Digitizing every customer interaction introduces troves of sparkling new opportunties for companies. Don’t just carbon copy the old customer relationship thinking – go to town on the computer and figure out how you can build and strengthen your loyal customers on a whole new generation of opportunities.
Customer loyalty is taking an ice bucket shower at the moment (and not the ALS kind). Loyalty has been a good buzz word, but you are hard to find true loyalty amongst customers or a bullet proof way of measuring it. The most obvious consequence of this are the latest redesigns taken by the kings of loyalty – the airlines. With major players scrapping a lot of the bonus programs for the 99% – selling their most valuable assets for cheap in order to attract normalpassengers just didn’t make any good business sense in the long run. Go figure!
The problem with company loyalty is that companies have been buying it – and worked in an economics game trying to figure out how to improve the margins between the cost of buying customers and the revenue from this purchase. All the way knowing though – that this isn’t really creating the type of loyalty they want; which is more motivational, personal and creates a feeling of ownership towards the company.
How does digital change the game?
If you are a fertilizing company, historically you would be selling fertilizers. But, forward thinkers know that farmers aren’t buying fertilizers, they are doing whatever they can in order to get more back from what they deliver – or, in other words; a farmer’s job is to get better crops. To do this they not only need fertilizer, but they also need to know where, when, how much and with what to fertilize. The forward thinkers help the farmer install sensors on their fields and farming equipment and offer them services to help them get better at knowing when, where, how much and with what to fertilize. And they work with the farmers every day to help them get better crops. While the traditional companies only come buy once every month or so with a bag of chemicals on the back of a truck.
This example shows us what’s happening with digital – the product becomes infrastructure and customers pay for the relationship that is best at helping them continuously improve at they job they are trying to do. Companies don’t sell products, they collaborate.
In the old model, loyalty was foreign objects satelliting around products without necessarily having anything to do with the offer itself. In the digital model.. loyalty is the product – collaboration is the product.