According to the latest COLLOQUY Loyalty Census, the average number of loyalty program memberships per U.S. household stands at 21.9, yet less than ten of those memberships are active ones, and this number has been decreasing since 2010.
And while U.S. brands can collectively boast 2.5 billion loyalty program members, the numbers above show that loyalty programs do not necessarily a loyal customer make.
The Quest for Customer Loyalty
What brands must begin to increasingly accept is that while delivering a single delightful experience or a reward to a customer is in the moment delightful, it typically does not earn a customer’s long-term loyalty. Instead, it’s multiple and consistent satisfying experiences that pay off in the long run. Delighting once is easy; delivering a satisfying customer experience multiple times over multiple channels including the phone, web, chat, social and mobile to name a few, is a quest few brands, it seems, can fulfill.
Forrester Research’s most recent North American Technographics Customer Experience Survey shows that 67% of more than 7,500 US online consumers say they’ve had multiple unsatisfactory service interactions over the past 12 months. A 2014 State of Multichannel Customer Service Survey from Parature reveals that customers are most frustrated by having to contact a company multiple times for the same reason and being passed from agent to agent or channel to channel to complete a customer service interaction.
The road to consistent customer satisfaction, especially across channels, remains long and bumpy with a lack of information, responsiveness, and uninformed or insensitive agents causing customers to simply give up their quest for service or take the competitor’s road because the journey has been made too difficult. According to the same Parature survey mentioned above, 65% of customers have stopped using a brand’s products or services over the past year because of a single poor customer service experience.
Paving the Way to Better Service
Despite the eye-opening statistics above, Dimension Data’s 2013/14 Global Contact Centre Benchmarking Report shows that most brands aren’t as focused as they should be on paving the way for a consistently better and more satisfying customer experience. The survey of decision makers from more than 800 organizations reveals that the three most important commercial drivers of their organization’s contact centers are currently (1) increasingly efficiency, (2) reducing costs, (3) improving service, (4) increasing sales and revenue – and then, way down the list, retaining customers and creating direct customer relationships at both below 8%.
Additionally, the report shows that first contact resolution rates have been on a decline for the past five years (from 85.2% in 2009 to 73.1% in 2014), with the causes being incomplete processes, lack of adviser knowledge and system and information constraints.
According to Forrester analyst Kate Leggett in her recent Navigate the Future of Customer Service report, good customer service should be pain-free, proactive, personalized, and delivered with maximum productivity. And if this is to be done consistently, that will mean:
- Centralizing multichannel support, along with the multichannel view of the customer
- Delivering consistent information to agents, as well as to customers across all interaction channels
- Using feedback to improve service and customer analytics to personalize and predict customer needs and trending issues based on data
- And using customer journey mapping to find out where customers are getting stuck or dropping off.
Unfortunately, Forrester reports that 58% of companies currently inconsistently measure, or fail to measure their customer’s cross-channel journey.
One Does Not Simply Walk Into Customer Loyalty
Loyal customers don’t come from issuing cards – they are earned through a consistently good customer experience, which is defined by Forrester as the sum of all experiences a customer has with a company over the duration of their relationship – including awareness, discovery, attraction, interaction, purchase, use, customer service and advocacy. Right now, a majority of brands are offering a long, bumpy, hard-to-navigate road. It’s time to pave the way to retain more customers.
There are key contributory elements cited in your comprehensive post, suggesting the several reasons it is so difficult to earn, and sustain, customer loyalty behavior. At the center of this is a lack of customer-centric enterprise focus and discipline, resulting in bland, non-differentiated loyalty programs, passive, inefficient and deflective customer service, little insightful or actionable customer data from systems, poorly supported customer-facing employees, and commoditized experiences.
Many consulting organizations have reported that senior corporate executives consider the most important operating imperative to be having a single, integrated view of the customer across the enterprise. As reflected in your post, this, however, is infrequently practiced, and almost never at an optimum level. Until companies really embrace the fact that organizing, and consistently executing, for personalized value and experience (especially in service) needs to be priority #1, true customer loyalty and bonding will remain an elusive goal: http://customerthink.com/service-process-vs-service-experience-solving-the-customers-problem-vs-owning-the-customers-issue/
Very interesting article, Tricia. I belong to several programs I don’t use simply because I have no overwhelming desire to use them. The company has to give me a real reason for me to spend my time, money and effort with them!