Loyalty Marketing and the Stockholm syndrome

04 Aug 08 - Mark Klein

Some of my friends have helped me to a better understanding of the difference between loyalty and satisfaction.

They live in a mid-sized city in the mid-West. For a long time their city has been primarily served by Northwest Airlines, so they are frequent fliers on that airline. By many measures they are loyal customers of Northwest.

But when you talk with them you quickly learn that they are more trapped than loyal. They don’t have alternatives, and   to them the airline is “Northworst". Loyalty may be high, but satisfaction is not. If there was another carrier, my friends would switch in the blink of an eye.

I’m sure you know instances of customer loyalty being more  the lack of alternative vendors than of a favorable opinion. So how do you think  a company  should operate when many  customers who appear to be loyal are really trapped?

The Devil's Compact in Customer Loyalty Programs

20 Apr 08 - Mark Klein

Sometimes I show some resolve and actually carry out my resolutions. Yesterday was one such day—I cleaned out my wallet, which was too light on money and too thick with cards from various loyalty programs. Pruning those loyalty cards made me look at each program and decide whether participation was worth it, whether there was there a decent quid pro quo for using the program.

The obvious description of customer loyalty programs is that they are a way for a company to thank its regular customers for their continuing patronage with rewards and discounts. Whether it is a coffee card for an extra java after ten purchases or free tickets to Hawaii after a winter of business trip, we all especially enjoy the “free” product or service. It’s nice to be appreciated and thanked.