Dentsu Aegis Network announced Wednesday the acquisition of U.S.-based HelloWorld, a promotions and loyalty group that will roll into Merkle's loyalty division to improve on the agency's people-based marketing offerings.
Through the acquisition, Merkle gains HelloWorld's proprietary technology and all 370 employees and adds a host of top brands to its loyalty division such as Coca-Cola, Johnson & Johnson, and Microsoft.
The business will rebrand to “HelloWorld, a Merkle Company" and will sit within the Merkle Loyalty Solutions group. Peter DeNunzio, CEO of HelloWorld, will remain at the helm.
"We are seeing a revival of loyalty programs that sit at the center of the brand advertising and marketing strategy," said Michael Hemsey, executive vice president of Merkle Loyalty Solutions. "All the conversations we're having with brands center on how to tie loyalty technology into addressable advertising, re-imagined customer experiences and CRM strategies."
Many of the implementations on Merkle's books for 2018 center on connecting loyalty to ecommerce, content management, business intelligence and analytics as well as search, video and display advertising campaigns.
With employees and technology at hand, Hemsey believes the acquisition will further scale Merkle’s people-based marketing disciplines such as loyalty solutions, performance media, customer relationship marketing, customer experience, and enterprise technology services.
Loyalty programs that drive customers to believe a brand really notices what's important have become the key to people-based marketing.
Merkle Loyalty Solutions supports brands worldwide. Hemsey hopes to offer HelloWorld's solutions globally as well.
HelloWorld differentiated its business model by linking response-driven consumer promotions with loyalty strategies and programs. The company operates on data, technology and marketing strategies that require an emotional response from consumers, which the company says brings customers closer to brands.
"Consumers are responding to custom digital and social integrations," according to Hemsey. "Brands do not want to offer the same experience to Millennials as they would Baby Boomers or Gen-Xers."
HelloWorld's technology allows brands to directly communicate and provide incentives directly to the targeted group.
Some 70% of consumers like earning loyalty points, but younger consumers are more inclined to prioritize their relationship with brands based on how they define innovative tactics, according to a HelloWorld report released in December 2017.
"Currency is the ultimate draw," Hemsey said, defining "currency" as information for reward points, discounts, and special incentives such as Eddie Bauer's loyalty reward -- lifetime returns for worn clothing.
HelloWorld's study found that 55% of Millennials and 38% of Gen-Xers prefer "surprise and delight" tactics, a strategy less appealing to 23% of Baby Boomers participating in the study.
There are challenges to loyalty programs that brands should address. More than half of consumers participating in the HelloWorld study believe it takes too long to earn reward points, with 32% worrying about the security of their personal information.
HelloWorld was founded in 1999 in Detroit, Michigan and has expanded to offices in Seattle, Chicago, Manhattan, and Los Angeles.