The Truth Behind Loyalty

You can’t have loyalty without trust.

Sounds simple enough, you can repeat it, you can stand behind it – what does it mean?

If you really want to build customers loyalty among your customers, forget having it as a goal.  You shouldn’t even try to improve customer satisfaction.  Those metrics don’t reflect the truth behind Loyalty.

Loyalty is not an end result – it is a byproduct of the trust in the relationships your build with your customers.

All the hoopla and buzz about something that you can’t even grow organically within your programs – something that happens only if you do other things right.  The easiest way to build loyalty is to build the trust your customers have in the relationship with you – then loyalty will just happen.

Consider the case of American Express Platinum cardmembers.  Is there a logical explanation behind paying in excess of $400 per year for the “privilege” of having the card? Yes, you get some more benefits and some of them are nice, but not sufficient to justify the cost of ownership.  Why would they pay then? Trust.  When American Express says you can buy a house with the Platinum card they mean it.  And their cardmembers trust them.  And, it is this trust that developed into loyalty over the years and makes Platinum cardmembers continue to pay year after year – even though most of them don’t buy a house with it.

Promises made and kept develop trust; trust engenders loyalty.  What promises are you making to your customers? Are you keeping them?

How to Avoid Failure In Your Measurement Programs

Would you like to know why your measurement program will fail before you launch it?

It is not about choosing metrics, designing reports, or training business users on the proper use of DIY reporting tools – none of those would guarantee success. It is not about taking the metrics you are using now in your organization and blindly continue to use those because “this is what we have been doing forever”. It is not reporting in a dashboard, scorecard, or report.

The key to success in your measurement initiative: know what you measure, measure what you know.

Let’s take, for example, customer satisfaction. Can you fully answer the following questions about it?

  1. Process – Where and how is customer satisfaction being measured? How can we be sure there is no bias in the survey or feedback process? How long has this been done? Has the process changed in any way? How is the data manipulated? Are we getting enough responses to remove bias? Are the processes for collecting it fair and consistent?
  2. Purpose – Why are we using customer satisfaction as a metric? How does it relate to senior management compensation? How are using it to reward or punish employees? How does it help or hinder our strategic goals as a company and as an organization?
  3. Results – What are the results we expect to get? How do these results compare historically? What workflows and processes we have planned to start based on the different results? What do the results mean? What does each level of customer satisfaction mean for our bottom line? What about if we increase it by one point? Two points? Decrease it by 10? What effect does the metric by itself have in the bottom line? Can we affect the metric enough to have an effect in the bottom line?

This is a sample set of questions you must ask about each metric you use. If not, you are simple collecting data to reflect the way you are working. You are not being proactive about using the information to improve your processes and grow your company. You are not embarked in a continuous improvement strategy, you are wasting your time

Are you wasting your time with your measurement initiative? Are you working towards continuous improvement?