Sprint Calls on Best Customers
In 2009, Sprint set out to reward the top tier of its 48 million customers with its first loyalty program, Sprint Premier. The program is free to customers, and offers perks like more frequent upgrades, accessory discounts and anniversary rewards. About 18 months in, the program has proven that these “Premier” customers are far more loyal. Melinda Parks, director of marketing for Sprint, talks about the decision to build the program and the way forward.
CHIEF MARKETER: Why launch a loyalty program?
PARKS: As wireless companies we’re not really good in this industry at making customers feel good about experiences with us. There are contracts and prices that can make the experience icky.
CM: Did you run a pilot?
PARKS: We had spent the year before piloting in the space. We watched customer churn behavior over time and did some things around what benefits should look like, including a core benefit of an annual upgrade, along with a package of other benefits, including a coupon for an accessory.
CM: Why did you decide to automatically enroll customers?
PARKS: We didn’t want customers to have to figure out how to get into the program. We sent a welcome kit, talked to those customers at point of sale, and communicated through newsletters, direct mail and e-mail. We also broadened how many customers we brought into the program. Our intent was to be very clear and transparent about how you got into the program.
CM: What about the budget?
PARKS: From a financial standpoint, it was a very sizable business decision because the annual upgrade costs us more money. We’re making a greater investment in those customers. But the fact is that these customers stay with us longer so they are more likely to recommend us. So it’s worth making the incremental investment.
CM: What kind of people power does it take to manage the program?
PARKS: The biggest factors were from a systems standpoint, identifying those Premier customers on a monthly basis and tagging them so they automatically come into the program. Then you have all the direct marketing and front line point-of-sale systems, so when a retail rep is talking to a customer they clearly see it’s a Premier customer. There’s a lot of training and communication so our employees understand the program.
CM: Recent changes to the program were made based on direct customer feedback. How did you get that feedback?
PARKS: The best vehicle that we found is our Premier Community Forum, where customers talk to each other as well as program managers — so we can help solve any issues or problems. We field questions out to them and we listen to their experiences and take that input to make enhancements to the program.
CM: Are you working to get non-Premier customers up to Premier status?
PARKS: We really try to. It’s the rate plan selection that decides if you’re in Premier — and obviously paying your bill on time. We don’t try to up-sell. We’re focused on whether it’s the right plan for the customer. However, if we look at the usage and history we can talk to them about getting on the plan and saying here’s an extra benefit.
CM: Was it difficult to get C-level buy in?
PARKS: It was not an easy decision because of the financial implications of that annual upgrade. Typically, competitors allow upgrades every two years, but our Premier can upgrade every year, and we didn’t really know how many of them would for sure, so that was a concern.
