How to move customers up the loyalty ladder


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I think of customer engagement as a ladder. The lowest rung is simple customer satisfaction, with subsequent ascending rungs be things like “repurchase intent”, “perception of a brand’s integrity” and the highest levels being a “customer’s identification” with a brand or a “sense of loss” should the brand not exist. A recent study by Epsilon revealed some interesting findings about industries that are moving customers up or down that ladder. Moreover the Epsilon research examined drivers of repurchase intent and consumer buying behavior. Some of the purchasing drivers explored by Epsilon included the recommendation role of family and friends, the impact of product reviews, the value of unstructured user generated content on websites, and even the channel preferences that contributed to buying.

While Epsilon’s survey produced a panoply of results, I’ll share a few highlights to get you thinking about ways to drive initial purchases and long-term customer relationships in your industry. Unfortunately or fortunately, (depending upon whether you are trying to maintain customers or lure customers from competitors) the Epsilon results suggest that a fairly large number of recent purchasers said that they wouldn’t buy from the same brand again. For example, less than 60% reported strong repurchase intent. Across categories auto insurance purchasers reported the highest likelihood to maintain brand loyalty. I’m sure no one will be surprised that the lowest repurchase intent was found among credit card brands.

Looking across categories, Epsilon’s analysis of the interface between brand communication options and consumer attitudes reveals:

Friends and families were the primary source of information that affected purchase decisions,
Net promoter scores were generally low (meaning customers weren’t likely to be recommend brands). Some industries like telecommunications and credit cards had abysmal net promoter scores,
Product review websites are playing a significant role in consumer’s purchases, Few respondents reported that “unstructured user generated content” (i.e. blogs, social media networks) affect their buying behavior, and
When given the choice and when consumers consent to receipt, customers reported that they preferred product information via email.

According to the report summary from Epsilon’s combined qualitative and quantitative research:

Consumers appreciate a sense of control and trust from email today, which has become the key to consumer experience marketing that consumers accept and value

Consumers are seeking validation from multiple sources. Marketers are featuring product testimonials or links to objective third-party reviews

Search marketing and optimization are important topics today, but the best marketers realize they only want a consumer to search for their products once, since each search needs to result in an engaged consumer

So are your marketing and customer experience strategies resulting in something up the food chain from simple satisfaction. What percentage of your customer’s report “repurchase intent”? What is your “net promoter” score? What are the preferred methods for your customers to receive information about your product or service? and What sources of content or recommendations are influencing the purchase intent of your consumer?

Since this medium is an important way for me to communicate with you, please allow me to take a brief moment to make a formal announcement about an upcoming book project for which I would welcome your input. For the fall of 2011, I will be writing and McGraw-Hill will be publishing “The Zappos Experience.” In the future, I will offer you ways to share your insights and personal stories about the “unique customer experience” that is Zappos. It is my sincere belief that Zappos has many lessons to teach us all – particularly when it comes to creating a “craveable” brand experience in what once seemed like an unlikely business concept namely purchasing shoes online. Stay tuned for updates and ways for you to share your wisdom and perspectives in our book.

Republished with author's permission from original post.

Joseph Michelli, Ph.D.
Joseph Michelli, Ph.D., an organizational consultant and the chief experience officer of The Michelli Experience, authored The New Gold Standard: 5 Leadership Principles for Creating a Legendary Customer Experience Courtesy of The Ritz-Carlton Hotel Company and the best-selling The Starbucks Experience: 5 Principles for Turning Ordinary Into Extraordinary.


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