Beyond Customer Loyalty Programs: 7 Ways To Build Lasting Relationships

Business is about building lasting relationships, not bribery. So what does this mean for the future of customer service?

Businesses talk a lot about customer loyalty. It makes sense: A person you can count on to buy from you again and again is more valuable than one who disappears after the first transaction.

But for many businesses, building customer loyalty means creating loyalty programs that reward repeat behavior. Buy our coffee 10 times and your 11th cup is free. But are your customers loyal because they want that free cup of Joe, or are they loyal because they truly enjoy your product and their interactions with you?

Companies need to face the new realities of the customer economy. Customer relationships matter more than ever, because your future revenue depends on those relationships lasting well beyond a single transaction.

In addition, the voice of the customer has never been louder; your customers have the power to bring you more business--or drive it away--via recommendations or rants that are amplified by social channels like Yelp.

Customer service interactions are becoming your primary means of creating true customer relationships. To be a successful business today, you must understand how relationships actually work, and how to build them. While the ways in which you do this may be specific to your business, here are some fundamentals about relationship-building that are universal:

1. Don’t overestimate your importance in the customer's life

You are not the center of the universe; you must listen to and consider the other person. The same is true of your organization. A person is not your customer, even when they're buying your product. It is a privilege for you to be in their life, not the other way around.

2. Consider the entire customer experience

Organizations, unlike people, tend to have terrible memories. The customer who buys a product in your store is the same one who writes in when that product breaks. Those two moments are connected, and you must recognize this.

3. Recognize the right relationships and adapt

Not everyone you meet will be your best friend. Some people are great dinner party guests, some are lifelong friends, and others just get a wave when you see them in the neighborhood. The goal is to have the right relationship with each individual. This requires becoming skilled at reading people. Figure out how to accept and improve the relationships you have, and say “no” when a relationship is unhealthy.

4. Be something actual humans can relate to

Given the choice between a faceless monolith and an organization that communicates directly and simply, consumers will always choose the latter. It is not just okay for your organization to have personality, it is vital. When there is an incredible amount of choice in the market, personality helps people identify which organizations they want to interact with.

5. Be transparent

People relate to organizations that are open and honest. Give your customer the information you have--good or bad. We are fighting against years of people feeling like companies are somehow screwing them over with hidden pricing and confusing return policies. The only way to establish trust and loyalty is to show your cards.

6. Empower your people to do what’s best

Allow and encourage your employees to act like people. We have been training customer service reps to act like machines--fake smiles, scripts, compulsory "have a nice days.” Little mistakes or inefficiencies will inevitably occur when you allow people to make their own decisions, but the business can embrace these as the very things that make the business easier to relate to.

7. Put a face to your customers

Your customer relationships are easy to ignore when they're the sole responsibility of your sales or support people. When you can put a face on the person who is truly frustrated, your employees realize that this could just as well be their neighbor. Make customer relationships a shared responsibility for your entire organization.

Relationships are not easy. Some will say that relationships can and should be managed. They will give you acronyms that promise to solve all your relationship troubles. But unfortunately, in business, as in life, relationships cannot be managed.

And while a business-customer relationship is not the same as a personal one, all relationships are personal on some level. When a person buys a product, they are buying the product of a group of people; when they email the organization, it is a person who responds; and when they decide whether to return to an organization again, they are one person making a decision.

Focus on that person.

--Mikkel Svane is the founder and CEO of Zendesk, a provider of cloud-based customer service software that is used by 40,000 organizations to provide support to more than 300 million people worldwide.

[Image: Flickr user Ivan Febri]

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4 Comments

  • Very insightful and accurate - Fast Company rarely delivers anything less.

    Our agency has been utilizing automated marketing and lead nurturing for our clients' loyalty programs for months. It helps immensely with strategy and reduces much of the lead time for relevant communication with behavioral triggers. I would strongly suggest for companies looking to go deeper in loyalty programs.

  • Love it! This article mirrors my thoughts exactly!

    Am currently trying to write a brand strategy for an app that my team and I are developing, which is based on customer loyalty going beyond the traditional definition of a loyalty program. Fingers crossed it works out!

    Follow me on Twitter- more info will be up once we are ready! :) @SophieSyed

  • Mark Quittner

    A very refreshing read. Here in Australia the marketing guru's are in full swing telling us to use scripts and manipulate customers for increased sales. Australians have always been wary of such techniques and the current back lash against out sourced call centre and front desk robotic responses is growing. Unfortunately, many companies here are ramping up the problem and the divide between business and good customer service is widening.

    The seven points outlaid in the article should alert everyone to a better scenario, and may just provide the competitive early advantage if adopted. Cheers, Mark Quittner MrPhysio+ Healesville Australia