November 20, 2019
Passion, authenticity, trustworthiness and an emotional visceral connection – we all know it when we see it and recognize it when we feel it. So how do brands foster and cultivate this inner deep loyalty with customers particularly now, when consumers have so many digital distractions and choices? And specifically, how do they manage this when customer expectations of brands are exceedingly high?
As consumers (and brand managers), we all know, that customer expectations and experiences are increasing at a faster pace than brands are usually able to deliver. Seamless frictionless payments are table stakes and what consumers expect is not just transaction oriented engagement & loyalty, but the broader commerce experience. Add to that, consumer desire to have their brands ‘get to know them’ and engage with them:
· 63% of customers say that organizations should make getting to know them a top priority
· 95% of customers are interested in proactive communication from the companies where they buy products & services
But what are consumers trying to tell us? According to the findings in Havas' Meaningful Brands 2019, seventy-seven percent of brands could disappear, and no one would care. Couple this with the seismic millennial shifts away from home ownership, car ownership, clothing ownership and we see much deeper, personal motivators. With consumers at the center, loyalty programs today are struggling to keep up with the dynamic demands of consumers. Points programs? Do we really care? Make my life easier, reward me for things I want to do and already do, encourage me to do the things I want to do with you, more often. The average American sees loyalty programs as a commodity and are ‘active’ in roughly fewer than a third of those they join.
Clearly, there is still a disconnect in design; most consumers think loyalty programs are there for them, an opportunity for brands to show their loyalty to their customers. But most programs are still designed as a way for consumers to show their loyalty to brands.
So how do companies bridge the gap between corporate loyalty and the visceral, human emotional affinity of love of family, friends and pets? A great category changer is Southwest Airlines, who enjoyed 40+ years of consecutive profitability. Founder Kelleher first viewed his business not in the airlines industry, but transportation (competing with trains, cars, buses). His single class, low fare service gained share and loyalty, whereas airline competitors (Ted, Song) failed miserably. At the center, was a fundamental understanding of customer experience in ways other companies couldn’t grasp. Kelleher was famous for instilling ‘mental models’ saying “I tell my employees that we’re in the service business, and it’s incidental that we fly airplanes. Other carriers fly airplanes that carry people. Southwest serves people using airplanes.” Wrapping this people centric focus into a customer experience that spans pre-sale to in-flight experience to after flight engagement with consistent customer service, multiplatform and app experience places Southwest in top tier ranks in the 2018 Tempkin Experience Ratings. And living up to their ‘people’ values, they place great focus on treating their employees well who in turn, treat their customers well. This taps into what Mark Bonchek, founder & CEO of consultancy Shift Thinking refers to as a strategy for sustained gratitude and shared purpose with your customers. This is a slight ‘mental model’ shift in how loyalty programs can tap into emotional connections. ‘Gratitude’ implies reciprocity – I do something nice for you, you appreciate it and pay it back or forward. Either way, you are appreciative.
We’ve all seen it - by 2020, customer experience will overtake price and product as the key brand differentiator – and while this seemed clairvoyant in 2013 when Walker released this research, the speed with which it arrived was even more accelerated than anticipated. And, consumers are willing to pay for it, yielding greater loyalty for those brands that earn it:
· 86% of buyers are willing to pay more for a great customer experience
· 73% of buyers point to customer experience as an important factor in purchase decisions
· 75% of customers have stopped using an organizations’ services because of a poor experience
Brands seen as meaningful and viewed as making the world a better place, two highly emotive indicators, have seen their wallet share multiply by 9 and purchase intention scores increase.
Loyalty is powered by emotion; repeat purchases are merely the result. And we consumers, are at the center of driving this forward.
And what do we customers do? In the age of big data, we are dropping hints of what matters to us all over our connected experiences. At BLEND360, we help our clients uncover rich customer insights via data analytics, machine learning and amping up addressable marketing all powered by impactful CX strategies and KPIs. Our team are marketers at heart – but perhaps more importantly, we too, are customers prone to devout loyalty to brands and experiences we love. Want to learn more? Ping me at pamela.veraart@BLEND360.com