Wednesday, April 27, 2011

12 Ways To Increase Brand Loyalty

By Thomas Murrell MBA, CSP International Business Speaker

Imagine being picked up by your loyal driver who has bought you a freshly baked warm muffin and your favourite hot beverage.

The radio is tuned to your station of choice and the morning's newspaper is on the seat.

You have a permanently packed bag with business suit, casual change, running gear, swim goggles and toiletries all in a small walk on cabin bag.

At the airport you swipe your life member status frequent flyer card to check in and it automatically books your preferred seat allocation, meal and movie preferences.

Your ticket is printed and you're checked in efficiently and quickly all without human contact and you make a mental note how much better the customer service is without people!

At the airport of your destination you're met by a friendly and familiar face of another loyal driver holding up a white sign with your name on it in handwritten black ink. He's wearing a dark suit, white shirt and chauffeur cap.

He takes you to a hotel you've never stayed at before and on check in they enrol you in their rewards program.

With the program you can earn up to five nights free, book a romantic getaway, or donate points to the Japanese relief fund.

Sound fanciful and far fetched? Well this was my experience on a recent road trip for a series of speaking engagements.

The loyalty programs reminded me of that scene in the 2009 movie Up In The Air with George Clooney playing Ryan Bingham where he meets romantic interest Alex Goran for the first time at a hotel bar and they are comparing loyalty cards. Here's how the scene goes:

"Alex Goran: Oh, my God. I wasn't sure this actually existed. This is the American Airlines...
Ryan Bingham: It's a Concierge Key, yeah.
Alex Goran: What is that, carbon fibre?
Ryan Bingham: Graphite.
Alex Goran: Oh, I love the weight.
Ryan Bingham: I was pretty excited the day that bad boy came in.
Alex Goran: I'll say. I put up pretty pedestrian numbers. 60 thousand a year, domestic.
Ryan Bingham: That's not bad.
Alex Goran: Don't patronize me. What's your total?
Ryan Bingham: It's a personal question.
Alex Goran: Please.
Ryan Bingham: And we hardly know each other.
Alex Goran: Come on, show some hubris. Come on, impress me. I bet it's huge.
Ryan Bingham: You have no idea.
Alex Goran: How big? What is it, this big? This big?
Ryan Bingham: I don't want to brag.
Alex Goran: Oh, come on! Come on.
Ryan Bingham: Let's just say I have a number in mind and I haven't hit it yet.
Alex Goran: This is pretty .... sexy.
Ryan Bingham: Hope it doesn't cheapen our relationship.
Alex Goran: We're two people who get turned on by elite status. I think cheap is our starting point.
Ryan Bingham: There's nothing cheap about loyalty."

So what's the point of the story and movie example?

Well, customers are more likely to recommend a product, service or brand if they have good experiences with customer reward programs, according to a new study.

The Colloquy study, "Measuring Word-of-Mouth Activity Among Reward Program Members", reveals that customers who have good experiences with customer reward programs are 70 per cent more likely to recommend that product.

Of the 7000 respondents who participated in customer reward programs, 55 per cent describe themselves as "brand champions". A huge 68 per cent of these "brand champions" say they will recommend a program sponsor's brand during the year.

The survey also shows 73 per cent of respondents enter loyalty programs to tell manufacturers what they think, 68 per cent to "get smart about products", 63 per cent to get free product samples, and 61 per cent to share their opinions.

So smart marketers are using these loyalty-marketing techniques to expand their business.

According to the study, businesses "should find brand champions buried within their program memberships, and build relationships that reward them for positive WOM (word-of-mouth) activity.

So here are 12 ways to build brand loyalty.

1. Start with a Great Product or Service
Basic but fundamental.

Get your product mix or service offering absolutely spot on.

Get this wrong and any brand loyalty will disappear into thin air.

Change it without research and consultation and you may also lose brand loyalty.

2. Provide Great Customer Service
Break down customer service into three simple A, B, and C steps:

A) Pre-purchase customer service to qualify the buyer. A good website as an example if they are researching your brand online prior to purchasing.
B) Customer service during the purchase or service delivery, and
C) Post purchase customer service, such as a warranty, guarantee or post purchase follow-up.

3. Provide a Platform to Share Experiences
You need to get advocates and brand loyalists talking about your brand.

Find a platform for this. It could be via social media such as Twitter or LinkedIn or through the use of testimonials in marketing materials.

Even more powerful is a face to face recommendation or referral.

Look at systems that facilitate this such as a VIP area.

4. Build A Sense of Community Like the scene in Up In The Air brand loyal customers love to hang out together and share stories.

Look at how you can create an event or cause related activity that can create a sense of community, belonging and togetherness.

5. Reward Systems
Obviously as the research indicates loyalty systems based on rewards work.

It doesn't have to be expensive - just something that makes life a little easier and makes people feel special.

Valet parking, a free car wash, free wireless access as an example.

6. Segment the Market
Think of market segmentation as like peeling off the outer astringent and protective layer of an orange to get the juicy and tasty flesh inside.

Instead of eating the orange, carefully separate the fleshy segments and lay them out on the table.

Do this with your database of customers.

Provide tiered loyalty reward programs based on how much they spend and consumer behaviour or other segmentation variables.

7. Track and Measure
Always track and measure key metrics. Data mining can provide some interesting trends. This is where all future revenue is going to be generated.

Remember the 80/20 rule. Eighty per cent of your revenue is going to be generated by the top 20 per cent of your customers.

8. Educate
Always focus on education rather than selling.

9. High Frequency Always reward those with the highest frequency of purchases.

Think of George Clooney on the plane when he reaches his miles target and is presented with the card by the pilot with the cap and bushy moustache.

10. Keep in Touch
Plan regular and personal communications. Phone calls, newsletters and special events.

11. Understand Touch Points
What are the hot buttons for your brand loyalists? Food, travel or entertainment?

12. Follow-Up
Always follow-up on feedback, requests, constructive criticism.

Think of feedback as a gift.

Need a speaker on brand loyalty for your next event? Consider Thomas Murrell and contact here.

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