Time to Rethink Customer Loyalty

Most businesses understand the tremendous value associated with highly loyal clients. That's why businesses of every size and form have implemented loyalty programs to maintain their best customers coming back again and again. Sadly, this conventional loyalty version has grown tired and supplies very little differentiation in the market today. As a result, it's time to rethink customer devotion.
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THE LOYALTY FLOOD

Unfortunately for many businesses, any benefit that was originally obtained through faithful programs has rapidly eroded. While airline, hotel, and car rental agencies were the pioneers of mainstream loyalty plans, other companies were quick to jump on the loyalty program bandwagon. The outcome is a company environment where each restaurant, gas station and also pet store has some type of devotion card or application.
Consequently, acquiring a loyalty program is not 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 way of business efficiency - often requiring another step from the customer experience procedure. They have become nothing more than another solution to supply a price promotion. Loyalty programs can also produce disdain for clients that can't receive the benefits or special pricing offered exclusively to program associates.

WHEN LOYALTY PROGRAMS BITE BACK

Some loyalty programs miss the point completely and may actually drive customers away. Hilton Hotels, as an instance, includes a long-standing loyalty program called Hilton Honors that collects points based on the amount of overnight stays at their network of resorts. To get a livelihood traveller, these loyalty points can continue to collect within a 10 or even 20-year time span.

On the outside, Hilton's loyalty program appears straightforward and simple; The more a client stays - the more rewards they will get. In certain circumstances, but the fine print can actually bite back. If modifications to a client's traveling habits keep them out of a Hilton home for 12 successive months, the customer will lost ALL accumulated rights and points. This coverage, in consequence, erases 20 years of devotion as well as some other associated benefits or rewards.

The customer might have been loyal and may even have been an advocate for Hilton. Penalizing a loyal client for absence of activity for 12 months will certainly harm any fantastic will that may have been accumulated 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's time to reevaluate what client loyalty really means. Customer loyalty isn't obtained by simply holding a card, amassing points, or redeeming rewards. What's more, loyalty can't be quantified simply by client longevity, frequency, or buy volume. Customer loyalty isn't a one-way street; it cannot be determined solely based on what the client has done for the corporation.

Rather, customer loyalty should be turned upside down. Perhaps more firms might get it right if they measured loyalty in terms of the degree to which the COMPANY is faithful to the customer rather than vice versa. Companies should aim to recall repeat customers, address them as individuals, call them by their name, and treat them special.

Consider the easy lesson of consumer loyalty which was demonstrated per week about the 1980's sitcom "Cheers", the bar where everyone knows your name: At the start of each series, the bar's best client, 'Norm', could enter the bar and proceed to 'his' barstool. There was no loyalty program, no card to scan, without a 'platinum' amount needed to obtain entrance. Everyone really knew his name, he had his very own chair at the pub and the pub owner knew precisely what he needed to drink. 'Norm' was indeed loyal, but the establishment was extremely faithful to him too.

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