Last week I shared the Loyalty Matrix – a framework that segments customers into four categories based on their attitude and behavior.
When we discuss this framework, people are typically very intrigued with the “trapped” category. It seems to be an element often missed in customer satisfaction ratings, Net Promoter Scores, and other measurements. The trapped customer is indeed unique.
In some ways trapped customers are appealing because they are giving every indication they are going to continue doing business with you. And that’s good!
However, this can be a short-term approach to building customer relationships and companies should be careful with it. We’ve found time and time again there are important differences between a loyal customer and a trapped customer.
Remember, trapped customers show positive behavior (plan to keep doing business with you) and negative attitude (not real happy about it). So it is no surprise that trapped customers tend not to refer you – a valuable element when you are attempting secure new business. What’s more, trapped customers tend not to increase their spending with you and may not be very open when you propose new products and solutions. Finally, when a new competitive offering comes along, trapped customers are much more likely to check it out.
In contrast, loyal customers will refer you, increase their spending at a much greater rate, and will resist other offers when they come their way.
While retaining customers is certainly important, it can be short term. Building loyal relationships is a long-term approach to more rapid growth and higher profitability.
Patrick Gibbons
Principal/SVP
Walker
When we discuss this framework, people are typically very intrigued with the “trapped” category. It seems to be an element often missed in customer satisfaction ratings, Net Promoter Scores, and other measurements. The trapped customer is indeed unique.
In some ways trapped customers are appealing because they are giving every indication they are going to continue doing business with you. And that’s good! However, this can be a short-term approach to building customer relationships and companies should be careful with it. We’ve found time and time again there are important differences between a loyal customer and a trapped customer.
Remember, trapped customers show positive behavior (plan to keep doing business with you) and negative attitude (not real happy about it). So it is no surprise that trapped customers tend not to refer you – a valuable element when you are attempting secure new business. What’s more, trapped customers tend not to increase their spending with you and may not be very open when you propose new products and solutions. Finally, when a new competitive offering comes along, trapped customers are much more likely to check it out.
In contrast, loyal customers will refer you, increase their spending at a much greater rate, and will resist other offers when they come their way.
While retaining customers is certainly important, it can be short term. Building loyal relationships is a long-term approach to more rapid growth and higher profitability.
Patrick Gibbons
Principal/SVP
Walker
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Thanks for your comment. We use a specific battery of survey questions that allows us to segment customers into the four quandrants of the loyalty matrix. In instances where account managers are trying to consider if a customer is trapped, they can often look at their spending and their openness to new offerings. Typically trapped customers are stagnant and don't show much interest in your new stuff. Regarding "rescuing" these customers, remember that trapped customers actually are not leaving. They are staying, somewhat grudgingly. The key with trapped customers is to consider what can be done to create a more healthy attitude so that they can be converted to a loyal customer, which not only will stick around, but will recommend you and will potentially spend more with you.
Every situation is obviously unique. However, that's where I would tend to start when addressing trapped customers.