What Happened to Customer Loyalty?

Marketing researchers have obsessed over customer loyalty for ages. Large corporations have devised elaborate customer loyalty programs. But things are changing, quickly. Nowadays, customer loyalty is slipping through the fingers of corporations. I sifted through several market research studies on loyalty and brand loyalty. I concluded that when it comes to keeping customers loyal, there is no one magic bullet or best practice.

Here’s an example of a customer (me) going from loyal to disloyal. I used to be a loyal customer of United Airlines. I attained the status of Premier Executive, got all the perks, and enjoyed life in business class. Then Southwest entered my local market. Cheap fares, no frills, easy to book. I had reservations (is there a pun somewhere here?) about the cattle-car feeling at Southwest and its policy of using a first-come, first-served seat selection process. Before I switched, I considered what it meant to me to give up my status on United and hop on an all-steerage airline.

When I started writing this piece, I realized I was Mr. New Consumer. I wanted more for less. Maybe Southwest would give me more for less. Let’s see, there were more Southwest flights available at all three of my local airports. Not only were there more flights, but Southwest also flew to more places than United.

Fares were considerably cheaper. To make matters worse with United, I became skeptical when United started limiting perks for frequent flyers. And, I was more doubtful about the future of this airline when United merged with Continental Airlines. I started to see tangible value by flying Southwest. I decided to switch from United to Southwest. I thought I made a good decision.

To complicate matters about customer loyalty, I know that by using one of my credit cards, I could use points accrued from making purchases on my credit card to pay for airfares, hotels, gas, or airline baggage fees. For example, there are credit cards that earn about 2 percent rewards per $1 spent when you redeem for travel. Credit card customers acquire 40,000 (or some other amount) bonus miles when they charge $3,000 worth of purchases within a given time period. This translates into about $400 in travel statement credit. The beauty of using this type of credit card is you are not limited to using any one airline.

What did I do? I closed out my old credit card, signed up for this new one, and started accruing points. So much for being a loyal credit card customer. Now I could pay for my Southwest trips using points from my credit card, and get great fares, too.

A Bit of Recent History

The story doesn’t stop here. In 2008, Airbnb bursts on the scene. According to its website:

“Airbnb is a community marketplace where guests can book spaces from hosts, connecting people who have space to spare with those who are looking for a place to stay.”

Through their experiences on Airbnb, guests and hosts build real connections with real people from all over the globe.

Airbnb has taken the idea of renting rooms to a whole new level. Prior to booking your room, you can read customer reviews as well as read what the property owners say about past renters.

The arrival of Airbnb type services brought up a key fact about loyalty. Customers now rely more on information about hotels from other customers rather than from the hotel’s advertising.

There goes loyalty down the drain

According to a recent study, there has been a drop in customer’s loyalty to hotel brands. Only 8 percent of those polled who stay in hotels said they always book

at the same hotel chain. Two reasons for this mass defection might be consumers can quickly find cheaper hotel prices and customer reviews on websites such as Trip Advisor, Kayak, and Trivago. Who wouldn’t want to pay less for the same or better quality hotel room? Remember today’s customer demands high quality at reasonable prices.

Customers are on high-alert, searching for the best value for their money. Kiss loyalty goodbye.

Now back to the beleaguered airlines. The market research firm Colloquy found “54 percent of U.S. airline loyalty-program members
are ‘unhappy’ with their reward options”. And, 48 percent say they’ve been “frustrated” by the reward redemption process.

Let’s look at the chronology of this story.

  • First, I defected from United to Southwest
  • After that, I used up all of my hotel points
  • Then, I applied my credit card points to pay for hotels or airfares
  • Finally, I switched to using Airbnb properties and paying for it with points from my credit card.

When I seriously began to rely on other people’s reviews, I became more and more aware of the impact other customers had on my purchasing decisions. The customer’s needs were no longer driven by loyalty, but by quality and value.

To learn more about customer loyalty and how to build your business click HERE.

