“You can’t please everyone all the time.”
You probably first heard this quote when you were a child, from a trusted adult who was trying to free you of the burden of trying to be everything to everyone.
In business, it sure would be nice if this quote weren’t true. But the harsh reality is that you aren’t equally pleasing to all your customers.
If you have supreme confidence that every single one of your customers is deeply satisfied, it’s just because you aren’t hearing from the dissatisfied ones. According to Lee Resources, for every customer complaint you receive, there are 26 more customers who are unhappy but never complain. Or, at least, they don’t complain to you. The White House Office of Consumer Affairs reports that a dissatisfied customer will tell anywhere between 9 and 15 people about their experience. 13% of dissatisfied customers will tell 20 or more people.
And with the Internet, just one of those conversations can have exponential impact. You don’t have to imagine what happens if a bad review or Tweet goes viral, because those examples surround us every day, harming brand reputation and ultimately contributing to business losses. When the average Facebook user has 338 friends and a viral complaint can reach millions, companies who ignore word-of-mouth are at their peril.
What is the customer loyalty definition? Customer loyalty is about giving customers the feeling that they’re valued and that they’re listened to. When you give people the chance to do business the way they want, they’ll be more willing to, you know, do business with you. And making people interested in doing business with you long-term is what customer loyalty is all about.
The importance of customer loyalty has been made clear during the pandemic. Customer loyalty is the most effective way to grow your company. Here’s why—and what it looks like when businesses focus on nurturing different types of brand loyalty.
Why Does Customer Loyalty Matter?
Companies aligned for growth get laser focused on understanding customer turnover—not just because turnover is expensive, but because it’s preventable.
Customers churn for one of three reasons:
- Customers don’t feel valued by your company.
- Your team hasn’t been given the purpose behind your work.
- Your company hasn’t successfully implemented processes to deliver a stellar customer experience.
If your product or service doesn’t deliver what you promise, customers are going to feel suckered – and they’ll leave.
If you want employees to get excited about your initiatives but haven’t shared why they’re vital, employees aren’t going to buy into the work.
If customers can’t rely on your team for a roadmap to success, customers will be annoyed, then angry, and ultimately absent.
As a leader, customer loyalty is your responsibility. Here’s the good news – the solution is simple.
Fixing The Foundation
Over 20 years, managing director of Alignmint Ali Cudby has helped companies improve customer loyalty—guiding companies in technology, retail, healthcare, financial services, media and more. In all of these cases, the formula for success boils down to the same factors:
- Industries have distinct challenges.
- Companies are unique.
- Individuals see the world through their singular lens.
- Humans have a fundamental need to feel seen, heard, and valued.
Customer loyalty, at its core, is a proven formula to build trust with every interaction, so people feel valued throughout their relationship with your company.
“Consumers will feel more confidence and trust if they believe that your company will value their needs, even after the COVD-19 crisis is over,” says Cudby.
These are extraordinary times. We are all still learning new ways of dealing with our worlds. But the essential, human need to feel valued hasn’t gone anywhere.
According to Deloitte, “at times like these, every interaction with your customers and partners is an opportunity to demonstrate what your organization is all about, and to be true to your brand and your purpose.”
That means focusing on customer loyalty in marketing, sales, delivery, and customer service.
Customer Loyalty Examples
Even with everything I’ve already discussed in this article, you still might be asking yourself a few questions, such as “Are there benefits to customer loyalty?” and “Are customer loyalty programs worth it?” The answer to this question on its simplest level is “Yes!” but a more comprehensive response will vary from business to business.
When B2C brands think about loyalty programs, they conjure images of punch cards and rewards points. B2B brands will have a different approach to increasing customer loyalty.
With that in mind, let’s take a look at three case studies that show customer loyalty examples and what it can look like in action.
