Spooky coincidences and a letter to the CEO

21 September 2010

A quite spooky thing happened this week and it’s not even Halloween yet. It was a bit of a coincidence given my groan last week in my blog about not being welcomed back as a customer when I’d only been visiting the hotel weekly for about 6 weeks. However one of the customers for the client I’m working with wrote a letter to the CEO on this very topic this week. He happened to mention he had been a loyal customer for 16 years and was somewhat irritated that he was not welcomed back and was always asked on check in whether he had visited before.

In order to get a programme in place that recognises the customer on arrival actually requires some work to be done but it’s not huge if you start focusing on the most valuable customers first which are we all know from pareto analysis are probably less than 20% of the total base delivering 80% of the value. What was interesting was that the company had been listening to their customers and the welcome had not come up as a need or issue in any of their customer feedback which they take from customers at many stages in the customer experience. This lack of recognition was a big niggle for a very important and valuable customer but for some reason it had not surfaced in any noticeable way from the customer research. This brings me to the point about how do we recognise our most valuable customers and make sure that our recognition programmes are tailored so that you do not overspend on some customers and underinvest in others.

I was intrigued to read a letter in the FT today1 from an investor in the city who was basically giving Tesco a hard time for awarding triple points to their most valuable customers. The person writing the letter was rightly pointing out that Tesco have the database and the insights to know exactly how much it would cost and the ROI to offer this programme. Tesco have studied many years of customer purchase behaviour and their rich customer database would enable them to accurately forecast their return on investment.

Customers just want to be recognised like staff for their contribution and the greatest source of rich ideas on how to do this are from your front line people who know the customers best. Often they will know the most loyal ones by their first name and would know what would make them happy and yet companies shy away from launching such programmes or in some cases just write them off as they are written in marketing departments far away from where the customer dialogues are happening.

My taxi driver today mentioned how in his previous job selling cars he did very small things to say he cared by leaving a bunch of flowers in the customer’s new car to often recognise the customer’s partner who may not have been directly involved in the car purchase but he knew would be pleased to have been recognised for supporting their partner through the transaction. He said when times were hard in the economic downturn his business thrived whereas those car dealerships that had not done anything to say thank you struggled much more to get their customers to come back.

How easy it is to say thank you for your business and yet how rarely do we do this enough for those customers who have bought over and over again. The magazine and publishing industry is a classic example where they reward their least valuable customers the most by offering them all manner of deals to sign up and then wonder why their customers find all kinds of reasons to cancel and sign up again costing them more admin time and effort in the long run and they do not really get to understand who their customers really are as they are actively training them to be disloyal.

So on that note I recommend that all Directors spend time listening to customers on a rota basis or reading customer posts. Social media gives us an exciting way to recognise customers. You can reward those customers that give the most to your online communities by looking closely at the number of customer likes on all customer posts. Oh I so love the transparency of this brave new online world although I’m still a bit freaked by the spooky timing of my public ramblings with incoming letters to the CEO.

Have you got any customer letters to your CEO which caused a real change to your business?

[1] FT Letters to the Editor, Weds 15 September 2010
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