Why do companies need a loyalty strategy
hat is Rita, ”a recent IBM ad tells us. »She grows roses, drinks green tea, drives a convertible, visits museums, owns a holiday home, invests in funds, pampers her grandchildren, separates waste, hunts discounts for senior citizens. Rita is a good customer. And a tough nut to crack. It teaches fearful companies to be afraid. Because she does not buy from companies that a) are too slow, b) do not know their buying habits, c) dawdle at their expense, d) do not accept suggestions and e) are not prepared for their wishes. "
Rita is like all customers at the moment: demanding, demanding, aware of her buying power. Nowadays, services are no longer sold, but bought. No longer your own product - the customer is the »hero«. He sets the requirements and the companies carry them out - as soon as possible, please!
We have buyer's markets today. That means: The customer has the power - and thus the say! He doesn't have to do anything, but he can do anything, otherwise he'll go! Because he has a choice. So: not what the chef likes to cook, but what the guests like to eat is put on the table. It is no longer the companies but their customers who determine the rules by which "selling" is played.
So it is high time that marketing changed direction. This requires much more than just turning to the customer: We need total customer orientation! Because today's customer is saturated and - overwhelmed by a wide range of products - tired of consumption.
If you are oversaturated, you don't need anything anymore, you only want to buy. Good salespeople must be able to understand people, be able to arouse wishes and generate a pull in demand. Customer satisfaction is no longer enough, we need enthusiasm management! In order to generate enthusiasm, many companies and entire industries will have to completely reinvent their services. That's the one challenge.
And the second, related, and much bigger one: Loyalty is not the consumer's sharpest weapon, not renouncing consumption. Because at some point everyone will (have to) consume again, the only question is, with whom! Customer loyalty is therefore the most important and at the same time the most important business challenge of the future. Whoever accepts this challenge, who is committed to the leadership of loyalty, who has the most loyal customers, wins the race.
Because all markets are overcrowded these days. But especially when the offers are becoming more diverse, while the buyers are becoming fewer and more disloyal, it is important to keep and maintain those who have already been won - and to find new, loyal customers. It is about the loyalty of the right buyers who are well suited to the company. Those that are profitable and have loyalty potential.
Loyalty takes time to grow. Because loyalty is voluntary loyalty. You have to (v) earn it - just like your good reputation - over and over again. And: loyalty is a fleeting good - there is no guarantee of loyalty. So you will constantly make advance payments and (have to) do a lot of good deeds, only then will you ultimately be given lasting loyalty.
It's like being in a garden. You will not say to the flowers: "Come on, start to bloom, then you will get water!" Rather, you will prepare and sow the ground, nurture and care for the first delicate greenery, water the young plant regularly and be loving with it Buds speak to finally enjoy the colorful, fragrant splendor.
Loyalty has very little to do with rational arguments, but has a lot to do with good feelings: with reliability, with trust, appreciation, sympathy and affection. Loyalty is like good friendship. A loyal customer wears rose-colored glasses, like a lover who only sees the good sides and gently overlooks small weaknesses.
And the most important thing: Loyal customers are your best advocates who, with missionary zeal, can win new customers for you - completely free of charge. Those who are loyal will become your ambassadors who are passionate about telling good things about you because you give them good reasons to do so. Harley-Davidson drivers, for example, have the brand logo tattooed on their bodies. That is »branding« in the truest sense of the word! Can you imagine your customers wearing your advertising on their skin?
Continuous customer loyalty leads to sustainable income security. It is not only aimed at the long-term customer value of a buyer, but above all at his recommendation business. Because customers are most profitable not as regular customers, but as active, positive referrers, with their "loyalty value" (equals customer value plus recommendation value) the highest income is achieved.
This is the most efficient sales acceleration strategy in the world. And - what good news - inexpensive one too, because loyal customers cost little. And the customers won by recommending them do not cost anything.
But does loyalty even have a chance these days? Does loyalty still fit into our fast-moving times? When the trade threatens to hit new rock-bottom prices every day !? When the media make us believe that we have become a nation of bargain hunters !? When people preach everywhere that greed is cool and everything else is stupid !?
If they are interchangeable, the price is decisive in the vast majority of cases. This may be successful in the short term, but it is usually ruinous in the long term. Because somebody is always cheaper! Who, like the rabbit in front of the queue, only stares at his prices, is closed to creative, sustainable and value-adding approaches. Those who, on the other hand, achieve something emotionally unique, those who provide customer-oriented top performance and thus aim at the loyalty of their employees and their customers, are sure to have a financially successful future.
