Time to Rethink Customer Loyalty
Most companies understand the tremendous value associated with exceptionally loyal customers. That's the reason why companies of every size and form have implemented loyalty applications to keep their best clients coming back again and again. Unfortunately, this conventional loyalty version has grown tired and supplies very little differentiation in the market today. Consequently, it is time to rethink customer devotion.
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THE LOYALTY FLOOD
Unfortunately for many companies, any advantage that was originally obtained through faithful programs has quickly eroded. While airline, hotel, and car rental agencies were the leaders of mainstream loyalty programs, other companies were quick to leap on the loyalty program bandwagon. The result is a business environment where every restaurant, gas station and also pet store has some type of devotion card or program.
As a result, acquiring a loyalty program is no longer a competitive differentiator. It has become a mainstay of a business environment where loyalty applications have become a product and a potential detractor to the overall customer experience. They get in the means of business efficiency - often necessitating an additional step in the consumer experience procedure. They've become nothing more than another way to supply a cost promotion. Loyalty programs can also produce disdain for clients that can not receive the benefits or special pricing offered exclusively to program members.
WHEN LOYALTY PROGRAMS BITE BACK
Some loyalty programs miss the point completely and may actually drive customers away. Hilton Hotels, as an example, includes a longstanding loyalty program named Hilton Honors that collects points based on the number of overnight stays at their network of hotels. For a livelihood traveler, these loyalty points can continue to accumulate within a 10 or 20-year time period.
On the outside, Hilton's loyalty program looks simple and straightforward; The longer a customer stays - the more rewards they will get. In certain conditions, however, the fine print can really bite back. If modifications to a customer's traveling habits keep them from a Hilton home for 12 consecutive months, the customer will shed ALL accumulated points and privileges. This policy, in consequence, erases 20 decades of loyalty as well as some other related rewards or benefits.
The customer might have been faithful and might even have been an advocate for Hilton. Penalizing a loyal client for absence of action for 12 months will certainly damage any good will that may have been gathered over the previous 10 to 20 year time span.
IT'S TIME TO RETHINK CUSTOMER LOYALTY
If companies want to reap the advantages of true customer loyalty - it is time to reevaluate what customer loyalty really means. Customer loyalty is not obtained by holding a card, accumulating points, or redeeming rewards. What's more, loyalty can not be quantified simply by client wellbeing, frequency, or buy quantity. Customer loyalty isn't a one-way street; it can't be determined solely based on what the client has done for the company.
Rather, customer loyalty should be turned upside down. Maybe more firms would get it right if they quantified loyalty in terms of the degree to which the COMPANY is faithful to the client as opposed to vice versa. Companies should aim to recall repeat clients, address them as people, call them by their name, and then treat them special.
Think about the easy lesson of consumer loyalty which was demonstrated each week about the 1980's sitcom "Cheers", the pub where everybody knows your name: At the beginning of each show, the pub's best client, 'Norm', could enter the pub and move to 'his' barstool. There was no loyalty application, no card to scan, and no 'platinum' level required to obtain entrance. Everyone really knew his name, he had his own chair in the bar, and the pub owner knew exactly what he wanted to drink. 'Norm' was really loyal, but the establishment was extremely loyal to him too.
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