Retain Customers by Building Community

 

While some may think that an annual customer retention rate of 80% is good, that means you loose one out of every five customers each year. Theoretically, this translates to 100% turnover every five years. And, as most business owners know, it is much more cost effective to retain a current customer than to acquire a new customer.

There are many approaches to retaining customers. Frequency programs purport to do so as do other customer loyalty programs. CRM systems are supposed to help with this. Some companies try to lock customers in through multi-year contracts and automatic rebilling. But the best approach to customer retention is community building because community building creates emotional connection and stickiness. People stay with the brand because it has created a community for them.

Think about how powerful coffee klatches, book clubs and bridge groups are. Imagine if you could create that type of community with your brand's customers.

So, what are some community building techniques?

• Producing user conferences.
• Creating customer advisory boards and customer steering committees. 
• Engaging customers through Facebook pages and other social media platforms.
• Holding customer meet-ups.
• Creating local brand-focused customer clubs.
• Creating physical spaces where customers can interact.
• Holding customer holiday parties and appreciation events.
• Recruiting panels of customers to beta test your new products.

Hallmark sponsors local Hallmark ornament collectors' clubs. Tesla Owners Clubs hold frequent owner meetups. Many wealth management firms hold holiday parties for their clients. Orvis offers free fly tying and casting clinics for its customers. Robert Graham offers exclusive closed door events for people who achieve Master Collector status within their Collector's Club. Most colleges and universities invite their graduates back to reunions every five years. Large churches create small groups focused on different interests to retain parishioners. Patagonia supports grassroots groups working to find solutions to the environmental crisis. Eastern Mountain Sports encourages people to share their outdoor photographs on Instagram with #goEast. SONY's Playstation has create an online space for gamers to connect. Harley Owner's Group (HOG) has more than one million members and holds HOG Rallies around the world. P&G created "Being Girl" as a resource for teenager girls to connect and find answers to the difficult questions that growing up entails. Lululemon's brand community offers free yoga classes, festivals and events and even an experiential store in Chicago featuring fitness studios and a juice bar.

If you want to retain more customers, identify and implement ways to create community among those customers. 

Using Lexicon to Build Brand Mystique

Some activities have their own lexicon, as do some brands. When I was growing up, I fished for muskies, walleye, perch and bass with my family. We took an annual two week vacation at Black Lake and spent much of our time fishing. Later in life, I took up fly fishing. In regular fishing, people sometimes use bobbers to indicate when a fish strikes. In fly fishing, these floating devices are called indicators. And in fly fishing, the study of etymology is critical. An attractor is an impressionistic fly pattern tied with certain fish-enticing characteristics. And one must know the meaning of caddis, callibaetis, chironomid, comparadun and Czech nymphing - and that is just a very small example of fly fishing terms beginning with the letter C.  Clearly fly fishing is more high-brow than bass fishing. 

Sailing has its own terms too. A sailor must know the difference between port and starboard. And one must know the difference between a close reach, a beam reach and a broad reach. It is really important to know the difference between tacking and jibing. And there are lots of terms for boat parts - i.e. halyards, a boom vang, a topping lift, stanchions and a windlass. 

And consider some surfing terms - focusing on just the terms beginning with C again - carving, charging, cheater five, choka, chowder, clidro, closeout, clucked, cranking, cripples and cutback. 

These terms seem to create a shared secret language or lexicon. It is a way to talk with precision about the essence and art of your activity. And it lets you know that the other person is part of your club. 

Brands also create their own lexicon. Consider Starbucks with its short, tall, grande, venti and trenta drink sizes. And how about skinny drinks and leaving room? Starbucks also introduced frappuccinos and macchiatos, terms people had not heard of related to the Maxwell House, Folgers or Sanka coffee brands. 

And consider Harley-Davidson related terms - ape hangers, bobber or bobtail, blockhead and chopper. And how about the Duo-Glide, Dyna Glide, Electra Glide, Hydra Glide, Super Glide, Tour Glide and Wide Glide, which are all Harley-Davidson registered terms?

