What Exactly Is Customer Loyalty?

First, do you mean loyalty to the customer or from the customer?

Published: Monday, January 18, 2016 - 17:36

When people at your company think about “customer loyalty,” are they thinking about your customers’ likelihood to recommend, likelihood to repurchase, or likelihood to purchase additional products? How does your company define customer loyalty?

Recently I experienced a situation that caused me to call on a provider to whom I’ve paid thousands and thousands of dollars via monthly premiums for more than 20 years. I had never filed a claim until six weeks ago. It’s not been a good customer experience since that day.

In conversations I’ve had with family and friends about this incident, they’ve questioned customer loyalty. What does it mean? What does it really get you? Is that loyalty about being a long-term customer and receiving an experience that befits a 20-year relationship, or is that loyalty about them wanting you to be customer forever, at any or all costs?

In other words, which side defines customer loyalty?

Why do I ask? Because typically after incidents like the one I had, companies drop their customers, regardless of said loyalty. Where’s the loyalty in that, for either one of us? (Because, hey, maybe I’ll drop them first!)

So, again, is loyalty about an individual being a long-term customer, or is loyalty about a company appreciating the fact that they’ve had a customer for a long time?

See the difference? Is the onus on the customer or on the company? Is it about them, or is it about us? Whose loyalty? Are you doing great things for your customers? Or are you expecting customers to do great things with and for you? There’s a big difference, yet shouldn’t they go hand-in-hand?

Maybe there’s a better way to make this point, but when you talk about customer loyalty in your day-to-day role within your organization, do you mean loyalty to the customer or from the customer? That’s the real question (and I believe I know the answer).

“We see our customers as invited guests to a party, and we are the hosts. It’s our job every day to make every important aspect of the customer experience a little bit better.”
—Jeff Bezos

First published Dec. 24, 2015, on the CX Journey blog.

About The Author

Annette Franz

Annette Franz, CCXP is founder and CEO of CX Journey Inc. She’s got 25 years of experience in both helping companies understand their employees and customers and identifying what drives retention, satisfaction, engagement, and the overall experience – so that, together, we can design a better experience for all constituents. She's an author (she wrote the book on customer understanding!), a speaker, and a customer experience thought leader and influencer. She serves as Vice Chairwoman on the Board of Directors of the Customer Experience Professionals Association (CXPA), is an official member of the Forbes Coaches Council, and is an Advisory Board member for CX@Rutgers.