Business Monday: Loyalty Often Starts with WHY – Bob Salvas

by Bob Salvas, contributing writer

The key to long-term success in business is to have loyal customers.  The normal advice for accomplishing that is to treat your customers well, give them an amazing buying experience, and consistently let them know you appreciate their business.  All three of these are critically important to keeping customers loyal.

While having loyal customers does require you to do these things, there is also a secret you can employ earlier in the process that can make the work of keeping your customers’ loyalty a lot easier in the long run.  The secret is this:

You need to acquire the RIGHT CUSTOMERS in the first place!

By selecting the right customers for your business, it can make keeping them loyal a lot easier. So, let’s talk about how you are getting new customers -it usually comes down to the 3 Ms of marketing: MARKET, MEDIA, and MESSAGE.

1.MARKET – Your target market is who you are sending your marketing messages to (ideally the people getting your messages should be your best prospects).  Remember, it is your job as a business to solve a problem that people are willing and able to pay you to solve.  Your challenge is to find those people.  So, if your business sells high end dog food, for example, then your ideal target market would probably be people of means who own and care about their dogs.

2.MEDIA – This is the means for you to get your MESSAGE into the hands of your MARKET (could be email, billboards, TV ads, social media, or whatever).  Depending on who your target market is, the media you choose can be important.  For example, if your target market are those wealthy dog owners we mentioned above, would a billboard be a good way to get them your message?  A billboard will likely be seen by a lot of people who are not dog owners and by people who are not so wealthy dog owners too- neither of which is your target market. So, you may be wasting marketing dollars by using the wrong media.  In cases like these, you may want to choose a medium that can be more targetable.

3-MESSAGE – This is what you are saying to your target market via the media you pick and what you say in that message can be the ‘secret sauce’ when it comes to finding those prospects who could end up being your most loyal customers.  Your target market may represent who can buy but the message can determine who will buy (and maybe if they will buy again).  Your message should normally answer the question: What action do you want your prospect to take?  Oftentimes the goal is to get the prospect to buy right away or get them to move to the next step in the buying process.  Let’s look at three options for the type of message you might consider sending- the WORST, the OK, and the BEST.

THE WORST– THE DEEP DISCOUNT – Businesses somehow feel that if they give away their entire margin so people can try them, they will have a bevy of new ‘loyal’ customers.  Not likely.  In fact, just the opposite.  The only customers who respond may be the ‘discount shoppers’ and if the competitors down the street have a better discount tomorrow, they will drop you like a hot potato.  To make matters worse, some businesses only offer that deep discount to the ‘brand new customers’ while charging full price to their regular loyal clients!  This is not a good long-term loyalty strategy.

THE OK – THE CREATIVE PRICING – If pricing is part of your offer, there are other pricing strategies that are better and you can offer them to both prospects and current clients.  If your product is low cost, you can give away a free sample (think of the sample chicken teriyaki at the food court).  You can try bundling more than one product together with complementary products at a package price (think of the value meal at the fast food restaurants).  You can offer a rebate or gift or future discounts (think of the rewards programs at many retail businesses).  You can offer a 100% guaranteed REFUND if the customer is not completely satisfied (most effective if the product is expensive).

THE BEST – THE WHY – Perhaps a better question might be if you even need a pricing message component at all?  What if instead of pricing, you attract new customers based on a different type of message?  There is a secret to doing this well and it all begins with the question WHY?  In other words, WHY are you in the business you are in?  The answer cannot be ‘to make money’.  Money is the result you get when you have a successful business.  Money is often a goal, but it should never be a WHY.  You must have another reason to be in business, a deeper meaning for you.

If that answer is not clear, you may want to read the book START WITH WHY by Simon Sinek.  The author describes several successful businesses, and they all have a defined WHY about them.  An often used example in the book is the company Apple.  Apple’s WHY is to be different and challenge the status quo.  That resonates in everything they do, from the products they design to the marketing messages they develop.  When Apple comes up with a new product, people wait in line to get it, and the price is almost always higher than other comparable products.  It is true that not everyone waits in line for the new products, but that is also the point.  The idea is to find those who are strongly aligned with your WHY and when you deliver what they want, they not only become your best, most loyal customers, but they also become your most active advocates, spreading the word to those who may be a bit indifferent about what you are selling.  Your WHY can be your philosophy or even your ‘origin’ story.  In the example we used previously about dog food, perhaps you worked at a dog shelter and saw tremendous malnutrition and wanted to create a healthier dog food.

You see, we live in a world of too many choices and ‘good enough’ quality.  Since we have so many options that are (for the most part) equally good, we end up buying many things on price alone…we see these things as a commodity.  Yet there are some products and companies that we remain loyal to regardless of price.  What Simon Sinek points out in his book is that we are more drawn to what those companies/products stand for rather than what they sell.  We believe what they believe.  We are buying not so much for the company, but we are buying for ourselves…to reinforce our own beliefs. This is why Apple fans wait in line; Harley Davidson fans tattoo the logo on their bodies; Disney fans pay a higher price to go to Disney World than a regular amusement park.  And when enough of these fans spread word-of-mouth, the masses start to buy as well.

Your business may not be the size of Apple or Disney, but the same theory applies. Find the WHY of your business and make business and marketing decisions with that in mind.  Find and speak to those who ‘get it’, who believe what you believe and build solid relationships with them.  Those will be your most loyal customers, and they can help bring you more customers.  Remember the key to long-term business success is to have loyal customers.  It can all start with WHY.

“People don’t buy what you do, they buy why you do it.”  –Simon Sinek

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Bob Salvas is a Professional Development Manager for the RI Builders Assn (ribuilders.org), a marketing consultant, the co-founder of Brew Work Networking (brewwork.org), and the co-founder of THE MARKETING CAMP (themarketingcamp.com). Bob can be reached at 401-359-1602 or at [email protected].