The content of the article was contributed by Dhruv Verma, founder of Thriwe and hence contain quotes from him.
In business, the term ‘loyalty’ carries a lot of weight. Customer loyalty, on the other hand, is of major concern now for many businesses.
Consumers that are loyal to a company or product will pick it again and again because of previous favourable experiences. Now, this is the kind of loyalty businesses are always seeking to retain their status as market leaders. For a business, customer loyalty plays a massive role in upscaling its brand to greater heights.
Some studies show the chance of selling to an existing client by a brand is between 60% and 70%, whereas to sell a new customer is between 5% and 20% only.
Off-late with the rising competition and innovation among businesses and organisations, businesspeople are finding it challenging to keep up with their customers’ loyalty for a longer period.
Here is what Dhruv Verma of Thriwesays about customer loyalty, “loyalty must be pinned back with the “Esteem needs” from Maslow’s hierarchy of needs theory. As long as the esteem needs are getting nurtured and fulfilled, loyalty remains intact for every customer.“
Indeed, the needs of customers these days do not depend upon the service that they were using before, it is all about going for the latest trends no matter which brand is offering them.
He further adds, “The paradigm shift in customer loyalty has ushered from the perspective that there is a constant evolution of esteem needs.“
As per Forbes reports, 68% of consumers worldwide are more devoted to firms and organisations that make it quick and convenient to interact with them.
We now know for a fact, how customer loyalty is so important, let us understand some points that can impact a customer’s relationship with their brand.
A lot of brands aren’t able to keep up with customers’ expectations. The reason is customers expect a firm to be always in pace with customer service in the constantly changing ecosystem and lifestyle needs. If a brand fails to do so, then it exposes the organisation to the risk of diminishing consumer loyalty.
With the constantly evolving ecosystem, customers want a company to be at par with customer service, but failing to do so, brands do feel the heat of declining customer loyalty – Dhruv Verma, Founder of Thriwe
Lack of Unique Relevance to Customers
Sometimes, customers do not show any emotional attachment to the particular brand if they don’t find it relevant to their needs. In this process of keeping a consumer engaged, firms provide repetitive rewards and perks, while the other brands also provide the same giveaway. As a result, the rewards do not stand apart from the competitor’s reward. This tends to render the agenda obsolete and of little importance.
To keep a customer engaged, companies give rewards and benefits that are redundant in nature, the competitor brands are also giving the same giveaway that you as a brand are giving to customers. Hence, when the rewards are not well thought of, it tends to make it a redundant program with little relevance – Dhruv Verma, Founder of Thriwe
Failing to Appreciate Customers
Customers are the lifeblood of every business. Every business must care for and appreciate its customers. Customers expect their brand to treat them well and receive outstanding treatment and services. It is mandatory for businesses to really meet their customer’s expectations. If customers feel that they are not acknowledged during their interactions with the company, the firm will surely fail, even if they have the slightest chance to retain customer loyalty.
Every business runs because of customers if the customers are not appreciated during their course of interaction with the business, customer loyalty is definitive to decline – Dhruv Verma, Founder of Thriwe
Consumers look for uniqueness in every product or service they use. If a firm’s product lacks a unique selling point, it simply means it is copied and accessible at a lower price, and then the company will almost certainly lose a price-sensitive consumer to a competitor. As a result, customer loyalty will decline. Businesses really need to offer some unique value to differentiate their products from competitors. In order to survive the competition, companies have to work more efficiently to attract the attention of potential buyers in the market.
If the company’s product doesn’t hold a USP of its own, it tends to get replicated easily and is available at a lesser value then a business is sure to lose a price-sensitive customer to a competition. Hence the reason for the decline in customer loyalty – Dhruv Verma, Founder of Thriwe
Lack of Consistency
Consistency means building trust. In life also, everyone wants consistency, because without it, there’s no balance, and you cannot rely on a certain thing. In business as well, customers look for a brand in which they can put their trust and not worry about it. Inconsistency in branding can lead to poor brand awareness and push away all the loyal customers for good. For brands, it is imperative to stick to a particular brand voice or quality they have been providing since the beginning.
Customer loyalty, stickiness, and engagement with the brands depend on a whole lot of things and businesses should keep a close eye on the ever-evolving nuances of customer loyalty – Dhruv Verma, Founder of Thriwe
Conclusion
No doubt, organisations today are neck-to-neck with each other to remain at the top of the list of their potential customers. The solution not only lies in the above-mentioned points or just fancy marketing campaigns, but it is way beyond all of these. Companies need to have a clear vision and well-thought-out plans and strategies to make their customers always feel special.
