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Loyalty Rules: How Today's Leaders Build Lasting Relationships Paperback – July 3, 2003
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From Publishers Weekly
Copyright 2001 Cahners Business Information, Inc.--This text refers to the Hardcover edition.
Top Customer Reviews
Many people take the financial incentive to keep customers longer as encouragement to employ all of the latest loyalty-building tools (from data-mining to loyalty incentive programs). Mr. Reichheld is correct that encouraging people to be loyal while treating them with bad service, poor products, or disloyalty in return will not work. He argues instead for a values-based orientation that will remind many people of the principles in The 7 Habits of Highly Effective People.
The essence of the concept for creating loyalty is: "Show your partners [stakeholders like customers and employees] that loyalty is a logical strategy for the pursuit of self-interest when self-interest is defined in the context of lifelong success."
His six principles for building loyalty are paraphrased as follows:
(1) Always play to provide wins for the stakeholder as well as for the company.
(2) Be selective about the employees and customers you take on and encourage to stay with you, so that they enhance your cooperative system.
(3) Keep your approach to being loyal (and earning loyalty in return) simple. For example, "Do right by the customer" was an actionable motto for Intuit when bugs cropped up in its tax software.Read more ›
The main rules Reichfeld sticks to and calls the "high road" are the following:
1. Focus on win/win solutions with partners
2. Focus only on clients which you can serve well
3. Focus on simplicity to allow everyone to understand the rules
4. Develop a set of principles and live by them, rewarding others who act according to those principles.
Overall, he makes a strong case to show how these principles can have a positive effect on business. By having low turnover, a fast food restaurant spends very little on HR expenses. By focusing on the bikes their customers love (and not diversifying), Harley gains lifelong customers.
The weakenesses of the book lie in the overemphasis of loyalty, in relation to other important tasks in business. Of course, being a book on loyalty, one could not expect anything different. Additionally, it would have eben useful to have some fake types of loyalty as example of weak attempts at loyalty. I am sure certain companies must have tried to gain loyalty through not-so-smart measures, so it would be nice to haev examples in order to differentiate them.
Overall, it is a very interesting book, useful to anyone involved in customer related businesses and in managing employee relationships. It is short (a benefit) and a bit too concise (a drawback), so it should not take more than a week to read for a regular reader.
In his most recently published book, Practice What You Preach, David Maister explains why there must be no discrepancy whatsoever between the "talk" we talk and the "walk" we walk. Reichheld agrees, noting that the "key" to the success of his own organization "has been its loyalty to two principles: first, that our primary mission is to create value for our clients, and second, that our most precious asset is the employees dedicated to making productive contributions to client value creation. Whenever we've been perfectly centered on these two principles, our business has prospered." It is no coincidence that the world's most highly admired companies are also the most profitable within their respective industries.Read more ›
Most Recent Customer Reviews
This book provides an easy read on what principles are required to build loyalty, both among your employees and your customers. Read morePublished on March 27, 2013 by Michael Ruckman
Really good principles on loyalty. A very good attribute to learn and understand in business. Great insight on the "Loyalty Effect". Very good for communication. Read morePublished on April 15, 2009 by Amazon Customer
When the majority of CRM/loyalty books still focus on convincing top management of the importance of CRM/loyalty as if those top management are ignorant of it, the author points to... Read morePublished on March 6, 2006 by ServantofGod
In today's economy, changing jobs is considered by many as a sign of a successful career. Customers and shoppers are constantly bombarded with challenges to find a better deal. Read morePublished on February 15, 2006 by Amazon Customer
Not long ago, loyalty was out of fashion. Tom Peters said, "Forget loyalty. Try loyalty to your Rolodex. Read morePublished on December 11, 2003
In Frederick Reichheld's 1996 book, The Loyalty Effect, he argued that a 5 percent increase in customer and employee retention can increase profits between 25 percent and 100... Read morePublished on October 22, 2003 by Max More