Customer Loyalty From The Lens Of CXM

Karim Razek

Technology is fundamentally changing the way that consumers interact with business and making purchases. If an organization is not focused on this transformation and what customer experience is at every touchpoint, they may risk losing customers and valuable opportunities to generate actual long-term consumer loyalty.

Consumers are increasingly focused on the customer experience and on an experience that is consistent, simple, and optimized with them in mind. Now more than ever, customer loyalty should be viewed through the lens of the customer experience and brand engagement should be offered by your organization and not just through loyalty programs.

Various literature defines “loyalty” with different nuances. While some stress the importance of loyalty on repeat purchases, it is important to note that not all repeat purchases are necessarily the result of loyalty. Many factors, such as customer “tie in,” physical proximity, a wider array of options, and so forth can be the reasons behind repeat purchases.

A more mundane definition simply looks at the customers who are willing to recommend your product or service to other friends, family, peers, etc. and are willing to act as references. This is the definition of loyalty we will use here.

Let’s spend a few moments to explain the various emotional connections customers may feel towards a brand or product.

emotional connections customers may feel toward a brand

Apostles include customers who are extremely satisfied and loyal to the company. They are more than willing to share their brand loyalty with others. This segment has had a very positive experience and is willing to recommend the product/service to others

Near apostles are very satisfied but aren’t as willing to share their enthusiasm with others. They have experienced some shortcomings in one or more of the key touchpoints in the journey.

Mercenaries are low-commitment customers who will immediately switch brands if a better price or experience is offered.

Hostages emerge when companies measure the success of their CX strategy by the amount of repeat business customers generate. This does not necessarily mean that those customers are loyal, but it could mean that a particular segment is tied into your brand because of technology or some other switching costs.

Rebels are very dissatisfied and non-committed customers who damage the company with negative word-of-mouth advertising. They have most likely had a very negative experience which was not addressed in a timely manner.

Given the critical role that consumer experience and engagement play in bolstering customer loyalty, taking steps to improve your business in these areas is key to winning long-term and repeat customers. Unsurprisingly, technological innovations are at the forefront of improving customer experience and engagement for many companies, from cognitive marketing to social media, to machine learning and artificial intelligence, to the Internet of things (IoT), and more. And a superior customer experience can ensure a paradigm shift from Rebels to Apostles.

For more on this topic, read “Is Experience Management Exclusive To Consumers?

Karim Razek

About Karim Razek

Karim Razek is the Business Enterprise Principal Consultant at the Qatar office at SAP. He is responsible for the development and alignment of SAP clients’ business processes, customer experience, and IT strategy to help meet their enterprise strategic goals. Karim is a certified Six Sigma Black Belt from Quality America, Global Business Transformation Manager, and Enterprise Architect EA200. He also holds an MBA from Maastricht University and specializes business process analysis and advanced discreet process simulation techniques. Other areas of expertise include customer journey management, strategy development, business process management, and business process engineering.