FAQs
What makes consumers feel more devoted to brands?
As per Forbes reports, 68% of consumers worldwide are more devoted to firms and organisations that make it quick and convenient to interact with them.
What makes customers less loyal?
Major reasons that make customers less loyal are:
Failing to Keep Up With Customer Expectations
Lack of Unique Relevance to Customers
Failing to Appreciate Customers
Easy Replicability of the Product or Service
Lack of Consistency
What is the probability of selling to existing customers?
Some studies show the chance of selling to an existing client by a brand is between 60% and 70%, whereas to sell a new customer is between 5% and 20% only.
When given a chance to interact with your customers, would you use the same messaging to communicate with people who’ve made their first purchase and repeat customers? Well, you wouldn’t. It is because they are entirely different audience segments. While the former has just been introduced to your brand, the latter knows your brand better.
Businesses often refer to the latter category as VIP customers because they have made a significantly higher number of purchases or they have a high lifetime customer value attached to them. They have probably contributed more to your bottom line than any other customer. Hence, as a business, you naturally gravitate more towards them and make extra efforts to retain them.
Crafting well-planned and personalized nurturing email sequences is one of the best ways to keep your VIPs engaged 365 days of the year. If you pull this off correctly, you can generate a whopping 4,200% ROI on your email marketing efforts. If you have an email list with a slow dying engagement rate from your VIP customers, try the following ways to gain it back.
Grant VIP Customers Early Access to Sales & New Product Launches
Making people feel special can go a long way in establishing long-term relationships. So if you’re planning to launch a new product or roll out a season-special sale, create an insider segment to inform your VIPs first of these events. Email them a day before or give them early access to sales.
When you execute this step, ensure you make the VIPs know that they are the ones receiving this privilege. Just like Amazon Prime members get early access to certain sale events, you can make your VIP customers get something similar. The more special you make your VIPs feel, the better.
Create Exclusive Survey Campaigns for VIP Customers
Haven’t heard from your VIP customers lately? Fret not! You can reignite the lost engagement rate by sending them engaging emails containing survey forms. Since the VIPs are the ones who have made most purchases, they understand your products better. When you seek peoples’ suggestions, they feel valued.
So planning survey campaigns can have two benefits. The first is making your loyal customers feel heard, and the second is fetching valuable reviews that can be used to better the product, service, and overall business operations. You can use tools like Survey Monkey to design visually appealing and interactive survey forms.
Incentivize VIP Customers for Referring Your Products
Importance of People Referring Your Products
Everyone loves receiving discounts, gift vouchers, free delivery on their next order, or a free sample product from their favorite brands. What if you could use this to generate more sales and make more brand loyalists? Well, it is doable. All you need to do is strategically develop a lucrative referral offer that gives people a reason to share your favorite products in their network.
The incentive can be anything that lures the reader to hit the share button. You can dig into the previous purchase patterns of your VIP customers and see what prompted them to make the previous purchases. Was it a special discount you were running, a BOGO deal, or something else? You can create multiple personalized referral email segments based on their purchase patterns and personal preferences to ensure the campaign has a high engagement and success rate.
If your past email marketing strategy included sending too many sales-oriented emails, you should stop now. People don’t like emails that constantly try to sell them something. Continuing with this method can result in people reporting your emails as spam or unsubscribing from your email list.
To ensure you don’t make this mistake, try sending occasional emails thanking them for their patronage. You can either send them a well-crafted thank you email or choose to add a discount code or gift voucher as a way to amplify your message. If you have VIPs with high lifetime customer value, sending them a thank you note with a bit of surprise is best.
They most probably weren’t expecting such emails, and this move can make them purchase more from your business.
Use Advanced Analytics to Boost Personalization
Email Marketing Effectiveness
You can only generate a spark with your email communications if they are highly relevant to the recipient. Since VIPs belong to the repeat customers’ category, it is easy to predict what they like and expect. Besides checking their customer profile on your business software, you can also dig past emails sent to them on your email marketing tool to analyze which subject lines or email themes garnered maximum responses from them.
