During a recent discussion with a valued client, I uncovered an interesting revelation. While they were delighted with their repeat business, which they attributed to customer loyalty, a closer look at the repeat business statistics painted a different picture. What I observed wasn’t a steadfast commitment from their customers; rather, it appeared to be inertia.
This prompted my realization that these customers might easily switch to a competitor if a tempting offer came along.
Now, you might be wondering, aren’t loyal customers the ones who keep coming back for more? They certainly are, but not all repeat business is a result of loyalty. In some cases, it’s due to inertia, and distinguishing between the two is what we’ll delve into today.
First, let’s establish clear definitions for customer loyalty and inertia. Loyal customers intentionally choose your product or service because they have a genuine emotional connection with your brand. They can articulate why they prefer your offering. In contrast, inertia is about automatic and habitual purchasing. It’s a decision made almost unconsciously, and individuals might struggle to explain why they chose your product.
Reflect for a moment on the people in your life to whom you feel truly loyal. Typically, you’d think of family and close friends. These are relationships rooted in deep emotional connections. Surprisingly, it’s these very emotions that underlie brand loyalty.
For many organizations, measuring loyalty can be challenging, but they often track repeat business. The issue arises when they treat other types of repeat buying – the inertial and the habitual – the same way they view loyalty, failing to distinguish between them.
In this episode, we talk about how to make this distinction. This approach separates loyal customers from those who buy out of habit or inertia. We also talk about how to develop strategies that nurture genuine customer loyalty.
Here are some other key moments in the discussion:
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02:03 We discover how Colin decided to cover this topic from his recent client meeting.
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05:29 Ryan shares his mini framework that he teaches his grad students, the three groups of repeat business motivations.
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10:19 Colin shares how he discovered that he wasn’t really as loyal to Delta Airlines as he thought he was.
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18:28 We share our list of telltale signs that you have customer loyalty.
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23:24 We discuss how extrinsic and intrinsic motivation is different and it affects customer behavior.
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26:51 We share our final thoughts about this topic and what you should take away from the conversation.
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About Colin Shaw
LinkedIn recognizes Colin Shaw as one of the ‘World’s Top 150 Business Influencers.’ As a result, he has over 294,000 followers and 78,000 subscribers to his LinkedIn newsletter ‘Why Customers Buy’. The Financial Times selected Beyond Philosophy as one of the best management consultancies for four years.
Colin is a renown keynote speaker and undertakes consultancy work and educational workshops to help organizations improve their Customer Experience.
Click here to learn more about Professor Ryan Hamilton of Emory University.
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