B1BLOG

The sub­ject of cus­tomer loy­alty is guar­an­teed to get the atten­tion of vir­tu­ally any­one involved in mar­ket­ing. The cost of acquir­ing new cus­tomers always mas­sively out­weighs the cost of retain­ing exist­ing ones (although sadly reten­tion is still given too lit­tle mean­ing­ful atten­tion by too many com­pa­nies). And with so many tech­nolo­gies approach­ing par­ity, switch­ing brands has never been easier.

Of course, exactly what mar­keters mean by loy­alty is often a some­what fuzzy idea. Gen­er­ally it comes down to a desire for exist­ing cus­tomers to carry on doing what they’re already doing (with a hope that they may do a lit­tle more too). As a result, many ‘loy­alty pro­grammes’ use clas­sic behav­iourist ideas of reward­ing desired behav­iour and habit­ual repeat buy­ing. This is fine when we’re talk­ing about get­ting some points on a store card for buy­ing sugar but doesn’t stand up to any­thing more com­pli­cated than sim­ple reflex pur­chases. This is because it is focused almost solely on habits of mind rather than any­thing deeper (what aca­d­e­mics term ‘rou­tinised response behaviour’).

A truer def­i­n­i­tion of cus­tomer loy­alty is whether peo­ple will wait for your prod­uct if it is out of stock (or still in beta). Whether they will rec­om­mend it to their friends (or blog favourably about it). And whether they’ll for­give you when you make mistakes.

But in a 2.0 world is any­one really ‘loyal’ to brands any­more (espe­cially in the tech sec­tor)? Loy­alty is, to some degree, a mea­sure of per­ma­nence. Yet as we all know, tech­nol­ogy is about relent­less change. The tech­nol­ogy grave­yard is lit­tered with the remains of brands and prod­ucts that at one time attracted many loyal users. And we are poten­tially see­ing a new wave of change with the move to webOS-based services.

It was unthink­able at one time that Sony Playsta­tion users might defect instead of wait­ing for the next ver­sion. Yet right now the brand’s posi­tion seems more pre­car­i­ous than ever as PS3’s release date and avail­abil­ity moves ever far­ther away and the com­pe­ti­tion gets its act together.

Like­wise, until Fire­fox came along, Inter­net Explorer had effec­tively won the browser war. Sadly, hav­ing won, there was no need to remain focused on improv­ing the prod­uct (ie bet­ter serv­ing users) and, from a tech­nol­ogy stand­point, Microsoft has been play­ing catch up ever since.

Even Apple, one of the more bomb-proof tech brands, only had to have a few scratched Nanos and dis­colour­ing Mac­Books to see once ‘loyal’ cus­tomers fall out of love with the brand.

One rea­son for this is that there is no habit of mind for most tech­nol­ogy pur­chases. They are two infre­quent, too expen­sive and the next pur­chase is almost never a like-for-like replace­ment of an older prod­uct (tech moves on too quickly). Buy­ers are also more informed than ever before (and far less scared of tech­nol­ogy than they used to be). They are more will­ing to adopt ear­lier because on the whole the con­se­quences of get­ting it wrong aren’t too worrying.

So where does this leave tech marketers?

The first thing to do is turn the whole loy­alty ques­tion on its head. Instead of ask­ing how loyal your cus­tomers are to you, ask how loyal you are to your cus­tomers. What can you do to help them get through their day? What would you do if you really were on their side? Find ways to be loyal to them (their wants, needs and aspi­ra­tions) between purchases.

Sec­ondly, involve cus­tomers in refin­ing exist­ing prod­ucts and devel­op­ing new ones. Work as part­ners with them. The open source ethos of co-creation comes into play here. If cus­tomers have some skin in the game then they are more likely to stay the course.

Finally, never, ever com­pro­mise on sup­port. For most tech com­pa­nies, this is the prime com­mu­ni­ca­tion cus­tomers have with the brand between pur­chases. Yet exam­ples of great sup­port are con­sid­er­ably rarer than those of dia­bol­i­cal sup­port. There is no faster way to squan­der hard earned brand equity than to deliver a crappy sup­port experience.

So is loy­alty dead? Yes and no. Tra­di­tional notions of brand loy­alty are, in the tech sec­tor at least, gasp­ing their last breaths. But in their place could come a more authen­tic, more effec­tive rela­tion­ship with customers.

No related posts.