I don’t need to rattle off the benefits of brand loyalty for customers and organizational loyalty for employees. You know it’s important, but here is the data to remind you in case you forgot:
- 80% of revenue for most companies come from 20% of their loyal customers
- 91% of unsatisfied customers who switch over to another service provider will never come back
- Loyal customers are the cause of almost 80% of overall purchases
- US businesses lose $11 billion annually as a result of employee turnover which is expected to rise to 65% in 2016
(BNA – 2014)
Here are 5 ways to keep your customers and employees loyal:
1. Don’t Mix-up Loyalty With Repeat Business
When a customer does business with you multiple times or an employee works for your organization for many years, that’s not loyalty, it’s repeat business. Loyalty is when a customer or employee is willing to turn down a better product or job offer to continue doing business with you – they simply don’t bother researching competitors or entertaining other options. Understanding the difference, will provide you with the correct lens to measure and interpret data.
2. Treat Them As Human Beings
Customers and employees are neither human resources nor human consumers, they are human beings. These destructive business terms reflect back to the industrial age, when employees were used on the assembly line and customers were consumers of process output. We’ve left the industrial age behind, but some of us still find it convenient to see people as extensions of machines. Machines don’t have the capacity to be loyal, human beings do.
3. Focus On Their Experience
Both customers and employees have interactions with your organization over a period of time, the outcome is an experience. A prerequisite for an employee to influence a customer experience positively is their own work experience based on six factors (compensation, continuous recognition, career growth, job security, company values, and relationship with management). Positive experiences are categorized by Forrester into three key areas: enjoyment, usefulness and easiness. If your goal is to create sustainable loyalty, start by paying attention to the six factors of employee satisfaction and listen to your customers in order to determine if their experience was indeed enjoyable/useful/easy.
4. Inspire Rather Than Manipulate
There are only two ways to influence human behavior, manipulation or inspiration. Manipulation comes in many forms such as promotions, fear and peer pressure. Although effective, manipulation tactics will only work in the short-term and will never lead to loyalty. Long-term loyalty comes from inspiration. To inspire you have to clearly communicate what you believe in, your purpose as an organization. When you do that, customers and employees will feel like they belong, like they are part of something special, something bigger than simply using your product or coming to work.
5. Never Take Them For Granted
Loyal customers and employees are also advocates that will spread your message through their social networks and actively recommend you to friends and family. They do that while constantly examining and testing your organizational values and assessing their relationship with you. They want to regularly make sure your values continue to resonate with their own. To achieve this, you have to continuously provide exceptional value that exceeds their expectations keeping them truly engaged and supportive.
Post references:
- Sinek, Simon, Start With Why: How Great Leaders Inspire Everyone to Take Action (New York: Penguin Group, 2009), 41
- Forrester’s 2013 North American Technographics Survey
- Bloomberg BNA
Guest Blogger: Yahia ELSawy 
