19 November 2017
Alexander Peschkoff

Beyond TEDIPAY

Alexander Peschkoff - TEDIPAY

119Posts 543,326Views 625Comments
Fintech innovation and startups

Fintech innovation and startups

Disruption, destruction, harmony and creation; Fintech’s new frontier – a place to discuss the cutting edge of innovation.

Loyalty is a four-letter word

06 May 2017  |  5855 views  |  1

Why loyalty matters

There is one simple reason why you should read this article.

   | “The purpose of business is to create and keep a customer.” — Peter Drucker

How do you keep a customer? With the help of loyalty.

However, loyalty is one of those words that are frivolously thrown around left and right. What does loyalty truly mean, when it comes to your customers?

   | “The beginning of wisdom is the definition of terms.” — Socrates

The Oxford Dictionary defines loyalty as “a strong feeling of support or allegiance”. But who has to show that allegiance — you or your customer? Or both?

Drucker already answered that question. Although it takes two to tango, it is you who invites a customer to have a relationship. It is you, who has to work on keeping the customer. It is you who has to show allegiance.

Loyalty means love

What does it mean “to show allegiance”? Let’s replace “allegiance” with “love”. Suddenly, things become crystal clear.

Luring customers in with a sweet offer and screwing them afterwards is not love, it’s a one-night stand at best.

Offering your new customers better deals than what you offer to your long-standing ones is not love — unless you are a sheik in a harem.

Locking your customer in with a year-long contract, and then raising prices every month is not love (and is dishonest, even if Page 128 of your Terms & Conditions does warn the customer you will be doing that).

Rewarding a customer with 10,000 points and then attaching a long list of conditions to that reward is not love.

Love me like no one else

I travel a lot. What is my preferred airline? Even in business class, let alone economy, a seat is a seat, and a meal is a meal. Hence, in many cases it’s all about price. When two flights cost the same (and depart at similar times), it’s still hard to have a strong preference. Because there is none. Most airline reward programmes are identical. No one has a simple and honest offer, such as “Your 11th flight with us is on us. No ifs, no buts.”

When it comes to hotels, the situation is similar. A room is a room, a bed is a bed. Well, almost. My recent experience with Four Seasons was a good example of “we seek to deal with others as we would have them deal with us”.

Interestingly, Four Seasons’ loyalty programme is “by invitation only”, as it is “based on recognition rather than rewards.” I find that somewhat confusing — if I am recognised as a loyal customer, I am expected to be rewarded. However, the “invitation” approach makes sense — if I am a valuable customer, then reward me proactively, without making me apply for yet another loyalty programme.

To sum it up

  • It is you who must show loyalty, not your customer
  • Be genuine — love does not come with strings attached
  • Be honest — screwing and loving are not the same
  • Be generous — love like no one else

For your customers, loyalty can be a word with four letters (love), or it can a four-letter word. How it goes is down to you.

   “Simples!” — Aleksandr Orlov  

 

a member-uploaded image TagsRetail bankingStart ups

Comments: (1)

Paul Love
Paul Love - Compass Plus - Nottingham | 10 May, 2017, 16:57

To me this is all good common sense - so I am glad I am not alone in seeing little value in many of the big "Loyalty" schemes. 

Like any love affair, you need to show a your subject a lot of attention, truly care about them, and let actions speak louder than words.

Paul Love

1 thumb up! 1 thumb up! (Log in to thumb up)
Comment on this story (membership required)

Latest posts from Alexander

Second bite of Apple

24 September 2017  |  3748 views  |  0 comments | recomends Recommends 0 TagsPaymentsInnovationGroupFintech innovation and startups

Loyalty is a four-letter word

06 May 2017  |  5855 views  |  1 comments | recomends Recommends 1 TagsRetail bankingStart upsGroupFintech innovation and startups

Before they move us, we move them

14 April 2017  |  6055 views  |  2 comments | recomends Recommends 0 TagsMobile & onlineInnovationGroupFuturistic Banking

Tap-n-PIN mystery

23 February 2017  |  4352 views  |  3 comments | recomends Recommends 0 TagsCardsPaymentsGroupFintech innovation and startups

Alexander's profile

job title CEO
location London
member since 2012
Summary profile See full profile »
I am the co-founder and CEO of TEDIPAY, the company that is bringing to the market a game-changing platform for secure mobile transactions.

Alexander's expertise

Member since 2012
115 posts625 comments
What Alexander reads

Who's commenting on Alexander's posts

Paul Love
Ketharaman Swaminathan
Anthony Pickup
Alex Lithgow Smith