Lessons in LOYALTY

Business growth depends on improving customer loyalty behavior. Companies with higher customer loyalty usually experience faster business growth than companies with lower customer loyalty, research has shown. Different business growth models exist, but they all share one common premise: The primary...

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Bibliographic Details
Published inQuality progress Vol. 44; no. 3; p. 24
Main Author Hayes, Bob E
Format Magazine Article
LanguageEnglish
Published Milwaukee American Society for Quality 01.03.2011
Subjects
Brand loyalty
Business growth
Customer feedback
Customer services
Discriminant analysis
Polls & surveys
Service industries
Studies
United States > US
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Summary:Business growth depends on improving customer loyalty behavior. Companies with higher customer loyalty usually experience faster business growth than companies with lower customer loyalty, research has shown. Different business growth models exist, but they all share one common premise: The primary factor responsible for driving business growth and company value is customer loyalty -- the degree to which customers experience positive feelings for, possess allegiance to and exhibit positive behaviors toward a company. A new measurement approach can help organizations identify and assess three customer loyalty components: retention, advocacy and purchasing, or RAPID. In turn, organizations can learn more about their customers and formulate better strategies to accelerate business growth. While there has been improvement in the quality of managing customer loyalty survey data, the quality of the measurement and meaning of customer loyalty has not kept pace. Factor analyses show the apparently disparate loyalty questions really measure three components of loyalty: retention, advocacy and purchasing loyalty.
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ISSN:0033-524X