Desperate special price promotions, maximum discounts and price drops do not create loyalty. On the contrary: they promote bargain tourism. Bargain hunters are nomads. You are loyal to the bargain and not the company. Through hectic price dumping, money comes into the coffers in the short term. But first such companies lose trust, and in the end maybe everything.
It takes seconds to bring prices down and sometimes years to bring them back to baseline. "For me," says the very successful hotelier Klaus Kobjoll from the Schindlerhof in Nuremberg, "Rabat is a city in Morocco, and nothing else." He adheres to this policy unconditionally even in difficult economic times.
»I think«, says Mathias Jahn from the Imagin company, »that the eternal discount wars destroy the last feelings of connectedness of the customers. They hesitate to buy until the final bargain. 20 percent, 30 percent ... no, you can certainly do more! The question remains: Has the provider shamelessly ripped me off with these discounts? Can I continue to trust in him? Rather not! Coupled with this is the complete loss of appreciation for a product. How should a value be determined if the price is first 599 and then 199 euros! «
"Cheap-cheap" is associated with a brutalizing of morals, with a deterioration in service quality (service is expensive!) And with a loss of confidence ("Couldn't I have got it somewhere else, next week?"). Money-guzzling queues, time-guzzling queues, cheap and therefore lousy quality, bad purchases due to a lack of specialist and service staff: all of this will not only annoy people, it will also make them aggressive. Legal proceedings and publicly staged boycotts will increase.
Or we buyers will quietly withdraw and go on strike in secret. If something doesn't suit us, our wallet stays closed! Buyer ethics are on the rise. And the longing for the perfect world. This brings emotions, trust and loyalty to the fore. These are the better ways to long-lasting business success.
The longing for well-being and solidarity, for "with each other instead of against each other", will grow. Because two basic needs are deeply rooted in us humans: to be perceived positively and to belong.
According to this, the purchasing behavior of consumers can be divided into three categories from a loyalty point of view:
:: Group-compliant purchasing behavior based on a desired group membership. This can be seen well in youth cliques and in fashion.
:: Monogamous buying behavior, which reflects loyalty to certain offers. This is easy to see in the case of objectively interchangeable products such as cola, beer or cigarettes: in addition to the purely physical, there is obviously also a psychological dependency, namely identification with the world of experience that the respective brand creates.
:: Polygamous buying behavior based on a pronounced need for variety. This is increasingly influenced by the internet, globalization and the bargain culture.
With this knowledge you can examine your own target groups. You can then create profiles that you can use to search for loyal customers in a more targeted manner - and avoid those for which all efforts to gain loyalty are pointless.
You will not achieve loyalty with everyone and everyone. It is better to generate maximum loyalty with a few than none with many. Better to be first less often than always to be second or third and have lost every time. Because in economic competition there is only one winner. The second in consumer favor lost just as much at the moment of the purchase act as the thirty-third.
He does this when something appears to him to be sensational or sensational; when something is enthusiastic or important to him personally; He does this above all when he receives an emotional "plus", an immaterial added value. This happens, for example, when the customer feels comfortable, when he can learn something, when he experiences understanding, attention or recognition, when he is pleasantly surprised, when he finds his world of values, when he is among like-minded people, etc.
In a sociable group, ask which brand or service provider the people present have been loyal to for a long time and then research the reasons. The answers are as different as people are different.
Your customer usually has expectations that are derived from your advertising promises, from previous experiences with you and your competitors, or from word of mouth. Such expectations change over time, depending on the mood of the buyer, the activity of competitors or changes in society. Conclusion: Loyalty works differently for each individual and always differently - depending on their mood.
There are many reasons for the willingness to change or for loyalty to be increased or decreased.
Loyalty is created, among other things, through lively, appropriate back-and-forth dialogues, as often as the customer wants and on the channels that the customer prefers. Proximity and frequency - made in an intelligent way - cause small loyalty miracles, because the bond increases with every contact or purchase.
All performance promises that you make in oral or written sales talks must be kept, or better yet, outbid. This surprises, inspires and creates trust. You can also actively involve the customer in the design of the service, as far as he wants. The key word here is: a transparent company. This has nothing to do with the good old "Open Day", which is from the last century! Today, internet-trained customers start a search deep into the companies that are of interest to them. Not only to allow such action to be done by necessity, but, on the contrary, to proactively promote it, which also leads to deeper emotional ties.
In the end, it is magical moments and a multitude of inspiring details that, when used continuously, are downright addicting - and thus loyal.
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