How Customer Brand Loyalty Will Help Your Bottom Line

In these times, it's surprising to come across businesses that operate as if they expect customers to magically show up at their stores or online. But I see it every day - and I'm sure you do too. What's worse is that many of these businesses do little or nothing to ensure that the customers they have will keep coming back.

With competition for new customers getting tougher every day, it certainly makes sense for companies that hope to survive and grow to start focusing on creating loyal customers. In fact, creating customers who are loyal to your brand is one of today's most important strategies for business sustainability and growth.

And here's why. When customers are highly loyal to your brand, they will:

• Give only slight consideration to similar brands when they're deciding what to buy.
• Request it by name.
• Recommend your brand to anyone who will listen to them talk about it.
• Accept only your brand.
• Be more open to your new product and service offerings.
• Travel farther and longer to get your brand.
• Pay more for it.

But the most important reason to develop customers who are loyal to your brand is also the simplest and most practical: it costs about five times more to acquire a new customer than it does to keep one. If you're one of the businesses that isn't doing anything about customer loyalty, you might want to think about that.

How to Destroy a Brand

There are plenty of articles about the Toyota recall situation. And I'm sure that there will be a lot more.

A recent Cleveland Plain Dealer article stated: "In a few short weeks, Toyota has done what GM, Ford and other automakers have failed to accomplish for decades: erase the perception that the Japanese automaker's cars are of much higher quality than those of its rivals."

The jury is still out about whether Toyota has truly erased its brand perception of high quality. But one thing did stand out when I read that excerpt - that a strong brand must consistently deliver its brand promise. And when it doesn't, it must be up front and honest about it. Waiting to address an issue - as Toyota did with its recall - and, in fact, as Tiger Woods did with his infidelities - can be a critical mistake.

Whether the Toyota brand will fully recover depends on many factors. But one thing is evident. It takes a lot longer to build a strong brand than it does to weaken it. Smart organizations protect their brands because they know that strong brands add value and increase their revenues.

Brand Tip #1: Don't Confuse Brand With Branding

You hear the words "brand" and "branding" a lot - especially when people are talking about marketing or advertising. In fact, I've heard a number of "experts" using the terms interchangeably.

But the terms are different - and it's important to know what each really means if you're involved in marketing and want it to be effective.

Brand is all about differentiation. It's who your company or organization is, the unique characteristics that make you stand out as more valuable than your competitors to your customers and the evidence to support those unique characteristics. It's what the purchaser of your product or service can count on from you. It's the promise you make.

Branding, on the other hand, is about tactics - creating the tactical marketing plan to communicate your brand's unique characteristics to influence your customers' purchasing decisions. Branding tactics can include the consistent use of graphics, spokespeople, typefaces, colors, logos - all of the tools used to communicate your brand's distinction.

But don't think the graphics or spokespeople are your distinction. Those branding tactics could change with your next campaign and are not the ultimate reason for purchasing your product or service.

Understanding the difference between brand and branding is important because, in order to build your brand, you need to understand who you are before you can create tactics that will make your brand a success.

Why Non-Profits Should Invest in Brand

The other day a client - who happens to be a principal in a non-profit organization - asked: How can non-profits maximize their fundraising efforts during an economic downturn and position themselves for the upturn?

I understood where she was coming from. After all, when times are hard, it's tough to decide where donors' hard-earned dollars will go. Haiti? The American Cancer Society? Go Red for Women? Susan G. Komen Foundation? The list is endless - and there are a lot of good causes.

Donors Still Give During Recessions

Historical data shows that donors will continue to give during recessions, and non-profit organizations can continue to raise funds - provided that they talk to people about their programs and goals by making a CLEAR, COMPELLING CASE.

People don't give just because there's a need; they give when there's a connection, when the message is clear, easy to understand, grabs their attention and is substantiated. They make decisions based on how closely aligned the organization is with their values and how much trust they have in what the organization is doing.


Making a Connection is the Key

This applies to making donations to non-profits as well as buying consumer products. And just like the for-profit companies' consumers. . .it's the BRAND and its "delivered promise" that connects donors with the non-profit organization. It's what makes that non-profit organization stand out and ultimately creates the emotional connection with the interested party - in this case, the donor.

When a non-profit organization truly differentiates itself and communicates a clear message to those who care, people will perceive it as higher quality and a better investment.