Surprise! A new approach to building loyalty

Today’s Retail Wire panel discusses a recent New York Times article about Hyatt Hotels. Hyatt is developing a new loyalty program designed to “surprise” its Gold Passport members with unexpected treats, such as picking up a bar tab or the price of a spa session. This goes beyond the customary accumulation of points to earn free nights, free trips, discounts, etc. Here’s what I think of the idea:

I recently ate at a local restaurant for a family gathering. We were celebrating two graduations and a birthday, and I told the restaurant ahead of time in order to get a preferred view, not because I was fishing for any favors. Imagine the surprise of everyone at the table to have several shareable desserts served for free.

This is the sort of “surprise” gesture that builds loyalty, not just the food quality or frequent-diner program. And Hyatt is definitely on to something with its own program. The challenge is to apply this idea to a less service-based, intangible business like a large retail chain. How do more service-oriented department stores like Macy’s and Nordstrom incentivize their best customers if they aren’t prepared to offer hands-on attention in the first place? And how do stores that have build loyalty programs strictly on the basis of price incentives start to think outside the box?


1 Response to “Surprise! A new approach to building loyalty”

  1. 1 Ted Hurlbut July 2, 2009 at 4:19 pm

    Dick, In asking how national chains can apply a more personalized approach to customer service and customer experience, you’ve asked the million dollar question. In my judgement, they can’t very easily. With few exceptions, such as Nordstrom, their business models emphasize volume, scale and technology over personal interaction at store level. At best, they seem to strive for as convenient and seamless a transaction and experience as possible. Anything more seems to be beyond their reach.

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