Searching for an advanced analytics tool that gives you a better understanding of your VIPs past behaviors can also be done. Ultimately, you want to craft emails that look like they’re directly talking to the recipient and are of interest to them. If you can pull this successfully with the help of analytics, you’re sure to witness visible results.
Conclusion
You can generate more business with your email list. Your email list is your biggest asset that no one can snatch away from you. But it takes proper nurturing to maintain the list. If you have a segmented list of loyal customers, you cannot expect them to remain interested in your brand by sending them the same emails you’re sending to your one-time customers.
Repeat customers expect more from your brand, so you must make extra efforts to keep them happy. While there are endless ways to keep an email list engaged in your brand, not every option might work for you. But to make things easier for you, this guide lists all the possible options to help you make the cut.
All you have to do is try out each option listed above, and see what works best for your business. The more A/B test you conduct, the better.
FAQs
What is customer engagement?
Customer engagement is the process of creating a good relationship between the brand and customers. Customer engagement’s main aim is to create brand awareness among targeted customers and make them loyal to your brand.
How do you engage VIP customers?
Different ways to keep your VIP customers engaged are:
By giving them early access to Sales & New Product Launches
Offer incentives to VIP Customers for Referring Your Products
Send occasional Thank You Emails
Use Personalized emails and offers
What are the best ways for customer engagement?
Some of the best ways for customer engagement are:
Surveys
Chatbots
Emails
What are the types of referral programs?
There are 4 types of Referral Programs for businesses to use:
A successful firm isn’t built by luck or by how much money you invest into it; instead, it’s the result of a series of activities made to grow a brand, which is guided and reinforced through time by a set of skills and choices. Building a brand is essential for every firm that wants to succeed, but sustaining it is even more critical and complex. It ensures that it remains relevant as customer behaviour evolves.
When marketing a product or service to a significant number of people, it’s better first to link them all to a common platform and then explain what’s available to each of them. The objective should be to create a compelling conversation that allows you to shift views, analyse expectations, and clarify the subject.
A brand mantra is a brief expression that captures the essence of what a brand stands for or the image a company would like to convey. A brand mantra is usually two to three words long. Although the message’s wording might vary, the tone is the most significant factor. A statement describes a brand with a sequence of adjectives and may or may not include the brand name.
A brand mantra communicates emotional and intangible connotations that attempt to generate a connection between a customer and a brand, which might shape the brand’s overall sentiment. The tagline of a company is frequently its brand essence statement, and as such, it is critical to brand identification.
The language used in a brand mantra represents the company and its goods and differs significantly from one to the next.
A brand slogan should be chosen based on the consistent experience and the emotional response it elicits in its clients. It hopes to pique the curiosity of new customers drawn to such attributes and promote brand loyalty among existing customers through this consistency and emotional reaction. For rebranding initiatives, marketers frequently devote a significant amount of work to developing a new brand motto statement.
Brand principles are all about capturing your product or service’s target market and instilling confidence in current and potential customers.
A solid brand management strategy aids in the development of a corporate image, and the brand manager is responsible for overseeing the brand’s overall success.
Brand management encompasses both the intangible and tangible aspects of a brand on a larger scale. The tangibles for product brands include the item itself, packaging, pricing, and so forth.
When it comes to services, tangibles include the client experience, while intangibles involve the emotional connection.
Credibility
It all starts with sincerity, the primary goal, personality, and worth. Every brand is built on the foundation of trust. It refers to the perception that a brand’s product information is accurate and fair. Credible brands are perceived as having the capacity and desire to deliver on their promises by consumers.
It is a never-ending and ongoing process. Product positioning, customer experience, value-added services, and customer relationships with the brand are intangible components of brand management that contribute to credibility.
Concentrate on your most vital skills and then communicate them consistently. There have been multiple cases when firms have bought other brands only to subsequently sell them off because the purchases did not fit within the parent company’s brand architecture.
Be Consistent
When it comes to distinguishing your message, consistency is always the key. For whatever you do, own up to your position on all reference points.
The degree of harmony and convergence among the marketing mix parts is consistent. It also refers to the consistency of marketing mix techniques across time. Companies must develop and maintain brand consistency in design, communication, and delivery.
The pattern of expression that influences what others perceive about a brand is brand consistency. The branding will be more consistent if the messaging is consistent. It doesn’t matter through design, language, or viewpoint.
Connect with People
A brand is more than simply a name, a logo, a website, or a billboard. This is just a set of tools, not a brand. A brand is a much more significant concept, the desired notion embodied in products, services, locations, people, and experiences.
