Surprise and Delight: Keep Them Coming Back
A recent statistic published by Colloquy found that although loyalty program memberships are growing, almost 58% of members do not actively engage in the programs. Jeff Berry, Colloquy’s research director, drives the point home: “Think of the U.S. loyalty market in terms of a crowded party where half of the party-goers are standing in the corner without mingling.”
So how do you get your customers to progress from wallflower status to “mingle”, join the party, have a good time and tell their friends about it?
One tactic many brands are incorporating into their programs is called “Surprise and Delight”. You have most likely heard of it ad nauseam. The term gets mentioned frequently in various blog posts and articles about how to engage with your customers. And there is a reason. It is an intriguing concept and there is underlying psychological research that proves how motivating it can be.
So let’s talk about why, from a psychological perspective, “Surprise and Delight” is so powerful. And then, we can look at some programs that are doing it and doing it well.
We can thank a man named B.F. Skinner for discovering the behavioral foundation underpinning the “Surprise and Delight” phenomenon. B.F.Skinner is one the most recognized psychologists since Sigmund Freud. According to Mark Sherman Ph.D., in an article published by Psychology Today, “B.F. Skinner understood human behavior like no other psychologist ever has”3. Skinner expanded upon Pavlovian classic behavioral conditioning theories with a system called operant conditioning starting out with his experiments with rats.
He proved that by feeding rats when the rats pulled a lever, he could increase their likelihood to pull the lever - very straight forward. The rat discovers food is associated with pulling a lever, so he pulls the lever to get his reward. Skinner called this type of reward ‘continuous reinforcement’ - a very effective way to teach the rats to pull the lever in the early stages. But here is the catch. Although using only “continuous reinforcement” does increase the rate of learning the behavior, unfortunately, it results in a quick loss of interest or in Skinner’s language, “extinction rate”. Think standing in the corner at a party. In order to keep the rat interested in pulling the lever for a long period of time, he used what he called “intermittent reinforcement” – randomly rewarding the rats every time they pulled the lever.
Now rats we are not. These experiments were merely the beginning of Skinner’s research. Ultimately, he successfully applied the findings from these very same experiments to make a profound impact on education by developing teaching methodologies that encourage an intrinsic motivation to learn. However, to develop the intrinsic motivation, he definitely used extrinsic rewards or “intermittent reinforcement” aka “Surprise and Delight”.
Let’s look at some of the brands that are using the “Surprise and Delight” concept to their advantage”:
MasterCard’s Priceless Surprises
Here MasterCard is making a splash by claiming to have surprised over 77,790 cardholders with extravagant experiential items such as tickets to concerts, the Grammy’s and MLB Opening Day. Using the #PricelessSurprises hash tag, MasterCard has not missed a beat in promoting their philanthropy. And, as an extension to this strategy, they have partnered with Yiftee, a digital gift card solution, to encourage members to “Surprise and Delight” the important people in their lives. Brilliant. MasterCard is modeling the behavior they want from their customers.
Panera
MyPanera, Panera Bread’s loyalty program, says it straight up. Their tag line is “My Panera is about showing our appreciation and rewarding you in unexpected and surprising ways.” Panera’s CEO, Ronald Scaich, confirmed that Panera has the largest loyalty program in the restaurant industry having already enrolled 50% of its customers. It sounds like their customers are “eating it up”.
Caribou
Caribou is the second largest company owned premium coffee house in the U.S. They launched their loyalty program at the beginning of 2014 – a program that delivers perks to members based on how often a member checks in and what items they buy. Playing up their ‘Surprise and Delight’ theme, Caribou dubbed their 2015 holiday season the “Season of Surprise” orchestrating daily surprises for members including special offers, interactive game play and celebrity promotions. In an interview with Loyalty 360, Caroline Larson, Caribou’s Director of CRM, said the program was enjoying steady membership growth month over month.5 It seems like things are ‘perking’ up for Caribou.
Legos
The use of “Surprise and Delight” does not have to be a tangible reward. At last year’s Oscar Awards ceremony, Lego surprised celebrities and viewers with an exciting unexpected performance – dancers whirling throughout the audience handing out Oscar statues built from Legos. Any element of surprise or unpredictability will encourage that ‘stickiness’ that all brands seek.
Wowing your customer and tapping into the element of surprise works to foster a positive emotional affinity towards a brand. But does that mean the predictable earning of points to achieve a reward is a wasted tactic? No. In fact, that very predictability, in Skinner’s words – continuous positive reinforcement – is essential for encouraging early adoption of desired behavior. You need your customers to join the party and stay long enough to realize it will be a blast.
Sephora
Solid and impactful loyalty programs rely on a combination of both tactics. Early bonuses and achievable rewards warm the member up. Unpredictable positive rewards and experiences keep them in the program. Sephora’s Beauty Insider loyalty program offers new and different product samples every month. The member can rely on being able to redeem for trial products, but the products chosen are always new and different. Using the combination of predictability (continuous reinforcement) and surprise (intermittent reinforcement) can be a powerful strategy.
So psychologically speaking, first you get people to come to your party and stay long enough to feel good. Then you mix it up with some fireworks and get them have such a good time, they tell their friends about it the next day. Incorporating an element of “intermittent reinforcement” into your loyalty program can reduce that “extinction rate” that results in 58% of customers never making it further than standing in the corner of the room at your party. Plan your party well and create some buzz around your brand.
1http://blog.accessdevelopment.com/customer-loyalty-statistics-2015-edition
2https://www.colloquy.com/latest-news/2015-colloquy-loyalty-census/
3https://www.psychologytoday.com/blog/real-men-dont-write-blogs/201007/bf-skinner-and-the-hopelessness-it-all
4http://www.cnbc.com/2016/02/11/panera-taking-the-digital-space-by-storm.html
5http://www.loyalty360.org/Content-Gallery/Daily-News/Caribou-Coffee%E2%80%99s-Loyalty-Program-Members-Best-of-t