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Loyalty royalty

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Jagdeep Kapoor

FOR regular customers, devise a loyalty programme which treats them like royalty.

When a satisfied customer repeats his purchase, or when he recommends other customers because he is satisfied, the net result is a healthy bottomline, whereby both customer and company benefit. My Profitable Customer Service (PCS) thus enables both to profit from the brand experience.

PCS is full of benefits, first to the customer and then to the organisation. It is important to understand that when service is profitable there are both tangible and intangible advantages to both parties. Loyalty programmes give the customers additional advantages and the company a greater frequency of business.

Shoppers' Stop in Mumbai started its First Citizens' Club for frequent shoppers. Every time a member makes a purchase, he/she notches up a number of points. The member is allowed to encash these once they reach a certain figure. Naturally, the higher the number of points accumulated, the better the prize that can be redeemed.

Shoppers' Stop has three types of privileges card members gold card, silver card and ordinary card. Along with this simple scheme to boost business by giving customers additional goodies, come the other advantages. Like a newsletter to keep customers informed about in-store activities. A `members only' queue for the cash counter so that the First Citizens of Shoppers' Stop do not have to rub shoulders with the hoi polloi. A few hours of exclusive shopping time for club members at festival times when the rush is heavy. Like they say, if you are a First Citizen, you get first choice.

In the fast moving consumer goods (FMCG) segment, a powerful adhesive brand, Fevicol, runs a mutually beneficial loyalty programme called the Fevicol Champion's Club. The primary target audience is the carpenter who is given not only exclusivity of club membership but also has the opportunity to attend carpenter meets to sharpen his skills. Jet Airways has a frequent flyer programme which awards flying miles with every ticket purchased from the airline. Regular customers also get the advantage of the Jet Airways' tie-up with British Airways. The Taj Inner Circle gives members special privileges whenever they use a Taj hotel anywhere in the world. . The customer service professional (CSP) must carefully design the loyalty programme with the three key elements of eligibility, privileges and validity in mind.

Solve problems when they are small

To treat loyal customers in a royal manner, solve problems when they are small. When a customer's concerns are not addressed at the initial stages, they turn into problems. And if they are not tackled then, they sometimes snowball into gigantic issues that can cause immense pain to the customer. Addressing concerns at the outset, answering queries in a satisfactory manner and nipping problems in the bud really help clear the air for the customer.

A good CSP is a solutions provider. An effective one makes sure that he understands and appreciates the concerns. This way royal treatment is given to loyal customers.

It is prudent for the CSP to ensure that he does not give the customer the cold shoulder. Neither should he ridicule the customer. He should come up with a satisfactory solution, holding the customer's hand if necessary and even nursing him, figuratively, so that he can get on his feet again.

Look at this example of customer service in the FMCG industry. The housewife (or adult or child) could be the consumer, while the distributor and retailer are customers of the company. The company sells products to the distributor who in turn provides them to retailers from whom consumers eventually buy.

Thus the first customer of the FMCG company is the distributor. Ensuring distributor satisfaction is to ensure customer satisfaction at the first level.

At the second level, the customer is the retailer whose satisfaction is very important. Finally, and most importantly, there is the satisfaction of the consumer to reckon with.

A good CSP makes sure that there is a pleasant brand experience and customer satisfaction at all three levels. He also gives royal treatment to loyal customers.

In one case, a distributor in Lucknow had a serious problem because the company had not settled his claims. This led to his working capital being blocked. In simple terms, it means that the distributor had run promotions and trade schemes in the market on behalf of the company and had not been reimbursed for his expenses. He had been complaining for over six months but to no avail. The only recourse he saw was to stop making purchases from the company and this led to a large part of Lucknow being starved of the company's products.

If the reimbursement had been made on time, there would have been distributor (customer) satisfaction. He would then have been able to regularly pick up stocks and feed the market. This would have ensured that the retailers were kept happy, with stocks being constantly replenished. And regular supply would not have necessitated consumers switching to other brands due to unavailability.

Buying an apartment in Mumbai can be a harrowing experience if the vendor is not the problem-solving type. In one instance, the task at hand was to retrieve the sale documents which go to the Registrar's office and take an eternity to come back. Getting those documents back for the buyer can be like searching for a needle in a haystack.

But with a little help from the builder who knows the value of customer service, it can be a cakewalk. Though he is not obliged to help in the recovery of the documents, the builder as a CSP may choose to make the life of his customer easier by lending a hand and putting the final seal on the completed sale deal.

If the customer is satisfied, the CSP can rest assured that he has won him over. He knows that one satisfied customer means several more through the good word-of-mouth he earns from this satisfied customer. Problem-solving customer service is like a stitch-in-time. It can save a lot if practised before the problems fester. And to provide mutual benefits PCS gives added value, tangibly and intangibly, to the customers and allows the company to profit at the same time. Royal treatment definitely leads to loyal customers. In your loyaty programme, treat customers like royalty.

(The author is Managing Director of Samsika Marketing Consultancy.)

(This article was published in the Business Line print edition dated February 3, 2005)
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