WHNetwork Blog

Once again it happened. One of those moments where you are customer and suddenly you feel that you are not being treated the way you would like. We're not talking basic customer service here - we're talking about that constant dilemma: can a company make a special offer to new customers without upsetting current customers.

Here's what happened. I got an email advertisement from a company I have made previous purchases from (they sell logo clothing and promotional items). I liked the price, I liked the item and I clicked through to purchase. Just the way the email was supposed to work, right? Don't you wish it was always this easy? The offer was so attractive to me because there was only a small minimum, and there was no set up fee for the logo.

I clicked to buy and there in my shopping cart was an additional $100 charge for logo setup! Wait a minute... Didn't I see the words "no set up fee?" I picked up the phone and called (it's already going down hill at this point, I am a click and buy girl; now it's getting to be time consuming). "Oh yes" the young woman one the phone told me, "We do offer a low minimum, no set up fee offer. But it is only for new customers."

Only for new customers? So, in other words, new customers get a better deal than long standing repeat customers? Guess how that made me feel! I said, "Well, this is a new customer, with a new logo. It just happens that I am the one ordering." (All true). In that case I was told, I would need to set up another new account with a separate email address and then I could go back and repeat the entire ordering process. In the end, I did make the purchase, but I was less than thrilled with the company or the process; in the end I got the items at the price offered; however paid a price in time and additional effort. I doubt that was the company's goal.

Now don't get me wrong - I understand the other side as well. Here you are - a good business, but one that needs new customers as well as regulars - to survive, let alone make money. It is a tough time right now - sales are hard to come by. You need to do something to attract these new customers. Why not try a "special offer?" Something enticing - maybe take less profit - or even none - just to get them in the door. Then you'll wow them with your product and service and they too will become regular customers! It's perfect. Until your regulars hear about it.

They say it takes $10 of new business to replace $1 of lost business. So what is your answer? I believe the wineries have a pretty good model with wine clubs - it is often the benefits or rewards that are part of the allure of joining. "Wine Club Only" event invites, the deepest discounts. Is this an example we can carry into other industries? Hotels often have "frequent traveler" pricing, however it is also often possible to beat the pricing with some of the "discount" booking sites. Are any restaurants making a model like this work?

I'd like to hear from you! What have been your experiences - either good or bad? Let me know! I'll share what I hear. Post here or email me at Margie@OTLConsulting.com.
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Hi Margie,

This is something I have struggled with this year, starting last year! My 'frequent sleepers' were getting the same deal a 'walk-in' could get, if asked politely and at the right time!

So, I sat down and thought about my repeat guests and how I could serve them while also getting the new guest on board as well.

Because a guest cannot book my inn on any discount booking sites, I control who gets what rates. This year my 'frequent sleepers' are getting discounts that are 50% better than 'off the street' traffic can command. They are also now able to earn free nights. Because many of my repeat guests have been coming here the entire time I have owned the inn, most of them will receive their free night this year. Nothing like instant rewards!

We will be doing a joint program this spring wherein my repeat guests will be invited to bring a friend with the second room being free. Essentially, a BOGO, with the repeat guest getting their room for 50% off and also introducing a new guest to the inn. For the repeat guest, the nights they stay at the reduced rate will count toward their eventual free night. And the new guest will start on the path toward discounted stays and a free night.

We hope that is a winner all around!

Thank you,

Monica & Rock
Innkeepers
White Cedar Inn
178 Main Street
Freeport, ME 04032
www.whitecedarinn.com
Celebrating 21 years of providing cozy accommodations,
scrumptious breakfasts and thought-provoking conversation for our guests. Since 1987.

Freeport's first B&B to be awarded the Green Certificate in Lodging by the State of Maine.

You may view our availability calendar and book online at your convenience.

As seen in Down East and Everyday with Rachael Ray.
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What in interesting article! It made me think of the promotional efforts I've tried or encountered over the years. I've been working in high-end fine-dining as a Restaurant Manager and Sommelier since graduating in 2002, from the Culinary Institute of America in Hyde Park, NY.

