Your customers are like Mr. Spock from Star Trek. (Leonard Nimoy, rest in peace.) In popular culture (as opposed to geek culture), Spock has become a synonym for cold-blooded logical thinking. But, as the true geek knows, Spock’s father was from Vulcan and his mother was from Earth. Talk about an identity crisis! Spock is a half-Vulcan. Just like your customers.
Customer loyalty literature expresses the dichotomy this way:
- Affective commitment – The emotional pleasure your customer takes in doing business with you, their identification with your organization, their sense of belonging with your brand. We’ll call this the Human impulse.
- Calculative commitment – The cold-blooded logic that dictates why your customer has a business relationship with you: the economic analysis of the benefits vs. the costs of that relationship, the economic suffering if you fail them, and other rational considerations you offer. We’ll call this the Vulcan impulse.
Now much of the drama of the original Star Trek series—and a key reason Spock is central to the recent reimagining of the franchise—grew from the half-human, half-Vulcan nature of Spock. How would he react in a particular situation? Which half would (temporarily) triumph?
And much of the drama of your business involves determining what keeps each of your customers loyal. Will the Human impulse forgive a lapse on your part? Will the Vulcan impulse cause them to quite logically switch to another supplier that introduces a more economical alternative? Which half will win, and why?
Robrecht Van Goolen and Katia Campo investigate this issue in their research report, “Does Commitment Really Provide Protection against Critical Incidents and Competitive Switching Incentives? The Differential Impact of Affective and Calculative Commitment” [PDF]. Their conclusions:
Based on the results of the preliminary analysis, we can conclude that affective commitment [e.g., the Human impulse] plays a much more important role in building customer loyalty than calculative commitment [the Vulcan impulse]. Not only does it have a stronger effect on customer loyalty in general, it also increases the ‘goodwill’ to accept (temporary) service failures and provides a much stronger protection against competitive inroads.
The distinction with more calculative based commitment becomes especially important when the effect of major events (service failures of the favorite company or switching incentives of competitive companies) and longer term effects (share-of-wallet) are considered. In the short term, and when the consequences of the event are of minor importance, calculative commitment may provide a similar protection as affective commitment. Yet, the probability that the trade-off between switching advantages and costs will turn out in the advantage of competitive companies is substantially higher when customers are only committed to the product or service based on expected rewards rather than satisfaction with and a positive attitude towards the product or service.
As Esteban Kolsky argues, “Loyalty Can Be Bought“. But if you buy your customers’ loyalty with a loyalty reward program geared towards rational rewards, don’t be surprised when such customers (the “mercenaries” of the Apostle Model) sell their loyalty to a competitor who offers even better rational rewards.
To build true loyalty, you have to appeal to the Human impulse, not the Vulcan impulse. Your loyalty reward program should work to increase customers’ affective commitment: increase the pleasure your customers take in doing business with you, strengthen their sense of belonging to your brand and deepen their sense of identification with your organization.
In the 21st century or the 23rd century, Humans make more loyal customers than Vulcans do.