 

Big Numbers – Little Impact

Let’s say you’re asked to write a public service announcement promoting diabetes education. You might start out by writing something like this: “Do you know that more than 29 million people in the United States suffer from diabetes?”

However, after reading this, your reader might ask, “what does this have to do with me? I can’t relate to 29 million of anything”

What is it about these large numbers? I believe that using large numbers to make a point can easily overwhelm people’s senses. Here’s an example of how large numbers can be overwhelming.

The Pew Internet Research Project (www.pewinternet.org) collected data about social networking and online usage. They found that 71 percent of online adults use Facebook, 17 percent use Instagram, 21 percent use Pinterest, and 22 percent use LinkedIn. Facebook alone has about 191 million users in the United States.

If you’re writing a business, be careful not to get carried away by using big numbers to build your case to start a business. Applying large numbers (demographic or economic) to help you understand your local market might not portray an accurate picture. For example, do 71 percent of adults in your geographic area use Facebook? Probably not.

Back to the public service announcement. How would you relate to the question,

“Do you have a friend or family member who has diabetes?” Most likely, you would say “yes, I can relate to that”. This is an effective way to connect with your audience.

What can you do to avoid using large numbers when creating content (online or print) to promote your business? Here two of the most important things to keep in mind:

  • Think small – If you are starting a business that serves local or regional customers, get data from local business organizations (Chambers of Commerce, economic development associations, etc.). Use the data to get an understanding of the unique demographic characteristics of your market.
  • Make it personal by telling a story – talk directly to your audience using common words and phrases to draw them in. Most people can relate to a short story. The diabetes example above can be expanded into a story about how someone prevented himself or herself from becoming diabetic.

Beware of getting lured into the world of big numbers.

10 Expert Views on Print vs. Digital Marketing

 

The folks at MetroVista interviewed me and nine other marketing experts to get our take on print vs. digital marketing. Here’s one part of the introduction to the article.

  • Print marketing offers its audience a sense of creditability; it takes time to write, edit, publish, and distribute. The web can be full of, well, “fake news”.
  • Print marketing might actually have a higher visibility rate because it cannot be as easily disposed of by a click of a finger. Your consumer will at some point hold your information in their hands, not just on their phone.
  • Print marketing targets those who are not always logged in online (cough Baby Boomers). Do you know how long it took my dad to stop printing our driving directions and just use his phone?!

You can find the entire article HERE

 

 

Do You Suffer From Brochure Inertia?

You probably know a small business owner who has stacks of unused brochures lying around his or her office. If you asked why the brochures are here, that business owner might say:

  • I printed too many.” or
  • “The content is out-of-date.” or
  • “Now that I’ve had them for a while, I don’t like the color.” or
  • “I found a typographical error after the brochures were printed.”

Each of these excuses are symptoms of Brochure Inertia. Brochure Inertia can be prevented if you carefully consider the following:

  1. Narrow your list, so your mailing tasks will be manageable.
  2. Where will you get the proper mailing list? How much will the mailing list cost?
  3. How many brochures and cover letters should you print? Always mail a brochure along with a cover letter unless you are printing a self-mailer.
  4. Who will write, design and print the brochure?
  5. How much will it cost for design, printing, and postage?

 If you need help with writing and design, go online and search for ‘direct marketing’. You will find tips on how to write brochures. You will get a feeling of the range of fees and costs involved in printing and mailing a brochure.

My favorite adaptation of the brochure is what I call a capabilities sheet (some refer to it as a pitch sheet). These are printed on one side of a piece of paper only – I print mine on my color laser printer. I like them because I can change the copy to fit the specific needs of a client or referrer.

For example, I met with a lawyer in a mid-sized law firm to discuss conducting a client retention program. I had previously written a one-page capability sheet for another type of client. This particular client owned a company that provided continuing education programs for healthcare professionals. I wrote a capabilities sheet for this company to deliver a customer service training program for his twelve employees. It was easy for me to modify the existing capabilities sheet for the lawyers.

Three tips to think about when you sit down to write a capabilities sheet:

  • Use bullets in the middle of the sheet.
  • Don’t squeeze your phone number, email address, and website on the 
very bottom of the sheet.
  • Next time you check your snail mail, see if there are any postcard styles that would work for your customers or referrers.

