Most customer loyalty programs are built around the idea that if you hand me a card with 10 spots for a punch hole on it, I’m more likely to come back. The really savvy business owners tell their cashiers/baristas/bartenders/whatevers that if they give two punches to the card on a customers’ first visit, they’re significantly more likely to come back. It’s a jedi mind trick that just happens to work quite well.
The whole system is built around gamification, with companies like Starbucks driving more and more towards an endorphin-fueled, gamified experience for their loyalty program. 10 drinks… Free food! 30 drinks… Gold card member! But keep coming back or we’ll take your gold card away. Muahahahaha.
At some point you show up and your card is punched the 10th (or 12th or 20th or whatever) time and you get a free thing-a-ma-jig. Congratulations, you’ve won a free prize! But here’s the question, when you walk away from the experience, are you more loyal? Perhaps, but more likely you are a member of the loyalty program for the coffee shop down the street as well, and your card there is on its 8th punch… two more to go!
Now contrast this with the stories we hear pop up from time to time. You’ve seen the headlines or status updates. “Starbucks manager decides to give free coffee to every customer for the first half of the day on April 18th,” (a date of absolutely no significance). “My favorite restaurant just gave me free dessert for no reason at all! That’s awesome!”
My friend recently had a similar experience. She happened to book a flight for the wrong date and she didn’t realize it until the day before she was to fly out. The flight she had booked used the same call number as her intended flight and she had been confused in her rush of excitement to book the ticket. She called the airline and asked if they could switch the date of her flight to 24 hours later when the rest of her travel group would be flying out as well.
Two associates with no decision making power did everything they could to stay out of trouble by saying, “I’m sorry ma’am, but there’s nothing we can do. The flight change + rate differential will cost you $900.”
She asked for a manager. She shared her story with the manager. “I’m headed on a mission trip with a group of people that want to do good in South America. I’ve done everything in my control to budget for this trip, but I have absolutely no wiggle room. I would have to forego the trip if I truly have to pay the $900 fee to change flights.”
The manager, unlike her disempowered associates, had the decision making power to build a truly valuable and customized loyalty program for my friend. It took just ten words, “Ok ma’am. I’ve changed your flight. The fee is waived.”
Which type of customer loyalty are you building?