Leaders in Customer Loyalty, Powered by Loyalty360
Leaders in Customer Loyalty, Powered by Loyalty360
#400: Loyalty360 Loyalty Live | Todd Hedberg, The Lacek Group
Founded in 1993, The Lacek Group designs, builds, and maintains loyalty programs for top brands across the globe. As part of the Ogilvy network, the Lacek team converts disconnected tech stacks and processes into successful CRM programs powered by data-driven strategies. The company helps brands deliver relevant messaging at scale across channels to ensure connected, seamless experiences. The company works across a broad range of industries, including travel, financial services, hospitality, cruise lines, QSR, retail, automotive, health care, telecommunications, CPG, and more.
Loyalty360 spoke with Todd Hedberg, Senior Director of Digital Strategy at The Lacek Group. Hedberg has been with Lacek for just over three years and is still relatively new to the marketing side. He defines customer loyalty as an opportunity to strengthen customer bonds—both emotionally and transactionally—in every customer interaction. Hedberg and the Lacek team aspire to help clients achieve brand devotion with their customers.
In this article, Hedberg discusses working with clients to achieve deeper personalization, how artificial intelligence and machine learning fit into the equation, and going deeper to mine individual customer preferences.
Good afternoon, good morning. It's Mark Johnson from Loyalty360. I hope everyone's happy, safe and well. I want to welcome you back to another edition of Loyalty Live. In this series we speak with leading agencies, the technology partners and consultants, and customer channel and brand loyalty about the technology trends and best practices that impact a brand's ability to drive unique experiences, enhance engagement and, most importantly, impact customer loyalty. Today we have the pleasure of speaking with Todd Hedberg. He's the Senior Director of Digital Strategy at The Lacek Group. Welcome, Todd, how are you?
Todd Hedberg:I'm great. Thanks so much for having me. It's an honor to be here.
Mark Johnson:Absolutely. Thanks for taking the time to connect. It's always great to speak with professionals in the industry. You get a bird's eye view of what you guys are seeing and doing. So first off, for those who may not know, can you give us a little bit of background about yourself and your role within the Lacek Group? It'd be great to know that.
Todd Hedberg:Oh, of course, Yep. So, as you mentioned, senior Director of Digital Strategy at the Lacek Group, and I've been here just over three years, so, interestingly, I'm still relatively new to the marketing agency side of the world. Spent nearly 20 years on the corporate side working in healthcare, medical device, retail, banking industries, so loving the opportunity to help engage with a lot of unique brands, unique situations and elevate their marketing efforts forward.
Mark Johnson:Okay, and for those who may not be familiar with Lacek, can? You discuss how Lacek helps support a brand's customer loyalty efforts and a brief overview of what you and your team do.
Todd Hedberg:Absolutely. The Lacek group has been a leading loyalty marketing agency for years, so we're part of the Ogilvy Network. We're viewed within the network. Ogilvy is a global leader in loyalty, but also Forrester and other publications have put us in that position too, and we work with the world, helping build and maintain many of the world's leading loyalty programs. So as part of this is not only the program design aspect, to make sure it meets and exceeds the needs of every member, but also the engagement marketing opportunity, delivering those timely and relevant communications to build meaningful interactions with each member.
Mark Johnson:Excellent. One of the things that we are very focused on is looking at kind of a lexicon for customer loyalty different terms, terminology, what they mean, how brands should understand them, and the most important one, I guess, is customer loyalty. What does customer loyalty mean to you and to your organization?
Todd Hedberg:For sure. So really viewing customer loyalty as an opportunity to strengthen those customer bonds, both emotionally and transactionally, with every interaction presenting a new possibility to do so. Clients achieve brand devotion with their customers and many of those brands that we've supported for a decade plus have already done so and will continue to grow those efforts. So brands like Dunkin', myriad, the Home Depot and more. So customer loyalty really is that opportunity to deliver rich experiences and meaningful outcomes Excellent.
Mark Johnson:I know Lacek released the most recent white paper. Infinite Personalization AI Makes it Possible. Can you tell us a little bit more about the paper, specifically why you did the paper and what it should mean to brands, and also it'd be great to know what infinite personalization means as well.
Todd Hedberg:Yes, wonderful. Well, right now there's obviously a lot of exploration of kind of the big what if? Imagination, imaginative aspects of AI and that's exciting to live in almost this fantasy world. There's a parallel path of practical applications and what's realistic today and what I found that's been really exciting from a CRM and an engagement marketing aspect, is the narrowing of the distance between those paths that convergence. So infinite personalization really is a view into not just the art of the possible from a full utilization of AI marketing capabilities, but what's actually realistic today. And much of what felt like fantasy a year ago is becoming a reality.
