Are you working to build strong customer loyalty and create a community around your brand? Industry experts Deb Hyun, SVP Global Brand Management & Operations at Lululemon, and Jean Namkung, Global Commercial Leader, PayPal Rewards at PayPal, suggest that there’s no one perfect solution––but there is definitely an art and science to it. Find out what they had to say during the Marketer 411 live conversation on how to lean into community as the foundation for customer loyalty.
Q: Where is your company on its customer loyalty and community-building journey?
Jean Namkung (PayPal):
For a very long time, the PayPal brand grew on a foundation of trust with consumers, given we offer financial services to consumers. But as the business has expanded so quickly into many different product offerings, we’ve recognized the need to expand our value proposition beyond safe and secure and flexible, but also into a rewarding brand. We launched a rewards program last year called PayPal Rewards, that enables customers to earn cashback savings for future purchases with no financial barrier to entry.
Deb Hyun (lululemon):
I found that when we’re in relationship with our community and guests, the type of experiences that we’re able to unlock for our community and brand are extraordinary. We have entered new markets and continued to be in relationship with guests all around the world because we start by understanding who they are and commit to building a relationship with them over time.
Q: What are the qualities of a great community, and how do you know if your community is engaged and elevating your brand?
Jean Namkung:
Community is centered around a shared and valuable experience among a group of users. Community is most valuable for a brand and business when positive word of mouth is doing a lot of the heavy lifting to fuel growth. It’s when you can rely on the product or offering’s value proposition.
We also look closely at our engagement metrics. We look at the volume of consumers, how frequently consumers are using our products and how large their basket sizes are when they’re checking out online. All those data points give us a numbers-focused way of seeing how groups of consumers are engaging with the brand.
Deb Hyun:
We know our community is engaged by their participation, so we look at engagement metrics. How many people are coming to our in-store events or regional events? We look at the number of people that come to our 10K races and engage with the brand and each other. We also measure the frequency of people who are participating, not only with the brand but then also with the wider community.
Q: Jean, tell us more about PayPal’s rewards program. How is it going, and how did you start?
Jean Namkung:
Rewards programs in the financial industry are tricky. People typically don’t like to talk about or share what’s going on with personal finances with other people. So we think about building community and building loyalty in a few different ways. We’ve done a great job building community with our peer-to-peer payment solutions, like what Venmo has done with icons and emojis. And our insights told us that consumers love cash back, who doesn’t love to save a dollar and stretch their dollar a little bit further? That was really the impetus for us to think, okay, we can absolutely lean in and create a rewards program. In the first 2 quarters of the year, we’ve seen a 20% increase in people using PayPal Rewards, and we’re now up to over 10 million consumers utilizing the program.
Q: Deb, where is Lululemon focused now, and what’s next as you evolve your community base and loyalty program?
Deb Hyun:
The lines between community and loyalty programs are a bit blurred. We don’t have a traditional loyalty program. What we have instead is a membership-based program where people have an opportunity to access different benefits. It’s less about the gamification of getting people to come back a certain number of times, and more about building programs that will support building lasting relationships based on services and benefits that would support them within their shopping journey and their brand journey with us. Things like access to different events, community programs, support points in terms of people’s well-being and fitness goals, as well as providing access to other members of the community.
We’ve been able to see which benefits and programing people like to have access to based on their participation rate. We’ve also learned along the way through surveys and forums what types of benefits they would like from us.
Q: Do you look at competitor brands who are doing a great job engaging the community?
Deb Hyun:
We monitor existing programs out there, but we prioritize going directly to our guests and community to ask them what programs and benefits they would like to see. We also experiment with pilots in our stores and across different regions. We understand that different regional communities may have different desires and wants from our brand and how they would like to engage with us. We have been fortunate to have a lot of people in our community who actively tell us what they think, whether it’s through direct channels or social media platforms like Reddit. We listen to everything, the good, the bad, and everything in between in terms of how they’d like to engage with us.
