Attracting new customers and keeping existing ones is a challenge for any organization.
Customers represent commerce however commerce is driven by value, relationships and experience. Many organization focus on the wrong issues which are not relevant to getting and keeping customers.
Advertising and marketing, at least in the old way, is no longer relevant to getting or keeping customer.
According to CMO Council: For the average brand, approximately one-third of all highly loyal consumers in 2007 completely defected to another brand in the same category in 2008, according to a recent CMO Council report. This report (Losing Loyalty) has major implications for marketers and underscores the critical need for brands to more effectively engage with individual consumers by tracking their loyalty behavior and responding with relevant offers.
What Drives Loyalty?
According to Wikipedia: Brand loyalty, in marketing, consists of a consumer’s commitment to repurchase or otherwise continue using the brand and can be demonstrated by repeated buying of a product or service or other positive behaviors such as word of mouth advocacy.[1]
An example of a major brand loyalty program that extended for several years and spread worldwide is Pepsi Stuff. Perhaps the most significant contemporary example of brand loyalty is the dedication that many Mac users show to the Apple company and its products.
From the point of view of many marketers, loyalty to the brand – in terms of consumer usage – is a key factor.
Reversing The Loyalty Factor
Notice in the wording in the CMO Council text as well as the definitions in the Wikipedia article. The world of marketing, brands and advertising thinks people are loyal to brands.
Sorry to disappoint or disrupt that which has obviously been the standard of thinking by an entire industry for a long long time but it is backwards and wrong. Yet organizations spend time and money over and over trying to make people loyal to their brand. Rethink your assumptions. Loyalty is defined as
- The state or quality of being loyal to a relationship
- A feeling or attitude of devoted attachment and affection. Often used in the plural: My loyalties lie with my family.
Notice that the definition has no context to things or brand rather the context is to relationships, people. As such the only loyalty a brand can instill is if it is loyal to its customers. Loyalty to people is reflected by actions or attitudes aimed at serving with the aim of satisfying needs. If loyalty is not reflected in a relationship then actions such as divorce, un-follow or rejection are the results of a lack of loyalty.
The only context of people’s loyalty to a brands products is whether the product does what is expected or more and price reflects the experience and the service (value) from people within a brand is relational. In summary it is people, process, product and price in that order that create the experience which may drive repeat behavior which is not loyalty. To say or view “loyalty” as anything else is trying to label people as objects rather than relational human beings who respond to human experiences.
And you wonder why social media is disrupting your industry, your markets and your bottom line. It’s because people are loyal to people communicating with one another and sharing their knowledge and experience. The difference between yesterday and today is these conversations are transparent and reaching millions at the click of a mouse. People create loyalty by the enrichment of relationship. We have a relationship with your organization (people) and we use your products. Use of a product impacts a relationship in two ways: it is a poor or expensive experience or the experience exceeds the expected value. Get it?
What say you?
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About Jay: Jay Deragon’s professional career includes providing strategic management consulting services to Fortune 500 companies as well as local small businesses. He has consulted with numerous industries spanning over 25 years of professional experience globally. His current professional endeavors are all centric to the disruptive nature of the social web. He writes at Relationship Economy and provides social media strategic services to businesses large and small. Jay Deragon is an avid student of the emerging landscape of all things social and the subsequent impact on business dynamics. Since 2004 Mr. Deragon has been actively studying, sharing and learning how business as unusual is changing business methods, models and relationships. Life is a journey and the experiences along the way provides learning that furthers the experiences if we know how and what to learn. for more info go here http://www.relationship-economy.com/?page_id=2 |




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Why Do Customers Leave?: This entry is part 3 of 3 in the series How Social Is Your MediaIn summary it is peopl.. [link to post]
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RelationshipEcon: Why Do Customers Leave?: This entry is part 3 of 3 in the series How Social .. http://bit.ly/oGxjA
Why Do Customers Leave?: This entry is part 3 of 3 in the series How Social Is Your MediaIn summary it is peopl.. http://bit.ly/oGxjA
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rt@JDeragon Why Do Customers Leave?: This entry is part 3 of 3 in the series How Social Is Your Medi.. http://bit.ly/1El7NY
Why Do Customers Leave?: This entry is part 3 of 3 in the series How Social Is Your MediaIn summary it is peopl.. http://bit.ly/oGxjA
Jay,
This is a great article! It expounds on points you made during a lecture!
It really clarifies the link between loyalty and our actions for me.
It is up to us to stay in touch with our people and give them what they need. It’s all about the relationship
Find What Your Customers Want.. Then Give It To Them… Great Article –> Why Do Customers Leave?…http://ow.ly/rbmi
Find What Your Customers Want.. Then Give It To Them… Great Article –> Why Do Customers Leave?…http://ow.ly/rbmw
Why Do Customers Leave? http://ow.ly/rbmC
Why Do Customers Leave?: This entry is part 3 of 3 in the series How Social Is Your MediaIn summary it is peopl.. http://bit.ly/oGxjA
RT @JDeragon Why Do Customers Leave? | The Relationship Economy…… http://bit.ly/uClbo
That cartoon describes exactly why I walked out of Key Bank, JP Morgan Chase, and Bank of America and when I was opening my business account.
I settled on Cascade Bank – they were great, no walls, no hassle, no paper, lots of smiles, a handshake and I even got a cool new Back Pack.
I drank the Cool Aid.
People are not loyal to brand they are loyal to people, get it! http://bit.ly/XkJE2
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