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Sunday 25 April 2010

Customer loyalty... going, going, gone?

(You are getting this note because you subscribed to The Shipping Blokes Blog by Brad Skelton)

Has anybody else noticed that customer loyalty seems to be dying a slow death as the forces of the internet gain more momentum? Now todays customers are better informed than ever in making their buying decisions and realise they are the ones holding all of the aces.

Courtesy of the internet today's customers can quickly search and find vast numbers of alternative suppliers of virtually any product or service and get real-time price comparisons. They don't really care anymore how long you have been in business or how big you are or how many offices you have or what great marketing promise you have come up with. The business climate has changed forever and the balance has tipped firmly toward the buyer and not the seller. Any company that thinks they can force customer loyalty somehow is now completely out of touch. In fact todays buyers can and probably will rebel against them.

If you think it is about price and price and price, then you are wrong. Sure it is a major factor in any buyers decision and every company needs to be competitive to survive however recent research suggests that in this fast paced world we live in people value their time and benefits more than their money.

This is the topic my good friend and mentor, Bob Bloom, has based his latest book "The New Experts" on. Bob has had a lifetime in marketing working for customers such as BMW, L'Oreal, Nestle, Southwest Airlines and little old Skelton Sherborne. Before retirement he was CEO of Publicis Worldwide. His immense experience is second to none and I always enjoy his no nonsense, cut through the crap style. Bob's common sense or perhaps "uncommon sense" approach has been dynamite for my business in helping me attract and retain the worlds leading shippers of heavy equipment and machinery.

I was sincerely honoured when Bob chose to write about some of the initiatives in freight forwarding we have come up with for our clients and even more honoured when he asked me to write an endorsement for "The New Experts".

This book is relevant, enjoyable and a compulsory read for anybody trying to come to terms with the thinking and habits of the new customer.

Bob has been kind enough to give me ten copies of his book. I will send a free copy to the first ten readers that leave a comment at www.TheShippingBloke.com offering a personal experience to the readers of this blog in dealing with the attitudes of todays customers.

If you miss out then you can buy a copy of "The New Experts" here.

All for now,

Brad Skelton

The Shipping Bloke


  1. I so want a copy of that book.
    As usual Brad is spot on, running a small boutique forwarding business on the Sunshine Coast I have a loyal band of followers who dragged me out of retirement from shipping, simply I do what I say , when I say but for a price.
    However in attempting to expand my client base it turned into a dutch auction my prospects were always keen to see my pricing, all I achieved in trying to grow my forwarding activities was driving the margins down the incumbent forwarder was getting. I ceased but am still happy with the business I have and I must say attract by word of mouth.
    My wife runs an accommodation business in Maroochydore and Brads words ring so true here as well. Whilst we do have a loyal band of clientelle thanks to the internet it is now star wars when it comes to rates.
    We at all times strive to deliver value for money, absolute cleanliness, and of course fabulous service.


  2. I think you are 100% correct.These days you have to give fantastic service as customers expect answers and information AT CALL,courtesy of the internet!
    best regards Joseph Sajn, Sydney.

  3. Retention of the "right" customer base is to be strived for - and the principals of good service, strong delivery and honesty along with good relationships (including a thorough understanding of the customers needs and drivers) helps deliver this. Simple things like making sure deliverables or project scopes are completely understood and signed off help.

    It should never be assumed that you have customer loyalty "in the bag" - its a precious thing that is very hard to get but can be taken away so easily.

    In our sectors of telco, property and construction there is always downward pressure on pricing from some quarters - and sometimes its better to let these customers go for the lower price - because when they find the old adage of "pay peanuts get monkeys" is true and they are faced with poor service, mounting delays and contractual claims thats when you can work on getting that customer back.

    Remember also some customers never learn that cheapest isnt always best and all you can do then is again wait untill they are neck deep in the smelly stuff and help out then - but remember rescue missions always pay very well indeed and charge them accordingly....

  4. The internet - and more to the point - the social web, has changed the dynamic of businesses globally. You either join the band wagon or consider yourself out of business. Customer loyalty is still there in a big way however those who have not adjusted to their customers needs will see this golden asset slip away. The pastures are very green online. Anything is possible! In industries such as shipping, which go back 100's of years, there's few social web innovators like we're seeing in travel, hotels, consumer goods, etc. So why not start developing online social tools to capture the needs of your customers and you'll be pleasantly surprised to see the new face of loyalty.

