Demand-side promiscuity (and control by customers)

Bob Tyrell ^[2] described the conditions for 'exit' behaviour in social relationships and how this relates to buyer behaviour and loyalty. Individuals are more confident about making their own choices, partly because they have access to many more information sources than previous generations. They demonstrate their new confidence by:

• accessing the company how, when and where they want to;

• controlling the relationship and not wanting to feel controlled;

• asking to be valued and treated specially, particularly if they are a valuable customer;

• switching suppliers if they feel aggrieved, or if they receive unfulfilled or disappointing service 'promises'.

The Henley Centre's report, The Loyalty Paradox, ^[3] demonstrates that while companies often talk about their need to manage relationships with their customers, few customers use this language or indeed behave in this way. According to Frederick Reichheld ^[4] of Bain and Co, 'Between 65 per cent and 85 per cent of customers who defect say they were satisfied with their former supplier'. Reichheld suggests that sometimes customers stay because they are locked into long-term contracts or because they are unaware of competitive offerings. Reichheld proposes ^[5] the 'Loyalty Acid Test', which is a set of surveys that measures the loyalty of customers, suppliers' employees and other corporate stakeholders. The Loyalty Acid Test addresses the basic question: does this organization deserve your loyalty?