Hey, it’s Bob Negen. And in this episode of Real Retail TV, we are going to explore the question, is customer loyalty dead?

The question is, is customer loyalty dead?

And I would say the customer loyalty is not dead, but the assumption of customer loyalty is false.

So let me tell you a story. So back when I had the Mackinaw Kite Company here in Grand Haven, we would have kite night on Tuesday nights where we would bring all the great kites out to the beach and all the kite flyers would come. It was basically a big demo field. And then the kite flyers, the core — and occasionally some of the people who are on the edges — we’d all go to the tip of few tavern and have a burrito and a couple of beers.

And I remember one day, a guy who I liked and who I bought beers for and who I considered a good customer, pulled the kite out of his bag, and I knew he didn’t buy it from us.

And I was so mad, and I was so hurt How could he do this?

I bought him a beer last week, you know, this whole idea.

And, you know, this idea that if I just sort of assumed that because I owned a kite store, and I did kite night, and I bought him a beer, that he wouldn’t buy a kite anywhere else.

And that after I calmed down and after I had a beer with him again that night, I realized that it wasn’t his job to be loyal to me.

I had no right to assume he was going to be loyal. He wanted to buy where he wanted to buy, and he did that. And that was okay.

But it also reinforced the fact to me and what I’m sharing with you is that you have to earn it.

It is not given it is earned. And even when it is earned, it needs to be nurtured. It needs to be maintained.

It needs to be cherished.

It needs to be near and dear to you and you need to do all the things that are needed to keep your customers close to you. So the assumption is it is that it’s dead is false, but I do wanna say that all is not lost, that you can do a lot of things to really, really, really engender, loyal.

And let’s talk about that right here.

So the first thing that I’d like you to think about to recognize is that your customers want to be loyal.

I believe this. I believe that people like to support their local independent retailers.

They like to come into your store.

They like your store.

The fact that they’re in your store if they’ve joined your loyalty program. It means that they feel an affinity to you. So then your job becomes to proactively build the relationship.

Let me say that again. Proactively build the relationship.

Again, going back to the assumption that loyalty is earned and it needs to be nurtured, you can’t just assume it. So how do we do this? Let’s talk about three things real quickly here. How do you build customer loyalty? And the first thing that you do is you give your customers an amazing experience so that every time they come into your store, they feel loved, they feel honored, they feel appreciated.

You know, there’s a statistic.

And I don’t even remember where I found it way back in the day. But it said that sixty seven percent of people who stop shopping at a small business do so because they think the owner doesn’t care.

They don’t feel loved.

Now here’s the thing. So when I heard this and when I read this, it occurred to me that even though I, Bob Negen, owner of the Mackinaw Kite Company could care deeply, deeply, deeply if my team wasn’t trained, if my team didn’t give my customers, that same kind of experience that I gave them my customers might feel that I didn’t care, and they would leave.

So when you think about building customer loyalty, the first place you have to think is your team? And you have to ask yourself, are your team members giving all of your customers an exceptional experience.

And this comes through education.

It comes through training.

It comes through coaching. Comes from engagement. It comes from empowerment.

You cannot just hire good kind, friendly, helpful people.

And assume they’re gonna give your customers an exceptional experience.

You have to give them the tools.

Now I’m just going to share a quick aside here.

So whenever I travel, I love to shop independent stores.

If I’m in a town I’ll go and I’ll go, I’ll shop the downtown, I’ll go into all the stores, see what’s happening. And I created this little mental thing in my head. And it’s called an engagement o meter. And you know when you used to watch the cartoons, there was a something that went like this, right? It was a meter. And so I would create this mental thing called an engagement o meter. And at the end of my wanderings in the shopping district, I would rate the district on the engagement o meter.

I’d rate the stores and the district.

And I can’t tell you how discouraging it is to go into a store that is beautiful, that somebody clearly spent a lot of money on branding, on layout, on display, only to have team members that were in different or good kind friendly helpful, but not skilled.

So the question to ask yourself is am I giving my team members the tools they need to give my customers the kind of experience that’s going to make them loyal.

That’s the first question. Here’s another quick exercise.

You do what I just did, and have your team members do it on your clock, but say, walk up and down the street or go to this mall or go someplace and shop all the stores and come back and report to me. What kind of experience you had? How many stores gave you the kind of experience that makes you want to come back?

I think it will motivate you to do a good job training. So that’s the first thing.

Really, really staying focused on giving your team the skills they need, the motivation they need, to give your customers the kind of experience that makes them loyal. The second thing is a loyalty program, right? There’s a reason it’s called a loyalty program because a good loyalty program will get people to come back. They’ll get people to come back for two reasons. One, a good loyalty program rewards frequency.

So they’ll want to come back to get closer to the redemption, closer to the prize.

But the other reason, and this is sort of more subtle, but just as important, is when people join your loyalty program, they’re giving you their contact information. And when they give you giving you their contact information, they’re figuratively raising their hands and giving you permission to market to them. And that allows you to you know, to send them emails, to send them text messages, to, you know, to engage them in lots of different ways, to invite them to your promotions and special events. So a loyalty program does two things. It builds your list, your customer database, and it allows you to engage in the activities that build loyalty You know, I have this concept called the emotional bank account, and I teach it when I teach marketing.

And I stole it from Stephen Covey in his book the seven habits of highly effective people. And basically, the emotional bank account is this. Every time you do something that’s a value to your customers.

You’re putting a deposit into this account, right? So if you send an email with valuable information, that’s a deposit. If you have a really cool event, that’s a big deposit. If you post on social media, those are all deposits. And as you build the balance in your emotional bank account, you earn the right to make withdrawals.

And withdrawals are anytime you ask someone to spend money with you, to do something. Anytime you give, it’s a deposit every time you ask, It’s a withdrawal. And when you have a loyalty program and build your list, it gives you the ability to proactively build the emotional bank account.

And the third thing the two build loyalty is really more of the flip side. It’s doing the things that don’t dampen loyalty.

And that is things like do you have customer friendly store hours?

Do you have customer friendly return policies?

Do you do really dumb stuff like charge your it customers to use a credit card. So think of loyalty as a rope. This is a sort of a parallel to the emotional bank account. But loyalty is like a rope. And every time you do something good, you’re adding a strand to that rope and that rope is getting stronger.

But every time you do something that isn’t customer friendly, that doesn’t show your customers that you care or that isn’t in their best interest That those strands are cut. Their holes in the buckets to mix metaphors.

But recognize that all the work you do to build loyalty can easily be undone.

Which is why I’ve been on a really high horse lately about independent retailers need to.

Keep customer friendly store hours.

Independent retailers need to let their customers pay the way that they want to pay. Independent retailers need to do all of the things that make their customers feel loved and appreciated.

So this is a really important topic.

Because loyalty, keeping your customers near you, keeping them close to you, keeping them with you so that they’re coming into your store more often, they’re coming into your store with their friends They’re coming into your store and spending more money. This is the way that we build a great independent retail business. So let’s loop back around. Is customer loyalty dead Hack, no. Customer loyalty is alive and well.

If you as the store owner do the things you need to do, to show your customers how much you care, how important their loyalty is to you.

anyway, that is it for today. I’ll see you next week.