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Increasing Customer Loyalty

Monday 13 October, 2003
Whether it is a small business like a local pizza shop, the members of a tennis club or users of a large mobile phone network, customer know-how is everything. In essence business success is determined by the ability to nurture intimate, two-way learning relationships with your customers. To help you improve customer loyalty let us take a moment to explore 6 tips that can lead to higher levels of customer relations.

This is the distinguishing factor in the modern market place. We must all be directors of first impressions in every dealing we have with each customer. If you wish to grow competitive advantage you must always have the customer clearly in your sights.

If the customer knows about you and you know about them, you are both better placed to share the spoils of exchange. The goal is not about selling for selling sake or simply giving advice, but is about improving long term shared value. This shared benefit far transcends the value of the current transaction. It moves beyond just price, to providing strong guarantees, added benefits and back up support. This is increasingly important in a marketplace where people are expecting the very best with no unpleasant surprises.

  1. Encourage joint problem solving

    Maintaining high levels of customer value requires on-going intimacy and joint problem solving. Business need to move away from a world of just serving customers, into one that welcomes feedback and works together to make lives easier, more enjoyable and more profitable. So learning, education and feedback is the key.

    Meet and exceed expectations

    Managers need to be skilled to meet two quite different expectations from customers. The first comes where a customer has an expectation of what will happen, next when they acquire your services or buy your products. This is heavily influenced by past experiences and your track record. If you have a good track record you are off to a good start. If you do not have a good track record you will need to address this issue first.
    The second expectation evolves around what the customer view is of how well they believe your product or service will work in practice. Here you will need to convince them of the benefits such as ease of use, saving time, money, effort and the quality of your product. Then you will need to back this up with consistent and high level delivery.
  2. Write a customer service objective

    Take the time to write a customer service objective. In shaping your ideas consider:

    • What makes your product and service special and stand out from your competitors and partners?
    • How could you package your services and products differently?
    • Which personal qualities will you demonstrate when you relate to your customers?
    • What will the service experience be like for the customer?
    • What is the biggest challenge facing your customers?
    • What is the key message regarding your brand, image and reputation?
    • How then will we develop our knowledge to meet these aims and goals?
  3. Don't take loyalty for granted

    Loyalty comes from long-term collaboration and excellent rapport. This includes viewing people as partners rather than the opposition. Retention of customers is important; avoiding the loss of customers (ie churn) needs to be a primary objective. Avoid spending all your energies on seeking out new contacts and expanding market share. Focus your efforts on improving the relationship with your current customers by better connection, interaction and honesty.

    Be thankful for loyalty and do not take it for granted. You need to understand how your service is perceived and then make it your passion to discover more about your customers. Use a healthy mix of face to face, phone and digital technology interfaces to keep interest and loyalty. Remember the frequency of meaningful contact with your customer equates to higher loyalty and improved competitive intelligence. In some cases a simple e-mail once a month may be sufficient, while on other occasions sitting down and having a chat would be better for the more valuable customers. I know of a local sandwich shop near my home who organised a Christmas harbour cruise for its customers. No doubt they got plenty of return business the following year.
  4. Connecting with hearts and minds

    Always connect with people's hearts as well as their minds. Personalise your services and brands and making people feel important. By showing a little more interest and giving personal treatment you will increase the chances of your customers not being swayed to go elsewhere. So use their name, recalling your last conversation or simply smiling can produce wonders. See recovery in service as a wonderful opportunity to improve relationships beyond current levels. Business needs to understand that all people have legitimate concerns and how well we respond will tell whether we will maintain the relationship. On-going loyalty is based on a strong emotional connection.
  5. Show and feel empathy

    Seek out those products and services that can dramatically improve customer value. Avoid spending resources on squeaky wheels which customers are not happy about but are willing to accept. The most important goal here is to determine whether you have met the customers expectations and acted on their feedback. Questions you may need to explore include:

    • Does your customer have a voice on how you can improve your services and products?
    • Did your business explain all the relevant information?
    • Did your business listen and understand the customer's needs?
    • Is there adequate follow up, support and assistance to your customers?
    • Does the customer know why you value their patronage?

Author Credits

Alastair Rylatt is the director of Alastair Rylatt Consulting based in Sydney. His writing and speaking focuses on smarter better business. His new book Winning The Knowledge Game has been published in Australia and New Zealand by McGraw-Hill and Butterworth Heinemann in the UK. To contact Alastair visit www.alastairrylatt.com or email: alastair@alastairrylatt.com.
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