by How come you can get a better deal being a new customer with many companies than if you were an existing customer, even a long-term loyal customer.
Last week I went to my gas companies’ website to order more, and I immediately noticed that the offers they were making to new customers had significant discounts compared to existing customers. Why can you get better deals when you are new rather than existing?
If you are a phone user, you know the best way to get a deal at a phone provider is by being a new customer. Right! The same goes for banks and insurance companies of all types.
I recently received my renewal notice for home insurance, it went up an amazing 75% on the previous year. How is that justified? Unfortunately, due to owning a heritage home, not as many companies will insure. Here’s my point though, I rang them up and they immediately adjusted the fee by over $600.00 per month. The thing that really annoys me with this, is that I had to call them to get this reduction.
I had to do the same with my bank. As soon as I rang, I got a better deal on my mortgage rate. They don’t understand loyalty. No wonder more and more customers are changing providers. They don’t give you reasons to stay; they don’t treat you as valuable by ensuring you get the best deals as an existing customer.
I just also changed my medical insurance provider, although it was not a significant difference in cost and benefits. What interested me is that I never heard from my current provider until I finished the transfer, and I received a letter saying they acknowledge me leaving and letting me know that if I decide to come back to them the Australian Lifetime Health Cover may apply and I will also have to re-serve waiting periods. Instead of finding out why I left, they are going to punish me to return!!!!
There are also many companies who really understand rewarding their loyal customers. Airlines and Hotels are ones that come immediately to mind. They give their loyal customers extra benefits to thank them for their loyalty. Things like free room upgrades, free breakfast, and gifts in your room. These save a regular customer a lot of money. I just reached platinum again with Accor, and last week I stayed in two hotels over 3 nights. As a platinum, I saved over $100.00 across the two stays, and that’s just for breakfast.
Airlines do the same, as a frequent flyer you get access to a lounge. For many people in business this is a significant benefit, a place can you do work, have a drink and some food. It is also easier to access upgrades, preferential seating, and the building up of points for free flights.
With belts being tightened, isn’t it time to stop the churn of existing customers departing to other suppliers.
Don’t these companies know that happy, loyal customers have:
better retention,
they’re less price-sensitive,
they’re more willing to entertain offers for other products and services and,
they also reduce – your expenses e.g., you can spend less on new business acquisition.
Need more information? Have a look through my previous Blogs, located on The Loyalty Zone website or contact me, I look forward to hearing from you.
If you have enjoyed this article, feel free to share with someone else you know will find this helpful. If someone has forwarded you this email, you are welcome to join The Loyalty Conversation, I appreciate your commitment to the conversation.
Warm Regards
Craig Cherry