home Customer Experience, People There’s no such thing as Customer or Employee Loyalty

There’s no such thing as Customer or Employee Loyalty

I remember being devastated when I learnt that Santa Claus and the Easter Bunny weren’t real…but as reality set in, I was embarrassed that I’d let myself get fooled for so long. It’s taken me a lot longer to come to terms with the reality that there is no such thing as employee loyalty. At least, not anymore.

The Collins Dictionary’s definition of loyalty: Loyalty is the quality of staying firm in your friendship or support for someone or something

Loyalty is something we can certainly expect from a family member or friend or even a pet. But in this age of continuous disruption, is it really something that companies and brands can expect from employees or customers?

In a different time, employers hired people who stayed with the organisation for their entire careers. In our time, employees average just under three years with a company. In the old paradigm, less choice was available in the market for both employers and employees, and stability was an attainable prize for both parties. In our time, disruption is an everyday occurrence, and stability hinders our quest for experiences.

However, some employers are still focused on employee loyalty. They want to hire someone with a virtual guarantee that this person will stay with the organisation indefinitely. In our time, how is such a guarantee even possible? Employers have to make hard decisions that affect even the most “loyal” of employees, and employees are onto the fact that they’re part of the “family” of the organisation… until the day they’re not.

What employers need to understand is that they really aren’t after “loyalty.” Instead, employers are after a combination of effort and retention. You may think this is just semantics, but the difference in definitions is important. It frames the employer-employee relationship differently and allows us to create a measurable plan to support it.

This plan serves both the employer and the employee. Employers are clear about what they want, employees understand what they get for doing it. It also builds better relationships – built on business needs and professional boundaries.

The companies of decades past (before globalisation, mobilsation, social networking, financial crises and private-policital hybrids) may have been able to foster mutually beneficial feelings of loyalty. In today’s reality, loyalty efforts are better focused on targeted retention and effort initiatives.

Customer loyalty is also a fiction

If you can’t expect the people who work for you (ie employees who are financially dependent on you) to be loyal how can you expect loyalty from complete strangers. Customers give brands or products positive reviews or referrals if they have a positive experience with that brand not because of any notions of loyalty. Bad experiences mean bad reviews.

People will remain loyal to family and friends despite negative experiences and arguments. Not so with the brands they buy products and services from. So it’s not loyalty companies should be aiming for but the ability to consistently provide customers with positive experiences. It’s more a matter of having the channels in place to influence people’s behavior for a certain period of time.

Tricia Mikolai

Global Marketing Lead for Energy Exemplar & Principal for Mikolai Consulting. Tricia is an expert in behavioural economics and how it impacts the customer and employee experience. Tricia is responsible for leading multiple successful initiatives to help Fortune 1000 companies drive performance improvement. She is committed to sharing her knowledge and experience with business leaders to help them drive and sustain business results. Currently, she is writing a book on behavioural economics.