What’s the big problem with building customer loyalty?

The ball and chain of short-term results

The problem with marketing in general, and even more so in digital marketing, is that customer loyalty is far from ingrained in the executive’s mindset.

ball and chain, with the Myndset, thought leadership in branding

Finding the right leg!

And there is good reason for that: the focus is frequently on the wrong ball. The ball they focus on is tied to a chain that is linked to the shareholder’s leg and the business’ near-term objectives.

Marketing needs to focus on organic growth

As Peter Drucker said way back, the purpose of a business is to create (and keep) a customer. In times of difficulty, there is a natural need to “attract” new customers to make up for the diminishing revenues. The first problem with this orientation of “chasing new customers” is that businesses tend to take their eye off the ball of keeping them. There is little net benefit for a business to go out and recruit new customers if the proposition of the company is not equipped to keep them. Acquisition without fidelity — also known as true organic growth — is not a winning model, unless you are, perhaps, in the funeral services business. It is not without coincidence that, with customers being so distrustful of marketing messages, moving from a recruitment mentality to a fidelity mindset is one of the critical myndset shifts needed in digital and social media marketing.

money handout, The Myndset Digital MarketingThe second problem with the chase for new customers is, especially in difficult economic times, that the easiest and lowest common denominator is the price tag. The consequence of this is that, even should the customer remain, the customer becomes accustomed to, i.e. a customer of, the discount.

Aligning company systems with long-term loyalty building

So, what’s the big problem with focusing on long-term fidelity? Outside of it being substantially and substantively more difficult than recruiting a client with a big red “NEW” sign and throwing money into Google ad words, achieving customer loyalty is synonymous with thinking long-term. And, therein lies the BIG problem. A CEO’s first port of call is, for all publicly traded companies, the quarterly earnings report. The country manager’s stint in his/her position is designed as a rotation, typically 3-5 years. A young marketing manager will start having itchy feet after two years. In each case, the person is programmed to create a strategy whose results are immediately visible; they are not held accountable for the strategy’s long-term sustainability.

The customer’s real relationships in the field

The problem is no better on the field, where salespeople — who are in daily contact with the nuts and bolts customer — create the real relationships. A salesperson who is migrated, restructured or even promoted to another position takes with her/him the built up credit (I also like the word equity). And, in a flash, the loyalty of the customer can evaporate.

Thinking beyond the product

Corporations need to rethink the paradox between sustaining employee motivation (career pathing, diversity of work, etc.) and building the customer loyalty. Having consistently great (and new) products is one part of the key, no doubt. But, creating a culture entirely centered on the client is another, more durable strategy. Giving sense and purpose to the employee base around a higher, more noble mission, supported by constant learning and an autonomy for the workforce are ways to keep your staff on board. This just needs to be organized around the client.

Social CRM needs to be conceived as a long-term strategy

In digital marketing — and more emphatically in social media marketing — since this is a relatively new space, the concept of loyalty and long-term are somewhat immature. One of the unchartered areas where I see a real need for a wake-up call is the “hand over” of a social media account (Facebook fan page, Twitter account, Google+ page, etc.). The tone, the regularity of posts, and the immediacy in responsiveness are key parts of the success of a social media presence. When the new marketing body is moved to the next position, how fluidly is the page’s administration being “handed over?” CRM, much less Social CRM, is a terribly difficult beast to manage with rotating staff. It is already difficult enough for brands to manage in the most stable of organizations.

Again, if organizations thought more about the client experience, this problem would surface a good deal more.

Your thoughts?

4 thoughts on “What’s the big problem with building customer loyalty?

  1. Pingback: Is social media right for customer service – The right fit for you? | Branding and digital marketing strategy | The Myndset by Minter Dial

  2. Pingback: What's new? Is it not getting old?

  3. Pingback: For or against? The Big Debate for 2014Branding and digital marketing strategy | The Myndset by Minter Dial

  4. Pingback: Is social media right for customer service - The right fit for you?

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.