That is a major question that I find myself asking more and more. What is the value to me of being loyal? I have used some brands without change for 20, 30, and, in the case of Crest toothpaste, over 50 years. More and more I see companies chasing new customers at the expense of their old customers. Maybe I am just old school or set in my ways or maybe their amazing brand campaigns brainwashed me into lifetime submission.
When someone uses one of my tools and does not sign up after a trial or demo and especially if they cancel, I ask them why. Most of the time, they don’t need it for an ongoing project or it does not meet their 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. Is it that they don’t care?
State Farm Insurance
The first significant 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. I 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 primary agent; they were fixed for a while, then back to problems – all because of the junior people who really did not seem 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, neither the agent nor State Farm has called me to ask why I left. A nearly 30-year relationship with a house, rental properties, and multiple cars is 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 businesses, we felt we had too many cards and wanted to consolidate them to get the best deals, benefits, and, of course, miles. In the end, we settled on 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.
My United card, which I have had for over 25 years, and I 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 1 points, which are nearly impossible to redeem, and as much as I flew, it was a good deal, but otherwise, there were no benefits at all and a $97 charge for the card. When I called them, they tried 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 got $200 savings from my airline 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.
Hotel Loyalty
Along the same line, I had been a Hilton Diamond loyalty member for several years due to working with and at IBM, many conferences, and clients with Hilton corporate deals. Due to poor treatment and crappy hotels, I did a status match with Hyatt and Starwood. Ultimately, I went with Starwood to keep my Platinum there because they always took great care of me. For Hilton Diamond, you need to stay 60 nights, and with an average of $200 per night, that was easily $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 new customers that they just let them go later. Any contact from them asking why I have not been staying with them might have brought me back.
Packaged Goods
Shifting loyalties for consumer goods happen all the time, and there is not much they can do about it as they are not 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 someone’s loyalties away from your products. However, they also show a significant element of why a product must work and be rock solid to the users.
No Longer a “Crest Kid” – While I know that Crest is not the sole reason I have no cavities, I did believe in the product enough to never look at other toothpaste. 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 “you’re getting 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 product teams are not talking to Dentists who seem to recommend 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 instantly.
Choosy Mothers Choose Jif – I have only bought Jif peanut butter, specifically crunchy peanut butter. Jif is what my mother bought, as she was, as the commercial told us, “a choosy mother” and “choosy mothers choose Jif”. About a year ago, my wife wanted a more natural product and bought Skippy’s new Natural Peanut butter. While I protested a bit more than a grown adult should, I tried it, and it was pretty good, all-natural, and had 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 to a new superior product.
I guess in the end, as a Marketer who 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 faithful, which will be my next rant.