This is the third post in a series that will explore a set of questions I received from participants during a webinar on the topic of customer service. (I say “explore” rather than “answer” because I’ve discovered over the years that there is rarely a single right answer to these types of questions. More often, there are a variety of solutions or guidelines that, when applied, produce successful outcomes.)
Question: What is your view of treating “premium” customers better than ordinary customers?
In considering this question, I am reminded of the Aristotle quote: “There is nothing so unequal as the equal treatment of unequals.”
This is a slippery slope in customer service because, when taken to extremes, it appears to be prejudicial service, where one customer is prematurely judged as less valuable or important than another customer. (Think about the scene in Pretty Woman when Vivian, played by Julia Roberts, was snubbed by saleswomen based on her immodest appearance while shopping at an upscale boutique along Rodeo Drive.) And, of course, this is wrong.
A popular assertion is that all customers should be treated equally. Here, I’d like to make a distinction between the terms equally and equity:
- Equally means having the same value as another.
- Equity means the state, quality, or ideal of being just, impartial, and fair.
Equally means 50:50. Equity might mean 60:40 (or some other unequal ratio) based on what each party needs and deserves. I have four children. The three oldest receive allowance but their allowance is not equal. The financial needs of my 7th Grader differ from those of his 3rd Grade sister and their individual allowances reflect that difference. Their allowance is not equal but it is equitable.
In the same way, customers who have flown 100,000 miles with an airline and achieved elite status in its frequent flyer program deserve to board the airplane ahead of those passengers who fly less often. And retail customers with a history of significant spending deserve to be notified of sales before the general public in order to preview the best selection of sale merchandise. These perks may not be spread equally among the customer base but they are distributed equitably.
The goal should be to treat loyal customers better, not casual customers worse. Doing so reinforces premium customers’ personal importance (not their importance as people—that’s equality—but their importance as customers) while recognizing the value they bring to the business through personal spending, loyalty, and referrals.
In the first paragraph, I suggested that there’s rarely a single “right” answer to these types of questions. You’ve read my response. Now it’s your turn. How would you respond to the above question?
Don’t settle for ordinary. Choose extraordinary. (It’s always a choice.) Order Delight Your Customers: 7 Simple Ways to Raise Your Customer Service from Ordinary to Extraordinary by Steve Curtin or purchase from select retailers, including Barnes & Noble.
Watch the 90-second book trailer.
Steve, thanks for a great post.
In past CustomerThink research we’ve found that customers do want to be “rewarded” for their loyalty. That doesn’t mean just a loyalty program (often just a disguised discounting scheme), but also being recognized and appreciated for their business. A sincere “thanks” is a start!
On the other hand, customers that don’t do a lot of business don’t want to be treated badly. I agree 100% with you that: “The goal should be to treat loyal customers better, not casual customers worse.”
But unfortunately I think some companies don’t see it that way. They sometimes forget that today’s casual customer can only become tomorrow’s advocate if treated well. And, that poor service delivered to an “unimportant” customer will get talked about on social media.
Great companies strive to treat all customers well, and loyal customers even better. But it has to be perceived as fair by everyone.
Bob, I agree that most “loyalty” programs are actually “customer retention” programs because customers are motivated by discounts to participate.
And I appreciate the research that found customers, generally speaking, didn’t want to be rewarded for their loyalty. If this refers to the annual tchotchke I receive from my life insurance agent, then I agree. However, I’ll never turn down an airline, rental car, or hotel upgrade. ; )
Thank you for providing a stellar audience for my blog posts and, especially, for taking the time to read and comment.
Steve