Everything I Learned About Loyalty Programs, I Learned From My Dog
I have a dog named Nacho. Per his Royal Canin DNA test, he is a multigenerational mix of Newfie and Border Collie. He showed up at my house in the winter of 2010. We live in the country and he followed my car up the driveway one day. He was emaciated and had burnt singed orange hair like you used to get from a bad 80’s perm. I took him in, of course. Nevermind he had to get some issues….abscessed tooth, parasites, anemia and zero training. We eventually signed up for dog school (insert images of Beethoven here). It was quite apparent he had never seen the inside of a home and had no idea whatsoever that listening to your master was even a “thing”. When we arrived at our first group dog class. the dog trainer kindly suggested he would be a good candidate for “private” sessions. After months of school, he finally graduated by barely passing a few of the skills tests.
The hardest thing for Nacho is to stay home. He routinely “leaves the area”. He doesn’t run away but just wanders off somehow when I’m not looking. But there is one thing that works all the time for Nacho….hot dogs! If I have some hot dog treats in my pocket (gross I know), he sticks right with me when we are outside. He transforms into an attentive and well behaved hot-dog dog.
Aha! Rewards drive good behavior. We know this and the interesting thing is that it doesn’t just apply to dogs. Soon after this, I introduced a reward program to my clients at the veterinary hospital. Like Nacho, they occasionally got distracted and wandered off to a vaccine clinic, or a pet store or Walmart to buy their flea and tick medication. When we instituted a reward program where clients were given paw print stamps on a virtual stamp card in our mobile app with each invoice they started to make the association between spending money at the hospital and getting rewards. In fact, soon after we started this program I walked up to the front desk and one of our clients said “Guess what Dr. Stacee, I’m so excited because I just got 8 stamps on my loyalty card”! It crossed my mind that in the previous 15 years no one had ever hollered at me they were so excited to spend $800 on their pet.
It is very important to structure your reward program in a way that will drive behavior…otherwise, it will just be a discounting program that won’t drive behavior.
Here are the key components for a successful loyalty program:
- Keep it simple. If it takes you longer than 15 seconds to explain, it might be too hard. If it’s too complicated, it won’t drive behavior.
- It must be universal. Whether the client owns a 5m old puppy or a 16y old hyperthyroid cat, they should be able to play.
- It must be attainable. Good clients should receive the reward in a reasonable amount of time with a reasonable amount of effort.
- The reward must be something everyone wants. (Nacho doesn’t do very well if I keep a pocket full of broccoli)
- The reward process must be interactive. While automated points given to a client might sound nice, it will not drive behavior in the same way as an interactive program.
The desired behavior must be immediately rewarded to achieve maximum effect. When your client spends $800 then immediately sees 8 stamps be applied to their card, the endorphin levels rise at exactly the right moment. Endorphins such as oxytocin and cortisol are most active in the cortex forming our opinions and feelings about trust and bonding. Whether your endorphins come from a hot dog or a $100 reward, the result is good behavior and everybody wins!