Every week or so, my wife and I bike from our home in Newport Beach to Huntington Beach on the seaside bike path. This is a relaxing, 16 mile ride on fat-tired beach cruisers. While I have my trusty Paul Frank Helicopter bike, we rent a cruiser for my wife each time since it is easier than storing and maintaining yet another bike. After just a few rentals, our local bike shop began offering us the bike for half the price ($5.39) and dispensing with the rental forms entirely.
Today, my wife asked for a a coffee holder to hold her hot drink. “Not a problem,” they said, and it was thrown in for the same price.
We’d achieved that coveted “locals only” status – personalized pricing plus personalized, off-menu services. The equivalent of “animal style” at In-N-Out (if you don’t know what that means, you unfortunately don’t know In-N-Out burgers).
Like any conveyed status program, even if informal, this type of personalized service offering promotes customer loyalty. As we walked today to the bike shop, a friend offered my wife the use of one of his three bikes at no charge. After giving his offer a moment’s thought, we turned him down. It would have been disloyal. They’ve earned my loyalty so solidly that even ‘free’ won’t take away my business. After all, I’ve recommended our bike store to several friends, the definition of having a high Net Promoter Score.
Big Data in a small town
We had a second experience with personalized pricing on our way back from Huntington Beach, but this time with a large, international chain. We decided to stop at our local Safeway to pick up dinner items. The store had just introduced a new, personalized coupon service and there were laptops helpfully placed on a folding tables to facilitate sign-up.
Once signed in the Safeway website crunched the data of my past purchases to predict what our family might want to buy. San Pellegrino water had somehow fallen off of our buying radar for the past six months. I was presented with a personalized offer of $1.40 per bottle, a 25% savings. We bought a bottle, of course.
I realized in that moment that this international chain managed to achieve something very similar to a local business, simply by crunching Big Data.” I found myself wondering, “How much further can they go to reach ‘locals only’ loyalty?” Not far at all.
What are we doing to give our customers “locals only” status?