Post summary:
- The cornerstone of customer loyalty is great service. Automate wherever you can and focus on pleasing customers instead of trapping them.
- Create a personable brand. People think in terms of relationships, but they can’t form one with a faceless corporation.
- Don’t assume that customers who stay are loyal. They might be waiting for a good replacement. (Ask Blockbuster Video!)
On balance, there’s probably nothing more valuable to a business than the loyalty of their customers.
You already know the statistics which back that up; Loyal customers spend more over time. Selling to existing customers is cheaper than acquiring new ones. Loyalty brings in valuable referrals.
But I’m not going to rehash them here.*
Why?
Because none of them are the best reason to work on customer loyalty.
The best reason to work on customer loyalty is this: it makes your business stronger. Across the board, in every way that matters – if you’re laser-focused on customer loyalty, you’re doing everything possible to make your business function as well as possible.
I’m going to add a ‘but’ to that… later. But for now, let’s look at how you’re going to increase customer loyalty.
*(If that’s what you want, read ‘The CX stats shaping contact center services’.)
5 Ways to Maximize Customer Loyalty
#1 Offer customer loyalty rewards
Why this works – ‘free’ is still the most powerful word in marketing!
Where it’s weak – loyalty based on transaction may not run very deep
There are two good Indian takeaways in my neighbourhood. Their food and service are about the same. Each a two-minute walk away.
So why do I always go to the same one?
It’s the loyalty card.
I’ve been pulled in by one of the simplest strategies in the book. Every third purchase nets me a free side order or perhaps a drink. It’s just enough to tilt the balance.
For the cost of a few onion bhajis, this restaurant has secured my business.
That’s simple enough for most businesses to recreate. Plus, there are few ways to increase the pull of these offers:
- Embrace ‘loss aversion’. People are more emotionally invested in preventing losses than making gains. Talk about the reward as something the customer already has – and just needs to reach.
- Keep rewards simple. You’re trying to direct a customer action, so keep the directions simple.
- Offer choice or personalization. Some people want the washer and dryer, while others will choose the mystery box.
#2 Create distinctive brand messaging
Why this works – humans want relationships and a sense of attachment
Where it’s weak – A corporation’s voice can easily become ‘try-hard’
Most people want to deal with brands which themselves feel like people.
Nailing the right tone of voice (ToV) is something businesses are obsessed with – especially given the rise of social media.
A favourite of mine is GiffGaff. This UK mobile network aims shamelessly at a millennial demographic.
When they want you to sell to your friends, they invite you to ‘share the love’. Their customers are their ‘lovely members’. Their deals tend to be ‘massive’, ‘amazing’ or ‘epic’.
The GiffGaff ToV might not be for you. But there is a perfect voice for every organization. Here are the things you need to consider:
- Your voice is for your customers. It’s not for you. A mobile gaming company doesn’t have the same customer base as a pension provider.
- Your ToV should exist at every touchpoint. That means marketing messages, customer service, website content and the rest. Don’t write different ToV for each department!
- A voice can be ‘found’ as much as planned. Look to customer-facing teams to discover how your ToV changes over time.
#3 Open out, don’t lock in
Why this works – you’re interested in customer who want to stay, not who have to stay
Where it’s weak – making it easy for customers to leave is a tough sell internally…
Focusing on loyalty helps you to build a stronger business.
But it only works if you have a sound definition of loyalty! What does it mean to you?
There’s a big difference between customers who love your service and customers who just can’t leave.
It’s something we often see in SaaS contact center platforms. Sure, the product might be sound – it might meet your current needs.
But what about your future needs? Well, once you’re signed up, it’s too late to worry about that. The data migration alone means you’re pretty well stuck with a provider.
So are those platforms’ customers loyal? No – they’re trapped!
Here’s how you avoid trapping customers:
- Redesign exit processes. Don’t create deliberate obstacles to make leaving difficult.
- Use your powers for good! Using proprietary software? Great! But don’t use that to foster total dependency.
- Open out. Use tech like API integration to benefit from the functionality of other resources.
(Hey, that sounds interesting. What does it mean? Read: ‘How do APIs enhance contact center services?’)
#4 Collect *better* feedback
Why this works – your customers are more informed than you are!
Where it’s weak – feedback is only useful if you can act on it.
The best steer you’ll get on customer loyalty will come from customers.
Most businesses know that they should be using feedback in basically every part of their service. But surveys are often confusing, poorly thought out or impossible to act on.
The answer is to start using a formalized feedback structure like the ACAF customer feedback loop.
It’s useful as a guide to both collecting feedback and actioning that feedback. When it comes to measuring loyalty, Net Promoter Score and Customer Effort Score are crucial metrics to look at.
But overall, the question to answer is: are your customers devoted? Or do you have a lot of customers on a knife edge, who’d leave at the first opportunity?
Get the most from customer feedback:
- Create automated triggers. Ask for feedback automatically, based on events in the customer journey.
- Keep it professional! This is an important reflection of your brand, so don’t just let anybody write your surveys.
- Take action on what you learn. Actually do something with feedback, or take it to the teams that can.
(Learn more about the ACAF customer feedback loop here: ‘Customer feedback 101 – 4 *simple* contact center management tips’.)
#5 Automate wherever possible
Why this works – better automation makes life easier for everyone.
Where it’s weak – are you kidding? Automation is great!
Here’s the best piece of customer loyalty advice any business can get: make your services better!
Of course, that’s easier said than done. We’d all like to have more resources dedicated to customer experience projects. After all, we know that those projects pay for themselves – eventually.
But in reality, most businesses have to think about right now.
So what’s different about automation?
Automation is the rare customer service improvement that actually saves money. In practically any case you think of, an automated service represents a major cost reduction in a matter of weeks.
So how does automation make customers more loyal?
Essentially, well-designed automation makes your services faster and easier to use. The goal is to make everyday service less ‘visible’ – something that just happens, fluidly.
Good examples of gold standard service that automation makes possible include:
- Proactive or pre-emptive contact center services. Study customer journeys and support customers before they even ask for help.
- Conversational IVR. Move IVR out of the dark ages with systems that gather data and resolve customer issues with sophisticated AI.
- Virtual queuing. Never again make a customer wait on hold. Use virtual queuing to shift peaks in demand, and end long queues.
When it comes to fostering customer loyalty, automation is one of the most powerful tools at your disposal.
That’s because traditional forms of customer service are viewed in increasingly negative ways. If I’m contacting you, some part of the system has failed. But a simple, automated process doesn’t feel intervention.
It feels like prevention.
