When it comes to customer behavior, is it a matter of adapts to, or one of directing it?

Marketing is often presented with the challenge of anticipating customer behavior as a result of their marketing efforts. Whether it’s direct response marketing, advertising, or promotions and PR, marketing will attempt to predict the results of various campaigns.

While reviewing a customer reward program – one where you earn points and redeem them for items or services – I began to contemplate whether success is built around the notion of directing the customer’s behavior, or developing a program that adapts to (or anticipates) their likely actions. In this example, it appeared the marketing department was attempting to direct the customer to act in a manner to benefit their company, and not necessarily to the pleasure of the customer. It’s a little like going to the State Fair and playing an arcade game with a limited set of prizes; it’s exciting to play, but sometimes the prize is a letdown.

My own experience with rewards points programs bears this out to some degree. I seem to accumulate a good number of points, but struggle to redeem them for items or services. Not long ago, I wrote about one such program and my less than optimal redemption of points for travel. In that Post, I encouraged readers to take advantage of gift cards as the most useful reward.

I am pleased to report that the rewards points program in the aforementioned Post has made some welcome changes. In place of a booking on specific flights, or advance coupons for airline tickets, the credit card company has changed their travel rewards to be redemption as a credit against any travel charges on my bill. So, in place of an advance booking or planned trip, I could immediately redeem my points as a credit on my upcoming statement.

In the first example, the rewards points program was attempting to fit me into a box and direct my behavior to their benefit, i.e., play by their rules and only as they saw fit. Whereas with the recent change to the program, I have a new level of flexibility and choice in my use of points, so they are adapting (their program) to the way I live and work. I can still redeem points for other goods and services. But, it’s the travel benefits that interest me most.

Now I find myself comparing other credit card companies to this company’s rewards points program. In my mind, they have now become the de facto standard that I will judge others by in the future. Since I have more than one credit card, I find that I now favor (the use of) this card over others. So it may be with any service provider; those that adapt to my behavior versus attempting to direct it are the most likely ones to benefit from my business.

What’s been your own experience with rewards points programs? Are you satisfied with the choice of products and services offered? Are your points easy to redeem, or is it easier to just let them sit idle while you purchase the item or service? Do you find that the company offering the rewards seems to understand your needs, or are they offering you a menu of limited options that barely meets your lifestyle?

To achieve 1:1 marketing success, learning how customers act and behave is far more beneficial than attempting to control the outcome through multiple campaigns. Too often marketing departments think in terms of the universe of potential buyers (the shotgun approach) instead of a more focused and likely select group of customers (the rifle approach). It goes beyond segmentation of markets; you need to get down to the lowest subset of market segments and tailor your approach to their needs and behavior. It’s simply a matter of adapting to your customer’s needs and desires.