Are You Building Customer Loyalty?

My friend says her Jetta is the best car she's ever owned. When she bought it nearly nine years ago, she was looking for a standard shift with a V6 engine, and Volkswagen was one of only a few manufacturers offering that option. But she really loves that car.

Personally, and while I agree it's fun to drive a standard shift, I must respectfully disagree with her brand selection.

Not that I dislike Volkswagens. I've never driven a Volkswagen. It's just that I drive a Volvo.

I've owned two Volvos in my life and most likely will purchase another. This Swedish-made vehicle with its reputation for high safety standards, durability and convenience (I swear, it is made with women in mind.) has earned my loyalty.

I maintain loyalty to a number of other brands and businesses, as well.

For clothing, for example, I shop at Nordstrom's. It's my store of choice. Similarly, if I am dining out, I generally select one of several favorite restaurants, and if I'm grocery shopping, I stop at my favorite grocer.

That's not to say I never go elsewhere, but I do have store and brand loyalties and examining them, I can report this: They boil down to consistent service and value return. I'll bet I'm much like you in this respect.

Think about your loyalties. What companies are you loyal to? What would cause you to move to another company? Just how loyal are you and why? Does your loyalty depend on service? Value? How much do your emotions play in your loyalty to a product or business?

What about your business? Do you have loyal customers or clients, customers who return time after time to buy from you? How do you keep them loyal?

It's important for all of us business owners to consider these questions and further to keep customers loyal to our businesses. Look at what statistics on customer loyalty show…

In addition, we know that…

So now, as one year ends and another begins, think about your customer relationships. In today's market in which business is so often driven by price, you must stand out. Do it by creating and maintaining great relationships. They are the key to your business.


Tips: Seven Customer Loyalty Drivers

In business, we work hard to satisfy our customers. But at a time when customers can be lured away by more competitive pricing, customer satisfaction may not be enough.


Rather, you need customer loyalty.


So, what drives customer loyalty? Here are seven keys you can use to assess and build your customer loyalty:

1. Emotional dependence. Customers become emotionally dependent when they rely on you for support, guidance and decision-making. This reliance is based on shared values.


To create emotional dependence, determine your customers' values — integrity, reliability, empathy, relationship depth — and then demonstrate that you care about those same values.

2. Structural dependence. Structural dependence is among the most powerful loyalty builders. It involves your customer's operations: his people, facilities, systems and distribution channels.


To create structural dependence, you must understand how your customer's business operates, identify his weak links and then help him strengthen those links.

3. Business dependence. When you and your customer work together operationally and financially for mutual value, you build a business dependence. Generally, business dependence develops around marketing issues such as creating go-to-market solutions, retaining a client base or maintaining a competitive edge in the market.


To create business dependence, identify where your customer is weak but you are strong, and where you are weak but she is strong. Your goal is to work together to build on each other's strengths and minimize each other's weaknesses.

4. Customer satisfaction. Customer satisfaction indicates how well your organization performs during a specific event. Was the product delivered of good quality? How good was service? How quickly was it delivered? How well was a product supported?


Satisfaction ratings are important because we need to know our success in delivering something. They are too limited, however, to accurately predict customer loyalty, especially when it comes to complex business solutions. Use other assessments along with customer satisfaction in determining customer loyalty.

5. Performance. We measure performance — how your product or service holds up to expectations and required industry standards — over a longer period of time and with more objective criteria than when measuring customer satisfaction.


To perform well, you must know 1) which performance factors really matter to your customers and which don't, 2) how your customers define various performance levels, and 3) your customers' minimum acceptable performance criteria.

6. Economic value. Economic value refers to financial implications in a customer relationship — the economic impact of having or not having your products or services, for example.


You create economic value by helping your customers reduce expenses, avoid expenses or increase revenue and profit.

7. Alignment and fit. The term "alignment and fit" refers to how well you work with a customer; how well you match in mission and vision, culture, collaborative practices, leadership and expectations.


To create alignment and fit, begin by thinking about your customer relationships. Which relationships have worked best? Why? Can you detect common characteristics among them? Conversely, can you identify customers that fit poorly with you? Can you identify common characteristics that predict a poor fit? Now use this information in your strategic account planning process. Remember, the higher the degree of alignment and fit, the greater the degree of loyalty.

Of course, your company is unique and for that reason not all seven loyalty indicators may apply to you. To most accurately measure loyalty, however, you should gather insights from as many drivers and players as possible. Your success in building customer loyalty will increase exponentially as your knowledge increases.


Your Solution Toolbox: Two Tools to Help You Deliver Effective Customer Service

Measuring What Matters

Customer service is one of the most crucial departments in any business. Customer-facing employees portray the company's image in the eyes of the consumer, and just one encounter with an employee can make or break a sale.


How can your business identify people with high potential for being effective customer-facing employees? By using customer service assessments.


Specifically, I suggest you use Profile International's assessment tool Customer Service Profile™ (CSP).


CSP measures six employee behaviors necessary for extraordinary customer service: trust, tact, empathy, conformity, focus and flexibility. It also analyzes how closely a candidate's perspective matches your company's customer service policies and attitudes.


Additionally, consider using Profile International's ProfileXT® (PXT). The PXT can help you determine job fit, a key indicator of how well an employee will perform and how long he will stay on the job. It also uses a job match pattern that you develop by examining employees who are most and least successful in a given position. Their scores provide benchmarks for new job candidates in the same position. PXT can also help determine the best candidates for internal promotions.

To put Profile International's Customer Service Profile™ and ProfileXT® to work in your organization, call me today at 952-322-3330 or send an email to mgorski@mgassessments.com.


HR Consulting

Call me, too, if you are looking for professional assistance with your personnel questions. We'll help you learn how to:

Let’s Talk! We offer a no obligation consultation to informally assess your current policies, procedures, and practices. This may help determine what’s missing in your current programs to meet the above recommendations. Call 952-322-3330 or send an email to mgorski@mgassessments.com.

Finally check out MG assessments on the Web at www.mgassessments.com.



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