5 Steps To Growing Loyalty: What to Ask and How to Benefit


1. Who Are Our 'Customer Faithful' ?Objective: Create simple, actionable loyalty segments

The starting point to any loyalty insight begins with answering this challenge. We recommend keeping it simple to begin with - typically using internal sales data with traditional mechanics such as RFM analysis (we have a few tweaks of our own here). This will give a good indication of loyalty behaviour - how long your oldest customers stay with you, and the frequency and value of their trading.

The Benefit: • Improve retention and performance - coordinate dedicated marketing activity to match and encourage these groups, focused around the behaviours that they exhibit • Drive new growth - create profiles of these groups, to recruit in their image • Drive revenue - explore the existing customer base to identify others close to this profile, and incentivise them to acquire a ‘Faithful’ habit.

2. What Do Our 'Customer Faithful' Value Most ? Objective: Communicate the Right Message to your best customers

Here we use qualitative research to pinpoint how customers attach value to the benefits they receive from you. We explore which of these drive loyalty, as opposed to simply satisfaction (by this we mean not just loyal in the transactional sense of buying again, but truly faithful in that they ‘believe’ in you, trust you, maybe even tell others about you).

The Benefit:

• Improve retention and performance - develop marketing communications, highlighting the core benefit sets that they value

• Provide and encourage use of tools for these customers to create positive word-of-mouth for you

3.What’s stopping others becoming ‘Customer Faithful’ ? Objective: Learn and Fix the retention problems in your proposition

We use similar qualitative techniques, but work with different customer segments. A key focus is to define what other brands or providers have that we lack. We explore what we can learn from them. This insight helps identify root causes of problems – e.g. is it a product or service that’s not available, or not performing, or simply not well communicated well enough ?

Sometimes we identify customers whose loyalty lies outside the industry (e.g. no preferred airline when travelling, but always uses the same hire car firm on arrival). What can we learn from these related companies?

The Benefit:

• Improve revenue / share of wallet – target improvements to the proposition and communicate the change (“You spoke, we listened and learned”)

• Incorporate winning ideas from out-of-industry benchmarking to strengthen the proposition

4. How Do I Recognise our ‘Customer Faithful’ ? Objective: Discover where your customers gather on-line, and how you can communicate profitably with them

Not as obvious as it sounds. In between transactions, many faithful customers may not be visible in your physical venues, websites or database records. But there is another whole world of social media where your customers do live. Not just Facebook and Twitter but countless blogs, bulletin boards and networks.

We’ll show you where to find these conversations, how to listen, respond, join in !

And commercially, we’ll guide you how to organise and track these interactions to link and drive familiar metrics such as brand awareness, website traffic, sales promotions and more.

The Benefit:

Almost limitless !

• reactively listen and solve problems• design new product development in line with real-time demand

• proactively seed product and channel activity into the conversation

• track competitor activity vs. your own performance

• and many, many more !

5. Who Could Be Tomorrow’s ‘Customer Faithful’ ? Objective: Find out how to detect growth potential in your customers and nurture them

We have some smart ways of spotting high potential customers in your database. We look for patterns in your product or service category data and seasonal cycles amongst faithful customer profiles. Then we match to customer profiles with a similar signature, as yet unproven over time. These become the ‘watch and grow’ list.

Our techniques are more intuitive than scientific – we do it by feel, hunch, trial and error…and close involvement with the client. Over time, we’ve learned to recognise some clues to loyalty, and we’ll teach these to our clients so they acquire the ability too.

The Benefit:

• Improve lifetime value sales / accelerate sales growth – use incentivisation and communication activity to deepen customer relationship

• By targeting these initiatives only on high potential groups, the cost-effectiveness of this marketing investment is greatly increased

For more information about how to grow loyalty for your business, contact us at rick@customerfaithful.com