Trustworthy customers trump traditional advertising
Successful companies care more about their existing customers than less successful companies. This is the central result of a survey of 300 executives in German business as part of the Excellence Barometer 2009. According to a study by loyalty marketing expert Anne M. Schüller, the pool of enthusiastic regular customers is also the easiest way to generate positive word of mouth.
According to this, 60 percent of the successful and 51 percent of the less successful companies advocate that it is more important to deal with how to better retain customers. In the latter case, 28 percent were primarily concerned with acquiring new customers, while only 21 percent of successful companies did so primarily. For the other respondents, both areas are equally relevant. “Of course, new business is also important, but companies live from their repeat buyers in the long run,” says Anne M. Schüller. The greatest asset a company possesses is the loyalty of its customers.
The results of a special study would also show how smart it is to look after loyal customers. For example, 57 percent of those surveyed would recommend their preferred provider to others, while only 27 percent would do this in the case of sporadic customer relationships. “The easiest way to generate positive word of mouth is from a pool of enthusiastic regular customers,” explains Schüller. Only those who have consistently good experiences with a provider will strongly recommend them. This pays off twice, because credible and trustworthy multipliers trump any classic advertising. Those who are loyal to a provider also help 94 percent through complaints and 74 percent through participation in customer surveys to improve. For a provider you only have to deal with now and then, the numbers are 77 and 41 percent, respectively.
Customer loyalty pays off even if a change is necessary. 82 percent of those surveyed would warn their favorite provider before it was too late and 86 percent would be willing to return when the service improved again. Only 33 percent of respondents would inform an occasional provider about it and only 66 percent would come back if necessary. According to Schüller, this shows that customers who are emotionally attached to a company are the real drivers of positive business development.