Customer Relationship Management: Getting It Right!

1.3. Loyalty in the New Marketplace

Loyalty is built on relationships developed through the customer's experiences when she interacts with your company. Of course, so is disloyalty! Loyalty, for our purposes, is the likelihood that a current customer will buy from you again, rather than from a competitor, whenever she needs new or additional products that you sell. The value of loyalty is well understood. A recent study by Bain and Company showed that when loyalty (customer retention) was increased 5 percent, profits within various industries (both consumer and B2B) increased from a minimum of 18 percent up to a high of 125 percent. The impact of customer loyalty on profits hasn't changed, nor has the way loyalty is created through a customer's ...