Monday, March 2, 2009

Want brand loyalty? Be loyal to customers.

Customer loyalty is often a one-way street. Customers patronize specific brands over time and in return get....well, nothing.

Car companies are big on loyalty marketing. But these programs often amount to nothing more than a special discount ("loyalty bonus") and sneak previews of a new model. The problem is that any buyer can negotiate a similar discount any day at any dealer.

When you think about it, Apple does little for its best customers. We stand in line like everyone else. And how about Coke and Nike and Sony? What's the benefit of staying loyal?

So this brings me to a category we love to bash -- airlines -- and offer some praise.

For example, United Airlines (disclosure: although a BD'M client, I was a "1K" customer years before) offers its frequent fliers a wide range of perks in exchange for our continued business. As a loyal customer I get to fast track through check-in and security lines. I can sit in Economy Plus and get more legroom (and not get my laptop smashed by the guy in front of me) free of charge. I receive upgrades and free tickets. My baggage fees are waived. That's real stuff that offers me economic and emotional benefits.

Very few brands offer real benefits and appreciation for our loyalty. This is a mistake, and also an opportunity in the current recession.

The best way to survive in the current climate is to get close to your best customers. They are most likely to buy and most likely to talk up the brand. They are the proverbial low hanging fruit. For example, Best Buy (another BD'M client) sent me a $50 gift card the other day in recognition of some recent purchases. What's smart about this is that I'm likely go into the store and spend more than $50.

The entire industry that sprung up around customer relationship management (or CRM) clouded a very simple premise: say thank you to people.

2 comments:

DOG ZOG said...

Best Buy's rewards program is great and just as you said, I take the $25 or $50 gift card I get from them and use it on an ADDITIONAL item that I was not planning to purchase. Good job BBY

Anonymous said...

David, I'm biased on United (TOBU and I are VERY close friends! ;-)) so of course I'll agree on that one but brand loyalty is a fickle thing these days. Few brands today have been able to retain it but those who have should be applauded.