In trying to find parallels in fine dining to your experience, I remind myself that the idea of discounts and coupons is counter indicated by the very nature of fine dining as a luxury activity. You'll never see discounts or coupons at restaurants like Per Se or Jean George because part of what we sell is an experience that is made exclusive partially by the high cost.

Furthermore, the idea of extending any sort of promotional pricing to new customers in a restaurant immediately supposes that you have a way of telling the new customers from the old. In the old days, one of the requirements of a superstar maitre d' would be an infallible memory to be able to create a mental database of guests, their preferences, birthdays and anniversaries, etc. Nowadays, more often than not, we use Open Table to keep files on as many customers as possible. Of course, no system is perfect, and it's not realistic to enter notes and keep track of every guest that comes into the restaurant.

To further complicate the matter, restaurant dining is a communal / social experience and is rarely about a single diner eating alone. In other words, how would you handle a table of six where some of the people are first-time guests and some are returning guests?

And so, as I comb my memory for promotional efforts, I don't think I can recall anything that is applied exclusively to new customers. Promotional efforts have to apply to both the new and the returning. On the other hand, I can think of many programs that have rewarded repeat guests. Furthermore, any sort of "discount pricing" is usually disguised at a prix fixe menu and we leave it up to the guest to figure out that it's a great deal.

And as far the use of "coupons"in fine-dining, I can only think of one example. At the end of every year, the chef/owner of this particular restaurant would send out a personalized letter to the repeat guests on the restaurant's mailing list, giving a recap of the year's activities and thanking the guest for their continued patronage. Included in the letter was a little certificate for a complimentary glass of Louis Roederer Champagne on their next visit (The certificate looked like a long rectangular bookmark with a ribbon hand tied to one end.).

I hope you'll find my comments useful, and I look forward to your next posting!

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Regards,
Arnel Salvatierra
Restaurant Manager and Sommelier

"Ingredients are not sacred. The art of cuisine is sacred. It is at that altar I worship, and I shall go to sacrifice the fat geese and tender cattle to serve its ends. The holy icons of the chef's faith—fragrant truffles, rich foie gras, well-marbled meats and other luxurious ingredients - these are not God. Their synthesis and their miraculous transformation into a sum greater than its parts is creation, and this is what I find most worthy of reverence."
Tanith Tyrr, 1997
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Good morning and a very interesting article about "deals".

As a professional chauffeur, I strive to provide the ultimate in customer service, i.e. knowing the restaurant managers to help get a table; knowing where to shop; where to buy good wine; taking care of their needs in advance.

Now the other day, at a major restaurant, I asked for an iced tea to go. Nothing out of the way. To this point the waiter had done a great job, but when he brought the tea, there was no straw. Now, how am I suppose to drink the tea without a straw in my limo going now the highway?

The point being, he didn't look at the situation to its fullest completion, and that is what providing great customer service is all about - looking ahead and being attentive to their needs.

Blessings and joy
Cptn. Larry
Rose Chauffeured Transportation
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Our winery offers 18 different varietals, not including the wine club offerings. Most of our customers are so happy to have so many unusual choices, that the wine club only selections are not such a big issue for us.

Tony Blackburn
Cellar Rat, Hose Dragger and Outside Wine Salesperson
Fenestra Winery, Livermore, CA
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Hello, Margie,

I had a similar situation a few years ago. The difference is that I did not express my displeasure before I made a purchase. I was an early adopter of DirecTV and paid a lot for the equipment. I liked the service, but down here we love our Braves, especially in the 90’s and early 2000’s. The games were moved to a new channel that was not on DirecTV. I switched to cable because of this. I never really liked cable as well as DirecTV. So, I switched it back a couple of years later when they added the channel. DirecTV had free set up and equipment deals for new customers. They told me that I was not eligible for the deal as I was not a new customer. I went ahead and signed up for the service and paid for the set up and equipment. I started thinking about the deal and I decided it was not fair. I decided to work on getting a refund. It took me about six months of letter writing, but I did get a refund eventually. I finally told them that they had an unhappy customer who was getting tired of writing letters and they needed to take care of the refund or they would eventually lose my business. I wonder how many people returning to DirecTV decided not to sign up for DirecTV service because of the fees and DirecTV.

Pete Bancheri