By M. Dana Baldwin, Senior Consultant
This article was previously published in Compass Points in November 2007
Most companies advertise their loyalty to their customers, but how many really are as loyal as they profess to be? What specific actions have they committed to which will build true customer loyalty? How is customer loyalty really measured?
Where does building customer loyalty start? Upon reflection, it should become obvious that to have loyal customers, one needs to have a loyal staff. What actions has your company taken to establish a positive, reinforcing, committed attitude within your staff? What are the components of building staff loyalty?
Staff loyalty should start with having an atmosphere within the company that encourages loyalty, low turn-over and continuing education or mentoring of many key employees. Starbucks works very hard at building employee loyalty so that their employees will make their customers feel special and appreciated. This involves training and setting an atmosphere in which the employees feel valued, and feel encouraged to pass on their positive attitudes towards the customers.
How often does your company listen to your customers? Do you regularly ask your customers how well you are meeting their needs and preferences? Does your company ask your customers — certainly your best customers at a minimum — what else you could do to provide even better service and satisfaction? Are there unmet preferences that should be addressed, in order to build an even deeper relationship between companies and their customers? Are their complaints well received, and, more importantly, acted upon in a timely manner? Make it easy for customers to complain, but only if you really intend to do something about the complaints. Response time guidelines should be established in order to keep the problems at a low level of intensity, because we all have had problems escalate when it takes too long for a response to be made.
Another part of listening to your customers is how well you act to improve your ability to meet and/or exceed your customers’ rising expectations. Are you really responsive? If you are, you likely are perceived as providing good service to your customers. If not, why not, and what needs to be done to change this approach to building customer satisfaction? Are your first contact employees — those who your customers first encounter when contacting your company — well-trained in understanding customer needs and preferences, and in responding to these needs and preferences in a consistent and responsible manner, within the confines of what is possible for the company to actually do for the customers? Are they well-equipped to respond both verbally and in writing? Is their grammar good enough to represent the company positively, and do they have the resources within the company they can contact in order to resolve whatever the customers requests, in a timely and appropriate manner?
Finally, how do you truly measure customer loyalty? It is very easy to measure loyalty by accepting what each customer says. The true measure is found by examining what each customer actually does. A customer’s buying behavior, not their expressed attitude, is the real measure of their loyalty. By examining what each customer actually does, you can tell which are truly loyal, and, using this approach as a guide, you can determine which customers really value your company and the relationships you are building.
If you think you may have some of the challenges outlined above, one good approach is to improve your strategic planning efforts. You can start this by attending one of our highly acclaimed seminars Simplified Strategic Planning, or by contacting us at: to discuss your situation.
M. Dana Baldwin is a Senior Consultant with Center for Simplified Strategic Planning, Inc. He can be reached by email at: .