Even small improvements to your loyalty program can improve your business and make for a happier place to shop or dine.

Why have loyalty programs proliferated so much in recent years? The answer is simple.

Customers have more choices than ever before and they can shop from almost anywhere. Whether online or brick-and-mortar, the ability to purchase goods and services is no longer limited by how much you can fit in your car on a Sunday afternoon.

In response, businesses of all sizes have implemented loyalty programs to induce their customers to come back and continue shopping with them by offering rewards and discounts.

That’s a good first step but loyalty programs are easily replicated by the competition and they often don’t go far enough to produce long-lasting customer loyalty. According to a new book from the consulting firm FranklinCovey, Leading Loyalty: Cracking the Code to Customer Devotion, there are three key elements that are needed to earn the true loyalty that businesses such as Costco enjoy. Those three elements are empathy, responsibility and generosity.

The authors say the reason they focused on those three elements is that they provide the foundation for a kind of fierce customer loyalty that comes from the heart as a result of positive emotional interactions with other people.

The empathy comes into play by teaching employees (and ourselves) to not only hear what customers are saying but to feel what they feel. In this way, you can make a genuine emotional connection with the other person and that can deeply influence the customer’s sense of loyalty.

The responsibility element is simple: take ownership for what needs to be done. This translates to owning the outcome for the customer. In other words, if the customer comes in saying they need help picking out apples, you will want to probe for how they plan on using the apples and then make a suggestion from there. It will take longer than just telling them where to go to find the apples but in the end, the customer will see you as an expert and they will remember the extra help you provided in making their experience better than usual.

Taking that extra time with the customer is also part of the last element: generosity. The book’s authors encourage generosity and giving more than is necessary or expected. By doing so, it’s a simple step from there to turn customers into advocates. Remember the customer who needed helping picking out apples? They’re bound to be grateful for the extra time and attention and will likely tell others about the helpful employees at your store.

In a news release about the news book, co-author Sandy Rogers, who is the FranklinCovey Loyalty Practice Leader, talked about how people influence customer loyalty.

“Loyalty is built one great experience at a time,” said Rogers, who attended Harvard Business School and previously worked in marketing at Enterprise Rent-A-Car, Apple and P&G. “And the difference between a good and a great experience often comes down to how customers feel about their interactions with us. The customer’s experience is certainly influenced by our products and services, policies and procedures, and the technology we deploy to make it easier for customers to work with us. But the actions of our people on the front line are paramount to delivering the emotional experience that is essential to earning fierce customer loyalty.”

As long-term shareholders in Costco can tell you, investing in loyalty practices can boost your bottom line. Even small improvements can improve your business and make for a happier place to shop or dine. If you can win customers’ hearts, they will likely purchase more from you and also tell everyone they know about your business.

Want help setting up a new loyalty program through your point-of-sale system? Contact us for a demo today.

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