What makes a customer loyal to a business? Does a loyalty program help ensure loyal customers?
I have been thinking about loyalty lately. One goal of many organizations is to create a loyal following among its customers. There are many ways to do that. One common way is to introduce a loyalty program. I will admit that I have a keychain full of little plastic membership cards. But, are they all equal?
In theory, loyalty programs seem like a great idea. For those people who shop frequently with your business, you reward them with free things, discounts, or other benefits. Sounds great. But, here is what I have been noticing.
My airline used to award a free ticket at 20,000 miles. Then 25,000. Not it routinely takes 40-50,000 miles to get a free ticket. They say it is a benefit to me because now I can get tickets on more flights – I just have to be willing to spend more miles.
My credit card used to automatically send me a rebate each time I spent 2,500 dollars. Now, to get the rebate, I have to sign in to their web site, navigate to the rewards section, and select from 20 different rebate options. They say that it is a benefit because now I have more choices.
An large office store accepts printer cartridges and awards a rebate to spend in the store. But, it is only awarded quarterly. And you have to sign in to the web site to request the reward. And you have to spend more than your rebate amount in the store or you don’t get a rebate. And if you forget to request the rebate in time you get nothing. And the rebate isn’t just added to your loyalty card, you have to print out a separate form. And last month you could trade in 20 cartridges but we changed the rules again so this month it is only 10. And…well, you get the point.
A loyalty program becomes much less rewarding when a company puts up barriers to its use. It may seem like a great idea to drive customer visits to the web site or to encourage other shopping behaviors. But, in the end, these make the program more complicated and less likely to be used.
Rather than spend money on loyalty programs that frustrate your customers, maybe it would just be better to improve their experiences. Maybe you could get to know them a little better so that you can make good recommendations for them. Or, maybe you could provide a better web shopping experience. A polite and knowledgeable staff goes a long way toward making customers loyal.
I recently had a great customer service experience with the Arvika bike rack company. When a part was missing, they didn’t hesitate to send along a replacement at no cost. A high quality product combined with great customer service means that I can recommend the company to others. I find myself drawn toward companies who know how to deliver great experiences. And I will avoid those who make things challenging or difficult.
As for me, I don’t plan to shop at that office store anymore. I will just go to Amazon and buy things cheaply without needing to join a reward program. But, I sure wish I knew what to do with all of those printer cartridges.
What is your experience with loyalty? What types of experiences make you loyal to a company or brand? Share your story by leaving a comment.
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