Understanding eLoyalty

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By Grace Casselman

The coffee shop I most regularly frequent gets my patronage partly for serving decent beverages and great pie. But honestly, the café’s single biggest attraction is that it’s in my neighbourhood; and hence, easy for me to do business with. Although a decent competitor may operate on the other side of the city, I’m unlikely to drive across town just to sample those wares.

Online, it’s often a different story, as location becomes essentially irrelevant. On the Web, if a company fails to live up to my expectations, switching to a competitor is as easy as a few clicks on the keyboard.

It’s just as convenient for me to type in the Web address for a local store as it is for a shop in Toronto or Halifax, especially if everybody promises next-day delivery. (Personally, I get irritated by extra charges and hassles associated with buying from the U.S. or elsewhere, but most businesses won’t blink at shopping across the border, particularly if it’s ultimately more profitable.)

Ellen Reid Smith is the author of a book called “e-Loyalty: How keep customers coming back to your Web site.” (See www.thee-loyaltyresource.com)

“e-Loyalty is about digitizing human relationships,” says Reid Smith. “There’s some form of humanizing approach to this relationship.”

You’ll hear a lot of buzzwords associated with the e-Loyalty concept, such as:

  • Stickiness — Although it sounds like “entrapment,” says Reid Smith, it’s about getting customers to return to your Web site).
  • Viral marketing — Members get members, as customers should be your best advocates.
  • Permission marketing – without getting visitors’ permission to market to them, it’s more like “stalking,” says Reid Smith.
  • Customization — providing an experience targeted to individuals, or at least to categories of businesses or consumers. “But we really need to be able to remember a person’s name,” Reid Smith admonishes. “You don’t have a relationship with someone if every time you meet you don’t know each other’s name.”

If you’re dealing with small business, their “loyalty drivers,” are more likely to match those of consumers — such as being strongly influenced by price and quality.

Small businesses online, says Reid Smith, “really want someone to understand their small business problems. And they want to be recognized as viable and valuable customers.”

Being successful online isn’t just a matter of properly catering to various types of customers. Instead, a business really needs to determine its target customers, and then market aggressively to individuals and organizations that will ultimately be most profitable. That’s not just initial sales, however. Consider profitability over a lifetime, with such issues as: total buying life cycle, current revenues, future revenues, cross-selling and up-selling opportunities, plus referral/influencer potential.

And once you have a customer base, how do you keep it?

“Customers don’t leave if the cost of defection is too high,” says Reid Smith. For instance, if the shopping/buying/support experience is unique; if there are points or rewards that would be forfeit; or if you’ve got great customer exclusives — like free shipping, advance notices or excellent service — customers will hesitate to do business elsewhere.

Take time to ask you customers what “extras” really appeal to them. Do they want better access to information, people or events? Do they want enhanced service? Product advice? Discounts? Community chat or mailing lists? Would a points program be attractive?

Give customers what they really want, to an extent that competitors will find it difficult to match.

“Humanize digital loyalty with intelligent dialogs,” says Reid Smith. “Use one-to-one principles to create a more human relationship.”

Finally, it’s critical to build trust with your customers, by personalizing your service, by protecting their privacy and security, and by concentrating on quality.

Doing business online differs from physical interactions because location becomes less relevant, while “personalized” service and relationships are more difficult to realize.

And yet, doing business is still very much — doing business. Regardless of the fulfillment medium, online or offline, the basic needs and priorities of your clients don’t change.

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