Below is an Autogenerated Transcript

Hey, everybody. Ron Kaufman here. I love to go out and get my morning coffee. Maybe you do too. In my neighborhood, there are 12 different places that I can go, just a short perimeter. Now, every single one of those outlets wants to get my next purchase. They want my customer loyalty. But what is the purpose of customer loyalty? This is the challenge that every business leader faces today. Is it only a matter of increasing the financial return, getting the next purchase, having somebody buy more from you, and increasing your revenue? Or is loyalty actually something much larger than that? That includes an emotional component, a willingness to be your advocate and your ambassador and share positive word of mouth with their friends and family members.

Well, I recently had a rather shocking experience where I went to one coffee shop and they’ve got a loyalty program where you accumulate points and it’s worth dollars. And then one day when you go in, you can have your meal or your coffee and you already accumulated the points. Great. So I was in there the other day and they said, “You know, Mr. Kaufman, you have this many points. So would you like today’s coffee to be on us?” I said, “You know, that’s a great idea.” And then the fellow said, “And it’s a good thing you’re using them because they expire in just a few more weeks.” I said, “What?” He said, “Yeah, our points expire after six months.” I said, “I didn’t know that.” He said, “Well, it was in the agreement when we set you up with the account.” Okay. It was in the fine print. And then he lowered his voice and he confided in me. He said, “You know, we had a customer come in here the other day, and she’d been accumulating points for a really long time with her morning coffee, and she had $150 worth.” So she brought her whole family there for lunch. I mean, it was going to be a really nice family event. And then after the meal, she went to pay with their points and they said, “Oh, I’m sorry, your points of expired.” She said, “What? When?” And they looked it and said, “Last week.” “Last week? I spent the last six months accumulating these.” Well you can imagine. He looked at me and said, “Yeah, she was really pissed.”

Now think about that. The problem is, who is designing your customer loyalty program? If it’s only people from the finance perspective, “Where do we want to get increased revenue?” Then you could end up actually destroying the other component of loyalty, which is the emotional side. The people who feel like they’re your partners, who want to help you win. Now, by contrast, I told you there were 12 coffee shops. One of the other ones has a very different loyalty program. You give them $200 upfront and they give you credit for $220. Now all I have to do is walk in, give them my phone number. They see who I am. They know what the balance is. And I walk out with a coffee without having to pull out my credit card or pay in any other way. Now, this is very intriguing because that other coffee shop, after just two visits already knew my name. I thought, well, that’s interesting. Why? Because they already have my money. They know that they owe me. And for me, I know that when I walk in, they’re going to recognize me. They’re going to be glad to see me again. They remember what my drink is.

Now, think about this for your organization. Who is designing your customer loyalty program? Do they understand that loyalty is so much more than just increasing your revenue and getting the next purchase? We help organizations all over the world design programs like this. Get everybody, including the finance department and the legal department, to think through what does it mean to really create more value for your customers so you get more value from your customers? And it’s not just in food and beverage or business to consumer. We do this with organizations in technology and supply chain and manufacturing and finance and real estate. So if you’ve got a situation like this or you want your customer experience and customer loyalty programs to succeed, then go ahead and book a call. Our team of experts will be happy to help you. And by the way, the next time you’re in Singapore, let’s take a walk and enjoy a great cup of coffee together. Mine’s a hot, dry, oatmilk cappuccino. You decide which of the coffee shops we should go to.