Loyalty is more than marketing, it’s a mindset
Contributor Evan Magliocca explains how retailers must approach customer loyalty -- you've got to give it to get it.
Marketers think of loyalty as a technology platform or a marketing campaign; they think it’s a demand or a lever to produce higher revenue, but it’s so much more. In its most successful iteration, loyalty is a mindset permeating all aspects of business.
We demand loyalty from customers, and we chase it fervently, but few marketers stop to realize that to get something, you often must be the first to take that step. Marketers must prove loyalty to customers before they can expect anything in return.
Loyalty is the long haul. Loyalty is what helped brands survive the last decade; it’s what prevented some brands from having to beg customers to buy with 40-, 50- and 60-percent-off promotions. Want to raise prices? Cultivate loyalty. Want more active customers? Foster loyalty. Want a more consistent customer foundation? Build loyalty.
It gets us through the dark times, it raises us higher during good times, and it holds off gray hair just a little while longer with a consistent customer base that diminishes the extreme swings of seasonal buyers.
Actions speak louder than words
“Do as I say, not as I do” — that’s the motto for many brand leaders, but loyalty’s effectiveness is directly influenced by support, sponsorship and active guidance from leadership. To be effective, loyalty needs broad support to change how the brand thinks about the customer.
Brands are living ecosystems, and while there are always bureaucracies and factions, the more high-level the sponsor for the program, the better chance it will have to unify everyone to work towards the same end goals. The C-suite can drive priorities for the program that change the brand mindset and create an atmosphere that elevates the customer throughout the organization.
The marketer mindset
Marketers are driven into factions by focusing only on numbers. Each team has its KPIs and goals to hit by channel, and they often cannibalize or even hurt the customer to hit goals in the short term. It makes for a terrible customer experience, and like it or not, it often shows how much brands don’t care about their customer bases.
Promotional exclusions are as long as novels today, customer service can be a living nightmare, customer data is captured yet never used to customers’ benefit, shipping takes too long and it’s expensive. There are myriad ways to make customers feel undervalued. But they’re usually symptoms of brands falling into the numbers trap because they can’t see the forest for the trees.
One easy way to help prevent the KPI trap is to institute an overriding KPI that all teams are driving. It can change quarterly, but there must be one consistent KPI across all teams to avoid factions driving the customer experience into the ground.
All teams work in unison to fix the issues, to elevate specific experiences and to drive change.
Stores are still vital
When we think about customer experience, we’re almost exclusively talking about the digital environment. But for customers, their expectations often depend on the level of investment they need to put in. That means time, energy, resources and so on.
Digital has almost no investment for the customer. That’s why everyone browses so often — but when people go to stores, they put in a significant amount of time and effort. Online experiences have become so seamless that the in-store experience increasingly is lagging in comparison.
Store teams need to shift their mindsets to think of the customer and the investment they’re making to come into stores. Stores that acknowledge and reward customers for that behavior will produce repeat traffic and increase brand sentiment, whereas poor or even benign store experiences will hurt the overall brand even more because customers have been let down when they’ve invested much more in the process.
It’s challenging to think of the customer at scale. It’s one area in which boutique retailers have an advantage: It’s easier to control at a smaller level. But changing company culture to focus on the customer and provide the best experience possible should be a brand pillar.
It takes a transformation in mindset to develop the experiences, campaigns and services needed to increase customer sentiment and loyalty. And if we are going to demand loyalty from our customers, we have to go first.