Customer Loyalty vs Repeat Buyers

All to often businesses confuse customer loyalty with repeat customers.  A repeat customer is simply a repeat purchaser.  A local coffee shop will often have it’s ‘regulars’ who buy a latte and muffin each day, and typically the coffee shop may offer a ‘loyalty’ punch card, buy 9 beverages and the tenth is on us.  The punch card is a form of manipulative marketing, or forced loyalty.  Take away the punch card and you remove the false customer loyalty.

Now, imagine a new coffee shop opens up one block away that provides equal quality coffee, service, and baked goods.  The new shop also has a loyalty program.  For the coffee consumer there is no real differentiation between the two coffee shops.  The false loyalty shop one thought it had is displaced by a new choice in the market place.

True customer loyalty occurs when a consumer turns downs a better priced or better quality product and does business with you.  Since we are talking about coffee shops here, a great example of a company that has tremendous customer loyalty is Starbucks Coffee.  Typically their beverages cost more then the average coffee shop, and last time I checked, their loyalty program was not all that great.

So why do consumers go out of their way to find a Starbucks over other local coffee shops?  It all starts with their mission statement: “To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.”

Starbucks is a master of providing a phenomenal customer experience in their stores and their employees are experts at the one minute conversation and know how to connect with people. Sure the coffee is good, but consumers can get that almost anywhere.  What they can’t get most places is the experience of visiting a Starbucks

Starbucks is a great example of a company that is fuelled by inspirational marketing.  It all starts with the core reason you are in business and expands out into everything that you do.  From there, one of the side effects is a tremendously loyal customer base.  A customer that is willing to do business with you over just about anyone else, all because your business inspires them.