How much would you pay to create a loyal long-term customer? Well, to have my loyalty, the answer is apparently $100, courtesy of HelloFresh. Allow me to explain.
HelloFresh is a service that delivers weekly meal kits, including curated recipes and fresh, high-quality ingredients in just the right quantities directly to customers’ doors. Customers have the ability to select from a wide range of recipes as well as choose the number of servings per meal.
My family has a HelloFresh subscription, and a few weeks ago we received our shipment of meals one day late. We contacted HelloFresh through its Facebook page to inquire about delays and our selected meat, which was not as cold as we had expected. We were just concerned that our food might have been compromised.
We received a response from a customer-service representative, Taliah, who informed us that the shipment was not delivered late, but rather it had been shipped late to ensure that we receive the freshest ingredients. The meat we received was also not ice cold because the meat HelloFresh ships is fresh and never frozen.
We were completely content with this answer and would have considered the case closed, but we then received another message from Taliah, who informed us that we would receive a complimentary replacement package for our troubles.
Because we were not comfortable receiving a free box when our original box was completely fine, we promptly contacted Taliah and declined her offer. She insisted, however, and indicated that she had already placed the order and could not cancel it.
Thank you very much. Have a nice day.
The value of that box was more than $100, and given the low margins on food products, the labor involved with individually wrapping ingredients and the costly Styrofoam packaging with cool packs, this clearly was not a cheap giveaway. I was besotted.
Of course, HelloFresh is no small company. In May 2015 the company reported that it was shipping more than 4 million meals per month. In the end, however, it was not price of the box that won my loyalty. It was the customer service.
Here is what other entrepreneurs can learn from this experience.
1. Prioritize customer retention as much as customer acquisition.
These days, we often hear about customer-acquisition cost, especially among fast-growing tech companies, and while growing your customer base is important, keeping them is becoming increasingly difficult. With countless choices, unlimited information and peer reviews, customers are far more fickle than generations past and more likely to leave a brand just because a friend recommends something else.
For this reason, any business strategy should prioritize retention as much as acquisition for long-term sustainability.
2. Empower employees to make decisions.
Customers have short attentions spans, so when a solution to a customer’s problem is buried in the slow, constricted veins of a company’s hierarchy, customers will often move on before they receive a response, leaving them with only a bad taste for your brand.
Providing company representatives from all areas of your business with the flexibility and latitude to take personal actions to satisfy a customer will ensure that issues never linger for too long.
3. Understand the value of a loyal customer.
While some entrepreneurs may look at a free box of food, or any product or service that is offered to reconcile a customer issue, as a dollar amount, it is important to understand the other values, such an investment yields. A $100 investment from HelloFresh yielded a positive customer review on several sites, a recommendation on a neighborhood Facebook page, a discussion and deliberation in two university classrooms and an non-sponsored post on Entrepreneur.com.
What is that worth?
The next time your business is faced with a customer-service issue, do not get flustered with the immediate cost it will require to solve it. Instead, look at the long-term benefit that customer will bring to your company in terms of loyalty and promotion.
This is arguably more valuable these days than any single new customer.
Do you have a similar customer-service experience that has made you a loyal customer? Why not share that experience with others in the comments section below?