Are You Building Relationships or Bribing Customers?

If you ask any marketing director, loyalty programs are a function of marketing. If you ask any long term customer, why they are loyal, service, quality, and responsiveness top the list.

Customer loyalty is more than retention and frequency of purchase. It is strength of conviction that motivates a customer to be personally devoted to a specific brand or company.

Loyalty programs such as bonus points or discounts can encourage customer retention and purchase frequency, but can not generate loyalty alone. Loyalty is generated by the knowledge that a company or brand will consistently meet or exceed the customer’s expectations. It is a rare customer that will say, “The service is horrible, but they have a great loyalty program.”

When customers place their first order, their faith in your company is based on their experiences with similar businesses. They presume that you will deliver as promised. Future orders are based on the customer’s faith in your specific company. The objective of marketing and fulfillment is to convince every customer that his or her confidence in your organization is appreciated and will be rewarded with continued value and service.

Webster defines value as a fair return for something exchanged. The trick is to define what constitutes value for your customers. Is it convenience, price, exclusivity, or a combination? However value is defined, quality of service and merchandise will determine the ultimate strength of a customer’s loyalty.

If you follow the lead of your competitors into major discount land, you are offering bribes instead of a relationship. Create a new path for your company and customers. Invest your resources in relationships instead of promotions. It will set you apart in our multichannel world.

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