Symmetrix's Crosby: Measure, model and manage

You could be a Harley Davidson fan (therefore, a tattoo is in order). Then, you may not. Either way, there's no denying the fact that if loyalty to a brand were to be defined succinctly, the word "Harley" would suffice. However, even Harley had its bad days. The cult bike company almost went out of business in the 1980s, and in a move to save its neck, and the business, Harley created H.O.G. (Harley Owners Group), a platform for Harley riders to interact and share their passion for the brand. This initiative reignited the flagging interest in the company and its bikes, and revived its business. Today, the wait for a Harley is a year long. And with over 900,000 members in its fold, H.O.G. is probably one of the most recognised examples of what a sound customer loyalty programme can do to the fortunes, and brand loyalty, of a company.

As Lawrence A. Crosby drove home the point on Harley to the audience, heads bobbed. Crosby, after all, should know a thing or two about customer loyalty. The founder and ceo of Symmetrics, the global practice in the area of customer loyalty of Synovate (the market research arm of communications behemoth, Aegis Group Plc.), he is a recognised expert in the field, having worked with companies around the globe on customer loyalty programmes for over 30 years. In India for the Business Today Knowledge Management Forum in New Delhi on July 12 and Mumbai on July 14, organised by BT in association with Synovate and Avaya Global Connect, Crosby addressed a select gathering of senior and middle-level managers of India Inc. at Delhi's Marriott Hotel on the theme "Raising the bar: Increasing your return on customer loyalty". On the occasion, Pavan Varshnei, Publishing Director, Business Today, said: "The goal of the BT Knowledge Management Forum is to define issues, provide commentary by experts, and set the agenda for evolving best practices."

Synovate India's Managing Director Alok Shankar

Avaya Global connect's Director (Marketing) Amit Sinha

Business Today's Publishing Director Pavan Varshnei

"To raise the bar and move an organisation forward requires embedding customer loyalty into the fabric of the organisation," declared Crosby. Harley wasn't the only example he used to prove the truism behind this statement. Cirque Du Soleil, Apple, Nike, Starbucks and South West Airlines were other notable instances he touched upon to demonstrate the fact that companies in the US, and elsewhere, were increasingly achieving their marketing and financial objectives through customer loyalty programmes. Defining customer loyalty as "a behavioural predisposition on the part of the customer to respond favourably towards the brand/company consistently and across situations", Crosby pointed out that it was increasingly becoming the centrepiece of business strategy. Having interviewed over 500 CEOs worldwide on their top business priorities, Crosby had arrived at a rather interesting conclusion. Among the priorities laid out, sustained topline, somewhat predictably, came out tops with 51 per cent of the CEOs considering it the most important, followed by adaptability (45 per cent), and customer loyalty in third position (41 per cent).

So, is customer loyalty an abstract concept, which cannot be laid down in black and white? Is it something you can only hope to achieve through better marketing and higher service standards? Not so, if you went by Crosby's analysis. To gain customer loyalty, Crosby advised companies to follow a three-step process: measure, model and manage. "Measure" entailed creating a performance matrix of touch points that a particular organisation can be measured by; "model" meant creating statistical approaches to measure customer loyalty; and "manage" is a process of creating an atmosphere within the organisation that would align it and its employees to customer loyalty. There's a caveat, though, as Crosby warns: "No single study works; there has to be an integrated measurement system that looks at all touch points that influence customer loyalty."

The seminar wasn't a one-man sermon, though. The senior and middle-level managers in attendance also put up their queries for the expert to answer. Rishabh Mehrotra, General Manager (Marketing), ACL Wireless, wanted to know how he could ensure customer loyalty in a business-to-business environment, which inevitably entailed lack of control over franchisees. Crosby suggested leveraging an individual franchisee by exercising strict control over quality. However indirect, all customer interactions were touch points that gave his company opportunities to improve. Then, Raji Chandru, Deputy General Manager (Patient Services), Indraprastha Apollo Hospitals, wanted to know how different services in a hospital could be measured by a standardised yardstick. To which Crosby's answer was: all services could have different measurements, but the standardised yardstick must be attentive patient care. Some of the attendees also touched upon their own experiences in enhancing customer loyalty. Amit Sinha, Director (Marketing) at Avaya Global Connect, spoke of how Avaya concentrated on relationship management after parting ways with Tata Telecom. "We realised our forte was customer relations and we were further aided on the technology front by Avaya," said Sinha.

A parting thought here. For those who believe that purchase decisions in India, particularly rural India, are based primarily on cost considerations, Crosby has an observation to make. "After seeing washing machines displayed in sitting rooms in rural India and talked about with great pride, we reached a conclusion that a purchase decision has more emotional motivation here in India than in the West," he said. According to Crosby, in emerging markets, all other factors being nearly equal, emotional motivation is the single biggest deciding factor behind a purchase.