Here is a brief excerpt from Colin Shaw‘s article for LinkedIn. To read the complete article, check out other superb resources, and sign up for email alerts, please click here.
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Successful companies have loyal employees. They also have loyal customers. But the question for researchers and consultants for the past two decades is how these two groups are related, if at all.
Over the past 20 years, the connection between the two groups, loyal employee and loyal customer have only had a loose connection at best. However, Beyond Philosophy’s Thought Leadership Principal, Michael Lowenstein, PhD and CMC, may have found a way to connect the two. The foundation of his findings is based on the concept of the difference between employee satisfaction and employee engagement.
There is a difference between a satisfied employee and an engaged one, although many organizations do not see it. Simply put, [begin] satisfaction refers to how an employee feels about his or her job as it relates to compensation and benefits, room for development, work environment and related conditions while [begin] engagement refers to the employees desire to go above and beyond what is expected of them to innovate and further company goals based on their discretionary effort. While you cannot have an engaged employee without first being a satisfied employee, you certainly could have a satisfied employee who isn’t engaged.
Researchers saw that the need for engagement was critical to companies that wanted to thrive in the new global economy. This was the key to the new generation of business and its related success. What they also learned was that the engaged employees had the best ability to affect the customer experience, which is essential to building customer loyalty. In other words, they bring the customer the “wow” factor.
The Challenges of Customer Loyalty Today
Customer loyalty is tougher to develop these days. Companies face commoditization of their goods and services based on globalization and access provided by the Internet. More and more customers are finding new channels, and in some cases, suppliers for their brands. Doing things the way they have always been done will not continue to work for many businesses. They must continue to adapt to new technology and consumer channels in order to survive.
The only place where this isn’t as true is with older generations like the Baby Boomers and Generation X that are still loyal to their brands for the most part. They tend to stick with what they know and what has worked for them in the past. This group will usually only change when the pain of the change is less than the pain of sticking with what they know.
But the Millennials otherwise known as Generation Y are different than the Baby Boomers and Generation X. They grew up in world with the Internet and are more comfortable with technology than any other generation before them. They adopt new ways of doing things faster than their predecessors. They also believe that they should have it the way they want it, when they want it. Generation Y members are, as a group, good shoppers and are likely to employ an aggregator site to find the best price, which diminishes their store or company loyalty. But the one good bit of news in analysis of this generation, is that they do like their brands and they are loyal to them.
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So the question becomes, how can you create loyalty these days when it seems to be as passé as parachute pants or twerking? The answer is….
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To read the complete article, please click here.
Colin Shaw is the founder and CEO of Beyond Philosophy, one of the world’s first organizations devoted to customer experience. Colin is an international author of four best-selling books and an engaging keynote speaker. To learn more about Colin, please click here.