(Originally Published May, 2015)
As businesses big and small plod through a slow economy, there’s a tacit sense of urgency to survive. “We must increase sales! Where can we find new customers?!” This natural, albeit knee-jerk, reaction to tough times seems sensible. If sales are slowing down, clearly customers are not holding up their end of the agreement. Rejection hurts!
There’s the inevitable mourning period, but hopefully survival instincts kick-in and businesses get out of bed, into shape, and back out there in search of better customers.
That’s one way to handle it. There’s also begging for forgiveness.
Whichever approach you choose, breaking up with customers is hard to do. Walgreens recently presented their new strategy at the Loyalty Expo a few weeks ago in Orlando and highlighted two main reasons they’re opting to coddle current customers before marketing for more:
Acceptance is the first step to recovery.
Rather than run away in search of greener pastures, Walgreens accepted their inability to keep patrons happy and worked to identify and repair the “leaky bucket”. From learning from their past mistakes, Walgreens is able to mature into a better brand.
Reconciliation is cheaper than divorce.
Before seeking separation, Walgreens’ accountants crunched the digits and determined current customers held more value once all the efforts and expenses were factored in. Ultimately, marketing to current customer provides greater ROI – a language everyone speaks.
As Walgreens moves to ramp-up loyal customer rewards, they’re not leaving prospects at the door. How much “strategy seep” Walgreens will reap remains to be seen, but my money is on Walgreens for making happy customers who will surely spread and share the good news about Walgreens.