Today’s post could be considered a Part II to my post of July 27, entitled Loyalty and the Opposite of Surprise and Delight . In that offering, I related an experience in which the expectations created by a hotelier’s loyalty program were not only not met – but were dashed against the rocks like a lost ship at sea. Despite my dissatisfaction, I also said that I would not complain directly to the hotel chain, but rather would simply start doing more business with some of their competitors.
Well, it appears that my reaction to a bad customer experience is not atypical. In an excellent article in Colloquy, Dennis Armbruster presents and discusses the findings of a recent new survey by LoyaltyOne Consulting and Verde Group. That survey collected the views of retail shoppers on how they react to bad customer experiences. It found that more than 80% of dissatisfied customers remain silent rather than complain and seek some type of remedy. And while not all of these unhappy customers actually defect, the survey further found that “a typical retailer puts an average of 16% of its revenue at risk from dissatisfied customers who stay silent.” Pretty serious stuff, assuming you’re interested in growing your business – which most of us are.
So how does this relate to a loyalty or incentive program? As I suggested in my July 27 post, your loyalty or incentive program is an excellent conduit to your customer base, primarily because it is (or should be) a personal and emotional connection to them. Your program web site and communications are very useful means through which you can assess and improve your relationship with your customers.
Delta Air Lines, for example, uses their SkyMiles loyalty program branding in communications related to recent experiences. After virtually every flight, I receive an email that says “As a Gold Medallion, Help Us Improve Your Travel Experience.” Delta is using my attachment to their SkyMiles program to induce me to provide my assessment of their performance. And while they specifically ask that the survey not be used to “complain,” I have found that low ratings on various dimensions do solicit further inquiry and follow-up.
I think that all of us understand that an incentive or loyalty program is a valuable and powerful tool to recognize and reward those customer behaviors (like buying from us!) that contribute positively to our business success. But I’m also convinced that these programs can be valuable in getting some of those that have had negative experiences to speak up. As the Colloquy article says “Conventional wisdom holds that no news is good news. When it comes to customer dissatisfaction, that couldn’t be further from the truth.”
