Are Your Frequent Customers Freeloaders, Scoundrels or Cheats?

Many companies reward their customers with a system for accumulating points with each purchase. These points are redeemable for free products or services in the future.

Fly enough on the same airline and you get a free ticket. Stay enough nights with the same hotel and you can enjoy free weekends. Rent cars from the same company again and again and free upgrades will be yours. Buy coffee or ice cream nine times in a row and the tenth cup or cone will be free.

This habit of gathering points is widespread and familiar, but customer experiences when redeeming these points are incredibly inconsistent. Some companies go out of their way to make you feel truly rewarded for the loyalty you have shown. Others treat you like a freeloader and dish out only the lowest level of service.

This is a cultural (and business) issue of the highest order. Here are a few examples:

An ice cream store ran a promotion to encourage frequent buyers. If you ate ice cream enough times during the promotional period, you earned a coupon for one free ‘all-you-can-eat’ session of indulgence the following month.

One of my students earned the coupon and went to enjoy his indulgence. The first scoop of ice cream was presented in an attractive glass bowl with a clean spoon. His second scoop was placed back into the same glass bowl, with a new spoon. The third scoop came back in the same glass bowl again, with the same old spoon. The fourth scoop was served in a paper cup with a small wooden spoon. The fifth scoop came back in the same paper cup with the same wooden spoon and a glower from the manager in charge.

My student did not stay for any further scoops in his ‘all-you-can-eat’ celebration…and has not returned to that store for ice cream again.

He noted, ‘I felt humiliated by the staff, as though enjoying my all-you-can-eat prize was in some way cheating the store. Hadn’t I earned my coupon? Didn’t I deserve to enjoy the prize?’

One popular airline encourages frequent flying with ‘double miles’ promotions and special ‘tier bonuses’ for very frequent flyers. One of our subscribers tried to use her points to book a free award ticket in First Class, but the airline refused to confirm her reservation. The airline’s approach was to sell the seats first to ‘real’ paying passengers, and then ‘give the seats away’ to frequent flyers if they were still available at the very last moment before departure.

How shortsighted! How does the airline think the passenger accumulated all those points in the first place? By flying as a ‘real’ paying passenger, of course!

Contrast this approach with the more enlightened view of Starwood Hotels and Resorts. Redeeming an award with Starwood is fast and easy, and the service you get in the hotel is especially warm and attentive. The Asia-Pacific Manager of Customer Care explained it to me this way: ‘If someone has enjoyed an award before, they will strive to earn more points.’

Listen carefully to the language:

1. Enjoyed an award means Starwood makes a special effort to ensure the customer is pleased with his or her entire redemption experience: booking the award and enjoying the award.

2. They will strive to earn more points means customers will go out of their way to accumulate Starwood points by staying in Starwood properties, dining in Starwood restaurants, bringing more visits, more revenues and more profits to Starwood.

Key Learning Point

Anyone who redeems a frequent buyer award has already proven their loyalty to your organization. The experience of ‘winning’ should make customers eager to come back and win with you again. Remember, what they get from you is not ‘free’ – they earned it.

Action Steps

Review the procedures for your ‘frequent customer program’. Make sure these temporarily ‘non-revenue’ customers are treated with the high level of special service they deserve: appreciate them, acknowledge them, praise, thank and take good care of them. Remember, ice cream is everywhere and airplane seats are abundant. Giving personal recognition and appreciation through your ‘frequent customer program’ will ensure that your best customers keep coming back.

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Copyright, Ron Kaufman. Used with permission. Ron Kaufman is the world’s leading educator and motivator for upgrading customer service and uplifting service culture. He is author of the bestselling “UP! Your Service” books and founder of UP! Your Service. To enjoy more customer service training and service culture articles, visit UpYourService.com.

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