I once heard a marketing professional say the purpose of a brochure was to be put in a filing cabinet or desk drawer.

This pessimistic statement does have some merit. But let’s face it, you have to have something tangible to mail and give customers.

What Do You Need?

ABC Corporation wanted to find out how they could improve their laundry detergent. So, they conducted a focus group with customers who used their product. The focus group moderator was selected from the company’s marketing department. This person had never conducted a focus group before. This 
facilitator asked each of the twelve people sitting around the conference table,
“What do you need in terms of laundry detergent?” Blank stares filled
 the room. The participants were speechless. One participant asked, “I don’t know what I need”. Another said, “I need my clothes to be clean”. After going in circles, the group was unable to articulate any concrete need. The leader got frustrated and terminated the group after twenty minutes, without any suggestions.

Another company, XYZ Corporation also sold laundry detergent and conducted a focus group with customers to find out how the corporation could improve its product. Same goal as ABC. This time the focus group facilitator asked the right question to group members.

“What problems are you having with your current laundry detergent?”

The answers came rolling off everyone’s tongues.

“I hate it when the liquid drips down the side of the bottle.”

“I can’t seem to figure out how to use the scoop.”


“The directions are written too small”. 


“The bottle is too heavy.”

“The handle is too small.”

“I don’t know if I’m getting my money’s worth.”


The facilitator presented her report to XYZ’s Product Development team. The team was quite impressed with the useful information provided by just twelve people.

The more you know about your customers’ problems (needs!), the more effective, and successful your marketing strategies will be.

 

Learn more about how to identify customer needs at www.criticalconnectionsbook.com

DailyBitsOf what?

Interview with Niklas Laninge

As a marketing consultant, workshop presenter, and business advisor, I’ve been challenged to teach business concepts and processes in a concise and concrete manner. I thought I had it right. Just as I was feeling confident, Niklas Laninge from DailyBitsOf contacted me. He asked me if I’d like to write a bite-sized course on Overcoming Your Fear of Selling. Well, that sounds easy. Or was it? Each lesson of the mini-course would be send to subscribers via email. One a day for ten days. Maximum 300 words per lesson. It was not easy to synthesize my thoughts without dumbing-down the content. It was hard work. Now I was hooked. As of this writing, I have created four mini-courses. And, I thank Niklas Laninge for his support and encouragement. Who is this guy?

I had the privilege of interviewing Niklas Laninge, the co-founder of DailyBitsOf. What is DailyBitsOf? Their website says:

DailyBitsOf is a service for people who love learning. People whose curiosity never ends, who see gaining knowledge as an ongoing process and who believe they can acquire any skill they might need to handle work and life’s challenges. We know that finding time for learning can be difficult. We buy books that pile up, save articles that remain unread and rarely have time for that online course we’ve been longing to take. This is why we created DailyBitOf as a tool to help people create a daily habit of learning something new.

EL: What motivated you and your colleagues to start DailyBitsOf?

NL: We all love learning new things, but we all felt that life often gets in the way. Since we all have worked within tech for a long time we had so many examples of products and ideas that fail because of friction and not being able to cut through the noise. This is why we decided to create a simple learning format that would be delivered to a place where you already spend a lot of time at – email and Messenger.

EL: Tell me a little about your background?

NL: I’m a psychologist by training and a technologist by passion. I have built and launched a lot of software that all aimed at helping people change behaviors. One was a platform for therapists and their patients, which would allow the patients to have some digital support between sessions. In September I will release a book called Behavior Design which is a collection of the best research and application of research I have encountered during my eight years in helping people use technology to change behavior.

EL: I noticed you changed your business model several times in the past two years. Why did you do that?

NL: We started out by being more of a tool for companies to gain fans by teaching small micro-courses on topics relevant to their business. We quickly noticed that the courses we got from this business model didn’t resonate at all with our values or our core-users. So we decided to aim at making the impossible possible – ask people to pay for content. By doing so we would motivate the best experts to put out their courses on our platform, and raise the bar at the same time – quality wise.

