In the book Loyalty 3.0 by Rajat Paharia, there are examples of loyalty in a business and the benefits that it plays. In chapter one titled “May You Live in Interesting Times” we learn the importance of building a relationship with clients so there is a deeper connection rather than a transactional relationship. This aspect keeps the customer coming back and resisting competitive brands or companies. Customer loyalty is not the only type of loyalty that matters in a business. Employee loyalty is one of the most important forms, because employees can steer the direction of the business. If internal loyalty is flourishing, clients and customers will feel more connected to the brand. Third, partners of the company should have loyalty as well. Partnerships that are actively engaged with the brand will have more of a willingness to work together with the brand to ultimately flourish.
The book expands on the current loyalty programs being faulty and not creating loyalty in the way that would build the company. The new way to cultivate loyalty requires three main methods. The first is motivation, knowing what motivates both your customers, your employees, and your partners helps to understand how to drive engagement and satisfaction. Big data is the next method, which has been growing continually as social apps and websites collect data from users. This data is extremely helpful in personalizing rewards and reaching the third method, gamification. Gamification is a way to make rewards fun and exciting, drawing in stakeholders to behave a certain way for a reward. The chapter emphasizes that a brand should aim for true loyalty, a tier of loyalty to that is earned by a deeper emotional connection between a brand and its stakeholders. They give an example, “If a new store opens across the street or a competitor slashes prices, a brand with true loyalty won’t lose customers because the relationship is based on a deeper connection of trust and shared value” (Paharia 14).
Although these methods may gain true loyalty, this chapter explains that we live in interesting times. The author says that technology has made this generation of loyalty unpredictable and sometimes uncertain. The rate at which a business can change is higher than ever before, and brands can grow or fall at any point. There are a wide variety of options, competition and distractions at any given point while on the internet, and this can have brands facing many challenges. There is so much information going on, that oftentimes there are not a lot of solutions to stand out as a company. Finding ways to create loyalty is the most beneficial asset to a company.
The author continues to explain the downfalls of technology in this age, and the effects it has on loyalty within a business. However there are many practical solutions that will be explored later in this book that will help with loyalty. Knowing the motivations of the customers a brand deals with and the employees within a brand is one of the first steps of this process, which is explored in chapter two.
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