Who Stole My Customer??: Winning Strategies for Creating and Sustaining Customer Loyalty, Second Edition

1. When Prior Strengths Become Your Weaknesses

I once stood in a boardroom and spoke with the top-tier executives of a major automobile manufacturer famous for its brand and renowned for engineering and product excellence. The brand had enjoyed a loyal following for decades, but it was now losing market share: in the United States, customer defection was nearly 70 percent. In other words, for every ten U.S. customers who bought the company’s cars, approximately seven would defect—only three would return to buy again.

To understand this trend, my consulting team had conducted extensive interviews at company headquarters, held workshops with dealers (the distribution channel), and set up focus groups with current and former customers. We had identified ...