Try selling something that meets not just people’s physical but also their emotional wants, and they’ll begin to associate with your brand over time.
On a fundamental human level, meaningful connections are formed when a brand forges a link between what it does and what people are looking for. Brand appeal, distinctiveness, and loyalty are enhanced through meaningful connections that flow deep inside the business and extend deep into people’s hearts and minds.
Established brands aspire to function higher than emotive and meaningful brands. They behave, interact, and react so that each moment becomes emotionally significant.
Communication is the Key
Brand Communication
Brand Communication is a significant aspect and instrument of brand management or marketing, which firms use to persuade, convince, and enlighten customers about their brand and its values.
The brand will communicate its strengths, values, basics, and product and service offering by championing the art of brand communication. If you master the art of contact, your company and brand will attract a vast portion of the community to communicate with them.
Build a Community
People are inextricably linked to the image of some companies. Others may not agree, but you must have individuals who understand and support the brand’s mission and values. A brand community is a specialised, non-geographically bound community formed by an organised system of social relationships among a brand’s fans. Customer loyalty, engagement, and relationships are all enhanced through brand communities. It provides marketers with glowing suggestions as well as fresh marketing concepts.
The most crucial aspect of brand management is maintaining the image of your product or service. A good brand management plan can give your product or service more purpose and clarity, allowing you to focus on making, developing, and selling something that people care about. As a result, your brand will become distinct and recognisable in its own right, earning a reputation in the marketplace. But then comes the most challenging part: maintaining the brand’s value in the future.
FAQs
What is Brand Management?
Brand management is a function of marketing to build the identity of the brand.
What are the principles of Brand Management?
The five principles of brand management are:
Credibility
Be Consistent
Connect with People
Communication is the Key
Build a Community
What is brand mantra in brand management?
A brand mantra is a brief expression that captures the essence of what a brand stands for or the image a company would like to convey.
This is the 21st century. You cannot expect a good profit unless customers think about you. Although there is nothing like negative marketing, you still have to make people think about you. It can be anything. They just have to think about your brand. And all this comes under the term “brand positioning”.
Brand positioning refers to the reason for people buying your product. Or how your brand is different from your competitors. 89% of B2B marketers say brand awareness and positioning is the most important goal, followed by sales and lead generation. To describe brand positioning, let’s look at some examples. Patanjali is known for organic products, even though they are literally in every product line. Mercedez is known for its class and luxury whereas BMW has its power and performance. If you think brand positioning is important for your brand, then these are some ideas to position your brand in the market.
Helps in making creating decisions more effective.
Targets a specific market.
Creates a well market differentiation.
Things To Remember For Brand Positioning
Uniqueness
To position your brand in the market, make sure you have something unique to deliver. If you are doing the same thing as everyone is doing, then you will be just “another” brand in the market. You don’t want to be that “another” brand in the market, you have to be that “wow” brand in the market. Even though you are not selling something new, add something which will make it unique. If there is nothing unique in your product, then you can make people think it is unique, like just give it a unique look. Remember that people should need your “unique” feature. Because no one needed a juicer which runs while connected to wi-fi. Millions were spent on marketing and launching this juicer. But the investors faced a very big loss. So, don’t solve the problems which are not there.
Brand strategy
Brand Strategy
The brand strategy or the tagline you use for your product should be relevant to your product. If the customer has your tagline in his/her head but doesn’t remember your brand, then how can they even buy your product.
Make It Clear
Your slogan or tagline should always be clear and easy to understand. If the customers had to think too much to understand your brand, then there is a strong possibility that they are going for another brand, even for that brand which has no slogan at all. Just make it easy to understand, thinking that all your customers are stupid.
Differentiable
Point out the difference between your brand and the competitor’s one. Your customer should be able to make his/her decision quickly. They should not need to do a deep research to decide the brand they want. Focus on your selected category, and of course, your strength.
It Should Be Recognizable
You have to make your brand recognizable. Create an amazing logo. Add awesome features to your product which scream for attention. People should quickly remind of your slogan and your advertisement as soon as they see your logo anywhere. Make people think of your brand again and again.
