The Power of Loyalty. Roger Brooks B.

shop you frequent, the bank you deposit with, the restaurants you dine in, the real estate agent you buy from, the pharmacy you choose—and all of the other touch points and places you patronize in between because they are the best fit for you. You remain loyal because there’s something about each one of them that keeps you coming back. The reason you remain loyal may be price or it may be the product or even the person you interact with, but each of these places provides some sort of motivation for you to keep coming back, some sort of motivation for you to remain loyal.

      Think about it. For the most part, you have endless choices when it comes to making purchases. It’s not always easy choosing which restaurant, office supply house, home improvement store, or gas station to patronize. There are so many options today that choosing where you spend your hard-earned dollars can sometimes be overwhelming. But you do ultimately choose—be it for location, convenience, price, or any other motivator. You choose for a reason that can likely be traced back to the personal reasons you remain loyal. Oftentimes, you may even choose because you participate in a loyalty program and feel attached in that way.

      Businesses have been trying for decades to master the art of earning and then maintaining a customer’s loyalty. Some businesses have truly mastered the art, but most have not. How many companies do you do business with that can improve their sales process, customer service, or delivery of their product or service? Most companies have room for improvement. Improving business practices leads to greater customer loyalty, which is a task that many companies work very hard to achieve. If the magic formula is found, constant maintenance and dedication are required to retain such high service levels to keep customers loyal.

      You all participate in loyalty programs in one form or another. More than likely you currently participate in one or more of the following programs: airline, hotel, grocery, pharmacy, sporting goods, credit card, bookstore, office supply, restaurant, gas station, department store, coffee shop, shoe store, etc. If you want to get a more detailed listing of the specific programs you are enrolled in, simply look in your wallet or hold up your key chain. That should provide a friendly reminder.

      Why is loyalty, and loyalty strategy in particular, such a big part of engaging customer behavior? Because at the end of the day, each consumer and each one of you want to feel appreciated and enjoy receiving a reward for your constant patronage. You enjoy being loyal, but you also enjoy receiving return benefits for your loyalty.

      DIFFICULT QUESTION: Why are there so many different loyalty programs?

      SIMPLE ANSWER: Because if administered properly, loyalty programs work. Here’s why:

      Loyalty programs provide a competitive advantage.

      Loyalty programs are a “hook” to keep customers coming back.

      Loyalty programs help identify your most profitable customers.

      Loyalty programs can positively alter purchasing behavior.

      Loyalty programs help lead to more profitable customers.

      I’d like you to take a quick test. To demonstrate loyalty in its purist form, I’m going to list ten products or brands I am most loyal to. On a scrap piece of paper or on the blank lines next to mine, I’d like you to do the same. List TEN products or brands you’re most loyal to.

      Show your list to three people you have a close relationship with. As they are reading through the list, ask them who the list represents. I guarantee you’ll receive the same answer from all three people. “I think of you,” they’ll say.

      It’s remarkable how such a simple exercise can define the essence of the products and brands you are most loyal to. It defines the person you are as a consumer and most likely represents the ten products or brands you obviously think of first and most often.

      Here are the reasons I am loyal to the products and brands I chose.

      • I like the Miami Dolphins because my father was and still is a Miami Dolphins fan. I grew up a Dolphins fan, and I don’t know anything different. I also like that they are the only undefeated team in the history of the NFL (which I like to point out in heated football discussions).

      • I like the iPhone because I think it is the greatest invention of my lifetime, and it is my primary source of communication, relaxation, and entertainment. My iPhone is by my side every minute of every day.

      • I like Nike because I spent six years in Portland, Oregon, where the company was founded, and I feel a personal connection to Phil Knight and the brand. I also like the high quality of its clothes and shoes.

      • I like Starbucks Coffee because I consider it my first experience and introduction to loyalty. I also like its nonfat mocha and its blueberry crumb cake.

      • I like the New York Yankees because they attract the biggest stars in the game and play on the biggest stage in the history of sports.

      • I like Zappos.com because it has the most humble approach to customer loyalty of any company that I know. I also like that its service is second to none. I really like that there is al ways free shipping.

      • I like Titleist golf balls because they are the best golf balls made. I also make more putts when I use the Titleist ball.

      • I like Versace ties because my mother-in-law bought me one about ten years ago and I felt more confident when I wore that tie. I now own over 20 Versace ties.

      • I like Nordstrom because I feel good shopping there, especially the Nordstrom at the King of Prussia Mall in King of Prussia, Pennsylvania. I also like when the clerk walks around the counter to hand me the bag after I make a purchase.

      • I like Entrepreneur magazine because I enjoy the articles and insights on progressive companies and individuals with cuttingedge ventures. I also like that Entrepreneur Press is the publisher of this book.

      Once you finish this exercise, I believe you will agree it would be quite easy to be a spokesperson for any of the brands or products you list. Once you become loyal to a product or brand, it’s hard to pull away from that brand. It becomes a part of your fiber and makes up the person you are.

      That is why companies spend ungodly amounts of money trying to earn greater market share and to retain customer loyalty. It’s also precisely the reason companies know where and when to draw the line.

      If a customer survey found that a customer leased a new Cadillac every 4 years for the past 12 years, chances are he will not be purchasing a Lincoln as his next car. However, if the incentive has enough value to make someone switch, a customer’s loyalty to a particular brand can be challenged. That is exactly the reason you can never take a customer’s loyalty for granted. It’s a tough balance, and maintaining a loyal customer base requires that your company excel in many areas, hence underscoring the need for perfecting the complete loyalty experience.

Personal Relationships Yield Loyalty

      Take a quick moment to recall where you have your dry cleaning serviced. There’s a reason you go to a particular cleaner. Whatever the reason, it can be traced back to the loyalty you have toward that business. Unless you live in a rural area, there are a number of dry cleaning businesses to choose from.

      I choose to go to Martin Brothers Cleaners. Martin Brothers is not the cheapest, and it is not the closest to my home. I go because I’m satisfied with the cleaning service and because I like the owner, George. I go because George made a connection with me. The first time I went into his store he was polite, he was efficient, and he was friendly. The second time I went in, George called me by name. He also brought out a sealed