Customer loyalty is more than just a number
The means by which most of us measure customer loyalty is a bit flawed. Retention is up, attrition is down, and we think all is well.
With sales, it’s easier to boil performance & success down to a number. Either you closed the sale, or you didn’t. New revenue is booked and realized, or it’s not.
With retention, it’s a little fuzzier, because not every customer is alike. Yes, you may have retained 95% of customers last month. But how many of those customers are raving fans? How many are frustrated and just sitting out the rest of their contract?
Those are very different customers. One is willing to sing your praises to other current & prospective customers – helping sales and solidifying retention (and possibly success) with some of your other customers.
The less-satisfied customer, unfortunately, may be doing the opposite. Their frustration is simmering, and they’re telling others about it. They’re sharing with their colleagues, with peers and other customers via their social channels, and literally closing the door on future revenue opportunities – possibly without you knowing about it.
Our spreadsheets tell us these two customers are the same. But they clearly are not.
How are you identifying these two customers in your business? And how are you using that insight to address and improve both the less-satisfied customers, as well as the potential weak points in the product or service itself?