Loyalty for Sale.

Times are tough. This economy has rocked our world and will continue to for some time. So people start to panic and look for ways to make money. And sometimes those ways are stupid.

I am a loyal United Airlines flyer. I fly over 100K miles a year. Domestic. Last week I found myself in a middle seat on a 6-hour flight from Washington DC to Portland, Oregon. It wasn't because I booked my ticket at the last minute or went stand-by. It was because of a new policy United put in place - to make more money.

Beside me sat a rookie flyer complaining about the 50 bucks she paid to get 5 more inches of room. She was a large woman and apparently didn't read that the extra 5 pertained to "leg room" not "seat room."

United Faux Pas

I thought this essay from Denise Wymore was amusing and true.

The Showdown by Denise Wymore

Are your rewards out of reach?

One of the biggest mistakes people make when designing a reward program, is making the reward not worth the effort. Or teasing me with stuff, only to discover I would have to spend $100 an hour for 5 years to get that flat screen television - it begs the question Who does that? Who are they targeting?

The answer: no one. Some of these programs are just jumping on the loyalty band wagon hoping that if they build it - they will come.

Case in point. Dunkin' Donuts announced a new reward program. The DD card must be registered online. It's only valid at participating outlets (I put in three different zip codes that I know have stores and none of them were playing yet) and the perks were, well, lame. For example - if you spend between $25.00 and $49.99 a MONTH at participating DD stores AND remember to present your card they will MAIL you a coupon for a free medium coffee and donut. If you go over $50 per month you have your choice of the free coffee and donut OR a coupon for $4.00 off (which will also be mailed). Reading the fine print - you do not get both - you must choose. I can only imagine there's a form involved.

Now is a good time to review your loyalty program to make sure that:

1. It is free of all deception (fine print) and does not involve a chart listing things like "If it's a full moon and a Tuesday you have a chance at 1/4% off of a new loan (VISAs, used car and signature loans excluded).
2. An MSR can explain it without using a cheat sheet.
3. The reward is worth the effort. Put yourself in the member's place when reading your rules. Would you care about the reward? Is it fairly easy to get?
4. You thank them for their business when redeeming rewards.
5. You constantly update them on the balance of their reward program.

I'm gonna go get my free pastry at Starbucks now. I guess I just have to "show up" before 10am.

Loyalty and the consumer

During this past six months I've been down a long and winding road through good, bad and downright hellish experiences as an individual dealing with various corporations and their customer service departments. Between negotiating the roadblocks and minefields set up by Comcast while converting to hi-def, attempting to ensure that my husband's computer is protected by a good spam filter/virus protection via McAfee, and downloading/synching the latest IPhone version from Apple, I have determined that sometimes going into a small room and screaming curses to the heavens is not only justified, it's downright therapeutic.

In each of the cases with Apple and McAfee, I have discovered that even after much time and frustration with some of their people, there were still a number of really good people who were willing and able to help me. With Comcast, not so much and in fact - not at all. It truly is amazing how many people at Comcast really enjoy using and abusing what little power they have to ensure that I not only felt beaten up, but now I never want to deal with them again in my lifetime. Maybe that is their plan - make sure no one ever calls back because they know you won't help them.

This occasional blog is about loyalty and how people and companies actually benefit financially and emotionally when there is loyalty and trust between them. I can truly say that I am loyal to a number of companies that haven't always done everything right, but in the end they were there to fix things. We're all human, so you can expect some problems, but also expect a willingness to help. For us to effect change in our relationships (both business and personal), we have to be willing to work with each other. If you don't find that in a company then it's best to give them the message via a "cancel/termination" request. Then and only then will those companies get the message that being successful requires loyalty TO your customers, not just from them.

Fairwinds does Loyalty the right way!

Sometimes it feels like no one appreciates the everyday consumer (me!) and then I find someone doing something really special to reward us.

I just found an article (see below) by Myriam DiGiovanni in the CU Times that talks about a credit union rewarding member loyalty. This is the way it should be done - rewarding and providing value with a business's (in the case Fairwinds Credit Union) products and services. Wouldn't it be nice if all businesses did this for their customers???

"Member Loyalty Rewards Put Wind in FAIRWINDS Credit Union's Sails
September 03, 2008

By Myriam DiGiovanni
ORLANDO, Fla. — FAIRWINDS Credit Union is out to prove membership has its rewards.

The credit union recently relaunched its 2006 member loyalty program dubbed Relationship Rewards, where members earn points for interest paid on loans, dividends earned on deposit accounts and for each year of membership. The points can be used to lower interest rates on loans, earn a higher rate on deposits, waive fees and reduce costs on insurance coverage. Members can sign up on the newly revamped site at www.fairwinds.org/relationshiprewards.

A second loyalty promotion that members can take advantage of is the Member Referral Campaign that will run on a quarterly basis. The promotion is geared to encourage members to share the benefits of a FAIRWINDS membership with family and friends. For each new member referred, the existing member will receive a 500-point Relationship Reward bonus and be entered into a drawing for a pair of round-trip airfare tickets, courtesy of AirTran Airways.

