Is There Any Loyalty Out There?
By: T.J. Tedesco
For: High Volume Printing
Published: December, 1999

There’s a lot of complaining about the lack of loyalty in our industry.  Employers aren’t loyal to their employees, employees aren’t loyal to their employers, and most importantly, customer loyalty is dead.

At the end of the decade, it looks like we have a new economic world order.  From 1986 to 1997, three things were certain: Death; taxes; and, the printing industry will grow at the same rate as the Gross Domestic Product (GDP).  Basically, this meant that if the economy does well, printers do too.  No longer.  Andrew Paparozzi, of the NAPL Printing and Economic Research Center, has pointed out that beginning in 1998, the growth rate of our industry has been half that of the GDP.  Whether this trend is an aberration, or a foretelling of things to come, nobody knows.  In light of this uncertainty, printers should examine the loyalty of their customer base and doggedly work to improve it next year.

You’ve heard it all before.  “The competition is fierce … customers jump ship for a nickel … and, there’s no customer loyalty anymore.”  Yes, we all can point to examples of customer actions that prove these points.  However, instead of harping on them, I think it’s more important to focus on what we can control, namely our actions and selling propositions.  Think of customers that have reduced or stopped using your services.  Did you do everything you could to make them loyal, or did you discover that (God forbid!) they were purchasing out of habit? 

Habit vs. Loyalty

It’s easy to confuse purchasing habit and loyalty because the short-term top and bottom line results are the same.  Even if you ask your customers how you’re doing, the answers look scarily similar.  Both types of buyers may say “You’re doing fine.”

What are some key phrases to listen for?  “You’ve never given us a reason to leave,” may sound good to the untrained ear, but these words indicate that you’ve never given them a reason to stay either.  Rather, you want to hear comments like, ”You’ve bailed us out of so many jams that we won’t take our business anywhere else.”  

Do this exercise.  Take the top 20% of your customers that give you 80% of your business and honestly try to categorize them as either “loyal” or “habitual” purchasers.  (Hint: Companies with multiple key business influencers may be both.)  Tally the columns.  If you’re honest, you may be both surprised and worried about the results.

What Now?

Information is more than half the battle.  Although your customer base may be less loyal than you’d like, at least you can take steps to shore up your profitable accounts before a competitor identifies them as low hanging fruit.  Since it’s cost-effective to increase business with existing accounts, focus on them for growth.  Increase your share of customer by offering spectacular service.  Ask what you can do better, and as long as the requests are remotely reasonable, comply.  For example, if your top customers want your preflighting process to be smoother, listen to them and act.  It’s better to make improvements while you have them as customers instead of later.

Improvement is a multifaceted and never-ending process.  As your plant improves its services and quality, improve your marketing efforts.  Shower your customers with useful information.  Be a teacher – it’s what they’re craving.  Catch your competitors napping: While they try to pry your accounts away with bagels and donuts, create fortresses of loyalty by helping the people you know do their jobs better.  Here are three tips that will start the New Year right for you.

1.  Be an industry ambassador.  Buyers like dealing with people who are recognized as industry experts.  It’s easier to get articles published and give speeches than most people think.  If you have doubts about your writing ability, let someone else put ink on paper for you.  If you have doubts about your speaking ability, remember that every public speaker once climbed the podium for the first time with knocking knees.  Like everything else in life, public speaking gets easier with practice.  Also, 

• Offer seminars to your customers.  These can be as short as one hour if necessary.  Try to get customers to your plant because you can follow up your talks with tours.

• Find out what associations your customers belong to and join them.  Become active in membership committees.

2.  Improve your listening skills.  Most sales representatives would sell more if they talked less.  Fantasy?   I think not.  According to management guru Tony Alessandra, the best sales representatives out-listen and out-question their poorer performing counterparts.  The best sales representatives ask twenty-five times as many questions as lower performing ones.  Why?  Talkers are perceived as having their own agenda.  Listeners and questioners are considered to be more genuine.  Most buyers will tell you exactly how to sell their account, but you have to hear them.

3.  Be brutally honest.  When things go wrong, don’t duck.  It’s amazing how people will try to help you as long as you’re shooting straight.  (Note: There’s a difference between being honest and being an alarmist.)

Conquer Fear

Although it may not seem so to you, buying printing services is both stressful and difficult.  There is a lot technology out there and most buyers either can’t or don’t keep up with changes as well as they should.  Fear is a great purchasing motivator.  Buyers are worried about their jobs – pun intended – and the best print sales representatives are able parlay this fear into loyalty.  Printing companies that reduce their customers’ purchasing anxieties are less vulnerable to competitive guerilla pricing tactics.   Loyal buyers know that it’s too risky to switch printing companies for a few dollars. 

How about self-inflicted wounds?  Every printer will be late on occasion.  Machines breakdown, key operators call in sick, and miscommunication happens.  Print sales reps are frustrated by internal production snafus because of the strain it puts on customer relationships.  This is where a concept called “idiosyncrasy credit” comes into play.  (Idiosyncrasy credit is the pot of goodwill that is built up over time due to good performance.)  As problems occur or are perceived to occur, idiosyncrasy credits are depleted.  However, as solutions to these same problems are found, idiosyncrasy credits can be fully replenished … and then some.

We live in an industry where problems occur – guaranteed.  Therefore, we are in the solutions-manufacturing business, and nothing else.  The trick is to keep our pot of idiosyncrasy credits not only positive, but wildly so.  Loyalty is high when credits are high, but quickly vanishes without creative solutions to problems.  It’s up to sales representatives to manufacture these solutions.

In the political world, idiosyncrasy credit is referred to as “political capital.”  Politicians build up as much political capital as they can by pursuing popular legislation and “spend” it on unpopular issues.  Politicians need positive political capital to do something important to them – get reelected.  This really isn’t any different than selling print.

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In today’s changing business world, it’s not enough to meet delivery dates and have a reasonable product.  Job’s have to feel right and the production process has to go well.  Buyer’s want “no surprises” and will pay more for this privilege.  Every time a significant printing order is placed, your customer’s customer is on the line, and your client’s job may also be on the line.  Understanding this is the key to creating lasting customer loyalty.  Happy New Year!

T.J. Tedesco is a “hands-on” marketing, sales, coaching and training consultant to the post press industry. He is the author of Binding, Finishing & Mailing: The Final Word, and Win Top-of-Mind Positioning, both published by GATFPress and available at Amazon.com. T.J. can be reached at (301) 294-9900 or tj@growsales.com.