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The 5 Reasons Customers Aren’t Being Loyal to Your Brand

This article examines the 5 major reasons why customers might be more inclined to seek out competitors.

January 28, 2015 by Kevin

For many sales professionals the concept of brand loyalty seems to have taken a seat on the backburner. Defining the core issues that underlie a decay in brand trust can be difficult, especially when markets emerge and disappear sometimes overnight on the web. In a recent Ernst & Young survey covering 34 different U.S. markets, a brand’s status or reputation impacted only 1 in 4 Americans in 2012.

 This significant shift away from brand loyalty begs a significant question:

 What psychological changes are distancing buyers from the brands they previously adhered to?

As consumers have become more empowered, they have also become more difficult to please, often with missteps on the part of the brand leading to silent dissolution of their client base.

Even with all the potential reasons to be disloyal to a brand, Neilson research recently found that there are only five areas that truly cause a customer to switch. By paying attention to these metrics, you have a much better chance of building a loyal customer base that will stick with you even when times get tough.

Price

It may seem cliché, but price almost always is the linchpin for loyalty. On average, 40% of global respondents to the Neilson survey said that price is the biggest attribute that would cause them to switch service. This means that price is a key element in keeping the loyalty of the customers that you already have.

 In order to help your customers fight the temptation to jump on board the “cheap” train, you need to be providing them with more than just a good deal. You need to be creating a buying experience that is regularly rewarding, positive, and makes them feel that they are a part of something bigger.

Quality

After price, quality is the next major deal-breaker for most loyal customers. Neilson reports that 26% of consumers would switch due to perceived quality issues in their products. Additionally, a report from the Croatian Marketing Association discovered that consumers of snack food products were more likely to be disloyal to brands that had poor quality control than almost any other reason.

 The necessity of high quality goods that meet or exceed consumers’ expectations is a key requirement for keeping them loyal to your brand. But, no one can be perfect all the time. That’s why it’s vital to cultivate a reputation for high quality, even in the face of missteps.

Customer Service

Customer service issues are the next major reason why consumers make the switch. A recent survey from the Quality Texas Foundation showed that turning a dissatisfied customer to a satisfied customer increases loyalty by 50%. That can lead to an increase of ROI by up to 80% over the lifetime of the customer.

 Of course, satisfaction is no longer the goal to maintain a loyal brand following. Forbes suggests that businesses need to create brand ambassadors, not just consumers. The idea is that customers need to come away from an experience with your company feeling like they were genuinely cared about, and that they had an experience worth sharing with their friends and colleagues. This requires a reevaluation of your customer-sales relationship, starting with the idea of customers as people, not just potential income.

Benefits/Features

One of the main tactics for keeping loyalty high and prices low has been through the inception of the customer loyalty program. Unfortunately, Entrepreneur reports that 77% of these programs fail to keep the loyalty of their customers. The problem? Organizations often don’t offer the kind of emotional incentive necessary to outweigh the benefits of a lower price.

It’s vital to see your organization from a customer’s point of view, especially when it comes to defining the value of being a loyal customer. If your loyal customers don’t have a significant set of regular benefits (not just an end-of-the-year dividend), there is no real reason for them to remain with you.

Management

As a customer, there is almost nothing more frustrating than a good company with a good product who can’t seem to get it to you. Reasons for these problems range from communication errors between sales and production to lack of inventory. No matter what the purpose, making mistakes in orders and improper management of information is a great way to force good customers into the arms of the competition.

One of the best ways to overcome this issue is by revamping your communication model, or by incorporating a customer relationship management (CRM) system into your business. A CRM can be integrated onto many mobile platforms, making it easier for sales and production teams to communicate seamlessly while handling an order. The researchers at Nucleus estimate that sales productivity with this type of mobile CRM integration can increase by over 25%.

Not only can a CRM increase sales productivity, but it can streamline many of your processes to make shipping quicker and information more accessible to the various parts of your organization. And, when customers are getting the right goods, right away, they are more likely to continue buying with you instead of your next-door neighbor.

What Do You Think?

There are many reasons why customers tend to go astray. What is your experience with customer loyalty? Have you seen any trends that you’d like to share? Tell us how you’re handing the loyalty discussion in your organization by leaving a comment in the field below!

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