LOYALTY

“An ounce of loyalty is worth a pound of cleverness.”

Elbert Hubbard

For a long time, it was thought that the satisfaction with products and services was a main driver for customer loyalty. True to the motto that if somebody isn’t dissatisfied then they won’t change to the competitor. This view has led to many companies trying to achieve a perfect performance at all times across all touchpoints, a noble goal to achieve which is certainly very expensive, and in most companies, is doomed to failure.

But how, these days, do you manage to retain customers on a long-term basis, increase the customer value and consequently secure the economic sustainability of your own business model? The key lies in a well-informed understanding of human behaviour. Based on scientific results and our experience in a multitude of studies we’ve developed a behavioural economics model, which encompasses the decisive factors of success for customer loyalty. The factors of success constitute a sound foundation for measuring loyalty, as well as being the blueprint for developing loyalty strategies and optimizing touchpoints.

Factors of success for Loyal Customer Behaviour

Every company benefits from the fact that customers tend to shy away from switching (under the assumption that they’ve positively identified with the brand / product). This so-called Status Quo Bias has the simple benefit of saving time and energy more specifically. Because if I always had to remake every decision that I’d ever made then I wouldn’t make any headway.

How then do you become – and more importantly remain – your customers’ status quo? The following factors are indispensable for loyal customers:

Reassurance

How does the customer get the feeling that he has made the right decision? How can cognitive dissonance be avoided?

Simplicity & Fluency

How can I make my customers‘ life simple? At which points of the customer journey can I reduce the “customer effort”?

Identification

How can the customer identify with the company / the brand?

Personality

How do I create a customer journey which the customer recognises? How can I be responsive to the individual needs of my customers and support them in their personal challenges?

Highlight & Peak-End

How do I create experiences so that they become sustainable retention experiences?

Social Validation & WOM

How do I create positive customer experiences which stimulate them to tell others? How do I ideally support the sharing of customer experiences?

Do you want to secure the success of your company with loyal customers?

What we do:

We’ll support you with the development of customer retention processes. Successfully optimize your customer journey with touchpoints that have been “tweaked” using the behavioural economic principles. Use the dramaturgy of human behavioural patterns and create a successful customer journey.

Introspective

Kick-off workshop to introduce the model / behavioural psychological factors of success. Definition of the project objectives and drafting of the customer journey from the company perspective.

Status Quo Analysis: Drivers & Barriers for Customer Loyalty

Workshops or online communities to identify the fundamental touchpoints and the behavioural psychological mechanisms, implying where in the customer journey things can be optimised.

Status Quo Analysis: Localising Need for Action

Quantitative testing for finding out which of the touchpoints identified needs action. Development of a loyalty strategy (which touchpoints, which target group, what investment).

Optimising Relevant Touchpoints

Development and evaluation of new ideas for optimising the touchpoints with help of design thinking workshops and / or online communities.

Deriving (Service) Design Principles

So that the results are conveyed sustainably in the company, we would summarise them, in a collective workshop, into design principles, i.e. generalized principles which form the basis for creating new or for optimising existing touchpoints.

Evaluation of the Measures

Regular evaluation of the touchpoints and the executed measures by measuring the key drivers for customer loyalty and recommendation.

What you receive:

Clear factors of success for retaining customers

Satisfied customers

Focused investment in the parts of the customer journey which would be most beneficial

Increased customer value

Sustained assurance of turnover

(Service) Design principles

Our Toolbox:

Online Insight Communities + -

Via the online platform customers express and discuss their experiences in their natural setting. The intensive interaction (across multiple days) leads to an in-depth understanding of customer needs. Ideation challenges can be realised and the ideas enhanced further in iterations. The interactive platform allows individual attitudes and patterns to be identified, as well as effects resulting from the group dynamics. For which we use a comprehensive set of psychological question techniques.

Insight & Creative Workshops + -

Empathy Game Workshops with a hands-on character. Through the element of play participants find it easier to express their memories and attitudes. Psychological associative and projective techniques help too in exposing unconscious motives and needs. Questions are thereby explored in their entirety. These are particularly suitable for B2B target groups, as they are compact timewise, and are particularly good at unearthing the emotional side of scientifically or technically-minded professionals.

Mobile Ethnographie (CXlive) + -

Some things in life you just can’t ask, you just have to sit back and observe. For this we use CXlive. Here we ask customers in the setting or context that they are most used to to report on their product or service usage by using a photo journal. The data collected is then analysed according to behavioural psychological aspects. The original recordings and pictures can be retrieved via the CXlive dashboard any time. This methodology is very good for putting products to the acid test in home placement situations and finding out what needs improvement.

Quantitative Measurement + -

For measuring the status-quo of the customer relationship or for evaluating the optimization measures we use online surveys. In these the factors of success for customer loyalty are measured and visualized as KPIs. We would recommend conducting this rigorous analysis of customer relations every 1-2 years, where necessary as a supplement to an existing CEM (Customer Experience Management) NPS (Net Promoter Score) survey. The surveys can be completed by the respondents without too much of a time or a mental burden, thanks to implicit measuring methods.