How Being Upfront With Members Will Pay Off

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"What's the catch?" That's the question many jaded consumers have learned to ask themselves when they come in contact with what on the surface seems to be a good deal. That's what came to mind when reading an ad for a local fast food establishment. The poster read "Kids Eat Free." The ad went on to promote this aspect and how great it would be for parents to save money as well as to be able to bring their children to a family establishment with good healthy food.

A nice branding strategy for the restaurant so far, until your eyes caught the fine print at the bottom which could be easily missed. The lower-font sentence at the bottom read "Limit one free meal per child per visit."

What happens when a mom with three kids is enticed to patronize the establishment because of the ad? Odds are she is in for a big surprise when she is told that only one of her three kids will be able to have a free meal.

What does this do to the branding strategy? The above example turns a mild positive into a huge negative. The mom will probably pay for the two meals, leave upset feeling she had just been taken for a sucker, and tell all of the other moms not to patronize the place.

Now not only has the restaurant spent money on the ad but will also lose money in negative word-of mouth. The fact that one child, but only one, can eat free would probably be welcomed by most consumers. After all, the restaurant does need to make a profit. They have to cover their overhead. Giving away free food can definitely cut into the bottom line. For example, what happens when parents come in with an entire little league team demanding to eat free? That can be quite expensive - not to mention loud. But despite the valid reasoning, the establishment should be upfront with the particulars of the program. A mother with three kids coming in knowing that one will eat free will be thinking of the savings rather than walking in with the expectation that they will all eat free. Then there will be no disappointment and no damage done to the restaurant's image.

A Better Example From A Credit Union

A better example of branding image comes from a $300-million credit union on the East Coast. The institution created a commercial on videotape promoting one of its services. During the commercial, after the benefits of the service are discussed, the spokeswoman clearly points out the risks involved with the program and how to avoid them. This is a great example of straight forward advertising. If members are aware of the worst that can happen upfront and know how to avoid it, the risk may not be of concern.

One of the primary tenets of branding is building long-term relationships. Relationships are based on trust. The institution, whether it is a restaurant or a financial cooperative, has a fiduciary duty to explain all of the features of the product or service. Being upfront will create trust from the beginning.

Relationships between an institution and its customers are similar to that of relationships between individuals. As Stephen Covey points out in his well-known book, The Seven Habits of Highly Effective People, everyone has an emotional bank account into which others make deposits and withdrawals. At the beginning of the relationship the account is at zero. As an institution the goal is to make a deposit from the beginning. Starting off with a big withdrawal by miscommunicating the value of a product or service makes it difficult to build trust. The company is already starting off with a negative and then has to work at least twice as hard to simply get back to even.

The truth is that in the world of member relationships, one negative well outweighs one positive. So don't dig yourself a hole from the beginning. Be upfront from the start. It may get you less business in the short term but the long-term relationships you build will be difficult for another institution to break.

Kenneth C. Bator is president of Bator Training & Consulting, Inc. Mr. Bator can be reached at P.O. Box 4844, Naperville, IL 60567, at 630-854-6380 or at kbator

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