The National Business Research Institute (NBRI) recently published an infographic detailing why customer loyalty is important, what customer loyalty is, the problem or disconnect between businesses and their customers, the solution for improving customer loyalty and the future of “customer delight.”
“Customers are a business’ most important asset, without them the business wouldn’t exist. So it’s imperative to keep these customers happy and improve their loyalty to your business,” NPRI explains. “We created this customer loyalty infographic to help you not only understand it, but to help you cultivate that loyalty among your own customers.”
We found NPRI’s presentation of the importance of customer loyalty in today’s economic society not only helpful and insightful, but easy to digest with specific details that would apply in a variety of business settings.
What details included in this infographic surprised you?
Where do you think your business falls regarding the problem and the solution?
When considering that the decision-making process is 30% logic and 70% emotion, how do you feel that affects your business?
What can you change to help improve your customers’ loyalty?
Real Results: How Did Bristol Toyota Scion Create a Valentine’s Day Email Campaign with a 58% Open Rate?
Everyone knows Valentine’s Day celebrates the ladies. That’s why Bristol Toyota Scion in Bristol, Rhode Island, recently used its points-based service rewards program, to conduct an email campaign centered on Valentine’s Day being “Ladies’ Day.” Colorful, Valentine’s-themed emails were sent to all of their service reward members, with the subject line, “Be Our Valentine – View Your Gift Inside.” The email included an offer: Ladies Receive $15 Off Any Service of $35 or More. The campaign ran on February 10th, with available redemption being from February 10th thru the 18th.
This was the first promotion Bristol Toyota Scion had ever done since adding LoyaltyTrac as its service rewards program for loyal customers; it resulted in a very heartening open rate of 58.33%, far surpassing the Direct Marketing Association’s (DMA) average of 12-14% for opt-in lists.
Other LoyaltyTrac auto dealerships achieved similar results with this Valentine’s Day-themed email campaign. Howdy Honda in Austin, Texas, ran the same campaign and enjoyed an open rate of over 30%. The campaign also resulted in 41 service appointments scheduled and a nice profit too; one week after the email campaign was launched, Howdy Honda was showing an estimated campaign revenue of more than $8,700.
Specially designed email campaigns themed around holidays and events can boost return business throughout the year. It’s key to engage users with content that is informative, easy to digest and adds value.
How have you used non-traditional marketing practices to drive more customers into your business and build loyal relationships with those customers?
I recently had an experience that had me wondering what ever happened to the maxim: “The customer is always right.” It was coined and made famous by retailers including Selfridges and Marshall Field’s (now Macy’s) around the turn of the 20th century. It’s a phrase that most of our parents and grandparents had ingrained into their brains as children, and yet it somehow appears to have been lost in translation among the generations – and businesses – born within the last 20 to 30 years.
With my over 15 years of personal experience in customer service, it is surprising to me that so many businesses have either forgotten this key factor in customer loyalty and retention, or – worse – they simply don’t see its relevance in today’s society.
While many of my recent experiences as a customer would lead me to believe that I – as a customer – am no longer as important or “right” as a company’s profit margin, I don’t think I’m the only one around left wondering what happened to the importance of the customer experience. In my quest to discover what happened to the application of this seemingly lost phrase, I googled it word-for-word and came up with over 5.25 million hits, with over 170,000 blog posts involving the saying in the last 12 months alone.
So I asked myself, “Is the Customer Still Always Right?”
One post I found on American Express Open Forum indicates that there is a secret that many business owners are perhaps loath to acknowledge: the customer is not always right. Andy Beal, CEO at Trackur, emphasizes that “some customers are so wrong, you sometimes feel like a fired-up baseball umpire that just wants to get in the face of your customers and scream at them just how wrong they are.
“So now that we’ve acknowledged that the customer is not, in fact, always right,” Beal continues, “why is this adage so popular? … You see, the customer is not always right. But, and it’s a big “but,” the customer always thinks they are right.”
I’ve been on both sides of the fence. I think, in some way or another, we have all been there. We’ve been the business professional dealing with someone akin to the Vinegar Boy’s mother, where we’re frustrated to the point of exasperation and cannot possibly understand where the customer is coming from or how they even feel justified behaving the way they’re behaving. We’ve also been that customer (although perhaps to a lesser degree of intensity and higher degree of being in the right); whether the facts can be supported or not, we feel that we have been wronged and we’re looking for some type of resolution.
“That’s what’s important to remember,” Beal explains. “There may be many incidents where you know that the customer is 100 percent wrong, and couldn’t be any more wrong if their name was Mr. W. Rong from Wrongsville, Wronginham. The key is to swallow your pride and look beyond the need for you to justify your company’s actions.”
Beal concludes by advising us to “treat your customers the way you would want to be treated—even if you knew you were not right – and your business will flourish because word of mouth will treat you well and you won’t get distracted by the Mr. W. Rong’s of the world.”
I think this is great advice that is too frequently forgotten. We all learned how to apply the “Golden Rule” to others in grade school. We are all human and we all make mistakes – businesses and customers alike, but if you want to strengthen the relationships you have with your customers and keep them loyal, then knowing exactly who is right and who is wrong doesn’t matter in most situations. The important thing to focus on is that the customer always deserves to be treated right and with a professional respect and courtesy.
