I was talking with Wayne - a old fashioned advertising man who has reinvented his thinking after having a 1:1 marketing epiphany some years back - about where classic 'branding' fits with the whole concept of marketing as a conversation. (He was the one who put me on to "The New Brand World" and persuaded me to re-read "The Cluetrain Manifesto").

In short, Wayne has convinced me that a company's brand is the sum total of the experiences they provide to their customers. Loyalty programs included - especially.

If this is the case, Wayne pointed out, then the loyalty program is a fundamental part of the brand as far as the customers are concerned. Makes no sense to manage such an important part of the business differently than you manage the other lines of business and departments surely.

The need for alignment between your loyalty program and your brand reminds me of the famous quote attributed to Winston Churchill - when confronted by a beautiful socialite who suggested their children would be exceptional, Churchill reportedly said something like; "with my luck they would have your brains and my looks!"

It takes planning to make sure the intersection of program and brand produces an attractive prodigy, not an ugly dullard. We have seen rich, relationship focused credit card loyalty programs fail inside Every Day Low Price retailers and low value programs fail inside a "top end" department store.

There is a management tool that, when implemented in line with the manufacturers' instructions, focuses the organisation on alignment across the various functions; the Strategy Map&Balanced Scorecard of Kaplan & Norton. We have good success in designing and aligning loyalty program initiatives by using these tools.

As a gross over-simplification for those of you familiar with balanced scorecards;

1. Financial Perspective

   Focuses on what and where the program will need to increase revenue and improve productivity - increased customer lifetime value of course, but how much and how specifically?

2. Customer Perspective

   Makes us explicitly design and measure the program (product) features from the target customers' perspective - rules for enrolling, earning, burning, engaging and partners - then make the relationship offer that goes with the program (and brand) explicit and then define the intangibles - status, image etc. that the program should inherit from your brand.

3. Internal Perspective

   The operational things that need to get done well - these are often outsourced because the simplest of them are generic - adding points, shipping rewards etc. Some are critical success factors however, especially the customer analytics and insight functions.

4. Learning & Development Perspective

   The heart of your employee culture and infrastructure must beat in time with the brand and the customer value defined in layer 2. Loyalty programs should not be 'bolted onto' marketing!

We recommend you apply the same management disciplines and tools to the design and execution of your loyalty program as you do to any strategic initiative - or face the "Churchill Dilemma" - a program that destroys brand value.