Keep Your Customers

Ali Cudby graduated from the Wharton School and joined The New York Times Company's corporate planning group. She then left to work as director of marketing for Discovery's Animal Planet, and then to start her own business advisory companies, Fab Foundations, specializing in customer experiences training, and Your Iconic Brand, which helps business leaders improve customer retention. She is the author of two bestsellers, Busted and Fit My Bras. Ali Cudby currently teaches at Purdue University's Center for Entrepreneurship, and is also in demand as a workshop facilitator and keynote speaker.

You can't just assume happy customers will buy from you again. Instead, you need to have consistent systems in place which will cultivate long-term customer loyalty and repeat business. You need a good customer loyalty program.

To cultivate loyalty across your organization, you have to clarify:

• WHY loyalty matters
• HOW to target loyal customers
• WHAT you need to do to enhance loyalty
• WHO will be responsible for customer loyalty
• WHERE you put it all together

1. WHY loyalty matters. Pure and simple, customer loyalty is lucrative. If you can increase your customer retention, long-term customers will refer additional business to you, buy more of your products, and cost less than new customers. Loyalty boosts your competitive advantages and generates superior financial returns.

2. HOW to target loyal customers. Your plan for keeping customers loyal should start with digging into the subset of your current customers who have the greatest potential for loyalty. Discover who your most loyal customers currently are, and where to find them, and how to engage them. These are your first steps to building more loyalty

3. WHAT you need to do to enhance loyalty. Once you have the right strategy in mind — target more of your most lucrative loyals — you can then focus on applying the right tactics. The overall aim of these tactics will be to create a vibrant customer relationship with your most lucrative loyals.

4. WHO will be responsible for customer loyalty. To drive greater customer loyalty, you're going to need internal coordination and highly engaged employees. Make sure your company culture is designed around loyalty, and that you track and measure the right data. You also need someone to champion and drive your loyalty initiatives.

5. WHERE you put it all together. Develop a written tactical plan for how you can make loyalty your everyday reality inside your company. This action plan should be designed to get your team members more engaged with your customer loyalty initiative. The loyalty plan is where you bring together everything you will need.

1. The Harvard Business Review found it's twenty-times more expensive to keep generating new customers than it costs to retain the customers you already have. Customer loyalty is lucrative, yet very few companies do it well or even systematically.
2. Business consultants Bain & Company did research which shows when companies increase their customer retention rate by 5 percent, they see an increase in profits in the range of 25- to 95-percent. If you don't have a systematic customer loyalty program in place, you're leaving money on the table.
3. The key to customer retention is to form genuine emotional connections with your customers. As author Ali Cudby notes, "Emotional connection allows you to develop customers who stay with you longer, buy more, and refer new customers. Now is the time to keep your customers."

Whether you realize it or not, only about 20 percent of your current customers generate 80 percent of your business's profits. Wouldn't it be awesome to have more profitable customers? The Harvard Business Review found it costs twenty-five times more for companies to secure new customers than it costs to retain existing customers and make them happy. Customer experiences guru Ali Cudby suggests the very best way to grow your business is to turn more of your current customers into "lucrative loyals" who will buy from you again and again.

I thought the basic premise of this book makes sense. Loyalty matters. What I liked is Ali Cudby suggests a very practical and down-to-earth methodology for cultivating and amplifying loyalty. It involves just five steps:

1. Make emotional connections with your customers

2. Set clear loyalty goals for your team or organization

3. Take measurable steps to grow loyalty

4. Use tracking and metrics to gauge your progress

5. Include customer celebrations to inject buzz into what you're doing.

I like it. Making customer loyalty something you build systematically sounds great. Great book. Interesting ideas, worth applying.