Create A Buzz
Create an advertisement which can be controversial. Not in a negative way, but something like funny or which can touch people’s emotions. Just make sure people talk about it. Giant companies do not advertise to show their product, but all they want is to create a buzz among people. It is strongly possible that Patanjali’s messenger app, “Kimbho” was launched just to create a buzz. When people talk about a brand, they get attracted to that brand. For instance, imagine you go to the market to buy a chocolate, in the days when “kimbho” messenger launched.
You might ask for Patanjali’s chocolate. Why? Because you want to talk about that buzz. You will subconsciously try to show off your general knowledge and your humor. Be Updated Keep analyzing the new trends on social media. Create something which is very popular among millennials. It is more or less similar to creating buzz. As of these days, you can focus on creating memes. Try to make it funny, because if you can make them smile, you can make them buy.
Being funny does not mean you make fun of your customers. If anything makes your brand creepy, customers may talk about you a lot, but will never come to you. The following image says it all.
Re-frame The Market
Use the brand to re-frame the market to what it actually looks like , by being creative and solving a problem which the product is not fulfilling. This will give the product more visibility than the other products, making it more on the shelves or more on the talks.
5 Ways to Get Your Customers to Actively Promote Your Brand
Entrepreneurs are fanatical with their creation. They time and again set out new goals for themselves and then make sure that those are achieved. In the start-up arena, there are some doctrine principles which are responsible for the overall success. Entrepreneurs today understand the value of their brand. Entrepreneurs are perusing something called as branding strategy, which till now was completely neglected. Companies today are spending with deep pockets on marketing, advertising, public relations and more. The best way to promote your brand is to let your customers do it for you – and the only way to do that is by addressing the pain points of the customer by giving them a practical solution to their pain points. Once this is done by anyone, the customer will go on his rooftop and do nothing but will shout your name.
Differentiate your brand
Anyone and everyone want his or her brand to be different and stand out. Brands say that they want to be different and distinctive in the eyes of their customers, but in reality, the brands just want to align themselves with their competition. To differentiate from others, the enterprise can depict themselves as an enterprise away from its competition or rival. Over a period of time, if the same continues combined with disciplined efforts, the brand can be marked different. Standing out from the competition is not making them enemies. But, with persistence, the consumer can make out the difference noticeable.
Focus on loyalty
A customer or a consumer telling about you to someone is in the Last leg of his experience. It starts with brand familiarity coupled with loyalty. The sky-scraping cost of bringing in fresh business compared to retaining existing clients is unquestionable. Increasing the customer retention can extensively heighten the profit bar. Customer loyalty schemes are an effective way to improve your customer retention levels. If you want to build a loyal clientele – the trick is simple, keep the customer satisfied. Apart from that, the customer needs to be rewarded. A loyalty scheme can be used to incentivise and delight the customers.
Create a community
Build Community – Brand Positioning
Having a customer community built offers the customers a hub to interact and support one another. Customer communities are platforms for customers to unreservedly exchange opinion, reactions and pose questions about products and services. A highly busy customer community helps to improve customer retention and encourage acts of advocating. These customers community acts as a news source about products and company and a place to gather tips from the users. Customer communities also breed ideas to improve products or services. Giving the customers a say on a product or service gives them a deeper connection with the company. These days the community can be online. This increases preservation rate and overall profitability.
Incorporate Feedbacks
Getting and generating feedback from clients is the most important thing for a business builder. It helps the company at all levels of brand building and management. It helps in knowing the existing position of the business in the market and also helps in the future prospects of the business. Feedback helps clients and entrepreneurs to communicate with each other. Most of the feedback is to draw the data about the sales, performance, drawbacks about products and services. Owing to thriving technology and internet, the importance of feedback has been highly soared. Internet has become the principal instrument for promoting business and branding. It plays a pivotal role in reaching to the mass and endorsing products beyond the international boundaries.
Make it easy to be an evangelist
Consumers have a hell lot of things to do. The last thing they would do is to be an evangelist. Even if they become, they won’t go out of their way to evangelize or promote your brand. So it has to be an easy task for them to do it. The easiest way to promote evangelist is to give as many as opportunities. The same can be done with contests, discussion opportunities on the social media channels of the brand. The participant has to be rewarded in some or the other way.
These tips are not the only way to make the customers work for you. But these tips will equip your startup by starting the community of brand evangelists. Also, it is important to understand that every customer you make cannot be your brand evangelist. However, with efforts in the right direction, a community of brand evangelists is certainly to make a huge difference and would be certainly effective on the profitability.
