would you give to brands thinking about a loyalty program?

1. When you're considering a loyalty program, you should first define the relationship you want with your customers and how a program can support that vision. If loyalty is the outcome you’re looking for, then what type of program supports this?
2. Strap in tight and be prepared to invest in the long game of a loyalty program. I think a lot of people say, let's build a loyalty program, without actually understanding the tasks that could be involved.

7. What do you think is creeping up on programs that could disrupt them for better or worse?

We spoke earlier about technological advancements and with that comes data management.

These developments offer an opportunity to better our systems, ensuring they align with the highest standards of customer care and strengthen our members' trust in our programs.

Programs that were set up on old legacy systems, when CDP’s were not? common practices, are prevalent in many of the loyalty programs of today.

So now, as loyalty leaders, we have an obligation to our customers to optimise our tech stack and data warehouses to be best in class with data maintenance, enablement and compliance.

This proactive approach will set us up for future success.

8. What’s the most underestimated force behind a program’s performance?

Your store teams are the powerful force behind the program.

For My Dan’s, our team members play a crucial role in advocating for the program with our customers and members. Their enthusiasm and support helps us achieve our KPI’s and they are always just so positive and helpful to members on anything and everything about the program.

9. What are your biggest frustrations with loyalty programs in general?

That has to be the ‘set and forget’ mentality when talking about your program to consumers. Plus the ‘one size fits all’ approach.

Audience segmentation plays a key role here to understand that not everyone wants the same things from your loyalty program. For example, a younger demographic prefers a digital approach with Apps & Digital Wallets, so ask yourself “are you addressing your Loyalty Programs member experience through the lens of all your demographics?”.

We use audience segmentation in our creative approach. In our case, it means relevant lifestyle imagery is served to our younger generations and the older demographics are served creative that features more product lifestyle imagery.

10.? What are three most important skills a loyalty program marketer needs?

Good Question!

1. Influential leadership skills - the ability to drive influence of ‘loyalty’ within your business and with executives. If you can’t influence internally, you won’t get very far.
2. Consumer behaviour and customer mindset - a deep understanding of your customers’ drivers and attitudes when it comes to loyalty and CRM practices.
3. Insights and commercially led - being able to understand data and insights to pinpoint opportunities to drive value for your business.

And then the ‘X’ factor is relationship skills, which are slightly different to leadership skills, and will help to drive great collaboration.

11.? If we are chatting again in (say) 2 years’ time, what do you predict would be the hot topic related to loyalty programs?

It's the adoption of AI into loyalty programs and all the positives it can bring through personalisation and innovative member interactions. Imagine digital screens running events and tastings with an automated ‘pourer’ … or a scenario like this…if I buy my rosé at 5:00pm and at 5:05pm I receive an email saying, “Hey Di, you just bought this rosé. Make sure you keep it chilled at ten degrees. Also, we suggest it would go well with this food. Have a good night!”

12.? Leave us with a lasting loyalty thought

Summary

Sometimes these Loyalty Leader interviews reveal a simple, yet powerful insight.

For me, Diana’s relentless focus on the ‘1% optimisation’ for long-term loyalty program success, is the simple, yet powerful insight.

Proof of this is the fact that the My Dan’s program has grown significantly, achieving over 80% scan rates and maintaining a strong membership of over 8 million, with 5.4 million active members.

Diana’s belief in the store team being a force enabling success, is a reminder for all loyalty program managers of the continuous commitment needed to engage and inspire the team who relate to members. It is a non-negotiable.

Finally, Diana's overarching strategy for loyalty program success revolves around the continuous, small-scale optimisations that build lasting value for both the business and its customers …it’s the 1 percenters!

Have a happy loyalty day!

The Point of Loyalty specialises in customer loyalty and Joyalty* program strategy, design and deployment, advising brands on how to achieve long-term loyalty from 'The triple bottom-line of loyalty program success?'.

1. Business: Profitable and sustainable for your business

2. Customers: Meaningful and desirable for your customers

3. Team: With belief and buy-in from your team

Enabled by fit-for-purpose technology + data analysis and insights for action + dynamic personalised member dialogue.

Founder of The Point of Loyalty,?Adam Posner is a customer loyalty specialist and is author of the annual benchmark customer loyalty and loyalty program research study - For Love or Money? now in its 17th edition.

He has developed the Loyalty Program Experience Index SPVx, a rating of a loyalty program by its members based on their experience with the program weighted against three key variables of how Simple (S), Personal (P) and Valuable (V) the program is to them.

Adam also created the 'Six Currencies of Collection Loyalty Program members care about' now available as a SPECIAL EDITION of For Love or Money? and the?'Four Factor Quality Program Proposition' framework?to increase member activity.

Adam has been involved in the design and deployment of loyalty and rewards programs and loyalty research across industries including entertainment, education, pharmacy, hotels, trade and various retail sectors.

The contents of this article are the opinion of the author. No responsibility for loss occasioned by any person acting or refraining from the action as a result of the material in this article can be accepted by the author.