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Is Loyalty STILL Dead?

Almost one year ago, I declared loyalty dead. I meant what I said, but now I’d like to examine this argument and hold the magnifying glass up to the crisp, new year of 2013. Is it dead? Can we revive it? What are companies to do to hang on to their customers if loyalty is as elusive as U.S. political harmony?

Loyalty is changing.

There was a time, not long ago, when customers would brag about their loyalty to products or companies. Loyalty seems to be moving on a scale, however. Take the way customers had to get information from companies. We would be required to sign up for a newsletter – either snail mail or the e-variety – and they could tell us great things to do with their products. Campbell’s Soup can be used for a great casserole!? Wowza. I better stick to that brand!

Now, we scan the pins of our friends and search for “what soup is best for casserole” instead of using brand names.

We also share – vehemently – when we are less pleased with the brand. We post to social media, insert reviews on Foursquare and sometimes go out of our way to make brand managers feel our pain.

And we seem to be especially affronted when we felt like we were loyal, and then we are disappointed.

dead bird

Belly up

Loyalty is fleeting.

A recent statistic from Oracle shows 82% of people describe their experience as taking too much effort.

We used to accept what a trip to the bank entailed. And then we heard about online banking and phone photo deposits. Victory!

The experience you are offering your customers is most likely NOT the easiest, lowest-effort option out there. Your customers will realize that soon enough, and if the products or services are comparable, your customers will start drifting to the easiest option.

Loyalty is still people-centric.

Even the most mundane product is influenced by the people selling it and buying it. Check out this quote from a makeup customer:

I love lipgloss, I don’t wear anything else. And I love Buxom! I was a very loyal customer, until a sales associated convinced me to try a Smashbox lipgloss, and now I love them too.

In the blink of a well-mascara-ed eye, a loyal, Buxom-buying customer just purchased a new product from a competitor.

Loyalty is still dead.

I stand by my argument that loyalty is not really attainable, at least not in the sense we used to consider it.

Loyalty is swift, so take charge when your customers ARE feeling loyal and start viewing loyalty a little differently.

  • Loyalty means customers care enough to tell you when something is not going well. Listen closely to what your customers are telling you. “Is there an easier way to do this?” means “I’ll be looking for an easier way to do this.”
  • Loyalty means advocacy, but not necessarily publicly. Not all of us are town square criers. Just because we’re not publicly announcing our loyalty doesn’t mean we don’t want to advocate for your brand. Give us the opportunity by providing the tools.
  • Loyalty means recognition. We want to be recognized for our loyalty. After all, being a new customer elsewhere will get us recognized with deals and perks, so what’s in it for us to stay with you?

Loyalty is hardly a new concept, but the way we treat it – both as customers and companies – is evolving. If you aren’t paying attention, then you aren’t really serving any goals.

What are your thoughts on loyalty?

Photo credit: Lightning Rod Man via Creative Commons license

Jeannie Walters

Jeannie Walters is the Chief Customer Experience Investigator™ and founder of 360Connext, a Chicago-based consulting firm specializing in the cornerstones of customer experience: customer engagement, employee engagement and connections like social media. 360Connext serves mid-market companies and larger by helping them evaluate their true customer experience. The evaluations always lead to improvements which then lead to results like increased online conversions or loyalty.

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8 comments
Lisa Gerber
Lisa Gerber

I think humans by nature are always open to new opportunities or a better deal, so we're always challenging our loyalty. I do that with my coffee. I've been loyal to Peet's for many years. And I'll try other coffees often, but I always end up back with them. Loyalty is more and more challenging to earn because of the proliferation of competition and higher standards. 

DestinationRewards
DestinationRewards

Loyalty is not dead. It's just increasingly difficult to attain and takes a much more rounded effort. The entire customer experience must be considered and tailored to exceed customer expectations. So many businesses are not doing it at all or are not doing it all out. Most small businesses aren't equipped for or cognizant of this kind of comprehensive effort. And the constant flux of communication and technologies just compounds the issue. Thus the rise of loyalty companies that can direct and manage this process for them.

DeliverBliss
DeliverBliss

I don't think loyalty is dead, but I suppose that depends on how you define it. What I know is that the cost of loyalty is increasing. This is especially true for retail and commoditized industries. When switching is easy, loyalty is expensive. As someone who has stayed 200+ nights at Starwood hotels and flown on 100+ United flights in the last two years, I can say that I'm a loyal customer of those companies. Of course, that can change, but not easily. Neither company wants me to switch and they structure their awards/upgrades accordingly. Sidebar, but that's a really interesting statistic from Oracle considering their implementations are notorious for taking far too much effort and money. :-)

retaincustomers
retaincustomers

My fave quote in this blog is:

"A recent statistic from Oracle shows 82% of people describe their experience as taking too much effort."

This is so true and really speaks to how much farther companies need to go to encourage purchases and repeat purchases. 

 

I agree that loyalty is hard won and can be faltering. But a company can still work hard to try to earn that loyalty - let's call it repeat purchase and if they are really good, evangelism. I'm a big evangelist for my favorite brands - JetBlue, Virgin America, Costco because they go above and beyond and win my favor and love!

jeanniecw
jeanniecw moderator

 @Lisa Gerber I think you touched on an important point - human nature. It doesn't always make sense because humans are so emotional. We are predictably unpredictable!

Latest blog post: Dead Bird

jeanniecw
jeanniecw moderator

@DestinationRewards interesting points about communication influx, but I'm not sure I agree with other companies taking over loyalty as the answer.

Latest blog post: Dead Bird

jeanniecw
jeanniecw moderator

@DeliverBliss You bring up an important point, Tim, about defining loyalty. It's important to know how both the company and customer consider loyalty. Wheels turning...I'll let you know when I write the post! ;-) thanks...good to see you here!

Latest blog post: Dead Bird

jeanniecw
jeanniecw moderator

 @retaincustomers I agree, Kim. I think even those who are evangelists, advocates, etc. can be swayed more easily than in the past to try a competitor, however. Take the Instagram debacle of a few weeks ago. They practically revived Flickr by driving their community to a competitor. 

As for "too much effort," this is what kills so many relationships. Companies should be making it easy, not difficult, and yet over and over they create barriers to a great experience.

So nice to see you here, Kim! Happy new year!

Latest blog post: Dead Bird

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