Loyalty is a funny thing. There was a time, not too long ago, when companies valued it, but they no longer do. That by itself is not really a problem. No, the problem is that they pretend to value it, they make a lot of noise about valuing it, they have all the trappings of valuing it. But they don’t really value it at all.
What they do is they covet it. They actually want your loyalty. They’d do almost anything to have your loyalty. But, it’s clear that they don’t really value it.
You see, if they valued it, then surely they’d reward it. And if they couldn’t or wouldn’t reward it, at least they wouldn’t punish it. But that’s exactly what happens all over the marketplace!!
About a year ago, I opened a new savings account with an Australian Bank – let’s just call it Eastpac. To actually induce me to open the account and put all my savings into it, I was offered an “INTRODUCTORY RATE”. An introductory rate?? Yep, that’s right! As a new customer, I received an extra 2.5% interest for the first four months! “Only for the first four?” I asked incredulously. “Well”, the bank salesman whispered conspiratorially, “if you call us at the end of the four months, we’ll do it again. And, we’ll keep doing it.”
This was a pretty good deal I thought. They say “introductory”, but at least it lasts. You moron, Goldberg. It doesn’t!! After I got out of the hospital and was sufficiently recovered, I called the bank to get my second “extension” of the “introductory” rate, and I was told in no uncertain terms, that that was only for new customers. In fact, a few weeks earlier, my daughter opened an account with them and did get the Introductory rate.
Since then, I’ve noticed this with other banks too. Special introductory rate for new customers. Switch your home loan now and pay no setup fee. Get a new credit card and pay no annual fees and 8 months interest free on all balance transfers!!
That would all be OK I guess. You have to have customer acquisition programs. I can live with that. But where are the customer retention programs? Why don’t I feel the love every time I walk into my local branch (where I’ve been hundreds of times before)? Why do I have to fight over everything when I’m on the phone with them? Why, when they tell me something will happen, can I go to the bank on it not happening (pun well and truly intended)??
The same is true of telephone companies. To get you to switch to them, they will actually pay your exit fees to get you out of your existing mobile phone contract, as well as giving you all kinds of discounts if you’re a new customer. If however, you’ve been with them for, say, 12 years – fuggedaboutit!! You can ask, beg, and threaten – all to no avail. Existing customers are scum of the earth.
In fact, on a day-to-day basis, the most reward for loyalty I get is from my local cafe. Every time I buy a cup of coffee, they stamp my little card, and after the tenth one, I get a freebie!! Now that’s what I call looking after your customers!!!!! Phone companies and banks – take note!!!
I have a theory as to the cause of all of this and I also have an idea about how to combat it. I’ll write about those in the coming weeks.
Meanwhile, what do you think? Do you have any examples of ass backwards “loyalty” from large organizations? How do you deal with it? Leave a comment and let me know!