My son decided he wanted to be a Skeleton this year for Hallowe’en – a far cry from his normal big budget movie choices (Batman, Spiderman, Bumblebee) and wow, is it ever hard to find a basic skeleton costume these days.
I ordered on online and had it priority shipped. It arrived in a day, and is a great costume. He and his exposed 3d glowing bones are also excited. I can’t wait to comb through his piles of loot and take out what I like next week. I have a sweet tooth.
The day after the costume arrived, I received an email from the company I had purchased the costume with, welcoming me to their ‘Preferred Customer Program’. While I am never one to shy away from future savings (how many Hallowe’en costumes am I supposed to buy in a year anyway?) my first thought was ‘seriously?’
I have been an off and on Customer of World of Warcraft for 6 years, and I still haven’t become a preferred customer there. What simple retail lessons can we learn after the break?
In the costume example, the company in a sense has failed. The purpose of having preferred customers is to reward loyalty and spending habits. People in retail know that rewarding loyalty to a company should actually stem from loyalty – not a single purchase. While not looking a gift horse in the mouth, the failure stems from the fact that as a customer I am not easily fooled – they should have given me the discount pricing on my first order since everyone gets the form letter after any purchase. It shouldn’t be a preferred customer program, only a customer program. I would have felt better with my purchase, and more likely to use them again, if received an immediate 10% discount as a first time purchaser.
When broken down to the most basic math sense, customers become a monetary number for all intensive purposes. I can tell you that my customers, on average, are worth $1500 per year of income. If that customer becomes an ambassador for my company – a brand lover who shares their enthusiasm with friends and family, that customer has a value of $1500 times the number of people they brought into the brand. Following the pyramid-esque scheme, those friends of the customer ambassador now share their newfound love of the product with 10 people each. You can see, even in this most stripped down and basic example, how a single customer can have a brand value of $100,000+ per year.
Get a few of those ambassadors and you have a successful business. Those customers really need to be treated as preferred customers. An honest business person can – and should – credit a lot of their success to those people, and reward them as such. While the customer already has an obvious affinity for the product rewarding them for their loyalty is just good business sense.
A lot of companies fail in this very simple yet paramount of importance ideal. I have been with my cell phone company for 10 years. My average spend is $550 a month. When my phone failed, I had to spend an hour and half pleading my case to the CS rep on the other line. I rarely complain (and choose to walk with my dollars). I had to plead my case- I have been a loyal customer for 10 years! My spend is 5x the industry average. While my phone failed, I really felt I deserved a free replacement. I had to fight for it. The company was | | close from me hanging up and singing with a new provider, before a manager came on and not only gave me a phone, but reduced my base monthly fee as well. While that felt satisfying in the end the time and effort it took left a really bad taste in my mouth. They lost a great opportunity to reward a loyal, long term, and high spending customer.
Why do MMO’s in general miss the mark? There are simple, cost free ways to reward loyalty. If I added up my WoW spend over the past 6 years I have spent multiple thousands – yet I get the same rate as Joe Blow who will just be signing up for the first time. I don’t need anything to cripple the income stream, but even a recognition of a free sparkle pony (again, it cost the company nothing to hand these out) for my years of income – or a small reduction in the monthly fee ($13 instead of $15 is still a big recognition). Those types of initiatives would create even more rabid fanboyism, promote the game further, and increase subs.
When will MMO companies start treating customers as customers?