Everything has changed except human nature

Customer loyalty programs are valuable to companies on a variety of levels. Consumers not only need to know that a product or service is a value; they also need to feel special. The traditional loyalty programs offer discounts, upgrades and freebies as rewards for repeated interaction. However, a study by Queens University of Technology finds that many of these traditional programs are suffering because consumers are struggling to see the benefits of signing up. The consumer is confronted with a value proposition at sign-up and must weigh the perceived benefits against the possible loss of privacy. This proposition minimizes the gratitude the consumer feels for the retailer or service provider.

Gratitude is the key and missing ingredient. The study by QUT's School of Advertising, Marketing and Public Relations found that “benefits that stimulate gratitude in customers have the power to strengthen the seller-customer relationship and ensure loyalty”. The shopper needs to feel that the seller cares more for the consumer than their own profits. An attitude of benevolence on the part of the seller goes a long way to building trust and loyalty in the relationship.

So how does a company appeal to this basic tenant of human nature? Here are a few suggestions gleaned from the aforementioned study:

Unexpected Gifts – a free case when you purchase a laptop is an example of an unexpected gift that will generate gratitude. The consumer made the buying decision based on the value of the purchase and is given a “bonus” gift. There was no requirement asked of the buyer other than the initial purchase. This cannot be advertised as a means to motivate sales of the laptop to get the proper response. It must be unexpected to garner the gratitude.

Bending the Rules – nothing make a consumer feel more grateful than an employee with the discretion and willingness to break the rules for them. This shows the consumer that they are indeed first and will certainly bind the relationship for the future. Each business has opportunities to empower front-line employees to “do whatever it takes” to win the customer. Zappos is an example of a company that believes that there are no rules when it comes to customer satisfaction.

Random Events – Anything unexpected to make the customer feel special will have the desired effect. Events exclusively for loyal customers coupled with exclusive discounts or gifts will generate gratitude and keep the loyal customer devoted. It must be exclusive to the loyal group and adding randomness to the scheduling makes it more unexpected.

Conspicuous Recognition – The Diamond Level boarding line is an example of an airline recognizing the importance of its most valuable customers and offering a conspicuous upgrade in service as a reward. There are opportunities in many companies to segment their most valuable customers and offer an added service or designation that not only makes them feel grateful but proud to take part.

The way companies do business and interact with the consumer is changing quickly with the evolution of technology and data management. But human nature remains the same and the consumer still requires exceptional acts to insure long term loyalty.