Judge Judy Sheindlin, better known as “Judge Judy” chose “Don’t Pee On My Leg, and Tell Me It’s Raining” as the title of her 1996 book about her years on the bench as a Manhattan Judge. It’s a great read, but that’s not why I chose it as the title of this article. The saying really does ring true when dealing with customers or employees.
In other words, don’t try to mask bad news by lying. Honesty is always the best policy. I’m not encouraging you to be rude. Just don’t lie.
What made me think about this particular book is the new Starbucks Gold Level Rewards Program. The old program was pretty simple, yet had a few flaws. It didn’t recognize you for the amount you spent, only the transaction. For instance, if you bought regular coffee, you were rewarded the same as if you bought four Frappachinos. (There is a significant price difference) In order to receive the “Gold Level” status, you needed to buy at least 30 drinks a year with your registered Starbucks card. Every 12 purchases, you received a free drink – so, conservatively speaking, for every $60 you spent, you got about $5 back.
Well evidently the margins weren’t what they used to be. So it was time for a new and improved program — for Starbucks that is. hey rolled out their new app, and you couldn’t order online for the first two or three days. Then, they made it so anyone who ordered via the app was elevated to a “Gold” level immediately. Finally, they changed the way the points are awarded. Instead of one point per purchase, you now receive two “Stars” for every dollar you spend. (You’re probably saying, “That’s good because it recognizes those who spend more!”) But wait for the twist… You now need to earn 250 “Stars” for your “free” reward. That’s correct — Starbucks more than doubled the amount you need to spend from $60 to $125 in order to earn your reward. What’s more, they didn’t do anything with the amount of the reward you receive, so they devalued their own program even further. What’s more, by giving the “Gold” level to anyone, they completely wiped out the feeling that “gold” level membership was special.
I spend between $100-$150 each month via their iPhone app. That was before the new and improved program was introduced. When my card is depleted, I won’t be filling it up. I’ve found a locally owned coffee shop, that’s not quite as convenient, to spend my money at. I was talking to the owner, and he mentioned that I wasn’t the only person to make this switch. He mentioned that he might even send Starbucks a “Thanks You” card for all the business they are sending him.
Here’s the lessons to be learned:
- Think about what could be the real outcome of changes in recognition/loyalty programs you are considering
- Never devalue your brand or any incentive programs
- Never presume that your customers or employees are stupid
- “Don’t Pee On My Leg, and Tell Me It’s Raining…”