Todd Hedberg:So the overarching premise with infinite personalization is the possibility to create an individualized marketing communication plan for every recipient on a list. This not only is from a content personalization aspect, but also a campaign delivery, the timing, the cadence, the frequency of messaging. So if you think about both predictive and generative capabilities, you're going from what we view as typically a Mad Libs style approach to personalization. Historically it's been this content dynamic, dynamic content insertion you know name recent purchase into a pre-built layout or template. Now that's evolved into more modular templates and that's really where we've had a lot of success with deeper personalization for our clients is having key areas of templates be modified in real time to meet the preferences of clients.
Todd Hedberg:The possibility that's put forth in infinite personalization is what if we started with a clean page, a blank page that allowed for not just reimagining each email or each communications content, but also the format, the link, the style. So somebody tends to scan and go right into what that call to action is. They prefer more imagery. Well then we can shorten the email, make it image heavier versus somebody who typically tends to read more very intently. Then we can make it longer with more copy, heavy, you know formatting and drive to those individual preferences, so not just the personalization based upon recent actions but their general substance and style preferences, and do that at scale. So that's the premise behind infinite personalization is the ability to again take a blank page and a unique approach for every individual in a database to meet their specific preferences.
Mark Johnson:Yeah, a quick follow-up question to that. We have a member of Loyalty360 that I had a discussion with a couple weeks back and they're a brand and they just got their first CDP. Cdp obviously is great, but he likened that CDP to starting a race team and you have your first Ferrari. So you get the CDP, which allows you to do action on data, bring the data in, clean it up, do some segmentation, marketing, automation. It's great, right. But then you got to buy a warehouse to keep the Ferrari in and once you get that all taken care of, you've got to get a whole team drivers, mechanics, specialists to make sure you're keeping it on the road, keeping it running. And he likened that to the CDP.
Mark Johnson:So they have a small team, right, huge brand, but a small team. So being able to do personalization at scale can be very challenging. Obviously, being able to leverage an organization like yourself is, you know, apropos and opportune as well. But do you see that challenge in some brands where they have this great opportunity but how do they put it into play within that organization? Maybe from a resource constraint could be a challenge. Is that something you see?
Todd Hedberg:Oh, absolutely, and I think that's the biggest opportunity for brands moving forward is to one create that data fusion with their customer data, between transactional history as well as engagement preferences. So a CDP really helps fill out that equation of knowing the ways that we can best communicate with each individual to reach those customer preferences to be more timely and relevant. And, whether that's through like a data cloud solution or their own in-house data lake, the opportunity to be able to slice and dice that data in real time, whether for segmentation or AI-driven personalization, is the great enabler of those possibilities personalization is the great enabler of those possibilities.
Mark Johnson:Excellent, and brands are very focused on leveraging AI to be able to enhance the personalization strategy and build those authentic relationships with consumers. But, as I just mentioned, many brands are struggling in that regard, right From the technology understanding the technology, understanding what personalization should mean and how do you automate. If you go from one to one to one to two to one to 20,000 different types of segmentation and personalization strategies, it can be complex. You know what are some of the struggles. You see you've talked to a little bit, or maybe what are some steps a brand can take to put infant personalization into practice.
Todd Hedberg:Yeah, Absolutely yes.
Todd Hedberg:So not only do we paint the picture of the art of the possible in infinite personalization, but provide a four-step process to get further down that road towards that ambition.
Todd Hedberg:And some brands are quite far down that road and are actually putting infinite personalization into practice today, and others are just getting started, and that's okay, are just getting started and that's okay. The first step, as I mentioned, is creating that data fusion, being able to tie disparate data sources together to have that full and singular customer view. Tapping into again, as I mentioned, not just recent purchasing behaviors but recent engagement signals and making sure that those communications are both timely and relevant. But also going into the second step is making sure that communications can be adaptive to evolving customer preferences and characteristics. So, looking at traditional utilization of customer personas today and evolving the understanding of personas to be less static and more dynamic, recognizing that people either today are a blend of multiple personas they embody the attributes or characteristics of multiple personas or they may fluctuate between different persona attributes over time and that dynamic nature allows for content signals to be captured or engagement signals to be captured for content adaptivity.
Mark Johnson:The third step Go ahead, please Go ahead.
