Brian Giese's Blog

AOL Sales Techniques Backfire

AOL is struggling to remain relevant as they open their mouth and insert both feet on this studio recording of the Vincent Ferrari Interview on the Today's show with Matt Lauer. In the now famous “I want to cancel my account” episode, AOL subscriber, Vincent Ferrari, battled mightily with a service rep to shut down his account.

This is a clear example of selling at its worst. AOL’s self-inflicted wound reveals the problems of a good sales strategy gone awry by using customer service staff in the wrong way. Granted, most customers expect to hear some sales pitch when they talk to a service rep but tenacious efforts to sell something to a customer while on a service call violates some basic marketing tenets. Namely, to keep the customer happy by providing a good experience.

5 Keys to a Successful Loyalty Program

Loyalty programs are hot. Jupiter Research estimates that two-thirds of online retailers will have a loyalty program by the end of 2006. And B2B isn't far away.

If you are thinking about launching a loyalty marketing program, here are five key concepts you need to know:

1. Whatever you have budgeted for training isn’t enough. Start building a relationship with your operations and HR departments now because you will need them to sustain training and focus over the long haul.
2. Promotional offers should account for at least 10% of your reward expenses.
   Using a program’s accrual mechanism (points or otherwise) as a promotional currency—say, offering double points rather than a straight discount-- can generate some of the best results.
3. A few great benefits are better than many average benefits. Most marketers know that a message that makes one point is much stronger than a message with several points. But many seem to forget this when designing loyalty programs. 
4. Testing can save your job. As much as you think you know about your customers, when you put a loyalty program in front of them, you can’t be certain how they will react. Testing multiple concepts simultaneously is strongly recommended.
5. Positive ROI usually comes in the second year. Start-up costs, initial enrollment rates, and rewards expenses all may vary widely, but most programs take a year to reach critical mass.