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Casual Articles - Customer Loyalty – Is it too Expensive?
Many entrepreneurs have preconceived notions about taking their company public, most of which are not accurate. Nine little known facts:1. You do not need a brokerage firm or investment banking firm to take your company public.Many companies opt to go public through a direct public offering. In these registered public offerings, a private company follows the same rules and regulations that are followed by companies who go public with an investment banking firm.2. You do not need to go public through a reverse merger.Many companies falsely believe th
Giving away profits
If you give away product it should be free or very low cost to you. A Mercedes dealership would not give away every tenth car. In fact when you give away the tenth cup, you are cutting substantially into profits. It is
Panama has a number of unique attributes that make this a great asset protection jurisdiction for corporations, foundations, banking and stock brokerage accounts. Some call Panama the Switzerland of Latin America but this is not fair, Panama is far better than Switzerland and any other jurisdiction. Read why Panama excels:Offshore derived Income is not taxed and does not need to be reported. You can have a Panama Corporation, and/or Foundation that banks in Panama and has an office in Panama and yet will not pay any Panama taxes if all the income is derived from offshore
How to lose profits without trying
The ‘buy nine, get the tenth one free card’ has been used to encourage customers to return and buy another of the same in many circumstances in various guises. Coffee shops suit this system well because a cup of coffee is a cup of coffee. Easy to identify, easy to give the reward for ‘loyalty’. I say ‘loyalty’ in quotes because I think these are several things happening here which are wrong. Firstly there is the problem of buying loyalty. Is this payback to the business worthwhile? After all, they have already bought nine cups. Surely giving them the tenth free encourages them to get another card and keep the cycle going? Do you think all those consistently crowded coffee shops have a better deal? Do they have ‘buy four coffees, get the fifth free’? Do they give away cake and other extras which are better than yours with their ‘free’ coffee? I doubt it. It is hard to base loyalty on giving customers ‘free’ product. If another establishment nearby gives more, clients who have been bought would quickly disappear if that was all loyalty relied on. It is expensive to buy customer loyalty.
Giving away profits
If you give away product it should be free or very low cost to you. A Mercedes dealership would not give away every tenth car. In fact when you give away the tenth cup, you are cutting substantially into profits. It is
Recently, I wrote an article discussing the Unique Selling Proposition: its definition, its use and its penultimate importance in all aspects of marketing, no matter what business you’re in. In another article, I told the story of Julie’s Mansion, a wonderful restaurant I was studying as a young hospitality school student. I mentioned that Julie (Jules F., the owner) was an eccentric, flamboyant entrepreneur who knew how to differentiate himself with the public by using the media and other crazy goings-on that took place in his restaurant on a totally irregular basis
How to lose profits without trying
The ‘buy nine, get the tenth one free card’ has been used to encourage customers to return and buy another of the same in many circumstances in various guises. Coffee shops suit this system well because a cup of coffee is a cup of coffee. Easy to identify, easy to give the reward for ‘loyalty’. I say ‘loyalty’ in quotes because I think these are several things happening here which are wrong. Firstly there is the problem of buying loyalty. Is this payback to the business worthwhile? After all, they have already bought nine cups. Surely giving them the tenth free encourages them to get another card and keep the cycle going? Do you think all those consistently crowded coffee shops have a better deal? Do they have ‘buy four coffees, get the fifth free’? Do they give away cake and other extras which are better than yours with their ‘free’ coffee? I doubt it. It is hard to base loyalty on giving customers ‘free’ product. If another establishment nearby gives more, clients who have been bought would quickly disappear if that was all loyalty relied on. It is expensive to buy customer loyalty.
Giving away profits
If you give away product it should be free or very low cost to you. A Mercedes dealership would not give away every tenth car. In fact when you give away the tenth cup, you are cutting substantially into profits. It is
You put a lot of thought into naming your children, why wouldn't you spend a considerable amount of time naming your business too? Your business name is the first impression of your business and the products and services you offer. It's important to name it wisely.Your business name should reflect your product or your target market (niche, which we will cover later) and should be relatively short and easy to remember. You wouldn't want to set up your business with a name like "Joe's washers, dryers, refrigerators and kitchen appliances supermarket" when you can easily a
Giving away profits
If you give away product it should be free or very low cost to you. A Mercedes dealership would not give away every tenth car. In fact when you give away the tenth cup, you are cutting substantially into profits. It is
If you've ever attempted to make a group hotel booking, you'll know how difficult it can be. When it comes to business meetings or conferences in particular, mass hotel bookings can be particularly hard to co-ordinate. After all, it's likely that all the delegates attending the business meeting you're planning will be arriving from different parts of the country at different times; so how can you be sure all their rooms are secure? You'll also have to ensure that you have sufficient meeting space for your business delegates, as well as refreshments and audio/visual equipment -
Giving away profits
If you give away product it should be free or very low cost to you. A Mercedes dealership would not give away every tenth car. In fact when you give away the tenth cup, you are cutting substantially into profits. It is
Imagine you are rich. Very rich. Obscenely rich.Normal people in normal parts of the world only imagine being that rich at an abstract level. They don’t really believe it is possible. Or at least, they don’t structure their lives around the expectation of being obscenely rich.In the mid-nineties, a phenomenon happened here in Silicon Valley, which defied all laws of market economics. Companies could be successful without having to make money or be profitable. Success meant Billions of Dollars in market capitalization, and consequently, very rich Venture Capitalist
Giving away profits
If you give away product it should be free or very low cost to you. A Mercedes dealership would not give away every tenth car. In fact when you give away the tenth cup, you are cutting substantially into profits. It is the cream of your sales that goes to profit after fixed costs, wages, service costs … It is your last 10% that is often the profits; the bit you are giving away when you should be keeping it.
Other smaller, yet still significant, weaknesses with this model exist when a staff might get on well with a customer and give an extra stamp here and there, reducing it to 'buy seven coffees, get one free' and so on. A considerable negative impact on profit results from a small act of kindness. Other semi-hidden costs are those involved with administering the system such as tracking how many coffees are given away, staff time making free coffee and cost of printing.
Treasure loyal customers
Let us not get carried away with our plans to give away profits with a ‘buy nine coffees, get the tenth one free’ strategy and have a look at better ways to lure customers to our coffee shop and then keep them coming back for more.
Often they do not ask for anything more than good service, consistent quality of product or even just a pleasant environment where they are recognized by name. Customers such as these should be treasured. Sometimes we forget that.
Trained staff generate loyalty among customers
As quickly as possible, train your staff to pay particular attention to service, to personal interaction and to customer satisfaction. Insist on it. Know the name of each customer, engage in conversation that reveals more personal details. These details can be as simple as pet ownership, car model, holiday destination and so on. This type of information is easily and readily shared. How
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