Recent research shows a third of consumers prefer that companies thank them in the form of points or miles – indicating the pervasiveness of loyalty programs. But retail interactions occur well outside purchase, and recognition extends beyond loyalty programs. How some retailers are thanking customers in fresh ways
If love means never having to say you’re sorry, then loyalty should mean always having to say thank you..
It can come as a verbal word of gratitude, or in the form of rewards points. One factor does not change when it comes to retail: Consumers like to be thanked and recognized for their patronage.
That’s my takeaway after reviewing the results of a recent survey by TD Bank, which measured consumer attitudes about giving and receiving thanks in both personal and commercial settings. Not surprisingly, when it comes to being thanked by others, 84% of those surveyed said they prefer their thanks to come in person.
However, just how consumers like retailers and other companies to deliver their thanks is a different story.
For instance, 33% of those surveyed prefer companies to thank them with points, miles or other loyalty rewards. This is a great boost for loyalty marketing and rewards programs, but I don’t think the takeaway should be so cut-and-dry. Retail interactions involve much more than a purchase, and a rewards program will realize its full potential only if a retailer shows its thanks across all shopper touchpoints, such as the online experience, its social channels and customer care.
There are ways to generate customer recognition beyond traditional loyalty programs, as Apple, Lululemon and REI have proved. Let’s explore them; but first, let’s look at the research.
Gratitude Generates Loyalty
More than three-quarters of consumers surveyed (77%) said they are more likely to be loyal to a brand that expresses gratitude, according to TD Bank’s online survey, which took place in July.
That loyalty figure skews slightly higher among consumers ages 18 to 34 (81%) and women (80%). Meanwhile, 60% of the respondents said a direct thank you is more genuine, while 44% find a personalized thanks to be more authentic.
However, when asked specifically how they would like a company to thank them, 68% of all respondents chose rewards such as points, miles or other loyalty program benefits. Just 34% chose a verbal thank you.
As earlier stated, one-third of the respondents said loyalty program rewards are their most preferred way to be thanked (a close second to freebies). Just 13% of the respondents chose a verbal thanks as their most preferred form of recognition.
Younger consumers ages 18 to 34 are more likely to say freebies are their most preferred way to be thanked (39%, versus the 55-plus set, of which 25% most preferred freebies).
Of the 34% who said they like a verbal thank you overall, 38% fall into the millennial category (18 to 34) while 29% are older than 55.
The survey results aren’t good news for the stationery industry, as the good old-fashioned, hand-written thank you note did not fare well across any segment. Just 7% of millennials and 4% of consumers between 35 and 54 most prefer receiving a written thank you note from a brand. The figure does not much improve among those 55 and older – 9%.
3 Fresh Ways of Giving Thanks
It is not a revelation that consumers crave acknowledgment, but it is surprising to me how few consumers, across age groups, prefer a verbal or written thank you to a reward or freebie. I suspect this is a sign of conditioning because of the pervasiveness of loyalty programs.
But with that pervasiveness comes a higher bar – to stand apart and remain relevant as a retailer and a brand. This means resonating with the shopper, and making him or her feel genuinely appreciated, at all retail touchpoints as well as in unexpected places. Here are a few examples.
Teach them something new (about you): Retailers can invite customers to free events that educate them about products or processes central to that brand – further ensuring their relevance. REI, the outdoor activities company, offers a broad selection of free courses, from bike maintenance and GoPro training to land and water conservation. (Fee-based classes such as photography are discounted for those who become REI members.) Similarly, Apple offers free workshops that extend from the basics of using its products to digital photography, as well as free field trips for kids and teachers.
Bowl someone over: Retailers are familiar with the concept of surprise and delight – wowing a shopper with an unexpected gesture that will remain fondly in his memory for years. The classic example is when a call center employee at Zappos.com sent flowers to a customer whose mother died. In this area particularly, loyalty programs help because the insights they gather enable more tailored communications. Morton’s The Steakhouse once blew a customer away after he tweeted the chain jokingly requesting that a steak be delivered following a long day of business travel. To his surprise, an employee met him at the airport with a porterhouse steak, a colossal shrimp, a side of potatoes and silverware to boot.
Feed their passions: People choose brands that support their lifestyle interests; they stick with brands that encourage and share them. Lululemon, the seller of yoga, workout and athleisure clothing, provides its regular shoppers complimentary in-store yoga classes led by local instructors. For those who are not near a store or cannot make it, Lululemon offers free online classes. By extending these free services, Lululemon is reinforcing its support of a passion that is increasingly shared by its best shoppers. And so the bond strengthens.
Thanking customers across all touchpoints is good practice simply because it is good manners. It also could be good business. If practiced genuinely, an unexpected thank you brings its own rewards in the form of many welcome returns.