new directions in loyalty

PERHAPS NO OTHER area of the travel industry is as much of a commodity business as car rental. The major players all offer basically the same cars and amenities, which makes creating frequent renters a real challenge.

National Car Rental, a unit of Vanguard Car Rental USA Inc., has long been a leader in developing innovative technological solutions that make car rentals faster and more convenient for frequent renters. For example, to speed up the car return process, members can receive an “e-receipt” – an industry first – which appears in their email box seconds after they return their cars.

driving loyalty

In 1987, National launched the Emerald Club®, the industry’s first frequent renter program. The Emerald Club’s primary customers were business travelers – a narrow market, which made one-to-one communications an attractive channel. As the company’s focus shifted from transactions to customers, direct mail became the predominant communications vehicle.

kundson newsletter

Online communications were added later to complement direct mail, making it possible to reach Emerald Club members on the road. Research indicated that the business traveler audience preferred getting news and information online. By combining relevant member data with direct mail and online communications, National provided customers with useful information in a very timely manner. For example, a combination of email and direct mail has achieved an incremental lift of up to 84 percent on profile completions, which are necessary to speed up the rental process.

The Emerald Club program was recently refreshed through the development of membership tiers. This allowed targeted communications to each tier and offered additional enefi ts to the program’s most valuable members.

shifting gears using dynamic messaging

The Emerald Club newsletter, a signature communication piece since 1987, was refreshed in 2006 to boost effectiveness. Unlike previous newsletters that used static articles, the new print version allowed for more than 120 dynamic message combinations based on the member’s history and profile data. The online layout offered even more personalization. National now uses the newsletter to drive incremental behavior on a segmented basis with Emerald Club members opting in to receive the version they prefer.

Examples of the newsletter dynamic messaging include:

  • Promotion registration messages for members who did not register
  • Promotion reminders for members who registered but have not rented
  • Tier stretch messages to show members how close they are to the next elite level
  • Membership information, including congratulations for reaching a new elite level
  • Special offers segmented by region, member level, previous activity, etc.
  • New membership activation offers
  • Membership profile alerts

The need for a printed version of the newsletter was carefully evaluated. Test versus control measurements showed an incremental lift of nearly nine percent for members who received the new print version. E-newsletter recipients showed lower incremental activity than print recipients, but still had a 5.6 percent incremental lift.
“Now we have a unique ability to direct specific stretch offers, rewards or membership alerts all on-the-fly during our planning process, without incurring additional production costs,” said Patsy Rey, Vanguard Car Rental U.S.A. Director of Corporate Marketing.

Weekly emails with customized messaging based on each member’s behavior and life cycle history were launched. An email that once contained the same information for every member now includes messages such as activation offers, profi le update reminders and stretch offers. Open and click-through averages have in many cases risen signifi cantly above industry averages for the category.

turbo-charged promotions

National launched the “1-2-Free” promotion in 2003. The offer was simple – rent twice during the promotion period and earn one free rental day. The original goal was to drive rentals during the low-rental shoulder period, but the promotion also improved market penetration and increased acquisition and activation of new Emerald Club members.

The 2006 version took advantage of new online features that improved performance while reducing costs. These features also simplifi ed the process for National and customers alike.

The multimedia marketing campaign was initiated two weeks prior to the offi cial launch of the promotion, giving members time to plan their rentals. Targeted direct mail and email campaigns served as the primary communications, with support including online banners and in-car advertising. Reminder emails were delivered throughout the campaign, targeting respondents and nonrespondents with different messages. These were extremely effective, with peaks in registration directly correlating to email broadcasts.

Promotional materials delivered a consistent message and directed respondents to “1-2-Free” landing pages. Members contacted via email enjoyed a “one-click” registration process with information automatically passed from data fi le to email to registration landing page. Direct mail respondents only had to provide their membership number and email address, and those who joined Emerald Club as new members were automatically registered.

For the first time, award fulfi llment was exclusively online. Members received an email informing them that they had earned an award, and could check their award balance with one click. To redeem awards, just one click transferred the free day authorization to the National booking engine.

The online process also created a security checkpoint to prevent unlawful redemption or viral messaging of invalid awards. A valid system serial number was generated for each earned award, populating the serial number within the website. Once a customer used an award code, the same
code could not be applied to a subsequent transaction.

The results speak for themselves. From 2005 to 2006, marketing contribution increased by 51 percent, registrations improved by 15 percent and new member enrollments increased by 71 percent (two-thirds of new members had never rented with National before). The lift in rentals was between 7 and 19 percent depending on the segment, with an average lift of 9 percent.

“We now distribute upwards of 90 percent of annual member communications via electronic means,” said Francesco Favazza, Senior Partner and Vice President, Account Services, The Lacek Group. “Members are now more attuned to e-communications from National, as they know they’re receiving specific, pertinent information relative to their membership, and in a timely manner. The result is better contributions for our marketing spend and
better service for the customer.”

kundson prints

Working in partnership with National, The Lacek Group continues to explore new technologies to enhance the customer experience. Novel ways to format dynamic messages and customizations for mobile devices such as the BlackBerry® are currently being tested. Stay tuned – there’s always more to come.

Author: Daniel Knudsen
Date: April 29, 2009