The majority of businesses do not fully get what it takes to maintain a customer. Noah Fleming is one of them. He has worked with hundreds of firms and thousands of people since 2005.
More significantly, he understands how to adapt current initiatives and approaches to your company.
The Customer Loyalty Loop examines the psychology of customer experience and how you may persuade your customers to do business with you repeatedly.
Background of the Brain
There are a variety of cognitive biases that influence how we rationalize, analyze, and interpret data.
Anchoring bias is the first.
When a single number or information establishes the context of a given point, this is known as anchoring. This is seen in advertisements that state, "Normally, this sells for $89, but today only, it's $15!" The initial price, $89, serves as a baseline.
The availability bias is another prejudice.
This indicates that if we have easy access to something, we are more likely to affect our story. For example, suppose an aircraft accident is widely reported on the news. In that case, we give it additional weight and relevance in our minds.
Risk aversion is a third cognitive bias.
When we utilize fear of loss as a source of motivation, we will go to any length to avoid a perceived risk. Of fact, several other biases influence our thinking.
Critical, reasonable, logical thinking takes a lot of effort, and our brains don't like to put in that kind of effort. Our perceptions and narratives are founded on biases that drive us to make simpler and easier decisions to make.
When it comes to memories, our brain is likewise untrustworthy. Stories we hear, emotions we experience, and frames we put on them may affect our memory.
Businesses should concentrate on establishing the proper customer memory, which begins long before the transaction is completed and continues as the consumer transacts with you.
The Customer Loyalty Loop
The Customer Loyalty Loop is divided into four stages:
- Imagination Before Persuasion: the start of the customer experience
- Conversion Without Coercion: making a sale
- Experience Choreography: procuring of deliverables or billing
- Happily Ever After: future email marketing
This isn't a closed loop, by the way. It's a circle, so the client starts over at stage one and repeats the process at step four.
Each stage is critical. The client experience is the total of the four stages, and you must concentrate on each of them. Let's take a look at each step one by one.
Stage One: Imagination Before Persuasion
People are the same individual, only at various phases of the process; thus, categorizing them as new customers and old customers is a false distinction.
You must grasp the psychology of the latest customer experience if you want to take your business to the next level.
Nothing is more vital than genuinely understanding your consumers so you can market to them directly if you want to succeed in Stage One. Make a thorough account of your ideal consumer.
Include as many details as possible, such as the vehicle they drive, the meals they consume, and their clothing.
Only if you know exactly what you're seeking can you discover nice customers.
The customer experience must be memorable, personal, and impactful. Small touches like complimentary incentives, individualized attention, and follow-ups may boost client satisfaction and loyalty substantially.
The Customer Loyalty Loop begins long before a transaction is completed when a prospect is first exposed to your sales, marketing, and advertising activities.
The key to Stage One? Figure out how to convey your story in a way that creates a good narrative in the minds of potential customers and keeps them interested in you and your company.
Pre-emptive marketing — everything that happens before the sale – is one method to achieve this.
Long before your rivals have a chance to impact your potential consumer, pre-emptive marketing is about creating trust, relationships, and a story. It allows you to be the first to tell them a tale.
The most crucial aspect of gaining a lifelong client is recording the customer's interaction with you. And, as we've seen, memories are notoriously untrustworthy. As you learn about the stages that follow, keep this in mind.
Stage Two: Conversion Not Coercion
Stage two is all for maintaining your prospects' confidence and converting them into customers. You may also raise their future expectations by providing an unforgettable experience every step of the way.
A customer is both the most expensive and the most important item a company can obtain. A company must regard the sales process as an important element of the customer experience to be successful.
Examine the specifics of your client's experience and look for any discrepancies affecting the consumer. Then repair them so that your consumer has a pleasant experience.
This stage of the sales process will be remembered depending on the overall experience—from beginning to end. Make it clear to your prospect that you are looking out for their best interests and want to fulfill and enhance their situation.
Make your consumers feel valued, important, and listened to by using language that makes them feel valued, important, and listened to.
You'll perform well if you keep your attention on the possibility. Test and enhance your strategies regularly. Put your sales effort to the test.
Include any helpful information to solidify your position as the customer's go-to source for all of their requirements. Make a note of your current operational processes and come up with fresh ideas. Test and try one more time. Continue to earn and keep your customer's confidence.
They're interested as they move from Stage One to Stage Two, but they're still uncertain about continuing further. Here, you want to build as much trust as possible while removing as much resistance as feasible.
Recognize their opposition and add value to the consumer. To provide your prospects 100 percent confidence and assurance in their decision-making process, offer a guarantee.
Stage Three: Experience Choreography
At this point, the client has been persuaded to finalize the deal. They now expect you to follow through on the promises you made before.
The most effective thing you can do is generate memorable recollections of doing business with your organization.
Remarkable Moments are those that make an indelible impression on your customers' minds.
Remember that developing a pleasant memory is the most crucial aspect of creating a Customer Loyalty Loop.
Remarkable Moments are one-of-a-kind, intriguing encounters that set your organization apart from the competition. It will lead to a pleasant and trustworthy connection between you and your consumer.
Consider the finest and most memorable encounters you've had with other businesses to help you build your own Remarkable Moments. Then, for your own clients, create your own Remarkable Moments.
Small touches that make your consumers feel valued and cared for will surprise and amaze them. Consider the product packaging, the suggestions, the environment, and the website.
Are your clients greeted and welcomed promptly? Are you doing anything to make them feel at ease as they browse?
Don't assume that once you have the consumer, the transaction is complete. If you can please your customers and generate Remarkable Moments, they are more inclined to recommend your business to others.
Stage Four: Happily Ever After
A consumer who has just completed a favorable transaction with you is more inclined to do so again.
And the more frequently a client transacts with you, the more likely they will repeat their behavior. Increase your customers' desire to participate, and you'll be well on your way to closing the Customer Loyalty Loop.
Both your customer follow-up processes and procedures rely heavily on being current. If you contact a consumer shortly after doing business with them, they are more likely to reply positively.
The cornerstones to Stage Four are familiarity and consistency since this creates the ideal atmosphere for word of mouth and recommendations.
Follow the 90-45 rule to do this.
According to this guideline, no client should spend more than 90 days without receiving at least a 15-minute phone call, and the top 10% of customers should receive at least 45 days of follow-up.
The statistics may vary based on your industry. Still, the key point is to maintain a relationship with your existing consumers. The more you communicate with them, the more money you'll make for your firm.
The Pick-3 Process is one approach to allocate particular Loyalty Loop-related activities.
You and your team will complete three easy activities linked to the Customer Loyalty Loop throughout this process:
- contacting three of your most valuable customers and clients
- giving out three handwritten notes
- contacting three inactive customers
- obtaining three testimonials from current customers
- keeping touch with three new customers
...or anything else that contributes to a customer's existing experience.
Customer loyalty is based on a sense of belonging. Develop a relationship with your clients to demonstrate that you care about them beyond simply when they pay you.
Maintain the relationship by being top of mind, providing value, and only pitching when appropriate.
Invest significantly in your present customers to provide them a memorable customer experience instead of focusing the bulk of your time, energy, and resources on acquiring new consumers.
You'll expand your company, get a competitive advantage, and generate significant profit returns.