Marketers need to stop focusing on loyalty andstart thinking about RELEVANCE! ~Harvard Business Review
What a wake up call to those of us who have been in business for awhile! Read on...
"If your customer retention strategy relies on “buying” loyalty with rewards, rebates, or discounts, it is coming at a high cost. And these days, it could also mean that you’re giving up something priceless:your relevance. That’s because the “loyalty era” of marketing, as we’ve known it, is waning. It was built in part on the notion that consumers will keep buying the same things from you if you have the right incentives. Yet, according to recent consumer research from Kantar Retail, 71% of consumers now claim that loyalty incentive-programs don’t make them loyal at all. Instead, in this new era of digital-based competition and customer control, people are increasingly buying because of a brand’s relevance to their needs in the moment." ~HBR
As we all look towards our marketing plans for 2020, we need to be smart about the approach.
Relevance has been on our minds at Walden's for quite a few years as we realized we must be a "living" business and could not simply offer the same thing and market the same way, year after year, hoping to be successful.
Instead, we now need to be like the concierge of a luxury hotel in order to serve our clients with a more personal approach, understanding their current needs and desires.
And, yes, we finally came to the realization that loyalty was dead!
General Mills was producing Yoplait with great success as simply a yogurt with fruit that was an alternative to "unhealthy" snacks. However, General Mills is a huge conglomerate, producing mass produced items with plastic packaging and they only marketed on price and promotion.
As the new Greek yogurts such as Chobani entered the marketplace (and the consumer's minds), they were seen as more meaningful and authentic to food traditions. Now, Yoplait had a problem...it was becoming less relevant to the savvy consumer who wanted more than a good price. This new consumer wanted to be part of something bigger and more relevant. Food based in national traditions such as Italian olive oil or Icelandic yogurt were becoming more and more popular.
"Recognizing that its long history of making French yogurt could be turned into a market advantage, it embraced a traditional French method in which yogurt is cultured and sold in small individual glass pots." HBR
Now, the consumer could take pride in purchasing these small glass pots of authentic french yogurt as it connected them to an authentic tradition. I was one of those consumers who was intrigued by these little glass pots as I searched for a good yogurt and I must confess, I loved the fact that it was french and the little glass pots...no words:-) Of course, the ingredients didn't disappoint as they were simple, non-GMO and natural.
This was a huge pivot for a very large company. We need to learn from this example as we all work to be and stay relevant to our clients.
Questions to ask ourselves:
*For those of us who specialize in wall portait art...are we aware of how home layouts have changed and are we offering solutions that are relevant to our clients? Do we know the trends in paint colors and home design that could impact what we offer?
*Are we aware of cultural changes and does our imagery reflect it? For example, we now offer an alternate option from a very clasical approach in our style to a more casual and family friendly approach. The men in the families really appreciate this option and are more willing to step through our doors:-)
*As our culture trends more towards personalization in experience, do we have tools to help us learn about and understand our clients, their desires and what they are looking for in a portrait? I believe we need to dig much deeper and spend more time to get to know our clients in ways we may never have years ago.
Today's consumer, with digital technogy, is evaluating every purchase decision in ways we never dreamed about in the past and they will choose relevance over loyalty. Are we a living and morphing business to stay relevant in meeting our clients' needs? If not, they will go elsewhere.
But, "living" businesses that stay relevant will be the ones who retain clients that will pay the asking price and keep coming back.