Is this loyalty or bribery? II

Jackie Huba and John Moore (the British one) agreed with me that the Pizza Hut VIP program is bribery and not loyalty (see the comments section).

What about the recently announced Customer Loyalty Program from Nintendo... does this program foster loyalty?

Keep in mind that I last paid significant attention to the home video game market in the late 80s and have only casually kept up with the battle for home video game supremacy that is currently being waged between Sony’s Playstation, Microsoft’s Xbox and Nintendo’s GameCube. It appears Nintendo has struggled to maintain relevance given the technologically superior offerings from Playstation and Xbox. So in an effort to cultivate a more loyal customer base and to maintain relevance, Nintendo recently launched a customer loyalty program for their American customers. (Nintendo of Europe introduced a similar loyalty program for UK gamers some time ago.)

I’ve written two other blogs on customer loyalty programs (“Is this Loyalty or Bribery?” and “High-Touch, not High-Tech”) and generally, I am not impressed with most customer loyalty programs. However, I am impressed with Nintendo’s customer loyalty program.

Nintendo has structured their loyalty program into three levels with the lowest level being nothing more than a classic permission marketing play and with the highest level being an inner circle of influential and fanatical Nintendo gamers.

The basic level is simply called My Nintendo and all one has to do to participate is visit nintendo.com and register by providing some personal information in order to receive an email newsletter and other announcements from Nintendo. (Nothing too special here.)

The next tier is the NSider level. To become an NSider, one has to register at least one Nintendo product and you will receive access to hidden game content, cheat codes, and exclusive news. (Okay, now we are getting somewhere.)

The highest level is the Sage tier. Only the most active NSider members will be asked to become Sage members. If one is deemed worthy enough to become a Sage, then they will have access to preview new Nintendo games/products and they will help to moderate community forums on the Nintendo.com website. (Rewarding loyalists with insider information that is only privy to a select few is very cool.)

I applaud Nintendo for rewarding their most loyal customers with exclusive news and special access to cheat codes. I especially like their multi-tier loyalty approach as this structure serves as a motivator by tapping into aspirations and emotions to encourage fervent followers to be that much more fervent. Nintendo seems to understand that the power of influential and evangelical gamers is a tremendous lever to maximize.

Now, I also read that this customer loyalty program will go beyond offering special access to offering rewards. The first reward is a Legend of Zelda® Collector’s Edition disc for gamers who register two game titles and their GameCube at Nintendo.com. Hmm… I’m not sure if I like this element to their loyalty program.

So, what do you think? Is this customer loyalty program from Nintendo designed to foster loyalty?

Comments

[John Moore]

Hmmm, I don't know. I've been thinking about this and I'm not sure that this really qualifies as a "loyalty" programme because it still retains the idea of Nintendo managing the loyalty.

To me, real loyalty is when the fans create their own sites and say how great a product is, and share their enthusiasms without the brand owner doing it for them.

One fairly trivial example: I have only a very intermittent addiction to computer games, but one that hooked me at Christmas was Return to Castle Wolfenstein. Their site links to fan sites like http://www.wolfensteinx.com which is stuffed with resources and enthusiasm. That says a lot more to me about the quality of the game than a manufacturer-inspired hierarchy.

When you say, "Rewarding loyalists with insider information that is only privy to a select few is very cool", I guess you are approving of the way this company rewards its big supporters. This kind of exclusivity may work in some contexts, but what if its big supporters didn't want to be part of a secret society? What if they wanted to evangelise? They might not really like to be invited to be part of something exclusive.

Also, I notice that I dislike the pressure that frequent flier progs put on me to clamber up their little hierarchies. On the one hand, my ego likes when I go up the ladder, but I also dislike the sense of being in some kind of competition for the love of the brand owner! I think I prefer no-frills airlines because I feel on a par with my fellow passengers, not part of some artful social hierarchy invented by the marketing department.

Then again, who can argue with the idea of recongnising customers who engage more... There's no magic formula I guess, but perhaps the two John Moore's could come up with one between us :)