This post is originally published on Antavo Ecommerce Marketing Blog.
4 DIMENSIONS OF CUSTOMER LOYALTY THAT MAXIMIZE CUSTOMER RETENTION
Do you want your customers to return?
Are you disappointed when you don’t see them again?
Well, you are not alone, especially if you sell to millennials.
According to this research from Maritz Motivation Solutions, millennials tend to drop out of loyal customer groups in the first 6 months. As a comparison, the risk of exit among baby boomers usually arises after 1 year of commitment.
How can you keep customers coming back?
Does retention seem like a Gordian knot that you cannot solve? Don’t worry. You just need to optimize your current strategy. Here is how.
THE FOUR DIMENSIONS OF CUSTOMER LOYALTY
In 2015, Maritz Motivation Solutions conducted the aforementioned research, and asked 2000+ customers from millennials to baby boomers in the US about their brand loyalty. After analyzing the answers, they came up with the 4D loyalty framework that shares the four stages of customer loyalty, namely:
- inertia loyalty
- mercenary loyalty
- cult loyalty
- true loyalty
The 4D loyalty framework describes the four dimensions of customer loyalty according to customer habits, like how often they are ready to interact with your brand and what motivates customers to love you. (Source: maritzmotivation.com)
Your whole customer retention strategy is affected by which dimensions your current customers are in. Once you know where they are, you can make them go for the next level.
But what is the real meaning of these dimensions? Let’s see!
#1. CUSTOMERS ARE LOYAL TO YOU, BECAUSE THERE AREN’T ANY ALTERNATIVES
Believe or not, I’m really into comic books. And when I was little, there was one comic book store in my town. There was only a poor range of products, and only one staff member who wasn’t really helpful when you were looking for the latest issues of Spiderman. But, I didn’t have another choice, so I stuck with this one store.
This is inertia loyalty. Customers shop from you, because there are no other alternatives they can choose from. You may be the cheapest on the market, or offer a very rare product. It may sound like the ultimate utopia at first, but you should be cautious, because…
- Prices can be beaten
- Competitors can arise
See? Here customers are easily flowing in, but they can easily disappear, too. That’s why the best competitive strategy is to move past this stage, and offer your customers real value, that shows you care about them and provides you with a chance for deeper engagement.
For example, 62% of customers expect online content from brands in exchange for their loyalty. Here it’s not only how-to blog posts and tutorials that matter, but also product descriptions.
Content marketing expert, Marcus Sheridan offers an outstanding example for how you can sell pools — quite unique products — online by offering your customers real value. He focuses on creating content for his customers, like ebooks and blogposts about everything that a person may want to know about swimming pools, like how to choose the best fitting one and how to clean, build or use one.
