What price customer loyalty

Paul Fifield and John Greenhough respond brilliantly in a letter to the FT on the subject of the “serial adultery of the modern consumer” as analysed by the FT’s Andrew Hill.

The alternative thinkers offer four thoughts about assumptions that we all have and which may be wrong.

· People do want relationships but generally with people rather than organisations.

· Value is too often confused with low prices or discounting. “In most markets only a small percentage of customers make their decision on price alone.”

· Customer fickleness may not be a bad thing. It is natural for customers to change their preferences.

· How loyalty is measured. Typically customers who spend more than 50% of their grocery budget at a particular supermarket indicates loyalty. But Fifield and Greenhough’s research shows that “this might indicate inertia”.

That last finding is worth thinking about. Are your shoppers loyal to you or is the effort of switching simply not on their minds. In which case, you don’t want to ask customers to think about change.

For more, go to www.betterretailing.com.

Comments

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