The third stage of mobile market evolution is the move from ARPU driven to Loyalty driven metrics. In today’s market loyalty is rarely prioritized as the main KPI, still secondary to ARPU, but represents the key route to long term profitability (Chief Marketer Most Recent). Too often brands take good customers for granted (The Big Kahuna). Not only do these loyal customers stick around, they are also an effective marketing channel (First Best or Different).
(chart from mobileYouth report 2009/1- insights into Youth Mobile Trends and Mobile Behavior)
The mobile industry doesn’t historically do customer service well (Customer Experience Matters) returning record churn rates (Geoconnexion) in even the most advanced of markets (itu.int), so should there be any cause for concern when brands that excel in customer experience (such as Apple) start building beachheads with young mobile consumers?
If you want to see what what happens if you ignore youth customer loyalty then look no further than the fortunes of US Auto – burdened by debt and unfavored by even their own domestic customers because they had focused too much on dealers and not enough on those paying their wages (Newgeography.com). Take a look here (The Customer Institute) to get a feeling for whose getting it right in this sector. GM certainly isn’t so no wonder it’s finding itself without much goodwill in the market to keep the company afloat (Customer Experience Matters).
Building a loyal base of young consumers is a healthy foundation for the future. This means moving beyond pipeline marketing loyalty tactics – i.e the worthless loyalty schemes (Satmetrix) and dreaded account cancellation crises (Customer Experience Crossroads) that only serve to enrage customers Blog & Buzz Marketing – and moving towards platform marketing loyalty that seeks to nurture a long term relationship without intrusion or annoyance (some inspiration here Springwise and here Chief Marketer Most Recent)
Platform marketing is more than just adopting social media and mobile. Talking “customer first” without effecting change at the level of organizational DNA means companies that continue to prioritize ARPU, market share, awareness and other short term metrics will gravitate towards short term tactics regardless of CEO led edicts to focus on consumer needs. The old Jack Welch addage “What’s measured gets done” holds true (The Perfect Customer Experience).
NPS is one such metric – not the holy grail but a start (Church of the Customer Blog). Lifetime value, churn and trust are others that brands need to prioritize alongside short term metrics in order to allow the organization to follow through successfully on loyalty tactics.
(pic from “The Next 10 Years” presentation)
Once longer term metrics are adopted strategy follows suit; brands are cut some slack in creative freedom to focus on the little things that matter (Buyer Behaviour), such as encouraging staff to be passionate about customer relationships (Customer Rock) and Brand Values (Buyer Behaviour) (Technorati)- a minor part of the business but a major factor in persuading youth which brands to buy.
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