Other Articles - October/November - 2015

Who’s Loyal Anyway?

You hear about customer loyalty all the time. Businesses offer “frequent buyer” programs of varying types and people have come to expect that there’ll be a loyalty program for those who make repeat purchases.

At the grocery store, at the cleaners, and at many restaurants you can just give them your cell phone number instead of carrying the plastic card and you earn credits toward some future bonus or discount.

But I think the whole business community is missing the point. Customer loyalty is something we should give, not something we should seek. It’s not about them being loyal to us. It’s about us being loyal to them. After all, they’re the ones who paid for it.

At Disneyland you know they value their annual pass-holders because there are special features and services reserved for those guests. In many hotels there’s a separate express check-in lane for repeat customers.

Why? Because they know that, over time, repeat customers will be more valuable than any single sale, so they want to show appreciation for that loyalty. That’s the point! It’s us who should be loyal to our customers, even when they don’t carry a loyalty card or member number.

Case in point: Coffee Bean & Tea Leaf (CBTL) is an international chain that’s been around since 1964. There are a few of them in and around my home in Thousand Oaks, California. I’ve been a regular at their Westlake Plaza shop since they opened over 10 years ago.

I bring friends there, hold business meet-ups there, go there to work on projects, and just generally like being there. My 60-person hiking group even goes there after our Wednesday and Sunday hikes. Yes, I said sixty people!

But the one thing that made me stay with that shop for so long was their brewed, flavored coffee: the “flavor of the day.” (That’s my deal-killer product. If you don’t offer it I’ll go somewhere else.) Maybe you’re like me: You’re very particular about your morning coffee. You have a favorite type, strength of brew, style of preparation, size of cup, and atmosphere where you can enjoy it.

Some folks say, “Good grief Jim, it’s just coffee. Lighten up.” But coffee lovers like me are spoiled when it comes to their morning brew. Even if it’s just Mrs. Olson’s good old Folgers in a porcelain mug, we want it the way we’re used to getting it.

A few weeks ago I arrived happily at the CBTL and ordered my usual: a regular flavor-of-the-day and oatmeal — $6.36. But I was informed that a “corporate decision” had been made to discontinue offering brewed, flavored coffee. “You can buy a bag of it to brew at home,” they told me. So I left.

What does this have to do with transmissions? Nobody has a rebuild-of- the-day, right? But here’s my point: I’ve been a decade-long, repeat customer who brings a substantial amount of new business to this shop. It’s an important “field office” to me and I enjoy meeting others there. But I don’t like standard coffee, nor do I like the add-syrup kind.

I know the staff at the CBTL and they know my usual order. Michelle even prepares it without prompting when she sees me arrive. But some “suit” was looking at the numbers and decided that my favorite product wasn’t an important revenue source.

So they lost my business altogether and the business of all the friends and associates I bring there. Not to mention that, by losing my coffee purchase, they also lost my oatmeal and lunch purchases… every week. All together, those total thousands of dollars every year, not to mention this critical article about them. See what I mean?

When you treat a customer in ways that indicate your loyalty to serving them, they tell others about you. They look forward to their next meeting with you. They seek you out for automotive advice and they consider you their friend. But if you wait for them to be loyal to you, none of that happens.

What’s more, when you only act like my friend as long as my checkbook is in my hand, and then ignore me or treat me like a first time stranger when I’m not buying something, it becomes clear you aren’t loyal to me. So I go elsewhere.

Action Item: How about having a conversation with your team this week about ways that you can show your loyalty to customers, whether they’re loyal to you or not? Just ask them what other businesses have done to make them feel welcome or valued. Listen to their stories. Then see what you can do to follow some of those good ideas in your own shop.

There’s a vast difference between an everyday eatery and a transmission shop — a daily sale and a one-time purchase — but the principles of business growth apply to both. When you find ways to show customers that you care about them, they’ll find ways to express their appreciation to you.

Maybe we could meet at Panera Bread or Noah’s Bagels or East Coast Bagels for some brewed, flavored coffee and oatmeal?


Jim Cathcart is a strategic advisor to ATRA and the author of Relationship Selling. His 110 short video briefings on Thrive15.com/acorn are available to ATRA members for 30 days at no charge. To contact Jim for advice or speaking engagements, go to Cathcart.com.