7 sales rules of customer loyalty economics

Customer loyalty economics

The next 12 months should turnout to be an interesting time in the world of business.  Most nonpartisan economists predict we will emerge from the gloom and doom to experience more positive growth.  If the economic forecasters are right, and we think they are, then it is a good time to revisit how we can leverage this positive development from a sales perspective.

In this regard Bain published an interesting article that is worth revisiting.  The authors explored what it takes to win the customer experience.  One particularly interesting discussion was about customer loyalty economics.  Let’s take a look at what they were talking about and explore what it means for Sales.

The authors noted: “The logic that connects customer experience to bottom-line results is simple. If people love doing business with you, they become Promoters. They’re less likely to defect. They buy more products and services over time. They sing your praises to friends, colleagues and complete strangers. They cost less to serve, and they provide constructive feedback. All of these behaviors have direct, quantifiable economic benefits.”

The bottom line – it makes sense to figure out how one can go about creating customers that look like Bain’s Promoters.  Clearly it requires a comprehensive effort.  It is not only about how you sell but also about what you do after the sale in terms of delivery and implementation.

Let’s take a look at this challenge just from the sales angle. Let’s begin at the beginning and look at some of the fundamentals for building customer relationships that are required for establishing the foundation for creating customers who are Promoters:

  • If you don’t know don’t pretend.
  • Do what you say you are going to do.
  • If you make a mistake take responsibility – and avoid repeating it.
  • Get on the customer’s side of the table – know what matters.
  • Help the customer arrive at a better definition of the problem.
  • Understand the difference between persuasion and manipulation.
  • Use imagination and innovation for crafting your solution.

Most winners don’t win by creating selling opportunities – they simply leverage the sales that occur.  The next several years will likely produce a fair share of selling opportunities.  Understanding the sales dynamics of customer loyalty is an important piece of the puzzle for leveraging those experiences.

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About Richard Ruff

For more than 30 years Dr. Richard Ruff and Dr. Janet Spirer - the founders of Sales Horizons - have worked with the Fortune 1000 - such as UPS, Canon USA, Smith & Nephew, Boston Scientific, Owens & Minor, Textron - to design and develop sales training programs. During his career Dick has authored numerous articles related to sales effectiveness and co-authored "Managing Major Sales", a book about sales management, "Parlez-Vous Business" which helps sales people integrate the language of business into the sales process, and "Getting Partnering Right" – a research based work on the best practices for forming strategic selling alliances. Dr. Ruff received his Ph.D. in Organizational Psychology from the University of Tennessee and a B.S. from Rennsselaer Polytechnic Institute.
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