  5. Hi Brad,

    A very interesting article as per usual! We run a consultancy business in the Human Capital space which includes the provision of staff into the Transport/Shipping industry at times. Often we get "knocked back" for not being on the preferred supplier panel of the organisation when pitching for new business. What I have found is that the key is the need of the buyer - it is never a cheap price to supply the service; it is always the best man for the job - delivered fast. We have "cracked" every preferred supplier knock-back by re-approaching strategic people in the organisation with a great fit executive or specialist skilled employee when we knew they were hurting by not having such skills on board. Targeting the senior manager/executive in need of a service with a superior solution immediately available and you are in the door. Price comes next but the deal is done. The web is only a shop front to display your wares: you still have to give the customer comfort and convince them to buy. Look fwd to reading Bob's book whether as a "freebie" or over the counter. Cheers. Greg O'Hanlon. Ghi Consultancy Ltd. Dublin.

  6. Great and topical issue. Simply highlights the importance of retaining existing customers through relentless efficient service, strong businesslike relationship, and consistent pricing principles. We have found that new customers are attracted by strong professional branding, timely and effective communication, superior product knowledge and quality, transparent and visible pricing, and when discovered our reputation for the customer satisfaction provided.
    Keep up the good work Brad.

  7. Hi Brad,
    I really want to go through that book, probably would open my mind a bit more …however I guess it’s quite hard to demolish the idea that price is everything these days opposed to fidelity or loyalty of the old days
    Adrian C@ CSLS

  8. Good evening Brad,
    customer loyalty for me has been through the service that I choose to give my clients, this is not always the be all and all all though because if other staff memebers in the chain do not do the same then the customer walks. In one case the client has openly told senior managers that he stays because of me and only deals through me for all of hos enquiries - can be scary to be placed in such a positon but at the end of the day the customer pays my salary not my company, they are only the conduit.

  9. Customer loyalty really is that holy grail. While I struggle to find new ways to reach potential new customers, it is that final step to convert potential customers into customers that is naturally critical. I'd love to read the book to find out more.

  10. These comments are certainly true. The advent of the Internet has empowererd the consumer with information and has given strength to the meaning "knowledge is power". Armed with knowledge consumers can make buying choices before the sales organisation recognises there is an opportunity. The challenge for today's marketers is how they stay ahead of the game and create opportunities for themselves before a physical approach has been made. The solution may lay in doing the small things right, the "1 percenter's" as my football coaches used to say. Providing total customer care from start to finish. Thus creating a positive presence in the mind of the consumer and to be recalled when it matters most. This in a way is a form of loyalty, though it is a tenuous grasp we hold.

  11. Brad

    Truer words not spoken lately. The net has revolutionized our businesses and time is the new price - people will always take the path of least resistance whereby service and ease of doing business has replaced the cheapest price. I know in my own experience I will pay a little more for an easy process to get what I want - the net ususally solves that problem for me.

    Ignore E-marketing at your peril.

  12. To me customer relationship has always been on a 50-50 basis. It is not a long term relationship on a different ratio - up or down -Not only do you have to understand your customer, but he has to understand you and this has to come from the process you use to nuture your customer, & in return he not only gives you his business but his loyalty and committment and as well. This has to be done through the business process and not on an individual level. Personalities certainly come into it, but at the end of the day - the right product, committment to quality of service and a competitive price will flog your opposition any day of the week and keep your customer contented at your counter. It would be very interesting to read the book and get another perspective on how we can nuture and develop our customers further. Ross Mylrea - A Man's Toyshop. ross@amanstoyshop.com

  13. So I'm comment # Lucky-13, I guess I missed the books... So here's my comment anyway. I work for a small company that has a large share of a niche market (If I can plug it: www.mid-east.com , we sell ethnic Musical Instruments). We have been in business over 30 years and recently did our first real survey of our wholesale customers. By and far the #1 highest rating we received was for our customer service. My office staff is great. We can be having a miserable day, with problems piling up on our desk, and pulse racing out of control, but when the phone rings the person on the other end would think we are the happiest person alive. Before the internet boom we took all the orders over the phone, by hand. Now, we steer the orders to the website, its easier and eliminates errors. It has also made it so that when the phone rings, with someone that needs help, a real live friendly person answers. I’m on the computer all day at work- the last thing I want when I call a company is to talk to a computer. I want a person that know what they are talking about- or who can find the right person to answer my needs. We have some loyal customers that have told us they come back because of our service. We are not always the best on price, but if you have a question about a product, we usually have the answer within minutes. If we don’t have it, we will research until we have something that helps you. The relationships used to be with your local store owner. Now they are personal relationships on a global scale. We get photos of our dealers kids when they graduate- and we have never met them in person. The sales may be virtual, but the service, real good service, should never be. Kim, Gen Mngr. Mid-East Mfg.Inc.

  14. You gotta add value to justify the business. If you don't -- you're "sunk" (no pun intended!)

    --David Dow