Virgin embarks on group-wide loyalty drive via new mobile app

Profile picture for user jtwentyman By Jessica Twentyman June 19, 2016
The Virgin Red loyalty app for the brand's customers has been in soft launch for around a year. The business is now ready to make more of a noise about it

Virgin Red heart image with logo © Virgin Group

Ahead of a bigger splash set for this week, diginomica has spoken to Neal May, head of product and data at Virgin, about the thinking and the development effort behind the group’s new Virgin Red mobile app, which has been in soft launch since last summer.

The app underpins a new cross-group loyalty scheme that gives signed-up members access to special offers, events and experiences from across the Virgin group of companies - including Virgin Media, Virgin Trains, Virgin Wines and its flagship airline Virgin Atlantic. Also included are “friends of Virgin”, third-party partners that currently include coffee chain Caffe Nero and restaurant chain Jamie’s Italian.

Cheekier than other schemes

Members can win points in order to unlock exclusive offers locked away in ‘vaults’, by taking part in quizzes and games in the app and sharing offers with their followers on Twitter and Facebook. In this way, according to May, Virgin Red taps into gamification and social media in a way that other loyalty schemes don’t. Points, meanwhile, are reset monthly, so there’s an element here of immediate (if short-term) gratification for getting involved. May explains:

From the start, we wanted to create an app that really reflected the Virgin brand right across the group – something that was a bit cheeky, a bit fun. We created Virgin Red because customers were asking for it and, because it’s 2016, we wanted to do something a little different from the rest of the loyalty market.

But given that some Virgin Group companies already have their own loyalty programmes – Virgin Atlantic’s Flying Club is probably the stand-out example – why would customers be asking for this? May insists that, since Virgin Red works with all Virgin brands and existing loyalty schemes, it’s “incremental” for customers.

That may be so, but it’s also extremely advantageous for Virgin. As detailed in the Financial Times last year, an internal study at the company revealed that although the Virgin group’s six largest UK companies have around 14.5 million customers, only one in ten used more than one Virgin service.

Effectively, that means that you may well be a very loyal Virgin Atlantic customer who shares a wealth of personal information with the airline, but Virgin Trains will know nothing about you or have any targeted way to market its services to you. Virgin Red, then, is a way for Virgin Trains –  and other Virgin companies – to get the attention and business of customers loyal to other parts of the wider brand.

End-to-end platform

In terms of technology, what’s interesting is that Virgin Red is being run very much as a separate entity and has its own, very separate infrastructure from the rest of the group, based on Google’s cloud services. This includes its own CRM system and integration with a payment provider, May explains, as well as analytics that help the company understand how, when and why Virgin Red members are interacting with the app.

At the same time, it also has bespoke APIs linking this infrastructure with systems belonging to other Virgin brands. This enables a member of Virgin Atlantic Flying Club member, for example, to link that account to their Virgin Red account, and receive extra points each month for doing so.

Virgin’s technology partner on Virgin Red was US-based mobile app developer DMI International. May says Virgin picked DMI on the basis of its ability to provide this ‘end-to-end’ platform.

We originally put out our RFP [request for proposal] around 18 months to two years ago, with the goal of selecting a partner that was up to the job of going on a journey with us and with starting with a fresh piece of paper.

Says DMI International president Magnus Jern:

Virgin was very open with us from the start that they wanted to do something different. And they were very clear that there would be a lot of integration work and a lot of user testing.

But that’s how DMI International likes to work in any case, he adds. Focus groups played a large part in the pre-development stage and an internal beta involving 100 Virgin employees and close partners was held last June. The iOS version of Virgin Red first appeared on the Apple App Store in July 2015. An Android followed in October. Early members were recruited via targeted email campaigns. Says May:

We’ve taken it slowly, wanting to get it just right – but we’re ready to make more of a noise about Virgin Red.