Business Articles

When Customer Rewards Programs Go Bad

Ten years ago, I have signed up for the “rewards” program at my favorite office supply store. In addition to mailing me coupons and emailing me special offers (which is how I bought a paper shredder for $10), they also keep track of my purchases, which allows me to earn quarterly discounts.

Conceptually, this is a great business idea. It promotes store/brand loyalty and gives me an incentive to not consider their competition.

When I was emailed my recent statement of activity, I actually looked at it. I wanted to make sure that the recent ink cartridges that I returned for recycling had been credited to my account. They had not. Nor was the purchase that I made that day. Looking through each statement for this year, they had a record of only one purchase.

Why do they scan my card? Since charges don’t end up in my statement, scanning it seems to be largely an exercise in futility.

It makes me wonder if their competitor—whose store is right across the street from them—has a rewards program that works better and could actually capture all my purchases.

I’m sure that it’s not the goal of their rewards program is to drive customers to their competition, but that could very well be what happens.

Sadly, their rewards program has gone bad—and as a result, this customer could go away.

What do you think? Please leave a comment!