"We felt a rewards program that enhances products that our members need would provide more value than using points to purchase a household item or merchandise typical of other reward programs. By simply using their credit union, members create perpetual discounts and bonuses for themselves," said FAIRWINDS CU Executive Vice President of Marketing Dianne Owen. "For example, if a member wanted to finance a $40,000 car for 72 months with an APR of 6.29% and then use 5,000 of his Relationship Rewards points, the rate would drop to 5.79%, which equates to a savings of $600 over the life of the loan."

As an added benefit for the month of August, members will automatically earn double points during the "Double Rewards Summer Bonus." In addition, both new and existing members can earn even more by opening a Clear account, which gives members the freedom to customize their financial services.

Owen said the programs are part of FAIRWINDS ongoing commitment to increase its membership while making the most of its over 65,000 member e-mails.

"We have a lot of initiatives on going green, so as we were thinking of growing our membership and that referrals are the No. 1 source for new members, everything aligned and it was the optimal time to do something like this," said Owen.

She added that the loyalty and rewards programs provided an opportunity to leverage its new e-mail marketing initiative by making it easy to not only refer friends and family but also help those referred open their accounts online in just 10 minutes.

"Members can simply plug in the names and e-mail addresses of five of their friends and family who are then shot an e-mail inviting them to check out their credit union and just click here to open an account online in less than 10 minutes," said Owen. "We're really excited about this because it is so convenient and easy to do and happy members are our best source for new members. FAIRWINDS service statement is 'every member an ambassador' so we value and want to reward those members that spread the word about what we have to offer."

Plans are underway to continue to send promotional e-mails quarterly in a bid to keep the programs fresh.

—mdigiovanni@cutimes.com"

Earning Loyalty Thru Customer Service

For the past several years, I've counted on my Lexmark laser printer for printing all of those things that I need to put on paper. Even though I had to beat that printer into submission every time I used it, it would come through in the end and I would get my document. Maybe a little covered with inkdust, but still - I did get my doc.

Well, after a year of having to bang the cartridge door open and shut multiple times before I could get a print job done, I finally broke down and got a new printer. This time I settled for an HP because there are so many choices and I was in a hurry.

I've had my printer three days. It was lovely the first and second days, and then sporadically decided to print gibberish when I would print some things off the internet. My Mapquest directions printed as an interesting combination of readable highway icons and crazy, unreadable symbols. I was frustrated. I was angry. I was ready to tell HP where to put their printer.

I called HP for help. And while I appreciate that lately it is difficult to understand the accents of some of the technology service people named Penny or Dan who are obviously speaking from India or Bangladesh, I did get through to someone to help me.

Now I don't know what program HP is using for their customer service training, but I can tell you it is working. OK, I know HP won't give me free ink, or even give me a little discount on their products, but I'm now a firm believer in using HP. Why? They seemed to really care that I got the help I needed when I asked for help. Their customer service is impeccable. Their supervisors get on the phone to make sure their employees helped.

While giving away gifts and products will always help make people loyal to a certain product or brand, good service will go that one even better. I'm convinced - and my printer works great!

A Day in the Life of the Rewarded

I had a great day yesterday. I flew to Columbus, Ohio. That's not why it was great.

I flew United. Got a first class upgrade and got to bypass the scary long security line and go in the "special" frequent flyer line.

When I arrived I got to bypass the scary long AVIS rental line and go directly to the "Preferred" area where my name appeared in lights on a big reader board telling me where my car waited - clean and ready to go.

When I checked into the Marriott my name AGAIN appeared (not in lights but in a framed welcome sign) because that visit signified my obtaining GOLD status (stayed 50 nights this year with them).

I went shopping last night at the local mall to stock up on AVEDA products. I was told that I also hit a milestone with my points. I get a free day at the spa!

Love all day long. Why? Because the people I do business with track my business, and thank me constantly for it.

What have you done for YOUR frequent flyers lately?

Membership Drive vs. Membership Bribe

iPods, George Foreman Grills, Cash, chance to win a car. I'm seeing it all. And it makes me sad and worried. Why are we resorting to bribing our members to join?

It’s simple. Because they’ve stopped referring us. But let’s be honest. Who is the person willing to move their checking account (and a sticky one at that) for an iPod? Someone who really wants an iPod. Is that bad? I don’t know. Consider this. If they DO come in (as a result of that offer) is your new account experience going to create word-of-mouth or is the gift masking the process.

We are in the business of managing moments of truth.

A moment of truth: Your product is service. It’s manufactured WITH the member present. You only get one chance at a first impression. That first impression is the opening of a new membership.

It costs, on average, five times more to get a new member than it does to serve an existing member (and that stat does not include the grill of MP3 player). That first impression needs attention.

If you haven’t reviewed your “experience” lately I have a quick and efficient way of doing so. The Net Promoter Score (NPS). Your challenge. For the next month, send a two question survey to each new member AFTER they’ve opened the account (like a week after). Here are the two questions:

1. On a scale of 0 to 10, how likely are you to recommend (insert CU name) to a friend, family member or co-worker?

2. Why did you answer the way you did?

Some people see that and say “Well, the member doesn’t have enough experience with us to answer correctly.” What I really hear is - “We don’t create a good first impression.”
I think that’s why we are giving away grills......