Here are some numbers dealing with customer loyalty. It has been proven that organizations with high levels of loyal customers typically grow sales at 2X the rate of their competition. It costs 5 times as much to get a new customer than to keep an existing customer. The most effective and least expensive form of adverting is word-of-mouth. An organization with disloyal customers will typically spend 4 to 5 times more in advertising to get additional customers. Loyal customers will be less likely to be swayed by discount pricing and other incentives offered by the competition. They are generally willing to pay more and are more forgiving if there is a mistake. 6 out of 10 customers will never return when they experience bad service. They won’t complain, they just won’t come back. The ultimate question to measure customer loyalty is, “How likely is it that you would recommend our organization, products and services to a friend or colleague?” Get your customers to answer this question on a scale of 1-10. It has been shown that there is a direct and strategic correlation between an organization’s revenue growth and this customer loyalty score.

Action Step for This Week

Develop a way to measure customer loyalty in your organization. Add up how much customers spend. What get’s measured, get’s focused on and has the best chance of being improved. Develop a questionnaire with the key question. “How likely is it that you would recommend our organization, products and services to a friend or colleague?” Poll your clients via email, phone calls or postcards. Listen, listen, listen. Summarize and share the information throughout the organization. Make this an on-going strategic policy.

Jeri Quinn

Jeri Quinn from Driving Improved Results is an executive coach, management consultant, speaker and author who focuses on communication in her work with executives and companies. She is the author of The Customer Loyalty Playbook, 12 Game Strategies to Drive Improved Results in Your Business. With more than 40 years as a serial entrepreneur.

Quinn has worked with executives and teams in over 40 industries, spoken at major business expos including New York City’s Javits Center, facilitated business development and extraordinary customer service at institutions such as MoMA and AIG, and has partnered with New York City, The Kauffman Foundation, Citibank, Merrill Lynch, HSBC, and Signature Bank to educate their clients.


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