Rewarding Disloyalty…

When did it become accepted practice to penalize loyalty? It seems that companies are more interested in the people who aren’t there customers then there customers. This trend has been bothering me for years its all around us. Banks offer rewards for moving your account, cell phone companies offer better prices and bonus services to new subscribers.

Where is the reward for loyal customers. I have been with my bank now for over ten years in that time the have raised my rates reduced my service and I never got a reward. Right now my bank has a promotion you can get up to $250 for opening a new account plus sign up some additional services. Of course I’m not able to get it. 

The fine Print reads:
This offer is available to individuals 19 years of age or older who open a new Personal Canadian Dollar Chequing Account by December 31, 2009. Individuals who have an existing Chequing Account or had one that was closed after August 1, 2009 are not eligible for this offer

So I ask you why should I say loyal to my bank if they have more interest in getting new customers then supporting there existing customers? It’s not just the banks, a couple of years ago when The Wife’s cell phone contract was up we went to her carrier to see what phones they had to offer. The best deal they would give her, with her signing up for a new 3 year contract was $200 off the cost of the phone. They phone she wanted was $300 or $400. So we were looking at at least $100 for her pink phone. A new customer would have been able to get it for either free, or $50. So she changed carriers.

So I ask why do we as consumers let companies do this. Why don’t we stand up and say we the loyal customers deserve to be reward. Or should we just become nomads, jumping from service to service looking for the best rewards.

MRJ
  • MRJ

8 Comments

  • It's crazy, right ? I completely agree.

    I was with Bell since forever and when I switched to Videotron, that's when they decided to woo me. It's all crap that goes into the recycling bin.
    http://pandabox33.wordpress.com http://bazookah5.wordpress.com

  • It's crazy, right ? I completely agree.

    I was with Bell since forever and when I switched to Videotron, that's when they decided to woo me. It's all crap that goes into the recycling bin.

    http://pandabox33.wordpress.com
    http://bazookah5.wordpress.com

  • My sentiments exactly…..Loyalty should be rewarded

  • My sentiments exactly…..Loyalty should be rewarded

  • It is more expensive for a company to acquire a new customer than to retain an existing customer. Still, like you said, we don't see them practice this common sense advice.

    The problem, I think is in the metrics they use to evaluate their internal departments. Sales cares only about how much they are selling and how many new customers they are signing up. I wonder if they even have a customer retention department! Customer service probably is measured on how fast they close their customer complaint case, not if they actually lost the customer. Finance probably want to cut costs across the board and that's pretty much it. Marketing also is all about new customer growth.

    The reason these companies survive is that they are able to create barriers for customers to switch. Maybe not just money, but the hassle of switching to a new service and starting things all over again.

    Not very customer friendly, but then who cares if you are already buying from them? That's why businesses are in trouble these days!!

  • It is more expensive for a company to acquire a new customer than to retain an existing customer. Still, like you said, we don't see them practice this common sense advice.

    The problem, I think is in the metrics they use to evaluate their internal departments. Sales cares only about how much they are selling and how many new customers they are signing up. I wonder if they even have a customer retention department! Customer service probably is measured on how fast they close their customer complaint case, not if they actually lost the customer. Finance probably want to cut costs across the board and that's pretty much it. Marketing also is all about new customer growth.

    The reason these companies survive is that they are able to create barriers for customers to switch. Maybe not just money, but the hassle of switching to a new service and starting things all over again.

    Not very customer friendly, but then who cares if you are already buying from them? That's why businesses are in trouble these days!!

  • I think TwinToddlersDad is on to something. What a company measures shapes its behavior. If they're measuring new accounts but not retention, that's going to warp their decision making. But I also wonder if they basically lose money on new accounts due to free phones, etc. and then the only way to make it up is to stop the discounts? No idea.

  • I think TwinToddlersDad is on to something. What a company measures shapes its behavior. If they’re measuring new accounts but not retention, that’s going to warp their decision making. But I also wonder if they basically lose money on new accounts due to free phones, etc. and then the only way to make it up is to stop the discounts? No idea.

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