EL: How do you find such creative course instructors?

NL: Hard work, googling, reading blogs and 100s of hours listening to various podcasts. Luckily many of them find us nowadays.

 

EL: What are some of your most popular courses?

NL: The two courses we have on behavioral economics are popular. We’re talking tens of thousands of people. Then there’s our courses on productivity with our course “How to Beat Procrastination” being the most popular within that category.

 

EL: If you could identify one thing that makes DailyBitsOf unique, what would that be?

NL: I’d guess it’s our ability to attract so many great experts and make it so easy for them to repackage their expertise. Also, our ability to deliver something as short as a 2 minute read that still have an impact on the way people behave.

 

EL: What are your plans for the future for DailyBitsOf?

NL: I’m always thinking about more platforms, like would Slack be a good place to consume a course? Then it’s packaging. When we started micro-learning wasn’t really a thing, now I see new companies pop-up every week – even Google have an own version. So I’m thinking a lot about our role in this landscape. The big challenge is to get people to commit to more than just one course at a time. This is a challenge we’ll probably be tackling during summer (2017).

Niklas@dailybitsof.com

https://dailybitsof.com

 

 

What’s The Difference Between Transactional and Relational Marketing?

What’s The Difference Between Transactional and Relational Marketing?

 Let’s say you’re building a marketing plan to sell garden hoses. Your marketing strategies and sales tactics are straightforward transactions. When you sell a product, your customer shops for price and options- length, thickness, type of material, etc.

There is little or no emotional involvement in the sale. The sale is a direct transaction using traditional sales techniques.

However, if you provide personal or professional services such as financial planning, tutoring, or any type of consulting, your marketing and sales tactics are relational, not transactional. Relational selling requires you to make a connection with potential clients or customers prior to making the sale.

Relational selling is value driven, not price driven. You must assure potential clients or customers that they are receiving a high-quality service delivered by a knowledgeable professional. In a relational model, there is some emotional involvement in the sales process. Let’s face it, buying a garden hose is not an emotionally-charged experience,

Think about the following:

  1. Do my marketing and sales efforts require transactional or relational strategies?
  2. If I’m marketing a professional service, what is the one key message I want my potential client to know?
  3. If I’m selling a product, what are the one or two most important features and benefits of my product?

Keep in mind that marketing professional services is all about building and maintaining relationships with your clients.

For more information about relationship and referral-based marketing, click HERE.

 

 

Fight Challenge With Strength

Let’s talk about your strengths that help you reach your business goals, and challenges that might prevent you from becoming successful. When participants explore their strengths
 and confront their challenges in my marketing workshops, they feel better equipped to make their business goals a reality.

A strength is a trait, characteristic, or skill that comes effortlessly to you. If something comes naturally to you, it’s a strength that you most likely enjoy using. More ethereally, you can’t be great at doing something unless it’s a strength. Even when others recognize your strengths, you might minimize them because strengths can be taken for granted.

A challenge is an activity that takes you out of your emotional and intellectual comfort zone and could cause anxiety. When you face a challenge, you’ll need to harness many of your internal strengths to achieve success. My psychotherapist friends like to say that dealing with a challenge can be an area of personal growth.

You often hear people refer to one’s strengths and weaknesses. I equate weakness with helplessness. I see weakness as a fault emanating from the world of negativity. Not good. Living in a world of negativity is a bummer. Negativity begets more negativity.

There are two different approaches to working with your strengths and challenges. First, you identify your strengths and use them to their fullest advantage. Second, you recognize your challenges and work to overcome them. Your strengths are not necessarily related to your challenges, but they can be.

Ben’s Story

Here’s an example of how one of my marketing workshop participants worked on his strengths and challenges. Ben is a 28-year-old graphic designer. He currently works for an advertising agency and wants to leave the agency to start his own graphic design studio. I asked him to tell me one key strength he would bring to building his own business. He immediately replied, “I’m creative!”

