Learn the difference between retention and loyalty. In this course, Noah Fleming explains how loyalty is a symptom and retention is the cause. We create a loyal customer through our processes and strategies throughout the customer loyalty loop.
- You know, this is probably going to sound weird. And, even though it's in the subtitle of two of my books, I really don't like the term customer loyalty. And the reason is that it implies that it's up to the customer to be loyal. It implies that, when a customer or client stops doing business with us, it's because they're unloyal. But the truth is this, loyalty is merely a symptom or a result, and retention efforts are the cause. Without having retention efforts in play, either accidentally or purposefully, you cannot have loyalty.
Loyalty is a feeling, the emotional bond that customers have towards you and your business. Loyal customers are often not swayed by pricing, and they're not swayed by the odd bump in the road, or a mistake in the delivery of your products and services. But if you don't have the right efforts in place, it's almost impossible to create the symptom. Retention, on the other hand, are the actions and efforts that lead to those symptoms. And if we really want to get nitty gritty and dissect those words even further, loyalty would suggest that it's a duty of the customer, and retention is a duty of the company.
But I digress. I think we can agree that we're not talking about customer acquisition, but we're talking about what happens after the sale. Now, I often tell my clients, if you only ever hear your sales and marketing people talking about the next great promotion or ad campaign they're doing, then they're only doing half of their jobs. The other half they're missing is retention, and it's incredibly powerful. Let me quantify this for you with a real life story. I was working with a client, and we learned that the lack of a retention system was likely costing that business at least $165,000 every quarter.
Think about that for a minute. Over half a million dollars every year of opportunities lost to competitors, the ability to create additional sales, and the increased loss of customers, due to the lack of a purposeful retention strategy. Now, that's not a, well let's just provide a great experience and wow 'em, solution. That's a problem of expecting the symptoms without the cause. So the solution? We implemented a simple process for maintaining, nurturing, and building the existing customer base.
And the business has gone through a transformation. His customers are happier, they're spending more money, they're closing more deals, and we've curbed the attrition issue. I've since started other clients on this exact same process, and they've seen dramatic results. That's the power of customer retention. Retention doesn't need to be difficult, but you need a process, and a system in place, if you want loyal customers. So let me ask you two very simple questions. Are you expecting your customers to be loyal? And are you doing enough to create the symptom? Remember, customer loyalty has very little to do with the customer, and everything to do with how you create it.
- Key ingredients for world-class customer retention
- Calculating customer lifetime value
- Preventing customer loss
- Driving revenue growth through retention
- Identifying your most valuable customers
- Leveraging customer data
- Learning to observe behavioral changes
- Bringing back lost customers
- When and how to use automation