Todd Hedberg:Well, briefly, the third step, then, is putting that insight into motion for each individual, not only adapting the content, but then looking at not just the content personalization displayed on the surface level, but also the timing and the relevancy. So an example of this if I'm a coffee chain customer, I may have a higher likelihood to engage, which many do. Coming into the fall season, pumpkin spice lattes, those type of beverages are quite popular. Recognizing that that engagement will pick up, leading into a peak period for myself and I would be more in tune to receiving more messages, more in tune to receiving more promotional messages. So, with a change in season can be a great opportunity to change and fluctuate the volume of communications, the timing of communications, the nature or topic of communications, to be in tune to those critical actions or preferences.
Mark Johnson:Okay, and can you share one or two examples of brands that are successfully putting their intention into place?
Todd Hedberg:Absolutely. I think a very popular case study out there is with Formula One. So this is actually a client that we at the Lacek Group have supported with our parent company Ogilvy and, you know, really helping them not only mine their database for data insights but put it into motion, and they've done that successfully using the Salesforce Einstein platform. So there's many case studies from the Salesforce aspect of how this omni-channel approach, adaptive content, has been put into motion utilizing a dynamic content and personalization approach. So whether their fans are engaging digitally with their video games, their Netflix series or, of course, live racing, or physically with in-person racing, e-sport events, customer meets and signings, there's a large number of combinations in which people have unique preferences and they can touch individuals with the right communications based upon those recent actions and those overarching preferences.
Todd Hedberg:The other recent example that I saw that I think was quite interesting and it touches on the fourth and final step, so I'll bake that into this example is with Pizza Hut and their use of machine learning for deeper, multivariate split testing. So, going beyond A-B testing, where a majority gets the solution they prefer and the other half, the minority, has to live with the solution they didn't prefer, they can actually get down to individual level through deeper testing, doing that at scale and measuring the outcomes and the incremental lift that it's yielded For them. They reported 30% increase in the revenue based upon that multivariate testing using machine learning. So that was a published case study through their vendor partner, braze, which supplied that AI marketing tool.
Mark Johnson:Excellent. When you look at AI and ML first off, there seems to be a little confusion, at least on our side. What is actually AI? What is machine learning? Because there's some similarities there. But when you look at it from a data analysis and modeling perspective, allowing brands to gain insight for improving their customer loyalty programs, what are you seeing? What is the role that data analysis and leveraging consumer insights in support of independent personalization and customer loyalty in general? What should that look like? Well, how should brands be pursuing that?
Todd Hedberg:Absolutely, and for me, the key distinction factor is that these capabilities unlock new possibilities and AI machine learning, some combination of those capabilities, play a huge role in delivering ongoing hyper-personalization for brands. So it's mentioned in that fourth step, taking split testing to the nth degree. It's making sure that nobody has to be on the losing side of split tests and receive subpar, suboptimal outcomes. Testing deeper, doing it at scale and going beyond what is typically in the bandwidth of small to medium sized marketing teams AI that's the superpower that it brings is doing more, quicker and, with the right guidance and implementation from the human side, it can do it very precisely Excellent.
Mark Johnson:When you look at the metrics or methods that brands should be using, how do they differ when they compare to, maybe, the traditional analytics, the traditional KPIs, the traditional reports they have?
Todd Hedberg:For sure this is a really great question. I don't think I have a perfect answer here, other than I think the methods will differ greatly, but I don't think the core metrics to measure success will change. So it will be exciting and important to measure success from incremental gains and those KPIs that are established when using this approach compared to methods of the past. And I think that Pizza Hut example is a great testament to their traditional testing efforts and then implementing machine learning to take that to a larger level and do deeper testing quicker, and the incremental revenue that that drove from those efforts.
Mark Johnson:When you look at brands who are looking to increase the efficacy of their communication programs and processes, you know, do you have any advice for brands that they should consider when they're looking to enhance those communication programs and processes?
Todd Hedberg:Yes. Again a couple of quick pieces of advice. I think the principle of using connections through key insights for engagement, marketing based upon customer patterns or preferences stays the same. That should be the ambition, and the ability to go deeper and to mine individual preferences is really what should drive the pursuit of AI and machine learning and then from an implementation of those capabilities. It's start small and build gradually. Find some low risk use cases, maybe just the background, imagery and communications and how that can be tailored through machine learning, and then the AI implementation of that. So it's a big kind of wild and complex space today and the more that brands can narrow their focus and their ambition and simplify the use cases, the more success they'll have.
Mark Johnson:Okay. So when you look towards the future, what is the next big thing brands can expect in the way of technology opportunities and tools?
Todd Hedberg:Sure, you know, ironically, with the infinite personalization, it seems like a big prediction, but the premise of that again is that those possibilities are reality today and there's a path for brands to get down towards that achievable reality today. So I tend to avoid getting into big predictions, but I'm truly optimistic at the momentum to adopt and implement marketing AI tools, advancing campaign development and optimization. I just really believe we're on the precipice of another great marketing renaissance and I know it sounds big and bold to say, but the more we can truly deliver one-to-one personalization, the more we'll move the brand efforts and ambitions forward in a positive manner.