Next, I asked Ben to describe the most difficult challenge he faces in building his business. He hesitated for a few seconds, and then said; “I’m always second guessing myself about my ability to be creative. I question whether I’m able to sell and whether I’m good enough to compete in the market.” For the first time, Ben was able to articulate his challenge.

Next, I asked Ben to carefully look at this difficult challenge. Then I probed deeper and asked him if there is some other way in which he might be second guessing himself. Ben looked down for a few seconds. He seemed to be somewhere else. “I don’t know.”

Another question. “Ben, think hard now. What, if any internal messages do you have about yourself that would make it difficult for you to overcome your challenge?”

Now Ben was deep in thought. “I’m not smart enough to be doing this,” Ben revealed. “My parents always compared me to my older brother who I thought was smarter. But it extends farther than that.

“Ben,” I asked, “is there something positive you would like to tell yourself in place of your negative message?” Ben replied, “I’m a competent, creative professional”.

I gave Ben a pen and an index card and asked him to:

  1. Write this positive message on the card

2. Display the card in a prominent place where it can be seen every day

Now that Ben had a clear picture of his new positive message, we went on to the next part of the exercise. I asked him if he had at least one concrete idea to address his challenge of second guessing himself. Ben, feeling more confident, said he would make a list of his recent accomplishments.

Finally, I asked the other workshop participants if they had any ideas to help Ben.

Someone suggested that Ben call one of his colleagues and friends to remind him that he’s a competent professional. Another suggested that Ben reread his list of accomplishments when he would start to second-guess himself. My suggestion was a straightforward message for Ben to say to himself: “I have an amazingly successful track record.”

Ben was candid about his struggle with second guessing himself. He took a good, hard look at himself. After the workshop Ben told me he felt like a burden had been lifted off his back. Good work, Ben.

Now it’s your turn. Answer the following questions:

  1. What are three strengths you bring to building your business?
  2. What are three challenges you face in building your business?
  3. Looking at the most difficult challenge you identified, is there something more you know about this challenge?
  4. Think hard now. What, if any internal messages do you have about yourself that would make it difficult for you to overcome your main challenge?
  5. Is there a positive message you have about yourself that can replace your negative message?
  6. Name several ideas you have to deal with your main challenge

If confronting and doing something about your challenges seems daunting, take a step back and focus on your strengths.

One final note:

“Our ability to handle life’s challenges is a measure of our strength of character.”

Les Brown

For more information about relationship and referral-based marketing, click HERE.

 

Preventing Marketing Paralysis – Final Chapter

Help Is On The Way

If you’ve been suffering from the pain and anguish of marketing paralysis, don’t worry. You can get immediate and long-term relief. How?

Phone a Friend. It’s a good idea to talk things over with a friend and get some advice. You might want to discuss a new idea, clarify a stumbling block, or just plain talk about your business. When you’re considering starting a solo business, it gets lonely quickly in the early stages of planning your business strategies.

Phone a friend who is not employed in your industry or profession. You want fresh eyes on your situation. You want the other person’s perspective. When you initially talk with your friends, do not ask them to solve your problem for you. However, most of the time, when someone gives you advice, the advice is more about what the other person needs rather than what you need.

Do not let them give you advice (easier said than done). Ask them to listen and act as a sounding board. Sometimes, just saying aloud what your situation is can be helpful. Now, you can brainstorm ideas or solutions.

Write It Down. Now it’s time to get back to basics. In order to jump-start your marketing efforts and prevent yourself from getting paralyzed, do the following:

In one or two sentences, write your answers to the following questions.

  • What are the unique characteristics of my target market?
  • What is my compelling message I want to communicate to my target market?
  • What is the number one most effective promotional vehicle to get my message out?

Use your answers to the above questions as a reminder to keep yourself on track and help you focus on where your business is going and what will be driving your marketing decisions. If you feel yourself becoming paralyzed, refer back to your answers.

What are your strengths and challenges?

Why are we talking about personal strengths and challenges? If we understand some of the more personal thoughts we have about marketing your business, we can get a better handle on how to overcome marketing paralysis.