Jean Namkung:
Staying updated on what our competitors are doing is crucial, especially in the financial services industry. However, we have come to understand that there is no universal approach to building loyalty and community within service-based organizations. It highly depends on the specific needs of the community we serve.
Q: What internal teams are you partnering with to drive your decisions?
Deb Hyun:
Nearly every team in the organization is involved in supporting the community in some shape or form. We have a community team, as well as an ambassador team, and there is deep integration with technology, CRM, and our data teams to bring these programs full circle. Our goal is to ensure that our guests who are a part of these programs feel well-supported along the way, and that the journey is seamless. This includes our educators and the people who work in our stores.
Jean Namkung:
We believe in cross-functional collaboration because building a unified experience for the consumer takes a village. When it comes to PayPal Rewards, our primary teams include our business, product, engineering, marketing, analytics, legal, and customer service teams. Marketing has played a major role in defining the program’s identity, look and feel, and branding elements. Analytics is crucial as we make decisions based on the data we collect and trends we observe. Legal and customer service teams are also instrumental in supporting the ongoing customer experience. Working together, we aim to deliver the best possible experience for our users.
Q: How are you leveraging data to inform decisions?
Jean Namkung:
I always think about this one statistic that says that in most companies, about 20% of their most engaged users drive about 80% of their business growth. This is a well-known 20/80 framework. This particular statistic was crucial as we were building out our rewards program. While data is a great tool for confirming or clarifying our hypotheses, we need to be careful not to get lost in the sea of data that’s available to us. It’s important to remember that when you’re building new products and programs, you should be hypothesis-led and data-confirmed.
Deb Hyun:
As a marketer, it’s important to start off with a hypothesis based on your experience and historical trends. Asking questions and finding trends is a great way to start. It’s important to identify a business objective or customer need that you want to solve. Also, having a partnership and collaboration with those responsible for maintaining data and analytics is crucial. Sometimes our intuition or qualitative data points may not align with what we’re actually experiencing, but understanding the intersection point can unlock valuable insights. It’s not about debating who’s right or wrong, but rather understanding the differences between implicit and explicit behavior.
Q: What key factors have most contributed to customer loyalty for each of you?
Jean Namkung:
In terms of everyday use, I believe consumers prioritize finding the best cash back rates possible. However, what truly sets apart one product or service from another is the ability to provide a seamless and valuable experience to the user that they want to come back to again and again.
Deb Hyun:
It’s all about backing up your words with actions. It’s important to show up in a way that your guests and customers have requested and to follow through on your promises. This can be either through transactions or more non-transactional brand behaviors. The key is to be authentic in your approach and always follow through on what you say you will do.
The Marketer 411 virtual events are hosted by Jennie Stark, the VP of the MTM Program at 24 Seven. These events are designed for Marketing Managers to bring value, direction, and inspiration to their teams from insightful conversations with top marketing leaders. Each 411 contains insights on different disciplines, such as what brands are focused on, leading teams, measuring success, and more.
Meet the Experts
Deb Hyun, SVP Global Brand Management & Operations at Lululemon: Deb Hyun is the SVP, Global Brand Management & Operations, leading the brand strategy & management, global content & social strategy, brand insights, and brand operations teams. Throughout her career, Deb has worked across various industries, building and leading marketing organizations. But her passion has been working at brands focused on building meaningful connections with Consumers. Prior to joining lululemon, Deb was the head of marketing at Headspace. Beyond marketing, Deb’s other passions include reading, Pilates, spending time with friends, family, and her dog, traveling, and doing anything related to food.
Jean Namkung, Global Commercial Leader, PayPal Rewards at PayPal: Jean Namkung is the Global Commercial Leader for PayPal’s Rewards Program. She builds and leads PayPal’s consumer loyalty from within the product organization and is the general manager of the business line, responsible for commercial (P&L) management, strategy, and end-to-end consumer experience. She is a dedicated and innovative global leader with experience building, scaling, and transforming businesses like Uber, Uber Eats, and The Atlantic. Jean has received education from The University of Notre Dame, The school of the Art Institute of Chicago, and Harvard Business School Executive Education.
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