Case Study #1: ClusterTruck
When Chris Baggot, co-founder of ExactTarget, turned his attention to the prepared food delivery market, he was surprised to find that people really wanted food on demand, but they hated the existing tools. As he built the company that became ClusterTruck, he knew that he had to be better than the competition at controlling every aspect of the customer experience. Where competitors were little more than tech companies, ClusterTruck would need to be a tech company, a restaurant, and a delivery service wrapped up into one.
By hiring their own delivery drivers, preparing all of their food from scratch in kitchens owned by the company, and building their own tech for users to order with, ClusterTruck made it possible to guarantee quality at every level. Their guiding mantra became “Don’t ship maybes,” and that’s not just dishes that aren’t up to snuff—it’s choosing the right food vendors, hiring the right people, and shipping the right digital products to consumers.
Where other food delivery services often leave customers with late deliveries of cold food, ClusterTruck has engineered every aspect of their operations to give customers what they want—and they’re always learning from customer buying trends to improve their offerings.
Now, ClusterTruck outperforms other restaurants consistently, and Chris Baggot has “Don’t Ship Maybes” tattooed on his arm. If that’s not dedication to customer loyalty, I don’t know what is.
Case Study #2: UrbanStems
Food isn’t the only commodity that has a troubled history with delivery. The country’s top flower delivery companies have a less than stellar reputation among customers for a bevy of reasons, from poor communication, hidden fees, lost orders, and flowers that show up looking less lively than a customer had hoped.
For Ajay Kori and Jeff Sheely, co-founders of flower delivery service UrbanStems, this created an opportunity to simply be better. By focusing on hiring empathetic employees who would put customer happiness above else, they’ve created a company culture that stays focused on the real purpose of flower delivery: brightening peoples’ days.
To keep customers loyal, that means giving a great purchase experience—but the real customer loyalty work happens when something goes wrong. Flowers are delicate, living things after all; there’s a ton of room for mishap from greenhouse to final delivery. UrbanStems has gone as far as naming their customer service team their “customer happiness” team, and that makes all the difference when an angry customer calls with a complaint. When met with someone on the other end who cares enough to make a problem right—and is empowered to do so—it’s almost unexpected compared to past experiences customers have with other floral companies.
The next time that once-angry customer wants to send someone flowers, who do you think they’re going to call?
Case Study #3: PERQ
PERQ is a marketing technology company that sells high-level consumer engagement for complex purchases, such as apartments and cars. For co-founders Andy Medley and Scott Hill, business is a game to be won—and they’ve made “the game of business” their guiding mantra, or bullseye, that informs their entire culture.
By setting clear goals and expectations and challenging their team to compete—and have fun playing the game in the process—PERQ has empowered employees to truly own the company’s vision and do incredible work. As teams work together to win that game together, they’re incentivized with half-days off and other, erm, perks that generate significant buy-in from employees.
In turn, that respect translates to customers, who have become fervent fans of the PERQ brand and helped the company explode with growth. With this approach, they’ve increased their cumulative annual growth rate by 900%—thanks in no small part to great customer loyalty.
Customer Loyalty Ideas
As stated earlier, the best customer loyalty ideas and outcomes originate when you accept that not everyone will be happy all the time. This allows you to anticipate and understand the events that make customers happy or unhappy. It can slo put procedures into place so employees know how to respond while celebrating customers for sticking with you and growing the relationship. Here are three steps to retaining long-term customers:
1. Make Customer Loyalty a Priority
Every customer’s long-term relationship with your company is defined by a series of inflection points. These are the touchpoints where customers will need more from you. This could be more information, additional services, reminders about maintenance, or troubleshooting.
These inflection points aren’t just an opportunity for you to understand your customers better, but also part of your responsibility to recognize and initiate. Even when these inflection points are triggered by something in your customer’s world, it is part of building loyalty for your employees to reach out. This will look different for different companies. A financial services provider might schedule employee outreach according to a specific timeline based around events like tax season or quarterly statements. A software provider, on the other hand, might reach out based on different less-predictable situations like when the client makes a new hire or an important update being released.
