• karaholm

Secret Sauce to Build Loyalty

We were in Las Vegas last week for meetings. While staying in Vegas we always visit as many places as possible to see what’s happening. Often, we are exposed to interesting ideas that we can adapt or modify for the Canadian marketplace. We can also learn what happens when a good idea is not implemented effectively.

The Cosmopolitan of Las Vegas is marketed to the hip, urban, professional crowd. The Chandelier Bar at the Cosmopolitan has an “off-menu” secret cocktail, called “The Buzz Button” or “The Verbana," which you can only order if you have insider information. Our colleague Chef Sylvain ordered one last Friday night and he certainly looked like an insider to me. Which is exactly why the Chandelier Bar offers an off-menu drink: patrons develop an attachment to places where they feel special. Chef was really keen to visit The Cosmopolitan and I understand why.


Chef also showed us a little out-of-way New York style pizza joint in The Cosmopolitan, located down a hall that could easily be mistaken for a service area, that is not advertised or promoted by the property, but still very busy. We all want to feel like a big shot from time to time. This secret drink and the hidden pizzeria at The Cosmopolitan give patrons the opportunity to feel like a VIP.

Having off-menu items or experiences that are exclusive to those who have insider knowledge is something that could be accomplished at any watering hole in a small town or big city, in order to generate interest and caché. It is something I’ll be remembering and recommending to my clients.

Another place that offers great experiences is Otto Enoteca located in The Grand Canal Shoppes at the Palazzo/Venetian. We have eaten there many times. When we arrive, they welcome us with complimentary glasses of Prosecco and thank us for coming back. General Manager Matthew tells us that the management team is focused on coaching their service team to enhance all aspects of the experience. Service staff members speak knowledgeably about the menu and ingredients, clearly take pride in what they’re serving and are polite and helpful. (Incidentally, the service is professional and attentive at Otto in NYC too!) This type of care and attention to detail is not limited to Las Vegas or big destinations, with training and coaching it’s available to anyone.

In addition to best practices we also have had occasion to experience misses. One thing that struck me this trip was the missed opportunities resulting from really good ideas that were not implemented effectively. Great ideas that are poorly executed make me sad.

At our hotel, the Palazzo, we did identify an issue with the Grazie loyalty program that could have been an opportunity for improvement. Since our first trip to Vegas we have been staying at the Palazzo, with one exception when I stayed at Caesars Palace. Do I think it’s the nicest hotel with the best service? Honestly, I don’t; but they have earned my business and do offer several comforts that we appreciate – including spacious suites and a dressing table and an amazing gym and spa. (Here’s an insider’s tip: there are no bad views but do ask about your proximity to the elevator.) We are loyal to the Palazzo/Venetian in part because you can earn points in the Grazie loyalty program for non-gaming activities such as hotel fees, as well as room charges from the restaurants, spa, theatre and retail. We have obtained a premium status in the Grazie program, which offers a variety of benefits such as courtesy airport shuttles, suite upgrades and discounts on various services.

The issue is that the benefits are not well communicated to members. And opportunities are missed by the property and its partners to convert the benefits to experiences. For example, Gold Grazie members receive a 10% discount at the Canyon Ranch Spa Club but the staff at the Canyon Ranch have never asked me if I have a Grazie membership. The onus is on me as the customer to advise them that I have a membership in order to receive the discount. This is also the case at the Café Pressé locations on property where Gold members receive a 20% discount. When coffees cost $6USD that makes a significant difference. There’s a little sign — if you look for it — noting members qualify for discounts, but the staff members never ask.

In both cases if you learn about the discounts after the fact, they can — with a bit of time-consuming fuss — retroactively provide the credit; but it would be so much more efficient from the operator perspective, and engaging from the customer perspective, if the benefit was offered proactively.

How hard would it be to train staff to ask customers if they are Grazie members during each transaction? If customers aren’t members you may encourage more people to participate in the program, and if they are members they will see value and be glad they belong. I am sure there are lots of excuses, but no good reasons, especially when the benefits area so clear for all parties involved — the operator, partner and customer.

This is a head scratcher. A company has invested a lot of time and resources to develop qualification thresholds, point values and reinvestment rates. Time and effort has been spent to define benefits and privileges. The company has even engaged third party partners to add value to its program. Why then aren’t they taking the next step and focusing on:

  1. Communicating these benefits clearly and often to their carded members;

  2. Training their staff, and those of their partners to activate those benefits at the experience level;

  3. Eliminating the cost of correcting errors?

The underlying question is how can patrons value your loyalty program if they don’t understand the benefits, or fail to experience the program through their interactions with the property and its partners?

This is a missed opportunity. Presented in this way, the customer interaction is neutral to negative rather than positive all around. The point of loyalty programs is to make your customers believe they’re valued and special. If you put the onus of activating the program on them you diminish that experience. You want them, after spending all that time and money building the program, to feel great after every interaction with your business, don’t you?

So the advice for today:

  1. Every interaction your business has with customers is an opportunity to make a connection and build a relationship. Some businesses do this well and so could you! (Call us and we can help you create an approach that’s right for your business.) It’s just as easy to have a positive interaction with a patron as a negative one. The leadership sets the tone, and the training and mentoring ensure it happens.

  2. Don’t miss opportunities to activate investments made in your business. Too often we see great programs or experiences or investments that are left flat by the failure of the business to think beyond the launch and commit to implementing on a daily basis. To succeed and make the investments work for your business, you, for your part, must continue to be invested in the success.

  3. What’s the secret sauce? Communicate, communicate, communicate. Communicate with your employees, make it easy for them to implement. And communicate with customers so they understand their importance to you. Help everyone see the benefit to all, the “WIIFM” – what’s in it for me. It is almost embarrassing to recommend something so obvious. Good communications require continuous care and management. You can’t set it and forget. Commitment to communication with staff, employees and other stakeholders requires daily attention.