In the past year I have noticed I am less likely to be loyal to a brand and I find that they really don’t care. Maybe they are jumping on the “How Brands Grow” bandwagon and going after new customers rather than trying to maintain those they all ready have.
Some of the brands I have defected I have used without question for 20, 30 and a couple cases, 50 years. What I find interesting is that every marketing book I have read preaches “lifetime value” and we must keep our most loyal customers. However, more and more it seems brands are giving up on the most loyal and spending lots of money chasing new customers. In every case when someone uses one of my tools and does not sign up or cancels I ask them why they did. Most of the time they don’t need it for on ongoing project or it did not meet heir needs in some way. That is great feedback especially if there are any patterns of why they left. I find that more and more, especially high ticket items don’t follow up and is it they actually don’t care?
State Farm Insurance
The first big defection was State Farm insurance. They were my parent’s home and car insurance company and when I came back to the US from Japan and bought a car I went to their agent have never even shopped around for another company in over 20 years. While I have changed agents due to various relocations, I always kept State Farm manly because if I had a problem they took care of it. I never had a problem with a claim or getting service. I also felt the price was fair as we got a bunch of multi-product and loyalty discounts. I had a variety of problems with them last year and a few things came down to simple account frustration and billing issues. This is a case where the customer service person at the local agent really did not care. I had previously escalated issues to the main agent, they were fixed for a wile then back to problems – all because of the junior people who really did not see to care. When I shopped around the Liberty Mutual agent got back to me immediately, gave me a great price, bundled everything, rather than making me pay everything up front set up auto pay to deduct from the various bank accounts all things that helped me.
To date the agent, nor State Farm have called me to ask why I left. A nearly 30 year relationship with a house, rental properties and multiple cars all gone and no one seems to care that I was gone.
Credit Card Companies
When Motoko and I sat down one day and looked at what we had between ourselves and the various business we felt we had to many cards and wanted to consolidate them to get the best deals, benefits and of course miles. In the end we settled on a just a couple of cards, the Starwood American Express and the Chase Sapphire Reserve case which offered the same benefits, except the lounge as my Platinum American Express.
I waited until last to cancel my Platinum American Express. This was the card that had special meaning to me. Growing up poor, and in a family that did not believe in credit, this was the card I wanted after seeing a TV show where a person bought a car using their Amex. The unfortunate part was, once I had the money to get an Amex and the credit limit to buy a car with it, I found out that you cannot do it. Sure, Amex will allow it but the car dealers did not want to pay the Amex fee… but I digress.
When I called American Express after 20 years of having the card they did try to talk me out of it but offered no real reason to stay other than the benefits of the card that I replaced with the Chase Sapphire card. They did remind me that there would be giving me $15 credit for Uber each month and raising the monthly fee by $150. The sad thing is since I cancelled my card I have received 50+ mailings and I get stalked on social media to sign up for the card that I had. They had me and any effort most likely could have kept me but now will spend a fortune to try to get me back.
My United card which is have had for over 25 years and spent at least $200k a year in business expenses was not a great deal. The only real benefit was I bought United tickets I got 2 for 1points and as much as I fly the was a good deal but otherwise no benefits at all and a $97 charge for the card. When I called them they did try to get me to convert to another card that was 3x the annual fee with a benefit I already had with my Club Membership, which I get $200 savings from my “airlines fee” rebate from Chase. They did offer to waive the annual fee for a year to stay – I guess if I kept a balance instead of paying it off I would have been more valuable to them.
Along the same line, I had been a Hilton Diamond loyalty member for a number of years due to many conferences and clients that have deals with Hilton. Due to poor treatment and crappy hotels I did a status match with Hyatt and shifted as many nights as I could to Starwood to also keep my Platinum there. For Diamond you need to stay 60 nights and with an average of $200 per night that was easy $12k worth of loyalty. BTW, that is 10 more nights than Starwood requires. I just stopped staying with them and no email why or letter or anything. Companies spend so much money to acquire a new customer only to just let them go later. Any sort of contact from them asking why I have not been staying with them might have brought me back.
Shifting loyalties for consumer goods happens all of the time and there is not much they can do about it as they are not really tracking your direct use of the product so I don’t expect any outreach from them. The following are just to illustrate how a single influencer or new product can shift someones loyalties away from your products. But it also shows a great element of why a product needs to work and be rock solid to the users. While I know that Crest is not the sole reason I have no cavities I did believe in the product enough to need need to look at anything else. This is where the concepts of “How Brands Grow” apply that you always need to be churning for new opportunities.
Jif Peanut Butter – I have ONLY ever bought Jif peanut butter except for my time in Japan when “peanut cream” was the only option. Jif is what my mother bought, as she was a “choosy mother” and “choosy mothers choose Jif.” About a year ago, my wife, wanted a more natural product, bought Skippy’s new Natural Peanut butter. While I did protest a bit more than a grown adult should, I did try it and it was pretty good, all natural and bigger peanut chunks than Jif so we converted. In this case there was nothing Jif could do, I am sure they did not miss me when I converted it was for a new superior product. I do have to note, that I am back to Jif since they now have an “all natural” product but it is not in all stores so we tend to stock up when we find it. Yes, unfortunately, the peanut chunks are still smaller.
The biggest brand change for me was to move away from Crest Toothpaste – I have been a “Crest Kid” my entire life. I have never had a single cavity, even as a kind, which is more genetics than toothpaste, but I felt no need to change. Motoko and I often used different toothpaste since I refused to change. Our dentist gave us the “your old speech” and suggested we consider preserving our enamel. He suggested we switch to Sensodyne as an alternative to Crest since it had the protection he thought we needed. Since I did not find a similar product from Crest – currently every product is about whitening – and yes, the new Sensodyne even has a whitening version – I had to move away from Crest. Apparently Crest are not talking to Dentists who seem to be recommending this to people over 50. So in one recommendation from a trusted source, and no alternative from the incumbent, 52 years of brand loyalty are gone in an instant.
I guess in the end, as a Marketer that models Lifetime Value and creates strategies to target specific types of high value customers it seems odd to me that many companies are not doing anything at all to keep loyal customers. I am also finding it can be expensive to be loyal which will be my next rant.