IHG takes swipe at Hilton with new loyalty promotion
08 February 2010
InterContinental Hotels Group has launched a new loyalty campaign that takes a deliberate swipe at a competitor.
Under its ‘luckiest loser’ program, IHG is offering to give out more than 400 million loyalty points to disgruntled customers in Hilton’s loyalty programme.
Hilton recently raised the number of points required for a free night at one of its hotels under its Hhonors programme – effectively devaluing members’ points by about 20%.
Under the IHG promotion, the member with the highest-verified Hilton points balance gains two million IHG Priority Club points – enough for about 80 free stays at InterContinental hotels.
“If you want your loyal customers to stick with you during tough times, it’s vital to show you appreciate them and give them more value, not less,” said Tom Sneddon, chief marketing officer, IHG.
It makes my blood boil - and I'm not even a member!
But as an ex-customer of so many of these loyalty programmes, I have realised that they are frought with danger for companies. The Hilton problem of unilaterally changing a contractual relationship, (even though their action is hidden in the small print,) is not unique, and it leads to a sense of betrayal from loyal customers. I lost hundreds of thousands of miles when Swissair declared themselves closed down - only to repoen within days as "Swiss."
Over and above the bad publicity and drop in reputation, here are some other problems:
- More governments are starting to tax "rewards"
- The costs of creating It infrastructure, launching the programme, training staff, and all other issues is vast
- Most schemes are open to fraud
- Pretty soon, customers from one company join all the schemes in the industry offered by all rivals
- It makes my purchases more expensive
It just doen't make sense.
Nice post.
Aki
http://www.DelightYourCustomers.co.za \