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Three letters for Loyalty: O P S
We often talk about the idea of "stickyness" - the idea that the best loyalty propositions create customer stickyness. One of the broad goals of loyalty marketing is to craft a customer experience and loyalty proposition that is perfectly and intrinsically linked to the company's operations. This creates customer stickiness and simultaneously creates opportunity costs for the company and for the customers to do business either elsewhere (for the customers) or in other ways (for the company).
As part of our work, we are always espousing the virtue and requirement of linking loyalty strategy to a company's operations. Last week, when returning from a client meeting (where we coincidentally were working on the operational aspects of a new loyalty program test), there were two completely contrasting illustrations we observed that are each worth sharing
First, the good: there is no better example of this than Hertz.
Hertz and their #1 Club Gold have made the experience of renting a car as perfect as any consumer experience anywhere. If you're not familiar with it (and if you travel and rent cars, you absolutely should be), as a #1 ClubGold member you basically walk off your plane, arrive at the Hertz parking lot and look for your name on the #1 Club board, which looks like an electronic leaderboard. Next to your name is a parking space number, which is where you will find your car ready for you, key in the ignition, ready to depart. There isn't a need to talk to anyone, wait in line or even pause as you walk by the board. You simply drive off after showing the guard at the exit gate your paperwork and driver's license.
Particularly in travel, where so many things can and often do go wrong, Hertz has achieved what virtually no other company has done. It has created an operating structure where the company is highly motivated to link how it operates with an optimal customer experience. There's nothing cumbersome for the company or the customer, and both are highly motivated to sustain this symbiotic relationship. Even when you return your car, the name tag on the employees who check you in (while you unload your car) have titles on their name tags that say "Instant Return"!
To put this in perspective, consider the contrasting experience we had at a Crowne Plaza as part of the same trip. We arrived late after working all day and dinner with our client, still having work to do before our early morning flight back. As we checked in there was a manager training a new front desk associate, and we asked about what time we would have to leave the hotel to make our 8:15 a.m. flight. The answer was 6:30 a.m. so we requested a 6 a.m. wake-up call.
Later in my room I noticed a table-tent card promoting the Wake-Up Call Guarantee! This promotion promised that if they failed to execute their wake-up call then our room would be free. I had mixed reaction to this: on one hand I am always skeptical that I would receive the wake up call and risk missing our flight home (of course the flights were sold out that day due to last weekend's Final Four in Atlanta) and on the other hand I expected the staff to be trained to avoid not doing something as fundamental as a wake-up call! Given that a training manager checked us in and wrote down our wake-up call, I didn't give it another thought.
Of course now you know how the story ends: no wake up call! Yes they did comp our room but that doesn't make up for such a mistake! This is where the beauty of Hertz's operation lies: their loyalty proposition, #! Club Gold, is a function of how they rent cars and handle returns. And it is a very sticky proposition.
The idea that loyalty marketing is not a department, an island or a function within a company is all too often overlooked and underappreciated. Of course, in so many cases such as the Crowne Plaza incident above, it is clearly a struggle.
