Apple of THEIR Eye: Customer Retention Strategies Transform Business

Key to Customer RetentionAmerican businesses are built for the hunt, for acquiring new customers.  We love closing the deal.  In fact, the White House Office on Consumer Affairs reports that we spend 6-7 times more on selling than we do on customer retention strategies.  This is astonishing given the overwhelming evidence showing that such strategies can have a profound impact on both revenue and profitability.

A study by BIA/Kelsey revealed that only 38% of businesses offer some sort of customer loyalty program, and most are built on at least one of three pillars:

  • Discount programs…typically activated at point of sale
  • Rebate/cash-back programs… accrue financial benefits over time
  • Points programs… accrue points for future deals/rewards

The truth is, many of these programs are created to “buy” a customer’s affection and are not designed to create long-term customer loyalty. 

They may be initiated with the best of intentions, but forsaken over time as priorities (and CMOs and budgets) change. A study by ACI Worldwide revealed that more than 85% of consumers who participate in loyalty programs report hearing NOTHING from the company since they signed up.  In other words, the vast majority of American businesses are only giving lip service to loyalty.

But there are some companies that “get” customer retention. 

They get that adherence to customer retention strategies can enhance long-term profitability from 25-125%.  They understand the probability of closing a new prospect is between 5-20%, compared to 60-70% when selling to a current customer.

If your business runs loyalty programs, are you disappointed with the ROI?  If you’re planning to develop customer retention programs in the future, do you know where to begin?  If the answer is yes to either question, consider the following foundational philosophies for customer retention:


Many companies articulate and publish “core value” statements to their employees.  Having core values is a good thing. However, it is another thing for a company to create a culture that embraces and “lives” its core values on a daily basis.

Southwest Airlines created a customer-centric culture by embracing a simple principle: they are in the business of serving people, not flying airplanes. To sustain this culture, Southwest hires based on attitude as much as, if not more than skill-sets (with the exception of hiring pilots, we assume!).  

Zappos is another company that understands the importance of culture, with core values such as: “Create fun and a little weirdness” and “Be humble.”  This culture begins at the top with Founder/CEO Tony Hesch (who has become somewhat of a customer service guru in American business), is embraced by the employees and, most importantly extends to the company’s loyal customer base.


Apple enjoys nearly cult-like adoration that translates to customer retention of more than 90%.  Apple understands the importance of delivering a consistent “experience” beginning with products that combine innovative technology and great design. But it is at the retail level where the Apple experience truly comes to life for consumers.   Apple Store associates are taught a simple, five-step approach to customer engagement that is worth sharing:

  • Approach with a personalized, warm welcome
  • Probe politely to understand all customer needs
  • Present a solution for the customer to take home today
  • Listen for and resolve issues and concerns
  • End with a fond farewell and invitation to return

If you’ve shopped in an Apple store, you know that the employees embrace this acronym with passion.  Every day.  What’s your customer service acronym?


We’ve all experienced customer service representatives who do not have the authority to make important decisions on our behalf.  This speaks to fear-based corporate cultures more than anything.

Zappos first core value is: Deliver WOW through service.  The company empowers its customer service team to do whatever necessary to satisfy its customers. Tales of Zappos WOW service are legendary.  Its associates have been known to help customers shop competing sites if a desired product is out of stock.  Once, a Zappos associate sent flowers and a condolence card (at her own expense) to a customer whose husband passed away.  

Are you employees empowered (and rewarded) to go the extra mile for your customers?


As suggested earlier, many customer loyalty programs are veiled attempts at buying a customer’s affection (and repeat business). Sure, we all love to get the FREE pizza after buying our 10th.  But is that free pizza meaningful? 

By contrast, Nordstrom’s Fashion Rewards Program is considered one of the best in the retailing industry. The program delivers meaningful benefits tailored to the needs of the customer: private shopping parties; individualized style experiences, holiday shopping parties.  This level of personal engagement inspires and compels Rewards Program members to shop TWICE as often and spend THREE times as much as the typical Nordstrom shopper.

And it begs the question: is your loyalty program inspiring true loyalty?

Regardless of your industry or business type, customer retention strategies should be one of your highest priorities.

Here’s a hint as you consider such strategies: replace the word “program” with “experience.”  What kind of cultural experience are you creating with your organization…and is it being extended to a superior customer experience that drives loyalty?  And profits?

Keep losing customers? Download our free eBook  on loss and retention to find out why.

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RDI Corporation was founded in 1978 and is headquartered in Blue Ash, Ohio. We provide precise business solutions through a fully integrated outsourcing model and our clients ranged from mid-sized corporations to distinguished Fortune 500 companies.