Know thy customer

Know thy customer
Today's customers are both savvy and fickle. So how do you build, maintain and improve relationships with your customers to give them a better service and ensure loyalty?

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Today’s customers are both savvy and fickle. So how do you build, maintain and improve relationships with your customers to give them a better service and ensure loyalty?

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What’s in it for me? That could well be the catch-cry of today’s consumers. They’re no longer content to just purchase a product or service; they want a discount, a reward, a voucher, a two-forone deal – anything that will persuade them to choose your brand over another. Added value might get you a sale today, but it probably won’t guarantee customer loyalty a week down the track when your competitors have their own special offer on display.

UK brand loyalty expert Shaun Smith is one of the founders of the Customer Experience movement. He’s developed some of the latest thinking and practice around this subject, helping organisations worldwide to create distinctive sales and service experiences that achieve brand differentiation and long-term customer loyalty. Over the last decade, Smith has helped expand management focus from customer service to the wider strategic issue of customer experience.

Defining a unique customer experience to differentiate you from your competitors is vital, says Smith. “Unlike an advertising campaign or a price promotion, which any of your competitors can copy, when you truly have a strong brand that stands for something, it has huge power.” He views unpredictability as one of a brand’s worst enemies. Organisations must take responsibility for creating a predictably positive experience for their customers, not leave it to chance.

“There’s so much choice in the world today. We’re bombarded with choices of products and services. There used to be a time when if you had a great product, that’s all you needed. As more competitors came into the market, it was all about share of market and marketing. I think now it’s all about share of mind. Those brands that have an emotional connection to customers keep them coming back. Organisations that have that special relationship with a customer and a share of their mind really create that sense of loyalty.”

Doesn’t customer satisfaction create loyalty? Smith says no, citing that 80% of customers who do switch express satisfaction with a previous supplier. It’s really only highly satisfied customers that are truly loyal, he says. “I think it’s a waste of time measuring customer satisfaction. The only thing that counts is advocacy; those people who’ve given you topbox scores.”

So what about loyalty cards? Surely they create loyalty? “Most don’t,” says Smith. “True loyalty cards are about the organisation being loyal to the customer, not the other way around. They do this through offering benefits and value-added services, fine-tuned to meet the needs of their most profitable customers.”

So, the commonly held belief about customer loyalty, he says is “180 degrees the wrong way around. I think it’s about the organisation being loyal to its best customers – and then they’ll reciprocate and be loyal in return.”

It boils down to this: know your target customers and what they really value, then intentionally create that value, designing it into the process to serve the customer and delivering that every day.

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