Guest Blog: The Most Under-leveraged Factor Driving Customer Loyalty

In Customer Engagement, Featured on App, Loyalty & CRM by Vaughn Highfield

Guest Blog: The Most Under-leveraged Factor Driving Customer Loyalty

Of all the things that can motivate customers to return to your business—the convenience, the special services, the excellence of your offering, the points you offer—the single largest factor in driving customer loyalty may be the quality of your company’s employees. This factor is one of the most underleveraged, maybe because it’s also one of the most difficult to manage.

Most companies profess that employees are their most important asset. But we all know that there’s often a disconnect between what executives say and how front lines deliver.

The reality is that while the financial benefits of not investing in employees—or even in eliminating positions—are immediate and easy to measure as a controllable expense, the long-term upside of supporting a strong employee workforce is harder to measure. For example, the front-line employee, not the inventory-management software, notices if products are in the wrong place or a shelf is a mess. The contributions of employees who pay attention to these kinds of details have a huge ripple effect in an operation.

The practice of training and empowering employees delivers three important benefits: It provides a better customer experience. It furthers employee loyalty. And both of those benefits, in turn, further build customer loyalty.

To achieve such results, companies must ensure that employees have the attitude, the tools and the authority to do whatever it takes to meet customers’ needs at key touch points. Here are four suggestions:

Equip and enable the team.

Employees must have access to real-time customer information, including actionable data. They must also have the authority to act on that information—either by making offers, resolving problems, or delivering surprise-and-delight rewards. At India’s Jet Airways, employees are trained to recognize Elite tier members, and have the authority to make offers and resolve issues. Employees are armed with pocket-sized booklets that offer quick references for best practices for customer issues, as well as details on the frequent-flyer program. This resource enables a front-line associate to quickly and easily answer detailed questions about earning points, for example.

Establish listening posts.

Solicit feedback from both employees and customers. For example, Bluegrass Hospitality Group (BHG) operates six restaurant brands in Kentucky and Tennessee. Management checks in with customers by managers visiting every guest’s table each night, receptionists calling guests the day after dinner, and employing an opt-in Mystery/Secret Shopper program for members of its loyalty program. Results: Guests have fewer complaints, satisfaction numbers are higher for all restaurants—and membership in BHG Rewards is up, as is customer engagement with emails—including an unsubscribe rate of less than 1%.

Reward for impact.

Productivity incentives are smart, but you can also provide perks simply to reinforce that employees are appreciated. SAS Institute, a business analytics solutions provider in Cary, North Carolina, provides a gold standard set of benefits, including on-site daycare, on-site medical care, and even a swimming pool. "We can either pay to recruit and train and retrain, or we can keep people here by giving them these benefits so they won’t leave," says Dennis Massengill, the company’s Executive Director of Worldwide Marketing operations.

Establish alignment.

In a Forrester survey of customer experience leaders from large North American firms, 76% said that employees don’t share a consistent, vivid image of target customers, while 40% said their firms don’t have a clearly defined set of target customers. It’s one thing for executives to be aligned on a customer focus, but that vision must be shared with front-line associates.

Research by Gallup shows that engaged employees are more productive, more profitable, more customer-focused, safer, and more likely to withstand temptations to leave. Gallup found that in world-class organizations, the ratio of engaged to actively disengaged employees is about 10:1; in average organizations, it’s less than 2:1. At SAS, where the average employee tenure is ten-plus years, Dennis Massengill sees first-hand the advantage of engaged employees: Managers "learned early on that employee longevity is directly relational to customer longevity."

A final thought to keep in mind: Organizational alignment is ultimately the key enabler of this kind of strategy. Building that level of alignment can be challenging, but it’s a worthy goal. Every company can make the connection between how appreciated their employees are and how much their customers will want to come back.


This guest post came courtesy of Dennis Armbruster, Managing Partner at LoyaltyOne Consulting.