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Loyalty Hit or Myth

Posted on July 13, 2007 by Sarah Eaton.

We all have our ideas about customer loyalty--many which turn out to just not be true.  This week we review the summary of "Loyalty Myths" by Timothy L. Keiningham Terry G. Vavra, Lerzan Aksoy and Henri Wallard.

Emily DeMarco

“Loyalty Myths” provides the reader with a whopping 53 myths about customer loyalty, only to wrap it up in just seven ways manage loyalty right.  The last line, “Each dollar appropriately invested in nurturing customer loyalty will pay substantial rewards in the future,” expresses that customer loyalty is a profitable thing, yet the whole summary focuses on how loyalty can be unprofitable. 
Maybe I’m in the minority, but I buy most of my purchases according to which companies I’m loyal.  My groceries come from Jewel not Dominick’s.  My french fries come from McDonalds not Burger King.  My purses from Coach not Louis Vuitton.  I think this summary would be much more helpful if it had 53 ways to improve loyalty efforts and only seven reasons why it doesn’t matter.

Kathryn Regina

“Loyalty Myths” should probably be named “Loyalty Assumptions,” since most of these 53 “myths” are not shared sayings at all. The exceptions are “Myth 1: The Number One Goal of Any Firm Should Be Customer Loyalty” and “Myth 8: It Costs Five Times More to Acquire a New Customer Than to Retain a Current Customer.” The authors wisely point out that “The fundamental purpose of any business is to identify and satisfy customer needs at a profit” and that acquisition and retention costs are far too complex and differentiated to be represented by one statistic.

Brian Pinkley

Across the globe, businesses spend billions of dollars a year in attempt to hold onto their current customers to gain a sense of loyalty.  However, this sometimes overzealous spending backfires since most CEOs follow old myths about customer loyalty. “Loyalty Myths” offers insight into ways in which companies make mistakes in the process of gaining the trust of customers.  The authors of this book challenge business leaders to think beyond what they have heard has worked to keep customers coming back and shows them what really works.  One myth I found interesting was the notion that companies “know their customers”--most companies do not know their customers as well as they think due to a lack of communication and feedback. 

Vanessa Day

In and out of the work place, loyalty is a big factor in any relationship. It seems to be common sense to nurture customer relations in order to be successful and maintain loyalty. So after reading the 53 myths about loyalty, I was a little surprised by some of the information. What interested me most was that good customer service doesn’t mean that customer loyalty will grow. I always felt that if employees provided great customer service, people were more likely to stick with that company. But, even if you are the most helpful person, the product may not be the best quality item. It’s not the size of your smile; it’s whether or not your product is better than the other guys’. That is truly what keeps customers coming back.

Jeff Sanchez

Loyalty Myths puts the truth behind hype of business strategies focusing on customer loyalty. Going through the exhausting 53 myths (which many could have been cut and combined) I had a mix of thinking “pretty obvious” and “huh?” A few of them combined the actual myth and reality in a confusing manner, when I felt a clear “Myth” and “Truth” layout should have been adopted to skim easier. A few of the myths such as “Firms Should Emphasize Retention Efforts Rather Than Acquisition Activities” shed some light on best practices for the specific strategy . In fact, I found the “Loyalty Myths That Subvert Company Goals” most effective.

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July 13, 2007 in Brand enhancement, Building Customer Intuition, Corporate newsletter, Educating Clients, email tracking, Freelance newsletter, how to publish and promote online, how to write a newsletter, Interactive Marketing, Newsletter complete outsourcing, newsletter layout, Newsletter ROI, Newsletter solution, outsource magazine, prospect newsletter, sample newsletter, self publish, Thought leadership newsletter, writing magazine | Permalink

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