Mind the gaps! Find your most important factors for creating customer loyalty

Customer Experience, Customer loyalty

An individual’s propensity to recommend a company may be the most direct measure of customer loyalty and, in the end, financial success. So mind the gaps – where is criticism created, and at what point are ambassadors created?

When we buy something, a piece of furniture, a mobile phone, a trip, or pretty much anything – at the moment of purchase we are most often a satisfied customer. We like the brand – otherwise we would not have chosen to make the purchase from this particular company. Most people are ambassadors at the time of purchase. In other words they may recommend the company to a friend or a colleague. But far from all are long term ambassadors – so where in the customer journey do things change?

  • Is it when they come home and read the unclear assembly instructions?
  • Is it when they have been using the product for a year and it breaks?
  • Or, when they contact customer service in order to order spare parts but they receive poor service?

If we as a company want to strengthen our position and the customer’s perception of our brand, it’s crucial to understand where in the customer’s journey the customer’s NPS* changes.

  • What are our shortcomings?
  • Where are we at our strongest in our contact with our customers?
  • And, where are we weakest?

What should we do with this knowledge? We need to do different types of things and we need to identify different stages along the customer journey. The customer journey is basically the same for all companies:

We buy something -> we use it ->we have contact with the company -> we make a decision whether to continue to be a user or to stop and move on to another supplier.

Where is criticism created, and at what point are ambassadors created?

By measuring NPS in respective customer contact phases it is possible to map out at what point the customer experiences frustration or complications – where is criticism created? And the opposite – at what point are ambassadors created? What transaction has the greatest impact on the customer becoming an ambassador? To supplement this with an overarching relationship measurement, in other words no matter when the client has or has not had contact with the company, it is possible to observe and understand the entire client experience.

Through this type of mapping it is possible to do anything from a small, simple adjustment, such as clarifying certain information or changing opening times, to more significant changes such as amending contracts or reviewing working methods. In other words – the company positive effect on the customer experience on the right activities, what actually has a positive effect on the customer experience at the end of the day.

Is it possible to measure customer loyalty and to see how this correlates with the financial growth of the company?

Yes! A company called Satmetrix has gathered loyalty data from over 150,000 responses from 400 different companies in various sectors. The analysis shows significant correlations on the macro level (0.70 or higher) for a majority of the sectors. This means that the recommend question expressed in % ambassadors or as Net Promoter®, to a very great extent can be used as a measure of loyalty which also shows the long term growth of a company.

*NPS stands for Net Promotor Score and is a question which is posed in order to measure degree of loyalty and likelihood of recommendation of the company. NPS is measured by posing the question “How likely are you to recommend us?” The result of the question is used in internal development work and in order to create a customer oriented culture.

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