And of course Apple has iMacs, iOS, iPhone, iPad, iPod, iTunes, iBooks, iPhoto, iMovie and iDVD.

Brand-specific lexicon helps people feel the bond of a shared language. It can lead to the sense of being an insider and even to a cult-like emotional connection to the brand. Consider what creating a brand-specific lexicon might do for your brand. 

Marketers Must Interact with Customers

We in the marketing community interact with each other a lot. We have our own language and our own issues. Advertising people move from agency to agency. And marketing people move from company to company. We attend the same conferences. And we are concerned about the same latest technologies and marketing techniques. 

This is reason enough to get out of our marketing "box" and spend some time with our customers. The other more important reason is so that we do not lose touch with the people to whom we are marketing.

Many companies require their marketing people to spend a few months to a year as salespeople before assuming marketing roles. Some companies require their marketers to monitor customer service calls several times a year. Some require marketing people to work on the front lines in customer facing positions at least a couple times a year. Other companies have required their marketing employees to role play the lives of some of their customers. Some research projects require anthropological research in which the marketer must observe customers as they purchase and use the brand's products. Harley-Davidson executives ride in HOG Rallies with their customers and then debrief what they saw and heard back at the office after the HOG rallies. One research technique for children and young adults is to ask them to take pictures of whatever they want in their lives for a period of time and then submit those pictures to the marketers to sort through and analyze. 

The point of all of this is to stay close to your customers and their lives so that you can understand and even anticipate their needs. This is an essential role of every successful marketer.

Trademark Law

As a brand steward, you must be aware of the laws under which legal protection is available. First, trademark law protects a brand’s identity. That is, it protects names, titles, taglines, slogans, logos, other designs, product shapes, sounds, smells, colors, or any other features that distinguish one source of products or services from another. Trademarks that protect services are often called service marks (“SM”). There are also “collective membership marks” (e.g., Boy Scouts of America) and “certification marks” (e.g., UL approved). Harley-Davidson filed to federally register the sound of its motorcycle engines. Dirt Devil vacuum cleaners are strongly associated with the color red. Geico owns the gecko icon. 

Trademarks, like brands, build in strength over time. The test for trademark infringement is “confusing similarity.” Put another way, if the average consumer believes both products to have come from the same source, there is infringement. Obviously, the more a consumer is familiar with a particular brand, the more defendable its mark. That’s why it behooves a company to do the following:

• Choose a distinctive mark, including a “coined” name. As I mentioned in the chapter on brand identity, brand names range from generic and descriptive to suggestive and arbitrary or fanciful (“coined”). Obviously it takes longer to build meaning for coined names, but they are also more distinctive and easiest to protect legally. Kodak, Xerox, and Exxon fall in that category. Suggestive marks are the next most protectable. Examples include Coppertone, Duracell, and Lestoil. Even common words can be used as trademarks as long as they are not used descriptively. These common words/phrases are also suggestive marks: Amazon (big), Twitter (brief and chatty), and Apple (different, offbeat). Descriptive marks are not protectable unless the brand creates a secondary meaning for the word, such as Weight Watchers, Rollerblade, or Wite-out. Generic marks, such as Shredded Wheat and Super Glue, are not protectable at all.
• Avoid geographic names as a part of your mark—they can be the basis of trademark refusal.
• Register the mark.
• Be consistent in the use of the mark.
• Create strong trade dress (as discussed later in this chapter).
• Widely advertise and distribute its trademarked products.
• Do all of this over a long period of time.

Because the strength of a mark is dependant upon consumers’ familiarity with it, it is much easier for a competitor to neutralize your mark soon after it has been introduced than after it has been in use for a long period of time. Courts use the following tests to determine infringement:

• Strength of the trademark claiming infringement.
• Similarity of the two marks.
• Evidence of consumer confusion.
• Care a consumer takes in comparing products.
• Intent of the organization in using the potentially infringing mark. (Some drugstores and grocery stores use generic brands that emulate a leading brand’s package shape, colors, typestyle, formulation, etc., and display the product side-by-side with the leading brand to imply that there are no differences between the two, encouraging consumers to purchase the lower-priced generic item. In this situation, there is clearly intent to emulate the leading brand and reduce the perceived differentiation and value advantage of that brand, but it is not clear that there is intent to deliberately cause confusion as to source.)
• Relatedness of the two businesses.
• Overlap between communication and distribution channels.