Waiting for customers to reach out means you are going to miss many problems that surface for them along the way. You may also be leaving room for small, easily-resolved issues to become big breaking points that ultimately cause you to lose their business. Therefore, it’s essential to take a proactive approach to communication and reach out to learn if customers are unhappy, and why.
As part of this outreach, it’s important to establish defined processes and success metrics for your employees to fall back on. Each team member needs a Playbook, a set of step-by-step processes for consistent customer experience that include structured ways to follow up about the customer’s experience and unmet needs. This allows customer loyalty to be built in as part of the employee objectives and achieved on timelines that keep employees excited about customer loyalty.
Without these processes in place, each individual employee will be deciding for themselves what is most important about the customer experience—and if an employee is disengaged, they might not consider the customer experience important at all. Even employees who want to do well might prioritize the short-term win that gets the problem off their desk versus the long-term solution that addresses the customer’s needs.
2. Plan to Reward Customer Loyalty Examples
Companies that do an excellent job retaining long-term customers will achieve a huge competitive advantage. According to findings by NOP Market Research Group, reducing customer turnover can increase profits by as much as 85%. The same study found that increasing customer loyalty doesn’t have to be a complicated process. In 35% of cases, customers said a simple apology for the miscommunication or poor service would have been enough to win a second chance at keeping their business. But in 73% of cases, businesses made no attempt at all to convince customers to stay.
The second key to inspiring long-term loyalty in your customers is rewarding employees who excel with customer experience. This means a back-end plan to identify and encourage the behaviors you want in employees. These processes could even include creating your company’s unique “Bullseye Message” to function as a mantra for customer experience. This should be a unique and engaging, but simple way to get everyone in your company aiming for the same target for customer-centricity. Also, employees will feel valued as the company is paying attention to their actions on behalf of their customers.
3. Monitor and Grow Customer Engagement
Once customer loyalty is a defined and established part of your processes, it becomes simple to take small daily steps that celebrate your most loyal customers and help those who are less-loyal grow their emotional attachment to your business.
What are the 3 levels of brand loyalty? These are lazy loyals, limited loyals, and lucrative loyals.
- Lazy loyals buy repeatedly out of pure convenience. They may not truly be loyal at all, so it may not be a valuable focus to try and grow their attachment.
- Limited loyals are long-term repeat buyers who may or may not be invested in their relationship with your brand. Through recognition and celebration, their loyalty can be deepened.
- Lucrative loyals are truly passionate and excited about being a customer of your business. They are not only a source of revenue, but of referrals and positive feedback about how your brand is doing well and can grow.
The key to attracting and growing your base of lucrative loyals is repeatable processes. One customer service representative can take one isolated action that makes one customer happy. But without a system in place to make these efforts repeatable you won’t truly know what works and what doesn’t. Customer recognition and celebration has to be strategic, measurable, and repeatable to grow long-term loyalty.
Implement Company-Wide Customer Loyalty with Alignmint Growth Strategies
By now, we can understand and outline at least three examples of why customer loyalty is important, as well as the three process steps that make customer loyalty a systematic part of operations. That starts with simply choosing that customer loyalty should be a priority.
Think of this like signing up for a gym membership—you have decided to get in shape! But that effort looks different for each person. Determining your key inflection points where customers may become happy or unhappy is like coming up with a personalized exercise plan. Putting the systemic processes in place to follow up during inflection points is like showing up to the gym on a schedule. Starting to celebrate and recognize your customers is like getting stronger and increasing the scope of your workout accordingly.
It may not happen overnight, but with small efforts applied daily, customer loyalty becomes a healthy habit. Working with Alignmint Growth Strategies is like hiring a personal trainer. We look at the current state of your operations and objectively determine the key exercises and improvements that must happen first. Then we help you grow from that foundation to achieve long-term wellness and happier customers. Contact us today to learn more about your current customer loyalty processes and how to improve them.