A strength is a trait, characteristic, or skill that comes effortlessly to you. Sometimes others recognize your strengths while you minimize them. We usually take our strengths for granted. If something comes naturally to you, it’s a strength. Most likely you enjoy using your strengths. You’ve always valued your strengths. In a more ethereal sense, you can’t be great at doing something unless it’s a strength.

A challenge (intrinsic or extrinsic) is some activity that takes you out of your emotional and intellectual comfort zone and could cause paralysis. When you face a challenge, you’ll need to harness your internal strengths to overcome the challenge. My psychotherapist friends like to say that dealing with a challenge can be an area of personal growth.

There are two different approaches to working with your strengths and challenges. In the first approach, you identify your strengths and use them to their fullest advantage. In the second approach, you recognize your challenges and work to overcome them. Your strengths are not necessarily related to your challenges, but they can be.

If you identify your strengths and challenges, you’ll be able to build on them and meet any challenge that might pop up along the way.

Try this: Name two strengths you bring to building your business. Now, name two challenges you face. If you want to avoid marketing paralysis, go with your strengths.

Review

In Chapters 1 and 2, you learned about the causes of marketing paralysis. In Chapters 3, 4, and 5 you learned the signs and symptoms of marketing paralysis. And, in Chapter 6 you learned about your strengths and challenges as related to marketing.

Now, you’re armed with all the weapons needed to overcome marketing paralysis. Go for it.

 

For more information about how to maximize your strengths click HERE.

How to Prevent Marketing Paralysis -Chapter 5

Here is another symptom of marketing paralysis.

Boil the ocean: When clients come to me for help, I ask what they have done and what they are planning to do to start promoting their business. I’ll usually hear something like: “I’m working on my website. I just started Tweeting. I’m blogging. I’m planning to speak at an upcoming local seminar.”

When I hear this litany of activities, I wonder if this person is trying to boil the ocean. The term “boil the ocean” is one of many business jargon phrases used to embellish a point. Boil the ocean means to take on too much, over-extend yourself, or become overly ambitious. This is a recipe for failure.

Next time you are at the seashore (if you live inland, a large lake or river will do), try to take that entire body of water and boil it. How are you going to do it? Now that you are disappointed you couldn’t boil the ocean, try this. Take a teaspoon from your kitchen drawer. Go back to the ocean, river, or lake you just visited. Dip the teaspoon in the ocean. Using a cigarette lighter, place it under the teaspoon and see what happens. In a matter of minutes, the water will boil. Congratulations, you have successfully boiled a teaspoon of oceanSo, what’s the point here? Be realistic in how much you can do. How many marketing related projects can anyone take on at a time? The key to successful marketing is to figure out how much time, energy, and money you can expend on your marketing efforts. Next time you feel overwhelmed by the number of things to do, think teaspoon.

So far, we’ve talked about three causes of marketing paralysis:

1. Using the wrong marketing model

2. Getting unhelpful or misguided advice

3. Getting overloaded with information.

We talked about some of the most prevalent signs and symptoms of marketing paralysis:

1. The glazed over look

2. Going down the rabbit hole

3. Second-guessing and overthinking, and,

4. Boiling the ocean.

Now, we will discuss the fifth symptom of marketing paralysis: Putting the cart before the horse. Metaphorically speaking, the cart represents a specific promotional tool (social media platforms, websites, print and broadcast, etc.). The horse represents your target group or customer segment.

Here’s how you can easily get paralyzed.

  1. You decide to start a business – (you’re starting off great)
  2. You write a marketing plan – (ok, so far, so good)
  3. You come up with an idea of how to promote your business (you’ve now put the cart before the horse)
  4. After you’ve come up with some innovative ways to promote your business (the cart), you think of who your customers are (the horse)

If you continue this way, chances are high that you’ll stall out your marketing efforts. It’s not too late to avoid this problem.

Try this:

First: “Who is my most important target group”. If you don’t know who your customers are, how are you going to make an informed choice as to what promotional vehicles to use?

Second: Create your sales message touting the benefits and features of your business.