By using the mark in association with your products and services over time, you gain trademark protection. Registering your mark (marks can be registered at the state and federal levels) provides additional protection. Although common law and federal trademark statute protect an unregistered mark, registering your mark transfers the burden of proof to the second comer in challenging a mark’s registration. With federal registration, you can sue infringers in federal court. Also, after five years of registration, the mark becomes incontestable. Federal trademark registrations last ten years and can

be renewed every ten years ad infinitum.

You can acquire trademark rights in one of two ways. To acquire trademark rights based on use in commerce, you must be the first person or organization that uses the mark in conjunction with the products or services for which trademark protection is sought. To acquire the mark base on intent to use, you must apply to  register the mark through the United States Patent and Trademark Office.

Before choosing a trademark, first conduct a simple search to weed out marks that are not available. This search can be done online for free (for a list of online resources go to www.brandforward.com). After that, for the remaining candidates, conduct a full search through a law firm specializing in trademark law or through an experienced trademark search firm.

Strong brands run the danger of becoming category descriptors. Always use trademarks as adjectives, not verbs or nouns. If your brand is in danger of becoming a category descriptor, consider talking about your brand in the following way that differentiates the brand from the category. For example: “Jell-O® gelatin,” “Kleenex® facial tissue,” and “Xerox® photocopier.”

Note: I am not a lawyer and this blog post is not legal advice, but rather is meant merely to help you consider the legal issues in brand management. When actually dealing with any specific issues in this area, please consult with lawyers who have an expertise in intellectual property law.

(c) 2016 Brad VanAuken. Reprinted from Brand Aid, second edition.

Brands and Happiness

One lens through which you can view your brand is, "How does my brand bring happiness to people's lives?" Does your brand make people happy? Does it make their lives easier? Is is surprising or unexpected in some way? Is aesthetically pleasing or beautiful? Is it charming? Is it amusing? Is it funny? Does it help people save time or money? Is it an indulgence? Is it quirky? Is it intuitively easy to use? Does it convey status?

Consider GEICO's gecko. Or Apple's product design. Or Dos Equis' Most Interesting Man in the World. How about iPhone's Siri? Or the scent of a Cinnabon product? Or the anthropomorphic M&M characters? Or the latest Hermès scarf design? Or the feeling of driving a brand new MINI? Or Harley-Davidson bike? Or even the simplicity of Swiffer house cleaning products? Consider the friendliness of your local Starbucks barista. 

How does your brand bring happiness to people's lives?

Brands and Belonging

Remember the television show, Cheers? People love to spend time in a place where everyone knows their name. Churches, coffee houses, book groups, country clubs, fraternal organizations, bowling leagues, summer communities - they all create a place where people feel as though they belong. People want to be recognized and understood. They want to hang out with others who know their name, share an interest, share stories and perhaps even share the same view of the world. 

Starbucks creates its in-between place where people can relax and get to know one another. I have met several of my friends of many years at Starbucks. Orvis is a place where people who love fly fishing can hang out. The North Face is for the outdoor enthusiast. Robert Graham wants you to join their Collector's Club and Hallmark wants you to join its Hallmark Keepsake Ornament Club. Harley-Davidson owners feel an affinity for one another as do Patagonia and Tesla customers. 

Colleges and universities want their graduates to feel a lifelong affinity to their institutions and brands. They go to great lengths to create alumni associations and events. 

How is your brand creating a space or platform for people to feel as though they belong and are known? 

