HOW DO WE MEASURE LOYALTY?
Loyalty can’t be measured using a single metric. It’s complex and multi-dimensional.
That’s why we’ve developed our proprietary loyalty formula. And it’s linked to hard business outcomes – retention, acquisition (through recommendation) and maximising customer value.
Our formula gives you a loyalty score for your business that can be tracked over time, and compared to your competitors. But a number in its own right won’t tell you how to improve your business to grow loyalty.
Motif’s loyalty formula has 5 building blocks – the key components that we know drive loyalty:
1. Quality: Is your product or service good enough? In this day and age, consumers demand excellent products and service, that are easy to access and use. It’s a given.
2. Value: Is it perceived to provide good value relative to other offerings? In some sectors, value will be a straight price comparison, but it’s usually much more complex than that.
3. Sharing: Will I tell others about my experience? Bain & Reichheld have been telling us for decades that advocacy drives growth. We don’t argue. In a recent study we found that 1 in 4 banking customers open their current account with a given brand based on personal recommendation.
4. Customer closeness: How well do you know me and do you show me you care? Over the last few years, customer-centricity has become a critical element in our customer experience studies. Recognising customers as individuals, and understanding their attitudes and emotions is key. Same goes for recognising or rewarding customers. Both are key drivers of loyalty. They are also two of the hardest things for brands to get right.
5. Brand magnetism: Am I drawn to your brand and what it stands for? The most emotive of all building blocks, put simply, do customers love your brand and are they drawn to it? Does it resonate with them? In a world where there is a proliferation of choice, the strength of a brand’s magnetism has a clear role to play.
We wouldn’t share all our secrets on our website. How we measure each of these building blocks varies by sector and audience. The importance (or weight) each building block has in our formula also varies.
And it isn’t just about measuring each building block, it’s about understanding what drives each one too.
We’d love to share more and help your business grow loyalty. To find out more, contact our Commercial Director, Chris Hall: email@example.com.