Loyal customers are much different from satisfied customers. 
Do you know the difference?
I didn’t but I think I do now.
During a training session this week we explored the differences between the two.
Derek Roberts, our sales coach for this week’s training described the difference this way:
“A satisfied customer says I received value (I’m satisfied) whereas a loyal customer says I received value and I am valued (I’m a loyal customer).”
Can you see the difference?
A satisfied customer believes they pay a fair price and receive value for the goods and services they receive.
A loyal customer believes the same as a satisfied customer but also believe (know) we value them as much as a customer as they value us.
Transactional vs. Relational
A satisfied customer is more transactional (an exchange of goods and services for money) whereas the loyal customer is much more a relational transaction. They want to be valued as much if not more than the value they receive.
How many companies consider you a loyal customer?
Derek, gave this example:
He has been a long time customer of his Internet Provider. They mostly meet his demanding needs which the other providers in the area can’t. He is subscribed to their premium package and doesn’t require much attention from them. However, when he does have a problem they seem to always mess up. They get the billing wrong, make him wait for what seems like hours to talk to someone. You get the idea. So, Derick is at best satisfied but also feels almost like a hostage.
But he suspects the Internet Provider considers him a loyal customer. He has had a long relationship with the provider. He is signed up for the best packages they have to offer. They don’t hear many, if any complaints therefore he must be loyal.
Derek is far from being a loyal customer. I don’t think he would even consider himself a satisfied customer. He goes all over the country telling this story about how unsatisfied he is with his internet provider, yet I think he is probably on their list as a loyal customer.
A loyal customer will stand up and sing your praises to all that will listen. They are willing to put their reputation on the line for you and your company. They will refer you to their friends, family and anyone they feel you could provide a value. It’s more than a fair price. To a loyal customer it’s about the relationship between you and them.
Satisfied vs. Loyal Employee
Another good example that I think we can all relate to is a satisfied employee vs. a loyal employee.
A satisfied employee feels they receive value for the work they perform. (fair pay, benefits and working conditions)
A loyal employee also feels satisfied (transactional) plus they know they are also valued (relational).
The benefits provided by both loyal employees and loyal customers are much the same. Both customer and employee loyalty is one of the most important factors in any successful company.
Loyalty vs. Longevity
We must not confuse longevity for loyalty as I think Derek’s internet provider probably does. I don’t believe time has anything to do with loyalty. I think it’s a common mistake made by many of us. We mistake years of being a customer as a measure of loyalty.
Nor can we believe we can have a loyal customer without them being a satisfied customer first. Without first providing value (I’m satisfied) it will be next to impossible to build the relationship a loyal customer expects.
Conclusion
Will you begin thinking of what makes you a loyal customer and let me know?
I would also like you to start thinking what you need to do to convert your satisfied customers into loyal customers?
If you are blessed with many “truly” loyal customers do your very best to never let them become just satisfied!
The road to having loyal customers begins with satisfied customers first. Once they find value in what we have to offer we must continue gaining their trust and making sure they know how much we value them.
Thank you for taking the time to read this article.
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A little something extra:
Customer loyalty doesn’t have to be a personal relationship. I consider myself a loyal customer to Amazon. I wish they were local but that’s not to be. I have always been satisfied with their prices, delivery and customer services (I receive value) but it’s the service and contact after the sale that makes me feel valued. I know they don’t know me from Adam but they always ask my opinion of the products I buy. Anytime I’ve needed to return something it has never been a problem. And they are always sending me recommendations of products they think I may need (ok two out of three ain’t bad). I hope you get the picture.
I’m always recommending Amazon and trust that they will treat others as well as they have treated me.
Now let’s get out there and over-deliver!
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