Is Loyalty More Important Now? No!

I just read an article in Advertising Age called Marketers Put Emphasis on Loyalty which talks about how companies are focusing on loyalty programs during the economic downturn. According to Adam Burke, Hilton Hotel’s senior VP-customer loyalty:

Like a lot of people in the [hospitality] industry, we’re starting to see some slowing. Our Honors members tend to be the group that buoys us through a downturn. They are the core audience and tend to stay loyal and sustain the business especially through those downturns.

That dynamic is true in other industries; loyal customers really help in a downturn. So is loyalty more important in a downturn? Absolutely not! Loyalty is ALWAYS important.

Let’s consider a simple loyalty lifecycle: (1) Engage customers, (2) build loyalty, (3) reinforce loyal activities. Downturns are the worst time for (1) and (2) because there are fewer customers. It’s the time to really hone in on (3). So if you just start thinking about loyalty during a downturn, it’s too late.

The bottom line: Loyalty is an asset that you build up when you need it the least.

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I am a customer experience transformist, helping large organizations improve business results by changing how they deal with customers. As part of this focus, I examine strategy, culture, interaction design, customer service, branding and leadership practices. I am also a fanatical student of business, so this blog provides an outlet for sharing insights from my ongoing educational journey.

Simply put, I am passionate about spotting emerging best practices and helping companies master them. And, as many people know, I love to speak about these topics in almost any forum.

My “title” is Managing Partner of the Temkin Group, a customer experience research and consulting firm that helps organizations become more customer-centric. Our goal is simple: accelerate the path to delighting customers.

I am also the co-founder and Emeritus Chair of the Customer Experience Professionals Association (CXPA.org), a non-profit organization dedicated to the success of CX professionals.

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