By | Ramesh Ranjan | Editor
Is loyalty a virtue or a value or just an emotional state of the mind/heart or is there a rationale behind it?
Loyalty can largely be driven by emotional connect between two parties – the producer & the consumer, the employer & employee, leader & followers. However many use Rewards (Carrot & Stick) to drive loyalty. Emotional loyalty, when achieved, has an enormous value and cannot be induced by force or incentives.
I worked in a Indo-Japanese two wheeler company way back in the 80’s and was a roaring brand. The company was in a remote place far away from the nearest city and company would not provide transport only to its senior executives and most employees had to fend for themselves. The public transport was not very effective and many employees used to travel on their own and mostly on two wheelers.
One day the Head of HR observed that in the vehicle parking area, there were many two wheelers of competitors parked over there. For a moment he was livid.
“How can we permit our competitor two wheelers be parked here”
He then raised hornest nest within HR and called for a meeting where he raised the question “should we allow our employees to bring to work & park their motorcycles of competitors brand”. There was a lot of heated discussions & debate and finally sense prevailed and he did not persist with his demand of not allowing competitors motorcycles being used by employees or parked within the premises.
However he did carry a grudge against these employees and silently would feel “how dare these employees who are supporting competitors work for us?”
In another example, I worked for a Multinational Oil company. They were into retailing LPG Gas to consumers. At
that time there was a huge price differential between what the Private LPG Gas companies sold vs the Government run Oil Companies, because the Government run Oil Companies used to enjoy Government Subsidies and the Private Oil Companies would not enjoy the same benefit.
There the company was struggling to sell to domestic consumers and was on loss. The CEO raised the issue of whether employees should buy the companys LPG Cylinder at home or should they buy the cheaper Government LPG Cylinders. Again there was a lot of heated discussions & debate and finally sense prevailed and he did not persist with his demand. However he would continue to ask employees as to what cylinder they were using and it would endlessly embarrass the employees as no one wanted to fork out additional 300-500 rupees per cylinder.
Recently we read Binny Bansal, Founder & CEO, speaking at an accelerator programme in Bengaluru
“My wife is a BigBasket customer,” Bansal said, breaking into laughter at the SAP Startup Social event in Bengaluru . “And I’m trying to convince her to buy groceries from Flipkart.”“My wife is a BigBasket customer,” Bansal said, breaking into laughter at the SAP Startup Social event in Bengaluru . “And I’m trying to convince her to buy groceries from Flipkart.”
There is an air of expectation from the Founder & CEO that his wife & family should buy the companys products. Given his gregarious nature he took it lightly and even joked about it but many a other Founder or CEO would have felt very embarrassed and not want to talk about it in public.
In another curious instance a relative of mine worked as Head of Marketing of a very large brewery company. Surprisingly he was a teetotaller. He managed to survive for long and had a long & successful stint with the company and under a mercurial leader. I used to wonder how he could go about selling alcohol to others and promote them day in and day out when he refused to drink.
When you yourself, your own family, employees are not convinced about your product how can you influence others to buy. This is a ethical burning question. Companys cannot force their employees to be their brand ambassadors or buy their products & services.
It is human nature to seek fulfillment. However, money can change a person, even the most loyal of them, and seldom do they consider the virtual bridges they leave to ashes.
Rewards are good ways to buy customer loyalty but when it comes to establishing and maintaining long-term customer relationships, you need to do more than bait people. You have to give customers a reason to stick around. These efforts can be in many forms, but all of them are based on the rule: Loyalty is a culture, not a commodity, and it’s not something that cannot be bought; it must be earned. The emotional appeal, emotional connect and the customer experience is what ultimately drives loyalty. That’s why customers que up in droves to buy at McDonald or at Apple Stores.
You cant take your customers for granted. As can be seen from above you cant take your own family or employees for granted. There is no guarantee that your own kith & kin will stand by you or rather you cant take them for granted. Loyalty has to be earned.
Loyalty, of course, is reciprocal, and both the company & stakeholders have a vested interest in promoting loyalty. That vested interest is hard to earn but extraordinarily valuable once it is achieved.