(moved from http://anuradhasivarajan.wordpress.com/ original date: June 01, 2012)
The beauty salon industry in India has seen phenomenal growth in the past decade, thanks to the increasing standards in beauty and awareness about international brands. This 5,000 crore industry, while being dominated by FMCG players and cosmetic giants, also has some niche players. Lakme by Hindustan Unilever is one of the most trusted brand names in India for the past many years and I personally know of people who swear by Lakme products so much so that they ask relatives travelling from India to buy it for them when they move abroad. The salon industry is but a natural extension for this brand.
Whenever I’m in a new city in India and I need to go to a salon, I trust Lakme for hassle free and consistent service. Naturally I was delighted when the chain came up with its ‘Club Radiance’ Loyalty program. Now having worked in the Retail industry, I have come across my share of Loyalty programs, and like newspaper Sudoku columns they can be classified as simple, medium, complex and evil (aka the customer is so confused, she does not know if she is being rewarded or punished!). Going by these classifications, on the face of it, the ‘Club Radiance’ loyalty program seemed simple enough. You earn 10% of your bill amount as points and each point is equivalent to a rupee that can be redeemed during your subsequent visits to any Lakme salon all over India.
Now here are two instances of what actually happened. First Instance: A couple of months back I was running terribly late for one of my friends’ weddings and needed a quick-fix blow dry. I went to the nearest Lakme, and was relieved that the lady finished setting my hair in 30 mins flat. I proceeded to the counter and opted to pay with my points accrued from previous visits. The lady at the counter looked at me as if I had offered to pay her monopoly money. She was fumbling with the system trying to find me with my name, phone number, card number, et al. To cut a long story short, she did not even know to process such a payment and had to call her regional office 4 times, while I ended up spending 20 minutes at billing alone.
Moral of the story:
A customer ends up feeling victimised for professing her loyalty to the brand when she sees 10 other customers walk out of billing in seconds having made no such promise to the brand!
Second instance: Today at another branch of the same chain, I informed the billing lady that I had a loyalty card and wished to pay with my points. First she searches for me in the system and tells me my card has probably expired since she is unable to find me in her system. After some back and forth and a cameo by the regional office, I begged her to forget about the points and take my credit card. She bills me and then wonder of wonders, finds me in the database. But now it is too late since poor her has already billed me. And more is the joy when she tells me that next time I am to inform her before my service starts, so that she can look for me in the database in the meanwhile (For 2 hours??!?).
Same Moral. Same Result:
On my way back I wonder if the failure of the Loyalty card to make me feel rewarded is an exercise in the effectiveness of Indian retailers’ loyalty programs. It is a pity that these programs just migrate in concept from international retailers, but fail to translate into effective customer engagement at the till because of poor staff training and inadequate investment in IT.
The beauty salon industry in India has seen phenomenal growth in the past decade, thanks to the increasing standards in beauty and awareness about international brands. This 5,000 crore industry, while being dominated by FMCG players and cosmetic giants, also has some niche players. Lakme by Hindustan Unilever is one of the most trusted brand names in India for the past many years and I personally know of people who swear by Lakme products so much so that they ask relatives travelling from India to buy it for them when they move abroad. The salon industry is but a natural extension for this brand.
Whenever I’m in a new city in India and I need to go to a salon, I trust Lakme for hassle free and consistent service. Naturally I was delighted when the chain came up with its ‘Club Radiance’ Loyalty program. Now having worked in the Retail industry, I have come across my share of Loyalty programs, and like newspaper Sudoku columns they can be classified as simple, medium, complex and evil (aka the customer is so confused, she does not know if she is being rewarded or punished!). Going by these classifications, on the face of it, the ‘Club Radiance’ loyalty program seemed simple enough. You earn 10% of your bill amount as points and each point is equivalent to a rupee that can be redeemed during your subsequent visits to any Lakme salon all over India.
Now here are two instances of what actually happened. First Instance: A couple of months back I was running terribly late for one of my friends’ weddings and needed a quick-fix blow dry. I went to the nearest Lakme, and was relieved that the lady finished setting my hair in 30 mins flat. I proceeded to the counter and opted to pay with my points accrued from previous visits. The lady at the counter looked at me as if I had offered to pay her monopoly money. She was fumbling with the system trying to find me with my name, phone number, card number, et al. To cut a long story short, she did not even know to process such a payment and had to call her regional office 4 times, while I ended up spending 20 minutes at billing alone.
Moral of the story:
- Staff at the front end are not trained to engage with customers that are part of the Loyalty program, be it with respect to knowing the rules of the program or knowing the right buttons to push on their billing system to charge someone their loyalty points.
- The billing systems are probably antiquated legacy systems with no integration whatsoever to, what I am presuming is centralized information, namely Loyalty customer information.
A customer ends up feeling victimised for professing her loyalty to the brand when she sees 10 other customers walk out of billing in seconds having made no such promise to the brand!
Second instance: Today at another branch of the same chain, I informed the billing lady that I had a loyalty card and wished to pay with my points. First she searches for me in the system and tells me my card has probably expired since she is unable to find me in her system. After some back and forth and a cameo by the regional office, I begged her to forget about the points and take my credit card. She bills me and then wonder of wonders, finds me in the database. But now it is too late since poor her has already billed me. And more is the joy when she tells me that next time I am to inform her before my service starts, so that she can look for me in the database in the meanwhile (For 2 hours??!?).
Same Moral. Same Result:
On my way back I wonder if the failure of the Loyalty card to make me feel rewarded is an exercise in the effectiveness of Indian retailers’ loyalty programs. It is a pity that these programs just migrate in concept from international retailers, but fail to translate into effective customer engagement at the till because of poor staff training and inadequate investment in IT.
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