Is Your Penny Pinching Costing You Customers?

by Halisi

The other day I tweeted anKeeping Loyal Customersd asked the question, “Is your penny-pinching costing you customer loyalty”?  With this economy have you decided to buy cheaper bread or charge for extra condiments?  Do your customers leave your shop with their suits on hangers or shoved into a bag?  Are you now charging for services you used to offer for free?  Or how about this – you used to offer one free cup of java after the purchase of 6 and now they have to buy 20 to get 1?  I’m sure we could all come up with 100+ more examples – the point is, all of this is very short-term thinking. You are sacrificing your brand for a few pennies per sale.

Over at MediaPost an article about hotel loyalty got me to thinking about the big picture.  In that article they wrote about the market research results on hotel brand loyalty and free vs. paid internet access.  The author makes a point that, judging by most of the comments, folks might have missed, and that is:  “why would you do something to antagonize the guests”.  I’ll go a step further and ask why would you do something that is against your brand?  As I’ve said in previous posts, your brand is the total experience that patrons get when they interact with product/service.   Do you want them to walk away remembering the tasty sandwich or the fact that they had to pay for extra condiments?

If you’re overly-obssessed with the bottom-line then figure out 1.  the cost of acquiring each customer and 2. how much that customer is worth?  You might find that you’ve given up $500.00/year to save $5.00/year.  Recently, I succumbed and bought in iPhone.  Being a bit on the frugal side, I purchased a refurbished iPhone 4 from my carrier’s site.  I spent my Saturday morning, activating it,  creating my email accounts on the phone, pairing it with my headset, etc.  Finally around noon I received my first call, and I couldn’t hear them!  I clicked the speaker button and then I could hear them say, “can you hear me now?”  Hmmm, I figured I must have something set incorrectly.  I couldn’t figure it out, so finally I called Apple.  She walked me through reinstalling the software, reconfiguring my email accounts, etc. – but still no sound from the internal speaker.  She told me I had to take it to the Good BrandingApple store.  I WAS PISSED!  I got in my car and drove the 10 miles to the nearest store.  It was a madhouse.  If we’re still in a recession, the folks at the Apple Store didn’t know it.  I went to the Genius Bar and put my name on the list (they’re all using iPads to do this now).  He told me it would be 15-20 minutes…it was actually about 5-7 minutes.  The attendant was about to walk me through the same things the Apple assistant on the phone did – and I told her so.  She looked at me and said, well I guess we’re going to have to send your phone back.  WHAT?!?! A week with no phone was unacceptable, I had resigned myself to go back to my crackberry.  She went into the back and came out with the paperwork and a BRAND NEW PHONE.  She programmed it and said, “here you go”.   I tried to act nonchalant, but inside I was doing the “Oh Yeah” dance.  THAT’S CUSTOMER SERVICE, that was adding another layer to my Apple loyalty.  That was protecting the brand!

Have you come up with clever ways to lower costs while protecting your brand?  Share your ideas with us.

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