Building A Loyal Customer

I enjoyed Blue Bell ice cream for my birthday. That might not mean much you, but consider this: I’ve had Blue Bell ice cream at almost every special event for the last 20 years, and you can’t get Blue Bell ice cream in California. My mom shipped it to me! How did Blue Bell make such a loyal customer out of me?

Strong Branding. I can still sing their jingle, and it’s been the same ever since I can remember. Their logo and packaging have remained unchanged, and their product has stayed the same. They add new flavors, but overall, it’s the same brand I’ve known since I was little. If you are constantly changing your brand, customers get confused. They think, “If the brand is changing that much, what’s their product doing?” When you pick your brand identity, make sure you consider the long-term message. The advertising may change, but the heart of the message needs to support your brand identity. Consider the Coca-Cola branding debacle. When they came out with “New Coke”, it failed miserably. People thought of Coca-Cola as “classic”, and didn’t take kindly to be forced into “New Coke”. They knew nothing about “New Coke”, and sales fell. When Coca-Cola went back to their “classic” standard, sales rose.

Build Trust. Getting customers to trust you is a fundamental piece of the puzzle. People are generally risk-averse, so it’s much easier for them to stay with a company they trust. Why try some other ice cream when I know Blue Bell always tastes great? If you can’t build trust directly, build it with a thought-leader. I may not know enough about hard-drives to trust a company’s word, but if my husband trusts that company, I will trust that company. It’s not just about a reputation of quality, it’s about sticking with customers so that they’ll stick with you.

High opportunity cost. Make it hard for people to leave! If you consistently offer exceptional products, prompt customer service, and fair prices, why on Earth would anyone want to leave? I’ve owned two Hondas in my life, and I’m quite content to own Hondas for the rest of my life. The car runs great, the salespeople are knowledgeable, and the maintenance is easy. It’s a high cost for me to try out another brand of car and another dealership. You need to exceed expectations, so that it’s very difficult for anyone to decide to leave.

Become a habit. The more involved you are in a customer’s life, the harder it is for them to leave. Create more touch-points with your customers, and make your product or service part of their everyday life. When I go to the store, I grab the same brands over and over, because that’s what I’ve always done. Habits are hard to break, so once you become a habit, you’ve most likely scored a life-long customer. Additionally, if it was a habit for a parent, it can easily become a habit for a child. You can save on acquisition costs and retention costs by becoming a mainstay in a household. When a new household is started, they’ll continue in the buying habits they built as a child.

So, are your products a mainstay? Do your customers keep coming back?

Co-branding, Affiliates, and Partners

I watched the VMAs last night, and the talk of the night was the Kanye West debacle with Taylor Swift. For those who didn’t see the Twitter trend, Taylor Swift won the award for best female video. During her speech, Kanye West took the microphone, and proceeded to go on and on about how Beyonce’s video is one of the best of the decade. Needless to say, Taylor Swift was about to cry, Beyonce was embarrassed, and the entire audience was angry. So, what does all of this have to do with co-branding, affiliates, and partners? Kanye West is about to start his tour with Lady Gaga… and guess what? After Kanye’s screw up, Lady Gaga may see her tour ticket sales plummet as well, as audiences attempt to boycott Kanye. This is a long story to say, “Choose wisely!”

Know and trust your partners. It may seem obvious, but you need to take the time to get to know a potential partner. Do your research! How do they treat their customers? Are they financially stable? Are they ethical? You wouldn’t trust your children with a complete stranger, so why would you trust your company reputation with a company that you don’t know?

Don’t alienate your target audience. Companies work hard to build a brand that their customers relate to, and it only takes one bad partnership to alienate your customers. When choosing to co-brand or partner with another company or non-profit, consider the value-add to your customers. Does the potential partner have a complimentary product or service? Do they support a cause that your company and customers are passionate about? Partnerships should be strategic moves that benefit the customer, not short-term endeavors to increase cash flow.

Do it big. If you’re gonna go for it, go for it whole-heartedly! Work with your partner or affiliate to develop a sustainable strategy, and share your resources to accomplish your mutual goals. Take time to understand their products, services, and customers, and let your customers know about the new partnership. If you seem hesitant about your new strategy, your customers will also be hesitant, so show them a united front.

In this economic climate, strategic partnerships can be the key to survival. But be smart about it, and don’t let someone like Kanye crash your ticket sales!

Price points, Mark-ups and Branding

What are you willing to pay for a cup of coffee? How about jeans? Sunscreen or bug repellent? Most would answer, “It depends.” When you start throwing in brands, locations, and extenuating circumstances, you start seeing a fluctuation in price points. Starbucks patrons will pay around $2 a cup for coffee. Jeans can range from $10 a pair to hundreds per pair. We went camping this weekend, and forgot to bring bug repellent. On top of a mountain, we were willing to pay a staggering $10 for a can of bug repellent. So, how important is your brand and location? I’d venture to say it’s the difference between profitable and bankruptcy. So how can you maximize the impact of your price points, mark-ups, and branding?

I discussed knowing your customers in an earlier post, and this is key when deciding your price point. If your value-proposition is largely based on price, you need to make sure that you are targeting consumers who base their decisions largely on price.

Price points and mark-ups go hand-in-hand, as price points can change depending on circumstances. You need to understand which circumstances warrant a higher mark-up, and which circumstances will be seen as outrageously over-priced. The circumstance may be a constant condition, and it may even be integral in your value-proposition. For example, Starbucks seeks to offer a coffee experience, while McDonald’s seeks to offer convenience.

The value of your brand is much more difficult to nail down, particularly because brands stand for values. Consider the cost of a pair of jeans. If you just need a “throw away” pair of jeans, you’re not willing to pay $100 for them, and the value of the brand is generally for convenience and the lowest price. If you’re looking for comfort, you’ll pay more, and go with a brand that stands for comfort, functionality, and flexibility. Some brands offer the most trendy and stylish jeans, with higher-than-average price tags and shorter-than-average life spans. Your brand, and what your brand stands for, plays a huge role in deciding how to price and mark-up your product or service.

So what are your customers paying for? What are they actually willing to pay for? Are you maximizing your opportunities?

Pardon the Hiatus

Alas, posting weekly takes time! I have caught up a little and will do my best to post weekly as promised. This breaks my #1 rule about social media avenues… post REGULARLY. Otherwise, you leave your readers wondering what happened. Eventually, they start to fall off because they aren’t sure when you’ll be back, and they are frustrated with the lack of content. I was a little absent from Twitter as well, but I am trying to post at least twice a day. There’s always so much interesting information to check out when I’m checking my updates, and I get distracted with the great content.

I will have a new post up soon, and again, please pardon the hiatus!