Robust Brand Identity

A brand's identity system helps people recognize the brand. It helps people encode the brand in their memories and quickly extract it from their memories. The system incorporates a number of identification triggers. These almost always include visual components but can also include other sensory components such as Cinnebon's cinnamon scent and Harley-Davidson's engine sound. Several hotels are exploring distinctive aromatherapy scents. The visual components can include a shape or icon such as Nike's swoosh, McDonald's arches or the Olympic rings. Often packaging shapes are a part of the system such as Coca-Cola's distinctive bottle shape or Absolut vodka's unique bottle shape. Colors are usually a part of the system such as John Deere's green, UPS's brown or Southwest Airline's vibrant color palette of blue, red, gold and orange.

Consider personal brands. I am known by my name. Sometimes people associate me with my Brand Aid book. Many people know that I earned an MBA at Harvard. People who interact with me in person know that I usually wear a bow tie with a jacket.  People that know me well expect me to arrive in a Toyota Prius as I have owned three of them since 2000. And friends know that I am a passionate sailor. Each of these are "brand" associations that may also serve as triggers for people to think of me. My brother associates me with scary clowns, but that is another matter entirely.

The more distinctive elements that you can build into your brand identity's system the better. They may include names, shapes, colors, patterns, type fonts, visual styles, sounds, scents, textures, flavors, spokespeople, jingles and feelings. You can also associate your brand with occasions, events, situations, product uses, lifestyles or particular types of people.

The system should be rich but not overly complicated and flexible enough to be effective in every media, use or application. And here is the most important part - you must use the elements consistently over time once you have decided what they are. This is key to memory encoding and decoding. 

Brands and Memory Structures

An important role of the brand manager is to determine the memory structures associated with the brand so that marketing communications can reinforce and leverage these structures. Also, potentially useful new brand associations can be discovered in the process.

For instance, Bush beans might be associated with summer, picnics, grilling, family and Duke (the dog). Coke might be associated with its bottle shape, the color red, the beach, parties and nightclubs. A pizza brand might be associated with cheese and tomato sauce, family and friends and watching sports on television. Hallmark's greeting cards are associated with holidays, special occasions, family and friends. But they also are associated with candy and flowers among other product categories.

Everyone knows McDonald's arches and Nike's swish. Most people associate Harley-Davidson with the sound of its engine. Many people associate Tesla with Elon Musk and batteries and alternative energy. People associate Cinnabon with the cinnamon scent. Many brands are associated with fond childhood memories or with sex. What is Old Spice associated with? How about Dos Equis? ("Stay thirsty, my friends.") GEICO? 

The trick is to discover all of the items people associate with the brand so that those associations can be reinforced, built upon and used to help people recall the brand associated with not only marketing communication and the brand identity itself, but also with specific relationships, occasions, complimentary products and other memory triggers.

If you have not identified and mapped out your brand's memory structures, you need to do so. it will help with the effectiveness of your advertising and your brand's identity system.

Brands and the Emotions they Evoke

Brands can evoke strong emotions ranging from excitement, anticipation and happiness to anxiety, trepidation and revulsion. 

For instance, if your spouse surprised you with a Maserati Quattroporte S for your birthday, how would you feel? If you won an all expense paid vacation in Branson, MO, how would you feel? If you won the same for Paris, France, how would you feel? If Donald Trump was elected president of the United States, how would you feel? If Hillary Clinton was elected president of the United States, how would you feel?

If you were told that your spouse was serving Spam for dinner, how would you feel? If dessert was Ben & Jerry's ice cream, how would that make you feel? If instead, you were going to The Capital Grille for dinner, what emotions would that evoke in you?

If you were required to watch South Park on television, how would that make you feel? If you were required to watch Downton Abbey instead, how would that make you feel? How about if you were required to watch FOX News? MSNBC? 

When I say Harley-Davidson, how does that make you feel?

How would receiving a Blackberry smartphone make you feel? How about an Apple iPhone?

What if I gave you a free carton of Marlboro Lights? How would that make you feel?

I hope I have made my point that strong brands evoke strong emotions. Do you know what emotions your brand evokes? Are these the right emotions to stimulate purchase and to reinforce loyalty? Or do they work against the brand in some way? Do the emotions the brand evokes vary by consumer segment? (The answer to this is usually "yes.")

I encourage you to determine the emotions your brand evokes for its different customer segments and then to amplify the emotions that have the most positive impact on the brand.