The soul of every business is their customers. Your customers can make you or break you. Even though the inflow and outflow of the customers are the basis of business but having loyal customers is also essential. Loyal customers are the reason a business or a brand becomes what it is. So, here are a few small but highly impactful ways in which you can make customers loyal to your brand.
Making personal relations
Treating your customers like your family is the way to get them to like you and your services. Getting to know your customer will give you an idea about their likes and dislikes which will eventually help you in serving them better. It has been found in a recent study that the customer remembers the first and the last part of your conversation. So it is very important for you to strike a conversation on a happy cheerful note and also end it in a happy goodbye. Send them greetings on their special days. Or if you find out anything they like, mail it to them. This will only take a little effort on your side but will have a big impact on your customer.
Know your customer
If you have a blog or a site or any other social media account of your business, make a note of what kind of customers does your business or brand attract. Get to know about their likes and dislikes and then post content on your sites according to that. If you are a beauty brand, posting easy tutorials and looks with your products can be good. Similarly, if you are a clothing brand, styling tips etc. can be done. Also keep posting about the various offers so that your customers are not left uninformed. Also, communicate with the customer in a way they prefer. If your customer wants to communicate through email do it. If they prefer social media attend to their queries there. Keep all your options open.
Invest in your customer
Invest in your Customer
If you have a regular customer that visits you or uses your services, try knowing theirs likes and dislikes. Research about them and then do things that they least expect like send them small gifts as a thank you for their loyalty. Or give them a free upgrade if you have a customer upgrade program. You could even give them small goodies or small things like hand written notes with every purchase. This will not only make your customer fond of you but this will also help you gain more customers. If you do not want to invest in giving them anything, you can always provide your customers with special services like the first preview to your latest collection, or bend some of your policies for them if they have a genuine issue.
Take customer advice and feedback seriously
Feedback – Brand Positioning
It is very important to take customer feedback on your services. But it is even more important to implement those feedback in improving your services. Also, having a FAQs section on your websites or blogs where customers can resolve their queries and give you feedback is very helpful. If you have employees who take care of the customers, ask them to be on proper behavior and solve customer issues without creating any problems.
Maintain quality
The most important part of keeping your customers loyal is maintaining the quality of your product. Many companies sell good quality products at the start of their business and then degradation the quality to earn profits. This only helps in making short term profits. Because your customer keeps leaving you and in the end, you have no customer to earn profits. So it is very important to maintain the quality of your product throughout so that people want to buy it again and again.
Conclusion
These were some roads to brand positioning. You can use some of them, or all of them, it depends on your business. Digital marketing is the ultimate tool for brand positioning. Although, these were some ideas from our side, you can also comment on your one below. And also, keep exploring new ways to position your brand. Brand positioning helps you to reach the potential customer. And also remember, being at number 2 is not very bad. But, keep trying to come in 1st position. If there is too much competition in the category of your product, then create your own subcategory and position your brand.
With these little changes in your public dealing methods, you will have a strong loyal customer base in no time. If you know any hack to make customers loyal to your brand please comment down below!
FAQs
What is customer loyalty?
Customer loyalty is the act of choosing one company’s products and services consistently over their competitors. When a customer is loyal to one company, they aren’t easily swayed by price or availability.
Why is customer loyalty important?
Loyalty can stem from many things, but in general, a loyal customer will associate favourable experiences with a brand, therefore, increasing their likelihood to make repeat purchases with that business. Loyal customers spend 67% more on products and services than new customers.
How to gain customer loyalty?
Ways to Increase Customer Loyalty
Make customer service a priority
Reward your customers
Ask for advice and listen to it
Offer conveniences
Don’t just ask for money
How to maintain customer loyalty?
Provide outstanding customer service
Reward customers with special offers and discounts
India is a market where our homegrown companies are competing fiercely with multinational giants. For Ola there is Uber, for Flipkart there is Amazon and Swiggy is competing with ubereats. One thing which greatly differentiate Indian companies from MNCs is the service quality. We all agree to the fact that Amazon and Uber provide better customer service than their competitors. This was also found in a recent survey by redsheer, where NPS score of MNCs were higher. ✔️
FoodPanda and Ola 🐼🤝🚗
I was talking to my friend who is currently working with Ola and he said that sometimes he has to work for Foodpanda when workload is higher (If you don’t know ola acquired Foodpanda this year). I instantly asked him if he can provide me Foodpanda coupons. He laughed it off and said, “why do I need a coupon when Foodpanda is already giving away food for free”.