Mark Johnson:Okay, are there programs that you admire, that you find yourself loyal to from a customer perspective, and, if so, what do you like about their offerings?
Todd Hedberg:Yeah, great question. So I'll take an unbiased approach here, because several of my favorite loyalty programs are Lacek clients. There are, of course, brands that aren't in our portfolio that I'm a fan of, and my favorite loyalty program outside of our client roster is Sleep Number, another Minneapolis-based company, and they took the unique and I know they've been featured many times on your podcasts and your loyalty live session. But what I love about that program real short here is that it's not a high frequency purchase and it's not really an exciting purchase for the most part of you know. Replacing your mattress once every decade on average and the way they leverage customer engagement is a loyalty mechanic to drive education, to drive advocacy and, of course, repeat purchases or incremental purchases is such a unique application of customer loyalty. So they've done it very successfully and I think they continue to build on that success.
Mark Johnson:Okay, last question Do you have any closing thoughts, ideas, you know what's next for Lacek as we go through the fall and into 2025?
Todd Hedberg:Absolutely. You know, for Lacek, for myself, we're continuing to help, support our clients to continue to take those steps towards richer personalization outcomes. Some of them are far down that path and others are just getting started on that path, and that's that's great. There will always be needs to course correct and pursue new. Started on that path and that's that's great. There will always be needs to course correct and, you know, pursue new opportunities along that path. So we're focused, from an engagement marketing aspect, on increasing the, the outcomes of those interactions and driving brand devotion and deeper customer loyalty excellent.
Mark Johnson:um, now we have the fun rapid fire, quick fire questions. We like to keep these to a one word or short phrase response, so we keep me in good graces with the content team. First question what is a short word or phrase you use to inspire others?
Todd Hedberg:This is the hardest part of the interview. I'm going to use a two-word phrase here and say what if?
Mark Johnson:Okay, what is your least favorite word that others use?
Todd Hedberg:Well, because I'm so hyper-focused on deeper personalization and unlocking those possibilities, I'm going to say segmentation, okay.
Mark Johnson:What excites you at work, turning possibilities into realities? What do you find tiresome, at home or work?
Todd Hedberg:Text messaging, IM messaging Okay To just have conversations about things.
Mark Johnson:Is there a book that you've read, or that you read, that you'd like to recommend to friends or colleagues?
Todd Hedberg:I just recommended this book recently to a friend, a past colleague, Fascinate by, excuse me, by Sally Hogshead. Okay, interesting, Fascinate is the title.
Mark Johnson:Okay, what profession out of the one that you currently have would you like to attempt?
Todd Hedberg:you know, in the last year I've always thought or started to realize I'm fascinated by behavioral science.
Mark Johnson:Ah, if I could cut it as behavioral scientists, but it would be interesting to pursue yeah, I've actually been been looking at a doctoral program in behavioral science over the last two or three months. Behavioral economics actually Wonderful, yeah. So we'll see if that ever happens, but I can commiserate with you on that one for sure. What do you enjoy doing that you often don't get the time to do.
Todd Hedberg:As a parent of an active child. The answer to this is read Okay, Don't get uninterrupted time to read.
Mark Johnson:They have this great thing called Audible. I highly recommend it. Who inspired you to become the person you are today?
Todd Hedberg:In addition to my parents, I'm fortunate to have several lifelong friends that I think we've all kept each other in check and on the right path over the many decades.
Mark Johnson:Okay, excellent. And what do you typically think about at the end of the day?
Todd Hedberg:I think another answer to your question as far as another career is I could probably become a travel agent. I love to plan trips, I love to research trips for myself and for others. So that's kind of my end of day thing is where to next or how do I make the upcoming trip as fun as possible?
Mark Johnson:Okay, and last question we have is how do you want to be remembered by your friends and family?
Todd Hedberg:Sure, I hope that they would see me as considerate and thoughtful.
Mark Johnson:Excellent. Well, todd, thank you very much for taking the time to speak with us today. It was great getting to know you a little bit better and also learning more about infant personalization and some of the programs and processes you're putting to play within LASIK. We appreciate everything you do and Lacek does in the customer loyalty-industry, so thank you for that.
Todd Hedberg:My pleasure.
Mark Johnson:Thanks again for having me today, really appreciate the opportunity Absolutely, and I also want to thank everyone else for listening. Make sure you join us back for another edition of Multi-Life soon. Until then, have a wonderful day.