How Customer Loyalty Programs Really Should Work

By Stevie Ray

Customer loyalty programs should be renamed. They should be called, “Our employees don’t know how to be nice to you, so we have to give you gifts to keep you coming back.”

Like most people, I am a neighborhood shopper. I go to the same grocery store, bank branch, pharmacy and gas station every time. Since I have been in my neighborhood for more than 13 years, you would figure that I am one of the more familiar faces for the employees.

But after all that time, the only place where I’m greeted by name is by the guy behind the counter at the gas station. The place where you would expect the surliest and briefest of encounters actually gives me the most joy.

After one visit, Ray (the regular afternoon guy), said, “Have a good day Steve. Are you going to Chicago to visit your wife’s family this weekend?” My wife asked me, “How does he know your name? And how does he know I am from Chicago? And how does he know we go there some weekends?”

“Simple,” I replied. “He asks me.”

Finding the Blame

My bank has great customer reward programs. They will deposit $25 into my checking account if I refer a friend who opens an account there. Wow. All I have to do to earn $25 bucks is to turn my friends into referral tools. I’m sure that will make my friends cherish our relationship all the more.

Now the tellers at the window and loan officers sitting at their desks don’t have to know who I am, or treat me like someone who has been coming in once a week for longer than some of them have been alive. That $25 takes care of it all.

When you treat people like that, they feel like cattle. First, they think something is wrong with themselves, then they think something is wrong with you.

For example, I was in my backyard doing some spring planting. I noticed my next-door neighbor Joe putzing around in his backyard so I said, “Hey, Joe.” He didn’t respond. He didn’t even look up.

Being human, my first response was to internalize. I thought, “Did I do something to upset Joe?” I ran through my memory for the entire winter, trying to think of what I could have possibly done to make Joe completely ignore me. I couldn’t think of a thing I had done, but I was sure I must have done something. I convinced myself that he must have not heard me.

So I waited the appropriate three minutes and said again, “Hey there, Joe.” This time I added more cheerfulness than was called for. Nothing. Joe didn’t even look up.

Now is when we go from internalizing to externalizing. “What a jerk,” I thought. “The least he could do is wave.”

First, something was wrong with me, then something was wrong with Joe. I found the proper place to lay the blame; all was right with the world. I kept glancing over at Joe while I continued my work. I made sure to look when Joe was turned away, I didn’t want my paranoia to be obvious.

Finally, I noticed two little white wires drooping down from Joe’s head to his pocket. And his head was nodding in rhythm. He was wearing earbuds and listening to music. When he looked up and saw me he gave a big smile and a wave. I waved back, feeling like an idiot.

Business Implications

Translate that scenario to your business. When people visit your organization over and over throughout the years and are still treated like they are complete strangers, first they think there is something wrong with themselves, then they think there is something wrong with you.

When they reach the stage that something is wrong with you, a $25 reward isn’t going to mean squat.

Ray at the gas station treats me like you would actually treat a loyal friend — remembering my name, remembering things that matter to me, giving a genuine “glad to see you” smile instead of a “this is how I was trained to smile” — I go out of my way to give him my business.

The rest? If another store opened that was a few cents cheaper or a few blocks closer, I will treat them like they have treated me: like I don’t even know who they are.

This article first appeared in The Business Journals HERE

Leave a Reply

Your email address will not be published.