Home Articles Marketing 101: Don’t take things away from your customers

Marketing 101: Don’t take things away from your customers

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It’s not often that I think Virgin make mistakes. Normally, I think its customer service; advertising and general corporate behaviour makes it a company that should be followed.

However, I don’t feel that way today. I think the company has made a blunder, one that will affect thousands of loyal airline customers.

Yesterday, I received an email from the Virgin frequent flyer program, Velocity. I’m on cusp of being a Gold member, so I opened it with interest, thinking it will be my alert that my flights last week tipped me into the next level.

The timing of the email was interesting. It arrived around 4:45pm, so for many, just before the end of the workday. I guess this is the time to deliver bad news.

Rather than it being an offer, or something of interest to someone who flies frequently with the airline, it was essentially, a kick in the teeth.

Each level of the Velocity program gives flyers additional benefits. Recently, at Australian airports, two priority check-in queues appeared. One is for Gold and Platinum flyers, the other for Business and Silver flyers. It was an interesting segregation.

The email informed Silver flyers, of which there would be thousands, that they will no longer get priority check in on domestic flights in Australia. They will still get priority check-in for international travel.

The result will be that there are now many more customers, who fly regularly, who will now join the long, long queues to check-in at the airport.

If you’re a daytripper, this change may not matter to you. You can check in online, on your mobile or, at the kiosk in the airport terminal. However, if you need to check luggage, you will have to join the queue for the baggage drop area. Alternatively, if you need to check-in as well, you can choose to join the madding crowd of the infrequent and occasional travellers, to check-in and do a baggage drop.

Given most airports are little short of semi-organised chaos, the real benefit of Silver membership has now been taken away. Silver flyers also will get two free lounge passes every six months, and a free baggage of up to 23kg. But, really, the best benefit was about getting around the queues.

While it’s great to encourage self check-in via the other channels, taking something away from a customer that they are used to, is very bold thing to do.

It will also encourage more people to take carry-on luggage. If you have flown recently, you may have noticed that there is so much carry-on luggage on most flights, that if you don’t board in the first 20-30 people, your luggage ends up in a locker that is no where near where you are sitting. This make disembarking from the plane a difficult and time consuming process.

Why the change?

Will there be fewer staff working at the terminal check in? Maybe. Yet, this is an airline that prides itself on its amazing staff. Its recent TVC sings the praises of its staff.

Indeed, there is an inflight magazine article in the October issue about the making of the ad, the staff that appeared in it. The staff sound happy, and are delighted to be involved with a company that looks after customers.

But is that it? Is this just a cost-cutting exercise?

Every time I visit an airport, which is often, I am amazed by the chaos and think there must be a better way to make the task of check-in, security checking and boarding less like chaos. At best, it’s a frustrating experience that falls into the ‘time I don’t get back’ category.

So, it seems an odd move by Virgin to downgrade the benefits available to its Silver flyers. I am sure that Silver flyers are a larger and varied customer group. I am sure they are more Silver flyers than there are Gold and Platinum flyers.

Will it make Gold and Platinum flyers feel more special? I honestly don’t know. In amongst the bedlam at most airports, you’re more concerned that you get to where you need to be, rather than worrying about whether anyone else has greater privileges than you.

Oh, and don’t get me started on the packaging used to send out the cards once you become Silver, Gold or Platinum. Excessive, indulgent and pointless, are three adjectives that spring to mind. Yet, I digress.

Surely, as an airline, you want to reward customers who fly frequently with your airline. I understand the desire to tier the rewards system to provide greater benefit to those who are almost constantly airborne. Gold flyers upwards also get to use the priority security screening and, priority boarding. So, the queue avoiding benefits of the different Velocity levels was already in place.

I don’t understand the need to reduce Silver flyers back down the food chain. A Silver flyer still needs to spend several thousands of dollars each year on flights, in order to achieve that status level. They are not ‘low-value’ customers.

If there are an increasing number of Silver flyers that is putting a burden on the priority check-in queues, then it’s the check-in system that needs an overhaul, not the rewards program.

Marketing 101

This is where Virgin has flouted a basic rule of marketing, but not in a good way, which is usually what the company does.

Here is large, loyal group of customers who spend a lot of money with the airline. The airline has taken away the key benefit that these customers have, up until now, earned by being a loyal customer. It has not been replaced with any other benefit; either a real one, or a perceived one.

The benefit of being a loyal Virgin flyer has been significantly diminished in one simple decision.

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