Tuesday, February 24, 2009

The $100,000 Salt & Pepper Shaker.

I just finished listening to the audio book The Last Lecture by Randy Pausch, the moving story of a 47-year old college professor and the life lessons he passed on shortly before succumbing to cancer. In the book, Pausch tells the story of the $100,000 salt & pepper shaker.

It seems that when Randy was 12-years old and on a visit to Disney World, he decided to show his parents his appreciation for the trip by purchasing them a ceramic Disney salt and pepper shaker. 

Minutes later, a minor tragedy struck when he accidentally dropped the shaker and it shattered into pieces. On the advice of an adult who witnessed the accident, a hesitant young Randy returned the broken shaker to the store—and to his surprise, was given a new one. No questions asked.

So where does the $100,000 come in?

After the incident, Randy and his whole family were so impressed by the Disney staff member’s handling of the incident that they began to appreciate Disney on "a whole other level". They made Disney their permanent vacation home. And by Randy’s calculations, over the years his family went on to spend over $100,000 with Disney, never forgetting the symbolic importance of that one interaction. Hence, the $100,000 salt and pepper shaker was born.

What’s your brand or company’s $100,000 gesture? As this story illustrates, even the smallest actions can pay off with a very big reward—turning a current customer into a customer for life.

Thursday, February 12, 2009

Lovely hotel. Tough loyalty program.

From November 2008 through early January of this year, I spent several weeks working in LA and was fortunate enough to be put up at the Fairmont hotel in Santa Monica. All in all, a really fine place to stay, with friendly attentive service, a pleasant lobby bar and comfy rooms with a view of the Malibu coast.

I of course joined the Fairmont’s loyalty program, the President’s Club, and for starters earned free Internet access throughout my visit, saving $10 bucks a day. A nice perk. But like most of us, I had my eye on the big prize—a free night’s stay.

I reviewed the program requirements and while they seemed a bit steep at 30 nights for eligibility, I racked up 25 nights in November and December 2008 and 5 nights in January ’09. By the end of the project, I had nailed the stay threshold for a free night on the nose. Yes!

There was just one issue.

Upon checking my President’s Club account in late-January, I discovered I only had a balance of 5 nights in the “bank”. My 25 nights from 2008 had been wiped off the slate. The reason: it seems the program resets at January 1 of each year, wiping out all nights accrued over the previous calendar year.

Now we can all understand accrued nights expiring at some point—but nights I had earned as late as December 20th had been wiped off my earnings statement, giving them a shelf life of a little more than 10 days. About the same as a container of milk.

I fired off an e-mail to a program representative and within 48 hours had a response. A nice one, indeed. I had been granted entrĂ©e into the top level Platinum Club, and with it received my free night’s stay—which I’ll soon be enjoying with my family at a very fine Fairmont hotel in New York City.

In the end, my faith was restored in the Fairmont and its loyalty program. My membership had been bumped to top tier status, I had received the reward I felt was rightly mine, and I will again stay at the hotel the next time business calls (as well as spread some WOM love, my brother just finished a stay there).

But as a loyalty enthusiast, I have a nagging concern in the back of my head: What of other program members in similar situations who may choose to protest their lost nights by switching to another hotel? Seems to me the Fairmont may want to do a little tinkering with the finer points of their program.

Monday, February 2, 2009

Can viral videos work in Loyalty?

At some point, you’ve probably seen a viral video, those short video clips that get passed from one person to another via e-mail or a media sharing Web site. They’re sometimes edgy, often humorous. And when they’re done right they can get people talking and generate a buzz.

The question I’ve been pondering: is it possible to create a viral video that works for your best customer base? One that’s personalized—and so good at capturing the essence of your company that customers want to share it with friends and associates, thereby cultivating new customers.

It could be a happy birthday video from the friendly wait staff at your local favorite restaurant. Or a thank you message from the pilot of your preferred airline. Or even a humorous “we miss you” video from a hotel you frequent, but haven’t been too lately.

It could be one more way to surprise and delight your best customer base—the people most likely to spread positive word-of-mouth about your company to others.