Why punish, when you can reward? Online or off-line, there are simple steps you can take to make your customers feel valued

Communication World, Sept-Oct, 2006 by Angelo Fernando

I make frequent shopping-cart sorties at Amazon.com. But despite the convenience of one-click shopping, it's not the only bookstore I visit. I'm an equally loyal customer at my neighborhood Borders Books and Music for a different set of reasons. If you put on your marketing hat for a second, you'll see why this poses a problem--or an opportunity. The "bricks" and the "clicks" aren't either/or scenarios today. As such, marketers cannot assume that customers fall into these either/or buckets.

Technology is one way to connect the dots when cultivating customer loyalty. Reaching out to consumers and keeping them loyal to your brand often involves rewarding their online behavior with benefits that make them feel pampered offline, and vice versa. When an airline allows a passenger to print his or her boarding pass, it's rewarding the online action (of e-ticketing) with the off-line benefit of avoiding long check-in lines at the airport.

To get back to the two bookstores, the retailer and the e-tailer have unique ways to gain and retain loyalty. For example, Borders sends its Rewards program customers regular e-newsletters with a 30 percent off coupon that's only valid in stores. Amazon has truly amazing customer service. The web site has a click-to-call button that immediately brings on an Amazon customer service person. If you don't believe me, go to the help link and try it. You will be asked to provide your phone number, which instantly triggers a phone call. Just refrain from selecting any of the three options you'll hear, and a real person will be on the phone in seconds. It's a neat combination for an e-tailer: to listen to your customer and not just be happy with click-through rates.

But when overused, technology can turn a standard customer experience into something else entirely. Marketing is so driven by competition that the need to reward customers is often overshadowed by the need to trap and punish them. We have all come across companies with an interactive voice response system that punishes you for hitting "0" in search of an operator by ending your call. You may be able to reach a live person, but you have to go through a complex menu to find that person.

Honey, not vinegar

I once worked for someone who used to remind his customer service representatives that you can catch more flies with honey than vinegar. Is the concept of rewarding customers so hard to grasp? Consider how some companies have turned consumers into raving fans. In his book Who Stole My Customer?? (Prentice Hall, 2004), author Harvey Thompson asks, "Why do you want satisfied customers? To create happy faces? No. You want satisfied customers in the hope they will return." Customer loyalty is more complex than customer satisfaction.

The candy maker Hershey's rewards customers by allowing them to collect points, with a twist. The WrapperCash points are printed on the inside of the chocolate bars and can be used to bid on products--from mountain bikes to cars--on a Hershey's auction site. But the site is run by eBay, nicely marrying the off-line and online experiences. Then there's Upromise, a loyalty-marketing program in the U.S. that allows customers to squirrel away cash payments toward a college savings plan. It's used by brands such as Coca-Cola and Tide to reward customers almost on a daily basis. To date, millions of parents have joined.

At the upscale end of the spectrum is Virgin Atlantic Airways, which has quite a reputation for pampering its passengers. Virgin's Flying Paws is a rewards program for passengers' pets--and obviously their owners! Business-class passengers also have access to an "in-flight beauty therapist" and a masseur, which clearly sets Virgin's reward program apart from those of many other airlines.

What if you don't have the budget or the infrastructure for a rewards program? How about clearing up those customer service minefields? Many companies unwittingly punish customers by having untrained people pick up the phone. Do visitors to your web site jump through hoops to get to the information they are looking for? Often a simple search box will do the trick. Do you have a plan to open up a new register when someone with 95 items in her shopping cart is holding up the line? Can your customers preorder a product from your web site and pick it up at the store? Home and building supplier Lowe's and Eckerd Pharmacy let you do just that.

In their book Raving Fans (William Morrow, 1993), Ken Blanchard and Sheldon Bowles say that rewarding customers is nothing revolutionary--just common sense. That common sense must take into account the hybrid online and off-line customers, who tend to have very high expectations. In the end, it's not the boarding pass, the book or the short checkout lines that they'll remember and talk about. It's the experience. By seamlessly integrating your off-line and online offerings, you can make them feel truly rewarded.

RELATED ARTICLE: Winning hearts and minds?

Punishing customers--or at least potentially doing so--went to a new level earlier this year, when word got out that Royal Philips Electronics had a patent-pending technology that would prevent viewers from skipping television ads by freezing the channel while the ad was playing. If viewers recorded the program on digital video recorders (DVRs), this feature would disable the fast-forward button, making sure the commercial would play. It would do this by inserting digital flags in the broadcast signal itself. But the more contentious issue was not the forced watching of commercials. The patent stated that "A viewer may either watch the advertisements or pay a fee in order to be able to change channels or fast-forward when the advertisements are being displayed." Technology that punishes the viewer for not watching the ad? There's a sure way to win the hearts and minds of your customers!