Episode 871 - The VIP Upgrade: Give People Something Worth Earning

0:04 Helping leaders motivate their people to a higher level of performance through strong human relations, team building, and goal achieving. This is the 7-Minute Leadership Podcast with your host, Paul Falafelito.

0:22 Hello, everyone, and welcome to the 7-Minute Leadership Podcast. It's episode 871. I want you to imagine something. You walk into a hotel, give your name at the front desk, and the person behind the counter starts typing, and then they look up at you and say, Oh, Mr. Falavolito, I see you stay with us quite a bit. We've upgraded you to a suite. Now we're talking, right? Suddenly the room is bigger. Maybe there's a better view. Maybe you get access to the lounge. Maybe a nice breakfast is included. Whatever it is, you feel different. You feel recognized.

1:00 Casinos have mastered this. Hotels have mastered it. Airlines have mastered it. They figured out a long time ago that there is something enormously psychological in telling somebody you've earned an upgrade. And I've been thinking about this from a leadership perspective. Why can't every business do this? And I'm not talking about giving away free stuff. I'm talking about Creating a culture where customers and employees have something they can earn. Something that says, you've been loyal, you've performed, you've supported us, you've earned your VIP upgrade. Think about how powerful that could be. Let's start with customers. Most companies spend an enormous amount of energy and money trying to find new customers. Advertising, social media, promotions, discounts. Meanwhile,

1:59 somebody has been buying from them for seven years and gets treated exactly like the person who walked through the door for the first time yesterday. That doesn't make sense to me. Your best customers should know they're your best customers. Maybe you own a restaurant. What happens when someone visits 25 times? Maybe their 26th visit triggers their VIP upgrade.

2:23 They get access to something other customers don't get. Maybe there's a special menu item. Maybe they get priority reservations. Maybe the owner comes over and personally thanks them. Maybe they get invited to a private tasting before a new menu launches. It doesn't have to cost you a fortune. The value isn't always in the thing. The value is in the recognition. You noticed me. That's what people remember.

2:51 Imagine a small... coffee shop with a VIP mug hanging behind the counter with the customer's name on it. And when that person walks in, the staff grabs their mug. Now you've created belonging. Imagine a car dealership where somebody buying their third vehicle gets a completely different delivery experience.

3:13 Or an HVAC company where maybe a longtime customer receives priority scheduling during extreme weather. Or Think about a non-profit recognizing donors based on years of support instead of only the size of their check. Every business could create some version of the VIP upgrade. But here's where I think this gets even more interesting. Do it for your employees too.

3:40 Imagine sitting down with a brand new employee and saying, everybody here has the opportunity to earn VIP status. Now, They're probably going to laugh at you. What does that mean? Well, it means there are benefits, privileges, opportunities, and experiences inside this organization that are not automatically handed out because you've occupied a chair for six months. You earn them. Maybe after a certain level of performance, you get first access to advanced training. Maybe high-performing employees get to attend a conference.

4:18 Maybe they earn preferred scheduling opportunities. Maybe they get access to leadership development programs. Maybe they earn company merchandise that can't be purchased. Or maybe they get invited to a special annual dinner with the executive team. And maybe there's a parking spot. And yes, I know somebody listening right now is thinking, a parking spot? That's stupid.

4:41 Is it?

4:43 Go visit a casino and look at how many people will spend Thousands of dollars chasing a different colored player card. Go watch frequent travelers choose one airline because they're trying to reach the next status level. Go watch somebody proudly attach a luggage tag to their bag that tells the world they've reached elite status. Human beings like achievement. We like progress. We like recognition. We like knowing our effort unlocked something. That's the part businesses can learn from Too many organizations have flattened the employee experience. Everyone gets the same thing. The employee who constantly performs gets the same employee experience as the person doing the minimum required to remain employed. And then leaders wonder why their best employees

5:34 eventually stop pushing. There's nothing left to earn. So create something and make it meaningful. And here's the human part. The criteria have to be clear. You can't create a VIP employee program where the boss randomly decides who gets special treatment. That's favoritism wearing a fancy shirt. If you're going to do this, everybody needs to know how the system works. Maybe eligibility is connected to attendance, performance, training, customer feedback, years of service, or reliability. You determine if what matters in your company, and then make the path visible.

6:17 If I do these things consistently, I can earn this. Now you've created something incredibly powerful. You've created a target. And leaders sometimes underestimate how much people enjoy having a target. There should always be different ways to reach VIP status. Your employee who's been with you for 15 years may earn recognition from loyalty. Your newer employee may earn it through exceptional performance. Your customer might earn it through frequency.

6:47 Another customer might earn it through referrals. Someone else might earn it because they've supported your business for 20 years. The point isn't creating an exclusive club designed to keep people out. The point is creating an achievable level that makes people want to get in. That's a Here's another piece that I love about this concept. The VIP upgrade can be unexpected. This is where hospitality companies can teach every leader something. Sometimes the most memorable upgrade is the one you didn't know was coming. Imagine an employee walking into work on their anniversary and hearing, you've been here five years, you've been dependable, you've helped train new employees, you've represented this organization well. Today, We're upgrading you and

7:39 then hand them something. Give them an experience. Give them access. Give them recognition. Make the moment matter. Because the employee is going home and telling somebody about that. Customers do the same thing. Nobody goes home excited and says, you won't believe what happened today. I got exactly what I paid for. People talk about unexpected experiences. I booked the regular room and they upgraded me to a suite. They brought us something that wasn't even on the menu. The manager remembered our anniversary. They knew my name when I walked in. That's what gets repeated. That's what gets posted.

8:19 That's what creates loyalty. And leaders need to understand something about loyalty. Loyalty isn't built through a company slogan hanging on the wall. Loyalty is built through moments, small moments, when somebody realizes these people see me. That's the VIP upgrade. And I think there's another leadership lesson buried inside all of this. You don't need a casino. You don't need a luxury hotel. You don't need a massive rewards program.

8:51 You just need imagination. Sit down with your leadership team this week and ask them one question. What could someone earn here that would actually mean something to them? And ask that question a second time. Once for customers, once for employees. And don't immediately make it about money. Sometimes access is valuable. Recognition, valuable. Choice is valuable. An experience can be valuable. A handwritten note from the CEO can be valuable. Being invited into a room you weren't previously invited into can be valuable. And having your name remembered can be valuable. And then build levels. Maybe everybody starts at the standard level. Then there's VIP. Maybe there's an elite level above that. Now people can see progression. And

9:42 once they earn it, celebrate it. Make a big deal out of it. You earned this. Those words matter because we gave you this feels completely different from you earned this. One sounds like a gift. The other sounds like an achievement. That's leadership psychology. And there is one final rule. Once somebody reaches VIP status, the experience actually has to feel VIP.

10:08 Don't tell somebody they're one of your most valuable customers and then put them on hold for 45 minutes. Don't call somebody an elite employee and then treat them like they're disposable. Don't hand out a fancy card while delivering an ordinary experience. If you're going to call people VIPs, lead like they're VIPs. Because the title means nothing without the experience behind it. So here's your challenge for this week.

10:41 Create the VIP upgrade inside of your organization. Give your customers something worth earning. And then also give your employees something worth earning. Make the path clear. Make the reward meaningful. And when somebody reaches that level, make sure they know they earned it. Because sometimes the most powerful thing you can tell someone isn't thank you. It's we noticed what you've done and you've earned an upgrade. This has been the 7-Minute Leadership Podcast. And I thank you for listening.

11:16 For more Paul Falavelito podcasts, visit paulfalavelito.com.