What Makes Customers Loyal?

Recognition of their ideas and problems.
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Listening to Customer Feedback

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We often hear stories about organizations who go above and beyond to exceed customer expectations. From accepting a return at a department store that didn’t even sell tires to simply providing unexpected cookies, we see stories shared across the country that become unforgettable in people’s minds. These moments happen because an organization exceeded customer expectations. When we are able to do this, we create reputations that attract more customers and talented workers.

Customer service in some form is usually a core value or principle for most organizations. Whether the primary focus is to provide a service, like in education, or to sell a product, customers expect to have a good experience and additional support when needed. Service is a differentiator between an organization and its competitors, again, whether price is a factor or not. To be an organization that generates and retains loyal customers, we place a high value on service. As a result, we listen to customer feedback and analyze that information for opportunities for improvement. We can’t improve what we can’t understand, therefore we listen.

improve with customer input

Brands that have a reputation for delivering an exceptional customer experience are continuously looking for opportunities to better understand that experience and anticipate their customer’s needs. Listening to customers and involving them in brand decisions allows an organization to gain a different perspective about the experience and uncover valuable blind spots and gaps. In turn, customers feel like their opinion matters to the organization and that we care about serving them. Asking for feedback, listening, and involving the customer increases customer loyalty.

Since as early as 2008, LEGO has recognized the importance of involving customers to generate new ideas. Their online community innovation platform, LEGO Ideas brings together passionate customers from around the world to explore, submit, and evaluate new ideas for LEGO kits. People actively participate in the creation of successful LEGO products all the way from the first idea through end development. The LEGO Ideas community has around 1.5 million members who have submitted more than 33,000 project ideas, including 30 that have been produced. This community gives LEGO fans a way to feel like they are part of the brand and communicate directly with the company.

Lego isn’t alone, the logistics and shipping company, DHL, has also discovered that its customers want to help think about how to improve their business. DHL’s innovation is customer focused by bringing together customers and employees through hands-on workshops to share best-practices and create value. As a result of the customer co-creation innovation workshops and other activities, DHL has improved inventory and warehouse picking efficiency by 25% and customer churn rate has decreased and revenue from new services/products has increased.

In addition, a recent report from Hitachi Europe found that 58% of businesses have piloted co-creation projects to help them innovate, and 51% say that co-creation has improved their financial performance. Whether or not an organization is seeking to add new products or services, a focus on the customer’s perspective and opportunities for improvement can help us identify critical gaps, and better provide an exceptional experience to those we serve. When we continuously listen to customers, and improve the customer experience, we bring the value of service to life.

4 steps for listening to customer feedback

There is More to Customer Service than Satisfaction

Think beyond customer satisfaction surveys, which can fluctuate based on emotions, to how the organization can track customer loyalty to determine its value to customers. If customers aren’t returning, or if they are deciding to choose a competitor instead, they may be unhappy with your organization, product, or service. In different organizations, research reveals 60-80% of lost customers reported on a survey that they were satisfied or very satisfied just prior to choosing not to do business again with an organization. Is measuring customer satisfaction really enough to create loyal customers?

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