Monday, January 17, 2011

Customer Vulnerability



The goal of any business is to successfully create a secure, long-term relationship with their customer and ultimately win their loyalty. Along the way, you need to keep the customer on that “happy path” but also manage them through the pitfalls that can put the customer “at risk”.

But the one thing companies often miss is recognizing when the customer relationship becomes "vulnerable". Vulnerability doesn't happen because of a poor service interaction or an incorrect billing transaction. And vulnerability isn’t always easy to see, often times festering under the surface of what appears to be a stable relationship. What usually creates vulnerability is the deterioration of the relationship over time where no clear value is ever established.

A great example of this can be found in customer loyalty programs, especially in the travel and hospitality industry.

While my work has me traveling with some regularity, I'm not the commensurate road warrior, flying out every week on Sunday night and returning home Thursday. But when I do travel, I make a point to try and book flights with United and hotels with Marriott as I am a member of their frequent traveler programs.

My recent trip to San Francisco began with an upgrade request to United first class using my frequent flier points. When I arrived at the airport gate I was greeted with an electronic sign indicated I was 34th in line for an upgrade. Funny thing was, as I continued to watch the sign I saw other names being added to the list in front of mine.

Obviously those people who have achieved platinum status are treated with a higher priority and I get that. But what about people like me trying to achieve that level? How do you think they feel as they watch other people jump ahead in the queue? Vulnerable?

On the other hand, Marriott continues to get it. I don't have a ton of points with their rewards program but when I arrived at my hotel in San Francisco I was greeted warmly, acknowledged as a Marriott Rewards member, and given a room on the highest level with a nice view of the city. I perceive value in my relationship with Marriott through their rewards program and continue to make them a priority when booking reservations.

My frustration with United, however continues to grow; slowly and silently. For my upcoming trip to Denver, both United and Jet Blue offer non-stop flights and this time I'm going with Jet Blue. Not because they were cheaper, but because United doesn’t seem to put much value on my loyalty. I also find it ironic to be inundated with credit card offers from United with the promise of “more points to be used for travel rewards”. But given my perception of United's opinion of me and my point balance, do they really think I'm interested in deepening the relationship?

I think not!

With Marriott, it’s the continuous journey down the happy path to rewards. With United, it’s all about the destination, regardless of the turbulence along the way. Who would you choose to be loyal to?

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