To create a better customer experience and longer relationships in the mobile market means going the extra mile
January 10, 2012The link between customer experience and employee engagement: More art than science
January 18, 2012
Just before Christmas I saw an article on the Econsultancy blog: Loyalty schemes don’t create loyal consumers, says Ipsos MORI. The post was based on research conducted by The Logic Group and Ipsos MORI and suggested that:
- Customer loyalty schemes don’t necessarily drive loyalty;
- That customers want something ‘special’ in exchange for their loyalty, where 71% said that that would entail better offers or services and 48% said that would mean better customer service than other customers.
- But, customers also said that they like ‘free stuff’ and rewards but if presented with a good enough and better offer then they will buy from another business or brand.
So, it seems that most loyalty schemes are reward programmes that don’t necessarily drive loyalty.
So, what does loyalty mean?
In the dictionary, loyalty is:
- the state or quality of being loyal; faithfulness to commitments or obligations.
- faithful adherence to a sovereign, government, leader, cause, etc.
- an example or instance of faithfulness, adherence, or the like: a man with fierce loyalties.
Whereas, Seth Godin in his post Loyalty suggests that:
“Loyal customers understand that there’s almost always something better out there, but they’re not so interested in looking.”
No mention of incentives in either of these.
Let’s not kid ourselves. A reward or ‘bribe’ by another description can and only will last for as long as it is not bettered by another. Just look at the picture above. How many ‘loyalty’ cards do you have in your wallet? Just because you have one in your wallet does that make you loyal? Probably not. I bet it’s got more to do with convenience.
Therefore, if you want to breed real loyalty then give your customers something that is ‘special’ to them as individuals like a better range of services or offers or just better and more personalised service.
Adrian Swinscoe can help you build better relations with your people and your customers that will grow your businesss. To find out more, simply click here.
16 Comments
8 coffee cards in my wallet
The only place that I enjoy buying coffee from is Pumpkin on Sheffield Station because the girl behind the counter makes me laugh. Not the most glamorous location, but she is very funny
Maybe making me laugh is still a bribe, but one I will always take
James
Hi James,
A bribe, perhaps, or maybe it’s part of delivering friendly and memorable service. Just goes to show that small things can deliver big results. Hope she keeps you laughing as I believe that’s what will keep you going back.
Adrian
Hello Adrian
To me the test of loyalty is the willingness, actually I will go further and say eagerness, of the customer to come back and do business with you such that you do not need to offer a customer loyalty scheme.
If you think about it you might just come to the conclusion that the loyalty scheme is only necessary because the core service and treatment that you deliver is simply not good enough to keep the customer.
So either you can work on the core service (in the totality of that word) which can be really hard work for some companies as they are so ‘broken’ or you can go for the quick and dirty version – the customer loyalty scheme. The latter is also attractive because it allows you to collect data that you can use to do targeted marketing – as if that is something customers are looking for!
Maz
Hi Maz,
That’s a great way of looking at it…..you only need a loyalty scheme if the core service or product is not good enough. That would make an interesting strategic question for any business manager or owner…..why are we contemplating a loyalty scheme? Is it because our core offering is not good enough and we have to bribe people to stay?
Great different perspective. Thank you.
Adrian