Customer reward programs — don’t ignore or belittle the 99%
So you’re running a business and want to come up with a way to reward your most valuable customers — why wouldn’t you want to thank them? In abstract, thanking them is great and in reality you have to be very careful about how you do it. If you aren’t careful you’ll setup a system that makes the 99% of the people that buy from you who aren’t “in the club” hate doing business with you.
A perfect example of what not to do is the airline industry. For the non-frequent fliers from the moment you step into an airport you’re notified that you’re a second class citizen. Priority lines for “first class” and “platinum” members to check luggage — often in many cases personnel are standing not helping anyone because nobody from the privileged class is in line. Now that you’re through checking luggage things should be okay — oh wait — that isn’t the case at all. Non-”members” see where they rank again in the security lines; at the gate while the agent calls out over a speaker for all to hear, “peons wait until boarding group 4 while we parade the 1% through in front of you” (They don’t say that but the people standing there think this); then on the flight, “peons, the restroom at the front of the plane isn’t for you, and your drinks will be $7 each in cash only while we give 1st class drinks for free”.
A great example of what to do is Apple. Go into a store and you’ll be helped in the same manner if you’re buying a $10 accessory or a $2000 laptop. Call on the phone..same again..imagine if Apple changed to model after the airlines? Everyone who wasn’t a frequent repeat customer had to stand in a long line while an Apple Platinum Status member received priority service at the Genius Bar even though you scheduled an appointment. A way to measure how your programs work to create the brand value and loyalty you want is called the Net Promoter Score. In the airline industry the top two scores.. Jet Blue and Southwest. What do they have in common? They’re the only airlines that don’t treat people differently. (Southwest is actually starting to do this and I wonder if it’ll lead to the beginning of the decline; hope they keep watching NPS closely.)
Airlines are making these decisions trying to maximize profits. I don’t have data but my gut instinct is the system they’ve setup suppresses air travel and makes people very price conscious because they are never delighted by the purchase decision .. flying from their pocketbook rather than their emotional response. If all of the airlines could have the courage to reboot and learn from the most profitable company in the history of the world (Apple, and by the way I am not a “fanboy” .. I do own some products but this blog is being posted from a HP laptop, I’ll tweet about it later on a Nexus 6 Android phone, I may reply to a comment from a Microsoft Surface tablet [I do also own an iPad but I generally use it for reading my newspaper or books and some web browsing]) they might be making money rather than struggling to stay out of bankruptcy.
Can you think of industries or companies that “get it”? I’d love more examples.