After the call, I checked the app and I found this 😍
Offers on Foodpanda app
I was really happy after seeing this, I will save money and time, as I won’t have to look in the big 4 (Zomato, Foodpanda, Ubereats and Swiggy) for coupons and offers. FoodPanda was my goto place.
Here is what I found one day! 🥧 Pastries in 5 rupees!
So we ordered like 25 pastries and we had party in the office that day. We could only order one item in one order but there wasn’t any restriction on the number of orders. 25 different delivery boys delivered those 25 packet worth 5 rupees (after discount).
Inefficiency kills me! Even though we enjoyed pastries, It was really surprising that, foodpanda or any other food delivery app don’t have any option to club the orders if two orders are from point A to point B. What’s more funny is that the a delivery guy who is 5 km away is assigned to pick an order from a restaurant who is just 800 mts away!
This clearly shows that foodpanda wants to increase it number of order no matter what, probably to show investors, raise more funding and burn more! This events reminds of one business leasson from ashish hemrajani, founder BookmyShow!
Ashish Hemrajani, founder bookmyshow on doing business
In StartupTalky, I learned a trick to check click data of any bit.ly or goo.gl url shortener. Just add “+” sign after the url. Foodpanda send a goo.gl URL whenever you place an order (to track status of delivery guy).
[I don’t understand any company will leave one real data point open?] I checked the data if the offers had done a great work, and yes they did. I am sure the team was able to increase the number of orders at least 3 fold! Congrats! You are now ready to raise more funds! 💸💰
Data of url sent to customers after delivery
Update: Well they recently removed the offers and we can see the clicks have gone below the average. 📉
Data of url sent to customers after delivery
Well, this the joy of ordering food for so cheap was very short lived. with scale came problems!
FoodPanda Problems
Foodpanda problems
Restaurant is closed still showing
Order not delivered
App not working
Late or No delivery
Coupon not working
Order cancellation and refund
Bad customer support
Difference in taxes with orders with and without coupon
Chef at work showing for the last 4 hours
Order is showing delivered in the app but not in reality
Was I the only one? NO!
Just to know that if Foodpanda is just messing with or with everyone, I checked their Facebook page to see and in a post with more than 170 comments not a single comment was positive. Just like me, other customers were also having all sorts of issue with the order. It was very hard for Foodpanda support team to handle all these queries.
Customers comment from their facebook page
I am sure their twitter handle is also filled only with such queries. One of the comments which made me laugh like anything was
We know running a startup is a tough job. Keep Indian customer happy feels like heaven but Mr. Panda how to plan to compete with global players when the situation is so pathetic? 🤔
What people think about Big 4, Food Delivery startups
I conducted a poll in StartupTalky to understand what people think of all food delivery startups.While swiggy stands at 157, food panda just got 8 votes!
Poll conducted in the group
What was the matter?
To know the reason, I again talked to my friend and here is what I got to know.
After the acquisition, Ola had announced that it would invest $200 million – over Rs 1,400 crores – in Foodpanda to elevate its market presence. Discount was one easy way to get new users and engage existing users. So a campaign “The Crave Party” was launched to relaunched Foodpanda. It was launched across all major cities and all discounts were given by Foodpanda only (restaurant was not bearing any cost for discounts, they just have to pay 23% commission on the original cost which Foodpanda anyways takes as an aggregator).
Woah! No words
Now to fulfill the orders, Foodpanda started to recruit 60,000 delivery men by offering a substantially higher salary than anyone in the hyperlocal delivery business but solwly they started reducing the salary from INR 1320/day to INR 40/delivery which comes around INR 400-450/day. Here is what happned next (in diagram).
Bad Experience, Bad Experience, Bad Experience!
How one thing at the top of the funnel affects the whole food delivery business
So you can see these are all operations are connected as a funnel. Also, we can see that foodtech startup is more about the operation than tech.
Learnings 📖
Scale your business but not at the cost of customer satisfaction/happiness.
Things may go out of your control while you scale, always be prepared for that.
Treat your team well, be true with them. They are one who will stand with you when no one will.
Indians are understood to love offers and discount, but everyone on the planet expects a minimum level of service quality. Especially when you are in food delivery, No one likes free pizza when they are not hungry.
Marketing is important but it must be supported with the efficient operation and tech.
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Chaitra S
