Kelloggs are running a new promotion which provides a free pack of cereal for 3 purchases. 
On the surface this appears to be more classic sales promotion than loyalty, but what isn’t immediately evident from the packaging is that this is actually a Coinks powered promotion.
Coinks are a provider of points programmes to brands and have a centralised points currency and reward selection which brands buy into. This means that when entering an on-pack code, whilst it can indeed be used to redeem for a free box of cereal it can also be used in combination with other points from other products to redeem for a wider selection of rewards.
Coinks provides the ability for a brand to customise the site, both in terms of creative as well as the initial reward selection presented, however in all cases it is still recognisable that it is a Coinks powered site and this is obviously part of the strategy.
In the case of this Kelloggs promotion, the branding is actually less Kelloggs and more Coinks. When compared to a site such as Cadburys Fingers who have full branding it would appear that they aren’t in it for the long term – using the site more as a quick and easy redemption scheme than a deeper link into the Coinks proposition.
There is however a potential danger with a Coinks powered promotion and that is that Coinks itself is the loyalty programme and Kelloggs in this case is the brand that currently offers an earning opportunity. When the promotion ends for Kelloggs there is a danger that so does the loyalty.
On the brighter side this promotion is good in that unlike more traditional sales promotions such as buy one get one free or 2 for 1, this doesn’t offer immediate gratification. It requires the consumer to actually purchase the product a number of times, driving repeat purchase at full price rather than giving away free product with a single purchase.
It is also good in that the reward is aligned to the brand – in fact it is the brand – and that it provides an opportunity for cross-sale, allowing consumers to choose another product if they want, driving trial across all products. Unlike many in the market offering cash prize draws, this promotion is strongly linked to the brand itself meaning it is more likely to attract brand loyalists.
What it does lack however is any real longevity for Kelloggs. The reward as promoted is low value and lacks any uniqueness or excitement. This means its unlikely to attract kids (and the pester power this brings) or indeed “collectors” who like branded goods. Whilst Coinks does provide a wider selection of rewards, these are evident within the packaging and so acquisition volumes may be suppressed.
In summary, it’s good in that it drives repeat purchase and is on-brand in a rewards sense, but weak in its overall ability to excite and engage. In all a Lean Forward Loyalty rating of 2.
| Score (0-5) | |
| Encourages Acquisition | 2 |
| Drives Repeat Purchase | 4 |
| Programme Longevity | 3 |
| Brand Alignment | 4 |
| Creates Excitement | 1 |
| Enables Interaction | 0 |
| Overall Lean Forward Score | 2.3 |
2 comments:
An advantage for a brand using Coinks is that when a promotion comes to an end the consumer continues to spend points and collect points and continues to be actively managed and supported.
In this way, the brand retains its consumers in between promotions. The brand's next promotion can then quickly re-engage this consumer base without the need to start from scratch or to re-invent the wheel.
Maintaining, managing and exiting a loyalty scheme are major concerns. Coinks removes these issues, while allowing a brand to build loyalty using short term tactical promotions.
As I said, the danger is that they become loyal to Coinks, not to the brand, and the fact that consumers can continue to spend and collect points after the promotion is finished would be a demonstration of this. In essence, the brand hasn't retained the consumer, Coinks has.
For the brand to retain consumers there would be an expectation that the consumer continues to interact with the brand online - driving up vists, frequency and dwell-time on the brand website even when the promotion is complete.
Of course the brand could execute another Coinks based promotion to "re-engage" the consumers - but this is less of a re-engagement for the brand and more of a tapping into the Coinks membership by the brand.
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