Tuesday, August 12, 2008

When a loyalty program gives a once loyal customer the boot.

I used to be a member of the loyalty program Hilton HHonors (a name both my spell check and I aren’t too crazy about). I say “used to be a member”, because on two recent stays at Hilton brand hotels, I was told they had no record of my membership. I had ceased to exist.

Some back story: Between the years 2001 and 2005 I stayed at a particular Hilton Garden Inn all the time. I was a very loyal customer. In fact, over 4 years I racked up enough points in the HHonors program to treat my family to a free weekend stay in a very nice New York City hotel suite.

But by late-2005, I had moved on to another job, one that at the time required zero travel. The Hilton hotel stays stopped. And by about the end of 2006, something else had stopped as well—all incoming e-mail from the HHonors program.

Fast forward to 2007 and 2008, and I’m again traveling ad nauseam, to the tune of about 50-room nights a year. Only now, the bond between me and Hilton has been broken. So, when the choice is mine, I’m opting for hotels I really like (Shutters in L.A.), give me special perks (Lowes) or offer a loyalty program that has greeted me with open arms (Hyatt).

Funny thing, though. Twice in the past couple of months, I found myself again checking in to a Hilton brand hotel. The first time, I asked the desk clerk to credit my Hilton HHonors account. After all, I still had my account number and password. Even had my Hhonors member card. There was no record of my membership—nor was I invited to rejoin the program. I later checked online at the program Web site. Ditto, no record of my existence.

What happened? Had the database see me as a lost cause, an inactive customer not worth keeping in the system? Or had they simply misplaced my information? The fact is, for all Hilton knew, I was still a frequent traveler who had moved my share-of-wallet to another hotel chain—in another words, a traveler worth trying to win back. Which begs another question: At what point do you eliminate a once valuable and loyal customer from your database?

This former Hhonors member’s opinion: If a “best” customer disappears off your radar, you should be making every attempt to win him or her back. If you’re sending out cost-prohibitive print communications, a trigger based on a full year of inactivity might be understandable. But if your customer has opted in for e-mail—with its infinitesimally small distribution cost—you should keep pushing out communications as long as the once loyal customer’s inbox will accept them.

After all, you never know when a once loyal and valuable customer might resurface—and potentially become a best customer all over again.

Tom Rapsas, Associate Creative Director, MRM Worldwide, tom.rapsas@mrmprinceton.com


  1. Tom,
    An extremely vital aspect of Loyalty management...When should you hold on..and When should you let go?
    Though it is quite often indicated that attrition management / retention is vital, business interests and quarterly results quite often lead marketers to push the envelope with existing "active" customers.
    It really takes "great" brands to hold on, which perhaps differentiates the men from the boys.....

  2. Upendra,
    Seems like there should be a way to put once valuable MIA customers into "sleep" mode and then reactivate them once they come back from the dead. The most surprising aspect of this encounter for me was there was no effort by the hotel desk staff to try and reactive my account or to get me to rejoin the Hhonors program.
    On another note, I stopped in a Banana Republic store a few days ago and the cashier greeted me with the line "Hi, how would you like to save 20% on your purchase today?" a come-on for their cobranded credit card. Smart move on the part of the honchos at Banana Republic, as they know putting the card in my hand (and obtaining my personal info) makes it more likely they will get me to return to the store in the future.