In my article last week I discussed warranties and what’s the right thing to do when they expire. Since then, I have had many questions put forward to me around Gift Cards and Vouchers. Again, It’s a Tough One or is it!
So, I decided to research the Australian Consumer Law – New Gift Card Laws and found,
The Australian Consumer Law (ACL) has been amended to provide protections for gift card consumers across Australia. These national changes apply to gift cards supplied to consumers on or after 1 November 2019.
Cards and vouchers sold before 1 November 2019 continue to have the same expiry period and applicable fees as at the time of purchase.
The law applies to all gift cards or vouchers sold on or after 1 November 2019, unless specifically excluded. This includes gift cards for online stores that trade in Australia.
This is a great example where there has been so much negative customer feedback that the government stepped in and changed the law.
What I love most about this example is,
They weren’t reactive! They didn’t change the law based on a few, they based the need for change on statistically valid data, data they could trust.
Even so, businesses can set their own rules in respect to what happens next. What are we willing to do? Do you have flexibility within you service standards to consider a customer by customer situation when a gift card or voucher has expired?
I am not suggesting you change your service standards to accommodate just a few rather I’m asking do you have a process in place or within your service standard that addresses these rare occurrences, provides flexibility, and delivers a 10/10 customer experience? Or do you simply follow the gift card and voucher rules and decline your customers request?
Doesn’t it come back to doing the right thing by people in certain situations and standing for the long-term customer relationship?
Do some customers try and rip you off, milk the system or bend the rules? Of course, there are that few that do.
What I dislike the most however, is when businesses become reactive when they have these occasional occurrences.
They don’t take the time to do the research and base their decisions on statistically valid data.
Instead, they use what I call ‘Buttock’ research
– they pull it out of their backsides then make critical decisions
They react by changing their service standards whilst focusing on the minority or the lowest common denominator; people who do the wrong thing and then treat all customers like they will behave this way.
For example, when you check in at your hotel, the front desk receptionist will need a credit card to put on hold before handing over the room key. A credit card hold is an insurance policy for the hotel. Specifically, the hold covers incidentals such as damage to the room, room service and dips into the minibar. And you don’t get it back for a number of days.
It adds up when you are travelling and possibly staying in 5 different hotels over the course of a week. So, if you stay in five hotels in one week, you can have up to $500 being held.
My point is unless you are known as a loyal guest through a hotel membership for example, they treat every other guest, like they’re going to be bad, naughty and do the wrong thing.
If we do make business decisions on the behaviour of a small group or percentage of our customer base, we are basically suggesting that all customers behave this way. And in our society, it happens all the time.
Like in Hobart for example, they have just changed the rules around the speed of which you can ride your scooter. Why, because of the behaviour of a very very small percentage of scooter riders, scooters are now considered to be dangerous. And they’ve reduced the speed to 10KM’s. In other places and countries, the speed limit is up to 50KM’s per hour.
So that reduction in speed, probably makes it not worth riding a scooter, for those who use them as an alternative to driving a car.
Or, you just have to think about road rules, each state in Australia spends millions of dollars focussing on catching people out and punishing them, not rewarding the good drivers for their behaviour.
And then there’s telcos, the best way to get a better deal is to threaten to leave, It’s only then they step up and offer a better deal to have you stay.
We punish people, we don’t reward people
In our society, we keep focusing on the negative behaviour rather than, the vast majority of people who do the right thing.
For example, if you go to countries like South Africa, you can walk directly up to the edge of a mountain, cliff, gorge etc and look over the edge. Whereas, in other Western countries getting close to the edge to look over is just about impossible. Why, because one person fell over. Tragic, I know, however my point in this article is all about making reactive decisions based on the lowest common denominator.
We just constantly react.
What happened to treating people like they’re going to do the right thing and rewarding them when they do?
Did you know that in some countries if you don’t get a speeding fine, your registration fee is reduced and in some cases, drivers don’t even have to pay.
These drivers are rewarded with a price reduction.
When customers demonstrate the right behaviour, they are praised, and without a doubt in most cases they will repeat it.
Rewarding our customers doesn’t get much better than this.
I think having loyalty programs that are truly based on acknowledging loyalty and rewarding your customers for their loyalty is a really good thing to do.
What I like about loyalty programs like Qantas for example, is that my loyalty is recognised and rewarded, they always look after me, and make me feel special.
It comes back to being in the world of your customer and doing nice things for them. When we do this, our customers are going to want to repeatedly demonstrate their loyalty and keep coming back.
It can be as simple as,
a free Sunday night’s accommodation, or a late check out
a free meal in the restaurant or upgrading breakfast
Take a lead from major airlines, and most really good hotels, they know the value of making their guests feel special, and they really reward their loyal customers.
How do they know who to reward in this way, you may be asking, which brings us back to statistically valid data.
Rewarding your customers isn’t about freebies or loyalty cards or discounting your services, you should always stand by the value of your product or service, I’m talking about the customer experience and delivering 10/10 customer service.
It can be as simple as taking responsibility in certain situations like honouring an expired gift card or voucher under particular circumstances or just acknowledging the customer, knowing their name, remembering their order etc.
It’s about being willing to be flexible and simply making it easy to do business with you, when you can.
We recently bought a fridge from Harvey Norman, they had never really been in my top 5 list of suppliers I look to when needing electrical products, so this was probably my first experience dealing with them, and they nailed it.
The sales process was easy, the fridge was delivered when they said it would be, and they bent over backwards when we unpacked the fridge and realised it was just too big. There was no way it was going to fit in our kitchen.
We felt really bad, yet they never made us feel bad.
They were fantastic, even though the fridge had been unpacked, there was no question about returning it and purchasing another. They delivered our new fridge and took the other at the same time. And all we had to do was pay the extra delivery fee.
Now, I speak about Harvey Norman to others in a really positive light, and yes, there are now on my top 2 list, I wouldn’t hesitate to recommend them and repeat business with them in the future. I know I can rely on them to take good care of us if something goes wrong.
Actually, I even wrote a review, which is something I very rarely feel inclined to do.
Rewarding not punishing your customers or making business decisions is never about the lowest common denominator, which brings me to statistically valid data, data you can trust.
Doing your research, talking to your customers, and capturing a valid data sample is critical.
When it comes to delivering a 10/10 customer experience and developing 10/10 service standards, the foundation always comes back to the customers experience, who your talking to and what data you’re collecting.
A friend and colleague of mine Dr Andrew Pratley runs a really cool half day workshop all about looking at your data. It’s called DAM.
I love the DAM reference, because it’s like – DAM, I wish I knew that before or, DAM, I wish I knew that about my data or, DAM, I could have improved my data before so much, now I know what I know.
To read more about DAM, or how you can work with Andrew, simply click here to visit his website.
In next week’s article, we will discuss this in more detail. In the meantime, If you would like to have a chat with me about ‘Customer Loyalty Best Practice’ contact me I look forward to hearing from you.