How we change what others think, feel, believe and do
Loyal customers are those who have formed an emotional bond with the company, often as a result of receiving excellent products and services.
Loyal customers behave differently to normal customers in that they:
When a customer has a good experience with the company's products and services they become satisfied. When there experience failures or other issues, they become dissatisfied.
Satisfaction is typically measured on a 5-point Likert scale, based on rating by customers in a standard questionnaire. This may break down the subject into specific experiences, but often has an 'overall satisfaction' single scale at the end of the questionnaire which is used as an overall 'satisfaction' rating. Loyal customers will give a top score in this category.
Very high satisfaction is necessary but not sufficient for the emotional bonds of loyalty. This typically happens with low-involvement and commodity products such as paper-clips.
When customers like a company's products, services, people and overall brand, they attach their identities to that of the company such that they feel a closer kinship with the company.
As a result of this bond, they are loathe to be disloyal as this would feel like a part of their selves were being ripped away.
An important positive action that loyal customers take is to come back to you for more. There are two styles of repurchase:
Repurchase is useful in that it is a measurable, quantitative factor that can be correlated directly with profit. If repurchasing can be predicted then the future total value of the customer may be calculated, which allows for intelligent decision about how much to invest in sustaining the relationship with the customer.
Customers can get involved with the product in a number of ways, including:
Customers who get involved may not be loyal, but it does indicate that the offering is important to them, which means they are candidates for loyalty (and also for loud complaint).
Involvement itself can be a significant step on the way to loyalty as, by the consistency principle, people need to explain how they behave to themselves and may conclude that their involvement is due to their real passion for the offering.
Advocacy is a step beyond involvement, and give a very clear message that the customer has significant feelings of loyalty. People who are not loyal are unlikely to stand up and publicly praise your offering.
Actions that indicate advocacy include:
Note that advocacy should be done just because they like your offering. If you are paying them for it (other than basic expenses) then they may be more money motivated than truly loyal.
Advocacy can also be measured. The simplest measure of at least intent is to ask in a survey if they would consider advocacy. A better measure is what they actually do.
When you fail in some way, for example with a faulty product or a poor service experience, loyal customers will assume this is a 'one off' and will likely forgive you, especially if the transgression is not serious.
Forgiveness has its limits and it is easy to take advantage of loyal customers by ignoring them or not offering them advantages (such as discounts)
Customers are the lifeblood of any company and much effort is put into wooing them so they will buy the company's products and services.
It is sometimes forgotten that loyalty is a two-way process. If you want them to be loyal to you, then you have to be loyal to them, including ensuring they always have a good experience and moving quickly to resolve any issues they have.
A common way of measuring loyalty is that three conditions must be met:
Where there is little involvement in a product then recommendation is unlikely, even if the person is satisfied and buys again. High involvement products, on the other hand, lead to high loyalty or deep dissatifaction.