Most customer defections have very little to do with the products on offer or even the level of satisfaction felt at the time, according to feedback management systems provider Allegiance, which has compiled a checklist of nine ways to help build and maintain customer loyalty.
Allegiance's latest white paper suggests that companies need to extend their efforts beyond customer satisfaction, instead aiming to build customer engagement and subsequently loyalty.
Among the white paper's recommendations for techniques that help boost customer loyalty through greater engagement:
- Give customers what they expect
Companies must first identify and understand their customers' expectations, and then provide value for money in terms of both product quality and good service.
- Go beyond simple reward programmes
Points and rewards do encourage repeat purchases, but they don't actually build loyalty. True loyalty comes when customers purchase products without being bribed. The key way of making better use of a loyalty points programme is to use the data gathered behind the scenes to improve your core offering, and to provide more personal and meaningful services and offers.
- Turn complaints into opportunities
Quickly resolve customer complaints to build up emotional loyalty, and show customers that your organisation really does care about them, not just their money. Monitor factors such as time to resolution, as well as customer satisfaction levels once complaints are resolved.
- Engage customers in a two-way dialogue
Gather feedback consistently from multiple sources - in fact from every customer touchpoint - and respond to that feedback both quickly and personally. Like a points programme, the feedback and its outcomes should then be organised and analysed to track results.
- Build opportunities for repeat business
It may seem obvious, but many companies are missing this opportunity. Monitor what customers ask for the most, and offer products and services that complement other purchases. Make good use of technology to track, classify and categorise any open-ended feedback you receive in this way.
- Survey customers and solicit feedback
Use short surveys that are unbiased and well structured. And of course employ random sampling to avoid survey fatigue.
- Centralise your feedback management
Technology such as enterprise feedback management (EFM) systems can help to centralise surveys and customer feedback, and analyse and track both the qualitative and quantitative data received.
- Tie customer loyalty and engagement to outcomes
Track customer responses over time and compare that data with revenues and profits over the same period. Start by determining how business outcomes should be measured (whether by satisfaction, likelihood to re-purchase, likelihood to recommend, or any other factors you can track).
- Use analysis to predict loyalty and intent
Analyse all the data gathered from your customer base, loyalty scheme, and feedback system to identify the most important areas of focus for customer loyalty, and how it changes over time. In particular, make use of feedback data to understand how customer intentions and motivations are changing (i.e. not just what they buy but why they buy it).
According to Allegiance best practices and loyalty expert, Kyle LaMalfa, "Many companies are losing customers at a staggering rate without really hearing from them or understanding why they're going. But by identifying what drives customer loyalty and engagement, they can begin to develop best practices that have a direct impact on customer retention and profits."
The white paper, entitled 'The Top Nine Ways to Increase Customer Loyalty', has been made available for free download from Allegiance's web site - click here (free registration required).