As a business owner, however, we need to understand that our employees are also – in a sense – our customers. Another article, posted on Customer Service Point, reminds us to remember that “You’re in business. And in business you don’t have to take every deal. You can draw the line at abusive behavior by the customer. You can draw the line at customers lying to take advantage. You can draw the line at customers stealing. In fact, you can draw the line anywhere you want.”
The important thing for you to decide as a business is where that line is going to be drawn, and then be consistent. When managing a call center, I acknowledged that sometimes customers just need to vent their frustration. Once they understood they were being heard, they would usually calm down and we’d be able to determine a course of action together. However, sometimes these customers became verbally abusive, offensive or irreconcilable; it was when this behavior changed, especially to our front-line representatives, that we drew the line.
When a customer crosses the “unacceptable behavior” line, your concern should not be for the customer so much as for your employee and your business. The Customer Service Point article continues by explaining that “when a customer actually does cross the line, you can tell them that you no longer want their business. And at that point, they cease to have the right to be right.
“The customer is always right. But not all customers need to stay customers.”
Do you think the saying, “The customer is always right” is still important for businesses today? Why? Why not?
Did you read the Vinegar Boy story? Do you think the employee (Aaron) was right? What about how the manager responded to the situation? Would you have handled things differently? How?
How have you trained your employees to handle “wrong” customers the “right” way?
Where do you think that businesses should “draw the line” of when the customer is right and when the customer is wrong?
Let’s say you set out to improve your company’s customer experience to drive better organization performance (kudos to you). What will be more important in attaining that goal: exceeding customer expectations or solving customers’ problems?
That’s the question that came to my mind after reading Robert Passikoff’s recent article on Forbes.com, “The Final Frontier: Customer Expectations.” Passikoff points to a shift in the past 15 years: customer expectations have increased significantly, rising 24 percent in all categories. That number has increased even more in the technology sector. An entire book could be written (and probably has been) on why customers’ expectations are on a sharp upward trajectory.
But my question is not the focus of Passikoff’s article. He notes that measuring customer expectations is a tricky business and turns to customer loyalty as a correlating metric. After explaining how customer loyalty is measured and providing an example from the wireless carrier industry, Passikoff concludes, “…brands that are able to better meet – even exceed – growing customer expectations always end up on the top of the list.”
Fair enough. On the surface, it’s a good point, and one that seems hard to argue with. But I’m going to argue it anyway. Because here’s the thing: customers seek out businesses because they have needs, and they expect those businesses to solve those needs. The business either solves the problem or it doesn’t. Period. End of story.
Expectations are like averages; they don’t exist in the real world (only in your customer’s mind, and perhaps subconsciously at that). Therefore, to “exceed customer expectations” is a weak goal. I’d go as far as saying that expectations are a “false god,” sapping a lot of focus, energy and resources from what should always be the goal: solving the customer’s problem.
Passikoff started a great conversation about customer expectations and satisfaction, but then took us down a road that’s essentially a dead end. Tying customer loyalty scores to customer expectations is not the answer. Why? Loyalty scores are important, but they don’t take into account all the reasons customers stick with a company. The “how well” question is the field of loyalty. The “if/if not solved” is the field of performance.
Take the example in Passikoff’s article that examines how wireless carriers rank on the Customer Loyalty Engagement Index. AT&T came in first, followed by Verizon, Sprint and T-Mobile (in that order).
Passikoff notes that this list correlates very highly with customer behavior, such as churn figures, and that, according to the latest data from the Better Business Bureau, AT&T had the fewest complaints and lowest complaint rate of these four wireless providers. All this, even though there was speculation last year that AT&T would see an exodus of customers to Sprint and Verizon when the iPhone became available on those carriers. It didn’t happen; AT&T continues to outsell Sprint and Verizon.
Although these numbers seem to confirm the Customer Loyalty Engagement Index’s ranking, there’s something the data does not reflect: captive customers. I happen to be an AT&T customer, but I am is because I can’t get out of my contract, and when I’m at a point where I can, it’s difficult. So, I perceive I am stuck – loyal, but captive.
How many people are in the same boat as I am? Locking customers in prohibits a measure of loyalty AT&T should trust. Until we come up with a “complacency” or “frustrated and stuck” index and begin dissecting truly loyal, enthusiastic consumers from those who don’t have the time or resources to navigate the breaking of a contract, loyalty is one metric – but not the most important metric we can fully trust to drive improvements in customer experience and organization performance.
Which brings me back to a goal we can trust: solving the customer’s problem. AT&T solves my need for road-warrior connectivity and that’s why I show up in the positive in their revenue and profit performance.
Now, think about the problem or need your company exists to solve. The desire that triggers them to act. Do you know how often, and how well, you solve that need? Do you provide an effective solution? This is where we should focus our time and energy: on solving our customers’ problems.
Source: Business2Community.com, February, 2012. Author, Linda Ireland.
Do you focus your business efforts on achieving high customer satisfaction or on solving your customers’ problems? Why?
Which do you think is more important? Attainable? Is there a difference?
How does solving a customer’s problem enhance the customer experience and customer loyalty?