The 5 Fastest Ways to Lose the Loyalty of Your Customers & Members
Have you ever asked yourself what creates loyalty?
In fact, we’ve filled several pages devoted to gathering the latest facts and stats about all things customer loyalty and engagement.
What is it? How do you earn it? Is it worth the effort? (And so on...)
On the flip side, have you ever wondered what makes loyalty fade?
We’ve asked ourselves that one, too, turning again to our content-filled stats pages to seek out some answers.
Read on and discover -- like we did -- five clear patterns that studies suggest are fast and easy ways to turn off consumers and drive them away from becoming truly loyal.
The 5 Quickest Ways to Lose Loyalty
1. Increase Cost without Adding Value
It's really no surprise that people don’t want to pay more for a product or service they’ve been using when no perceived value is added to account for the cost hike.
And what exactly is value? Well, Webster definitions aside - value really comes down to two simple questions: "How much did I get?" and "How much did I have to pay to get it?"
Feedback from customers drives home the point, as 92% of loyal customers rank price and value as the top driver for loyalty to specific retailers. Unfortunately, a common example of this let's-raise-prices-without-any-added-value tactic seems to be a regular business model for many cable providers.
Just ask "Deputy Cartman:" a frustrated and vocal cable customer with New Jersey-based RCN:
"RCN jacked my cable bill up by $30 one month in October 2018. I called and threatened to cancel, at which point they backed off. Then last month, they jacked it up by $10. I now have an antenna with a range of 130 miles that cost $22 via Amazon and no cable TV anymore."
Unless you’re adjusting prices to reflect annual inflation, our general rule of thumb is that an increase in price calls for an increase in perceived value.
2. Show Customers How Little You Really Care
It goes without saying that how we treat our customers/members plays a pivotal role in their loyalty. So it's no shock that 60% of consumers would take their business elsewhere due to unfriendly service, and 74% of Millennials said poor customer service would make them less likely to purchase products from a brand they’re loyal to.
Part of a good customer service experience includes being able to converse with a human, not a machine. 74% of consumers are more loyal to a business that provides them with the option to speak to a human, and 43% would think about taking their business to a competitor if they were not given the option to speak with a human.
Moral of the story – if you'd rather build loyalty instead of losing it, spend the time and resources to educate and train your staff properly on how to best deal with customers or members of all types. People want to speak to people. They want to feel like your business or organization is human, relatable, and cares about their needs.
3. Provide No (or Poorly Executed) Personalization
There's nothing that says "I love you" quite the same way as "I love you, Customer" - except maybe for "I love you [first name]."
On the other hand, successful personalization efforts can be quite beneficial to making your customers feel delighted and special. In fact, 80% of consumers are more likely to do business with a company if it offers personalized experiences.
So if your company or organization doesn’t currently have a personalization strategy in place, our advice would be to get one. Start with something simple like greeting customers by name, and build up to things like using customer/member data and a basic marketing automation platform to deliver tailored, customer-specific messaging.
Note: while we highly encourage the right kind of personalization, there’s definitely a line not to cross when it comes to this area. Make sure your efforts are well thought out and beneficial to the customer as 48% of consumers have left a brand’s website and purchased from a competitor due to a poorly personalized experience, and 22% say they would leave a brand altogether after a "creepy" one.
4. Forget About Social Responsibility
Now more than ever, consumers are hyper-aware and increasingly sensitive to who and what they’re spending their hard-earned dollars on. Millennials are especially tuned in to this trend as 52% want their values to align with the brands they like, 70% would buy less from a brand they’re loyal to if they found out the brand doesn’t pay employees well, 69% would buy less after learning the brand relies on unethical labor practices, and two-thirds would be less likely to buy from a brand if the CEO makes a lot of money while the average employee makes little.
But it’s not just Millennials that are sitting up and taking notice. Consumers of all ages are jumping on the do-gooder bandwagon with 48% of gen X and 35% of baby boomers feeling it’s important their values align with the brands they like.
Social responsibility doesn’t just influence what brands and businesses consumers like, it also affects where they shop, how often, how much they spend, and the overall strength of their loyalty. 44% of all consumers want retailers they shop at to share their values, 52% say a key influence on loyalty is knowing retailers are acting sustainable, and 54% of teenagers have deliberately purchased or stopped using a brand because of its ethics.
So in short, if you’re looking to build consumer loyalty and engagement, it’s probably best to treat your employees fairly, choose some causes/charities to own and support, and keep your business practices ethical.
5. Don't Offer a Loyalty Program
If you really want to put off your audience, don't offer to help them save money or otherwise feel special as a loyal patron of your product.
Of course, we here at Access like programs that save people money. After all, saving money is a universal motivator for most people of any demographic, so not offering a discount or loyalty program of any sort can be detrimental to the success of recruiting new customers/members and keeping old ones. Don’t believe us? 48% of consumers would avoid brands that don’t offer discounts, and 77% say loyalty programs make them more likely to stay with brands.
So if you’re looking to add value to your product or service and create a positive emotional connection with your customers/members, then we highly suggest thinking about adding a loyalty program to your brand, business or organization.
We hope our anti-loyalty caution has reached you in ample time to heed its warning for the upcoming year, and wish you luck on creating more loyalty than ever before with your customers and members.
And, if you're looking for ways to send your customer loyalty efforts in the RIGHT direction, you can find some at our recent post: "40 Inexpensive Customer Appreciation Ideas."
Written by: Ashley Autry