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315Chapter 19: Fortifying Customer Relationships

ߜ Rebates against spending levels. Instead of providing a discount upon
achievement of a spending level, this program tallies up a year’s worth
of spending and provides a year-end rebate:

Benefit: Urges buyer to rack up purchases for end-of-year payoff.

Downside: Success relies on the size of the rebate. Also, because the
customer has to wait so long for payoff, it inspires only the most cost-
sensitive consumer, who is likely not the buyer in whom you want to
invest your marketing effort.

ߜ Upgrades and special treatments. This program relies on the value of
surprise rewards. Imagine driving into a car wash, pulling out your bill-
fold, and having the attendant say, Our license plate reader tells us this is
your tenth trip through our car wash, and we want to make this one on us,
along with a complimentary wax and hand-dry finish.

Benefit: The spontaneous nature of the reward combines customer recog-
nition and customer service, a surefire loyalty-development formula.

Downside: Customers will begin to anticipate and expect this kind of
acknowledgement, so be prepared for ongoing commitment to customer
recognition to keep your best customers inspired by demonstration of
appreciation.

Avoid programs that look more like promotions than rewards or that provide
incentives with too many strings attached.

For example, a $10 certificate good through the end of this month on any in-stock,
regularly priced item of $24.99 or more looks more like a come-on than a gift.

In customer service and in customer loyalty programs, give customers what
they want, deliver consistently, show true appreciation, and exceed expecta-
tions that only your business can meet. See Chapter 18 for tips.