Is the Incredible Indian Luxury Customer loyal to a Luxury Brand or does he seek others as well ?? As they experiment by hopping from one brand to another, the customer is enjoying his trip on luxury !

1. By: Mr. Abhay Gupta, Founder and CEO, Luxury Connect

3. Loyalty means "unswerving in allegiance“
How many brands would consider any customer to be unswerving in
allegiance?
 We try to measure Customer loyalty, but can we?
 The ‘Smartphone’ age has empowered customers to make
informed purchases
 It’s usual to compare prices and check reviews before buying
In such a scenario, does customer loyalty truly exist?
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4. Most companies use the terms customer loyalty and satisfaction interchangeably.
In reality, satisfaction is not the same as loyalty
Focusing on drivers of satisfaction can be misleading for your loyalty plans.
Fact:
1. Satisfied customers often switch when competitive offers emerge or switching
costs decrease
Recommendations:
1. Understand the drivers of loyalty
2. They are very different from drivers of satisfaction
3. Loyalty is an attitude
4. It leads a customer to consistently repurchase, increase
spending and recommend your brand
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5. Examples
Case 1: A satisfied customer is not always a loyal customer
Sometimes you are really satisfied with something, yet fail to be loyal.
Case 2: A loyal customer is not always a satisfied customer
A lot of Apple product users are loyal but often switch other brands
like Samsung for a variety in features and vice-versa.
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6. Facts:
1. Customers increasingly know what they want but do not tell you
2. They are not afraid to switch brands for better prices-value proposition
3. Sales person needs to decode what they say
Recommendations :
1. Take customer’s feedback
2. Ask customers what else they would like to find in the store
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7. Facts:
1. Market research shows that only 6% customers join loyalty membership programs
2. The positive effects wear off as soon as consumers come across better competitive
programs
Recommendations:
1. Focus on program penetration
2. Lean towards program exclusivity
3. Concentrate on acquiring category entrants
Improvements in loyalty from loyalty programs are fleeting unless programs
can be made exclusive
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8. Facts:
1. The traditional role of sales representatives has little impact on developing loyalty
for the brand
2. Teaching customers about the product category produces much better results
Recommendations:
1. Equip your sales representative to be a brand representative
2. Educate customers, not just serve or sell to them
The true potential of sales interactions is in leading the customer to learn
something about the brand, as this has the greatest impact on customer loyalty.
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9. Facts:
1. Attitude of every employee in the organization can make or break the loyalty
program
2. A research says, empowering employees who don’t face customers improved
loyalty scores by 14 percentage points
Recommendations:
1. CRM team should see itself as a “facilitator”
of customer loyalty activities
2. It should equip all other teams to contribute to the
process
3. Use systematic customer immersion programs
4. Give staff first-hand knowledge of a customer’s experience
Involving other functions can not only drive loyalty, but also result in other benefits
for the brand.
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10. Fact :
1. Customer loyalty can be tracked with membership, loyalty and rewards cards
Recommendations :
1. Ask - Is your membership base growing?
2. Are members spending more this month?
3. Are members cancelling their memberships?
All of these are metrics that can be used to track and gauge customer loyalty.
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11. 1. Loyalty happens organically. Like all good things, building loyalty takes time and
calculated effort.
2. Loyalty doesn’t happen until after conversion : Conversion is key, but it’s the
actions that lead up to conversion that produce loyal customers.
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12. 3. Building loyalty is someone else’s job : Stop right there, fellow marketer! Building
loyalty is everyone’s job.
4. Building loyalty is too expensive for small brands. No way! There are many tools
small brands can use to compete with the big guys.
5. You can invest in loyalty once, and then forget it. “Set it an forget it” is so 1990’s.
Building loyalty takes time, and the brands who are leading the loyalty pack do it
through strategic long-term planning.
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