Get Them to “Feel the Love” – Customer Emotional Needs Generate Customer Loyalty

Customer-Emotional-Needs-Customer-Loyalty

A very nice article here, Mr. Lieu – like versus love is an excellent analogy.  The difference between like and love is found in their emotional foundations.

We have found that in order to create loyalty in a customer, three things must happen.  First, you must satisfy the customer’s practical product-related need.  Second, you must meet the customer’s emotional need tied to that practical need.  Third, you must create a perceived Low-Effort Experience for the customer.

A customer whose emotional need is not met may end up satisfied as a result of the experience (like) but not necessarily loyal to your company, product or brand (love).  Companies that focus more time, energy and resources on meeting their customers’ emotional needs are more successful in generating loyalty in their customer bases.

Original Business to Community Blog Post Below:

Customer Satisfaction and Customer Loyalty: It’s Like “Like vs. Love” By: Hansen Lieu

Customer-Loyalty-Brand-Loyalty-Customer-Emotions-Emotional-Needs Are you customers satisfied? That’s good, right? Well, yes for the short term.  But in the long term, it’s not necessarily enough.

 Even among many business leaders and managers, it is common to equate customer satisfaction to customer loyalty – they sound similar,  right? But while a loyal customer is a satisfied customer, the converse is not necessarily true. And many organizations are measuring  customer sat while leaving customer loyalty to the side – a dangerous practice.   It’s really pretty simple.  Is it “Like” (no pun intended for  Facebook) or is it “Love”?

Customer satisfaction is a far more tactical concept and measurement than true customer loyalty.  Customer satisfaction speaks only to one  moment in time—typically, right after a customer has completed an interaction such as a purchase or has a problem solved.  Usually, a  customer will be satisfied if her expectation has been met.  So measuring customer satisfaction merely tells you if you are doing your job, in  the perspective of the customer.  Many organizations should be performing up to their customers’ expectations.  This is really just the  basics.   While these days consumers are in the driver’s seat, the mindset tends toward “what have you done for me lately?” as opposed to  “that transaction went well so I’m a customer for life.”  Thus, good customer satisfaction does not guarantee that you will continue to keep those customers.

A much more reliable and strategic measure is customer loyalty.  True loyalty – much harder to earn than mere satisfaction – tells you that your customer wants to stick with you over the long haul and will share that feeling with others.  Loyalty derives not from hum-drum “good” transactions but from exceeding the customer’s expectations on a repeated basis. It is the delightful experiences that make someone – emotionally devoted to you - want to tell others.

The Net Promoter Score (NPS) question, developed by Satmatrix, “would you recommend us to your friends and neighbors?” gets to the heart of loyalty.  If your customers are really happy and loyal, they will recommend you.  If their feeling is not that strong, they will not want to go out on a limb (i.e., on Facebook or other community) and make a recommendation that later turns out to be a dud.  So, to meet and maintain the threshold of “net promoter” is what companies should strive for in the long run.

Roger Hallowell’s seminal 1996 Harvard Business School study concluded that customer satisfaction is a necessary but not sufficient pre-condition for customer loyalty, which strongly relates to profitability. Though no more authoritative research has been done in the intervening years, it is widely accepted that loyalty drives profitability to at least some degree. It is critical, therefore, to track loyalty via a score like NPS or other similar ones over the long haul. The loyalty measurement will give you a much more accurate picture of how you’re doing vs. your peers.

So, yes it’s good that you measure and track customer satisfaction.  It gives you the feedback so you can make the necessary adjustments in the short term.   However, don’t stop there.  You’ll need to find out if your customers are truly loyal.  Because in the long term, customer loyalty is what really matters.  A loyal customer is worth recurring revenue, while a satisfied customer is worth, well – maybe that last purchase transaction that probably net you zero margin.



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About Jack Dempsey

Jack Dempsey, CEO, heads Pretium Solutions’ Customer Experience & Sales Area focusing on Customer Loyalty, Brand Loyalty and Customer Retention Strategies. He directs Pretium’s revolutionary customer loyalty program, the Golden Touchpoint™. Pretium Solutions is a premier provider of cutting-edge, sustainable and globally-recognized customer experience management solutions and customer service, call center and sales training, consulting and leadership programs. Pretium shows companies how to create, build and maintain customer loyalty, the most important measure of a company’s success with its customers and the most profitable customer service outcome.

2 Responses to “Get Them to “Feel the Love” – Customer Emotional Needs Generate Customer Loyalty”

  1. Quest October 23, 2011 at 6:24 am #

    How do you make your front staff love the customer and job if you cannot afford to pay them well nor promote them?

    • Pretium Solutions October 26, 2011 at 1:04 am #

      This is a great question. “Make” in this context is a strong word – I’m not certain that it’s either feasible or reasonable for you to make someone on you front-line staff do anything they don’t want to do. That stated, however, you can set expectations and then manage to those expectations.

      Based on the latest research, we know that customer loyalty is the greatest predictor of company profitability. Therefore, the goal of exceptional customer service is (or at least should be) to create loyalty. As a leader, manager or supervisor, I cannot force someone on my team to “love” our customers. That is just not within my control. What I can do (i.e. what is within my control) is to equip them with the tools and skills to meet the customer’s practical and emotional needs and to create a low-effort experience for the customer.

      It has been our experience that when an organization’s front-line staff has the tools and skills to effectively and efficiently create the above three outcomes for customers, the staff derives more enjoyment from their work, regardless of compensation. Their job becomes easier, and their job satisfaction increases because they know how to control and lead the customer interaction much more effectively.

      Your question compels me to wonder what type of leadership is in place inside your organization. Is the leadership high quality? Do they focus on what they want, not on what they don’t want? Does the leadership appreciate and reward performance, or is performance punished?

      We often come across company managers who tend to “punish” performers, most often without even realizing it. Giving a high performer on the staff more to do and expecting more out of her than a lower-performing colleague can often discourage the high performer. This kind of unequal expectation can lead to situations where the higher performer feels punished insofar as the lower performer is allowed to “get away with” a lower level of performance.

      Although your question is fairly straightforward and simple, the solution could be complex depending on all of the relevant facts and circumstances. I would love to discuss this further with you.

      Jack

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