Using Technology To Drive Loyalty

You are probably familiar with the term "loyalty program," however you may not know these programs do little to influence true loyalty.

So-called loyalty programs typically assign points to your continued usage of the vendors' product... the more you use it, the greater the reward. Think frequent flyer miles (FF miles), which began in 1981 at American Airlines to keep business travelers flying with them. While many argue that without FF miles, only a couple of airlines would remain today, from a loyalty standpoint they failed. That is because money, rewards, gifts, etc. do not impact what is most important - quality of products and services. If an airline existed that was almost 100% on-time, comfortable, went everywhere you needed to go, reasonably priced, safe, etc., but did not give you a "gift," how would this lack of a "gift" or "reward" impact your loyalty? Probably not at all. The gift only matters when you first meet the basic requirements for loyalty.

This issue of quality applies to every company and industry. Dell was once the poster child for exceptional customer service, a major competitive advantage, but is now fraught with customer service woes after letting customer service slip as Kevin Rollins, CEO, admits. So how can software help?

In and of themselves, nothing from CRM to ERP to ECM to BPM to BI to CEM to BRM or any other 3-letter software-related acronym will generate loyal customers. As much as a brochure may say, it simply will not happen. However as I discussed in May, enterprise software implementations with an agile plan, solid project management, executive sponsorship, collaboration between IT and "the business," realistic expectations, strong user adoption, and appropriate metrics with a feedback loop for improvements, can put your organization on the track for driving loyalty and profitability.