November/December 2005
Best Practices: Loyalty programs
Customer relationship management professionals “earn as they learn” with CRMI
By Cathy Chatfield-Taylor

Sales reps earn commissions. Account executives get bonuses. But what do the oft-maligned call center people get when they help customers? If companies heed the advice of Chelmsford, MA-based Omega Management Group Corp. (www.omegascoreboard.com), they have an incentive program to reward employees for keeping customers satisfied.

Specializing in loyalty management programs to maximize customer and employee satisfaction and retention, Omega practices what it preaches at its spin-off company, Customer Relationship Management Institute (CRMI) (www.crmirewards.com), which launched the CRMI Membership Rewards Program to gain and retain members.

“We call our clients’ customers to find out how satisfied they are with their services and recommend what they need to do to improve retention,” says CRMI President Richard Castellano. “We decided to follow our own advice and look at programs that reward our membership for learning, training and using our partner services and our own programs.”

Founded by Omega President and CEO John Maraganis in 2002, CRMI didn’t have “members” prior to the launch of its rewards program. But since the rollout in August 2005, 200 customers have joined the institute and earned 1,000–5,000 bonus points for one- to three-year memberships. They’ll earn points each time they renew their membership, participate in seminars and Webinars, purchase training products and services, or attend the SCORE Symposium for Customer Operations and Relationship Exposition to be held each April in Boston.

Points are redeemable beginning at the low-end, 3,000-point redemption level, at which members can choose from among $25 gift cards for shopping and dining, entertainment and electronics such as DVDs and magazines, gift items such as a juicer or tool set, and travel gift certificates from Marriott. Gift certificates and merchandise value escalate up to $1,000 at the high-end, 100,000-point level.

Partner programs and services are also eligible for earning points. CRMI has formed strategic alliances with providers of products and services in loyalty management strategy, incentive marketing, e-learning, management consulting, telesales, independent testing, and assessment and certification services.

“We don’t want to lose customers to direct competitors, but if they have complementary training programs, we’d like to offer those to our membership base,” Castellano says. “Our business partners have the opportunity to be exhibitors and potentially speakers at our SCORE conference, so they can continue to have mindshare and visibility with the customer care audience.”

CRMI now has 10 partners, including Omega, that pay annual partner fees ranging from $2,000–$5,000 to help underwrite the cost of the rewards program. The program is administered by Incentive Logic Inc. (www.incentivelogic.com), a Scottsdale, AZ-based provider of customized online incentive programs.

“We thought their program was unique because you could get it up and running in a short time, and they offered a great selection of rewards and a very workable Web site,” Castellano says.

Members can log in to the secure Web site to manage their account information, check their current point balance and redeem points. CRMI currently awards points by entering the appropriate number in a database when members sign up, renew, register or buy. The database is uploaded to Incentive Logic’s secure server daily.

“We worked with Incentive Logic to be sure the points earned would be in line with the value of the redemption item,” Castellano says. “At the same time, we had to be sure the margins for all participants would be protected.”

If the rewards program is successful, CRMI expects membership to reach 5,000–6,000 within two years. While not expected to grow as dramatically, SCORE’s annual attendance is expected to increase from the current 200–250 attendees to several hundred, as loyal members earn 2,000 bonus points for each consecutive year they return.

“When the membership looks at the points they’ve amassed, if something else comes along that they could join instead, we hope they’ll stay with us,” Castellano says. “It takes initiative to have customer satisfaction scores above your competitors. We want to reward that initiative.”