Tesco are one of those organisations here in the UK that have a sophisticated customer loyalty scheme in place. Their range of services covers their core segment (supermarket shopping) but also extends to energy supply, car rentals, hotels and an extensive selection of products and services that their consumers use. And their loyalty scheme is geared to keep customers coming back from mere, with a rich set of rewards ranging from Airmiles, cruises, days out and other goodies. Both my wife and I are pretty big fans of the scheme, albeit for different reasons. Personally I find the way Tesco use their data and incentives to motivate their customers to purchase quite interesting to observe.

This morning however, we had a pretty negative experience with Tesco. They have a “Deal of the Day” mailshot with a different special offer every day, and last Friday my wife decided to take advantage of a special offer to get an LG phone on PAYG for around £20 (see picture). In fact, she liked the offer so much, that she decided to get 4, to give as gifts to her family who sometimes visit the UK. Yesterday she received an email from Tesco saying that they had cancelled her order because of a problem with her credit card. We had also made other purchases with that card on the day, and guess what, no problems there.

So, she decided to phone up Customer Services to provide them with further payment details and was informed that the problem wasn’t really with the payment, but that the offer was limited to one unit per household so they couldn’t supply four. If you click on the advert, you’ll see that the bottom half is all small print, but that condition just isn’t listed there. My wife was even more upset, because the website had allowed her to actually place the purchase and pay for the order without any problems. If you try shopping for groceries and try to buy more than an allocated amount of items (I think it’s 10) the website stops you from doing this. Was it wrong for her to expect the same sort of behaviour from another part of the site?

The net result of the whole experience is that my wife is feeling bitter and disappointed. Does it mean she’ll stop shopping at Tesco? Probably not, but the experience has knocked a substantial dent into her loyalty. Instead of raving to her friends about how great her new phone from Tesco is, she’ll be telling them how disappointed she is because Tesco cheated her out of a new phone for herself and her siblings.

How could Tesco have prevented this situation? First of all, they should have been honest with their advertising. It’s a great deal, but we’re only letting you have one. Don’t just say it in the small print, but set the customer’s expectations, even make them feel honoured with the opportunity. Next, if you make a promise, honour it. The customer service representative who my wife spoke to shouldn’t have been making excuses, but should have been looking for a way to resolve the situation. And finally, don’t lie to a customer. Why blame the failed transaction on a problematic credit card (and worry the customer that they have been subject to identity fraud) when this was just not true.