2021 Customer Loyalty Strategy – Relationships over Transactions
According to the Salesforce Connected Customer Report, 90% of consumers expect companies to clearly demonstrate their values and 66% expect brands to demonstrate empathy. In other words, when thinking about customer loyalty strategy, you need to understand that customers want you to CARE.
Why do you think these numbers are so high right now? I venture to say if enough brands already displayed these characteristics, values and empathy would not have made the list of consumer expectations. In other words, these stats prove brands still do not offer empathy driven, human-centered experiences.
And why is that so important? Because empathy and trust are the basis for relationships/ And creating relationships is the core of your 2021 customer loyalty strategy.
2021 Post-COVID Consumer
Even with the vaccine rollout, many are anxious about experiences. There is still so much uncertainty surrounding us. This makes commitments hard to execute.
In addition, cash is tight across industries. However, if you have a real relationship with your consumer, all these uncontrollable factors diminish. What remains is the respect and loyalty you have for each other.
Customer Loyalty is Impossible When a Customer becomes a Credit Card Transaction
Let me show you what I mean. When it comes to working out, I am an old school person with an old school gym membership. I know that my gym is struggling due to the events of the last year. So, I was on the fence over whether to resume my membership when things open up. My gym experience was not good pre-COVID, but as a consumer, I had empathy for the business. I felt bad for them. However, the gym sent me a total of one email during the pandemic: the email alerting me to the temporary closure.
They sent a second email (nearly ten months later) on 12/29/2020. It stated only that they would resume monthly charges in January. Now, I do not know what you usually do at the height of the holiday season, but reading bi-yearly emails from my gym is not high on my list.
Had the gym applied empathy, at the very least there should have been a follow-up email providing a “you will start paying again” heads-up. But that didn’t happen. Why? Because, for them, I (like my fellow gym members) am nothing more than a credit card transaction.
And they are going to town transacting on that credit card. Since my card on file with them expired, I am now getting charged the monthly fee for a gym I don’t use, as well as a monthly “penalty fee” of $15. As you can imagine, the nameless, faceless transactions are over. I am now no longer a member of the gym. My empathy for them is exhausted. And their empathy for me never existed.
Creating and Maintaining Relationships is the Core of Customer Loyalty Strategy
Relationships of any kind are hard to create and maintain. They require effort, consistent investment, and bearable compromises. In brand speak, that means launching that extra email campaign, or assigning employees to make those quarterly phone calls to check in and offer support.
Building loyalty relationships can also mean taking your client out to dinner more often than you originally budgeted for, to reinforce your connection. After all, relationship building is about the small things, not the big things. And, like everything related to customer experience, it requires intentionality and strategy.
What about Brands with No Customer Loyalty Strategy?
Surprisingly, many brands do not have a customer loyalty strategy. Bigger enterprises are particularly lacking in this area. In many cases, they equate loyalty points programs with customer loyalty strategy.
The problem is, points and cards are not for everyone. So, you run the risk of missing an entire segment of customers who may be equally loyal. Loyalty programs create almost a caste system of your customer base. This can be isolating to many, another significant limitation of these kinds of programs.
The legacy airlines business model, for instance, is based on the premise that loyalty programs equate customer loyalty strategy. With COVID, they lost that customer loyalty overnight because their customers were never actually loyal to the brand. They were only loyal to the points system. Once there was no ability to accumulate points, the entire model deflated.
Make Loyalty Part of Customer Experience Strategy
Customer Loyalty Strategy should be part of your Customer Experience Strategy. Creating relationships over transactions necessitates an investment in technology. This investment is functional: allow customers to remove credit cards from autopay! It is also experiential: build seamless user experience. For instance, think about what the digital experience actually looks like. Then, invest in designing the digital experience to serve customer needs and build customer loyalty.
But creating loyal relationships does not stop with investing in technology, just like customer loyalty strategy does not stop with points systems. It requires an investment in hospitality training. How you speak to your customers matters more than you know. Your tone of voice (in person or in written communication) makes your customers feel a certain way. Relationships grow from feelings of protectiveness, security, and empathy, all of which you have the opportunity to create. And remember, this needs to happen consistently in order for the brand customer loyalty to follow.
So what does all this mean to you? It means that even if you are terrified because of COVID, you must be cool, calm, and collected in front of your client or customer. It also means that you are not penny wise, pound foolish. In other words, GIVE and you shall RECEIVE.
Do not punish people who are busy with a $15 penalty fee. And, definitely, do not call the fee penalty! Elevate your game. And never forget, you are working hard to build a relationship with everyone who uses your service or buys your product. This is what makes your customer loyalty strategy successful.
Culture Starts at the Top
Without a leader who believes that today’s business success is about acquiring and retaining customers, you cannot even begin the process of building a culture. Leaders who are passionate about the customer are also passionate about creating culture and employee engagement.
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