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Monday, August 17, 2009

You’re not worthy! You’re not worthy!

The Fairmont chain of hotels has a reciprocal agreement with various airlines to provide air mile recognition for hotel stays.

I didn’t know about this, because my airline never told me, even though they have enough data from the airline miles credit card to know that I stay in a variety of hotels reasonably frequently, including the Fairmont chain.

Nevertheless, upon seeing my airline’s logo prominently displayed on their rotating advertisement board with the claim that they would provide air miles for Fairmont service experiences, I inquired at the front desk if I could have air miles for my current stay.

“No” was the kind reply. (a reply I’m getting used to at the Fairmont) “Your stay is covered by a conference rate, and as such, the exchange of miles for stay nights does not apply. But I see you travel often, and if you like, we could set you up so that future stays would be credited.”

Don’t bother. Yes, I travel reasonably often, but most often in association with a conference, so by your definition, my business will never be good enough to qualify for the mileage credit.

Most loyalty programs are awful, and this one is no different.

What constitutes “loyalty” is defined from the company perspective, rather than the customers. I don’t care that I’m on a conference rate. The conference gave me 8 hotels with rates to choose from, and I chose yours. At the end of the day, I am selecting Fairmont because of (a clearly misplaced) affinity for the brand.

Most rewards programs are not tangible enough for users to understand when they are applicable, when they are not, how to claim a reward-eligible service encounter and how to redeem it. Whether this is by design (service companies wanting the benefit of loyalty program activity without associated cost of redemption) or by a benign-but-poor communications strategy, the result is the same customer confusion.

Loyalty and rewards programs have been so “me-too’ed” that there is little differentiation, and so little point to selecting one vs. the other. Their benefit is quickly approaching negligible.

With the exception of Southwest Airlines.

Fly 16 times, get a free trip. Clear, tangible, egalitarian. Kansas City-to-St. Louis is the rewards equivalent of Miami-to-Seattle. They show legitimate excitement when I get a reward ticket, and when I redeem it. In terms the Fairmont probably wouldn’t understand, a stay is a stay is a stay. Thank you for your business. Please give us more, and under any circumstances.

Unless your intent is to design a loyalty program that identifies true customer loyalty activity and rewards it accordingly (and with the appropriate level of excitement for a customer that is choosing your brand time-after-time in a sea of options), save yourself the effort. Go to your largest competitor’s website, copy the text of their program, execute a find / replace to insert your name where theirs currently is, and call it a day. I get the sense that most companies engage in this anyway.

1 comment:

Sara said...

I was going to disagree with you on one point until you mentioned Southwest. Granted, those 16 credits are hard to earn in a 2 year span if you're the average person. I finally earned my first Rapid Reward, but it was only because I'd had a few business trips (which are out of the norm) that helped me along. I will completely agree with you about how Southwest treats their Rapid Rewards members, though. I was *stoked* to get my first free flight - and they were too! They sent me 4 free drink coupons to celebrate.

Best Western really has a rewards program as well... now, I can't speak to how good it is in its own right, but since they're partnered with Southwest, I get .5 flight credits for every stay. (Though I do have trouble figuring out when a stay is a "stay".) I'm loyal to Best Western because of the consistently great service I've received and the great customer experiences I've had. The extra Rapid Rewards are just icing on the cake.

United, on the other hand, I'm still not sure what to do with my lousy 3000 miles.