Stop Chasing Customers: Why Loyalty Is Marketing’s New Battleground | Ep. 9

0:00 What if your biggest marketing problem in the future isn't getting customers to choose you? What if it's getting AI to choose you? Think about that for a second. Because, because AI isn't just changing how businesses market, it's beginning to change how customers buy, and that could make something incredibly valuable, the relationship you already have with your customer. So let me ask you a question. Why do businesses spend so much money trying to get the next customer and so little time fighting to keep the one they already have?

0:29 You already paid to get them. You already earned their attention. You already earned their trust. They already chose you. And then, in far too many businesses, we start treating them like a stranger the day after they buy. That's what I want to talk about today. What- Every result has a price. Every goal requires a choice. Comfort keeps you where you are. Discipline takes you where you want to go. Welcome to Discipline Over Comfort with Bob Terrio. Real world conversations on leadership, business, marketing, and execution.

1:01 Welcome back to the Discipline Over Comfort podcast. I came across a Reuters story that immediately caught my attention because it connects to something that I've believed about marketing for a very long time. The headline was, "Rise of AI Shopping Pushes Merchants to Protect Loyalty." And I want you to think about that, what that means. AI isn't just changing the way businesses create marketing. AI is beginning to change the way customers shop. We're moving toward a world where someone may simply tell an AI assistant, "Find me the best running shoes for under $150."

1:36 And increasingly, that AI can help research the products that you want, compare the prices, evaluate reviews, recommend what to buy, decide which merchants deserve the consideration, and eventually participate in more of the transaction itself. Recent Adobe data cited by Reuters found that 41% of US consumers used generative AI for online shopping in June, 41... So this isn't just some theoretical conversation about what might happen 10 years from now. Customer behavior is already beginning to change.

2:13 And here's the marketing question I think we should be asking. What happens when the customer doesn't start with your website? What happens when they don't start with Google? What happens when they don't even start by searching for a company? What happens when AI increasingly influences which businesses the customer considers? I think that makes the relationship you already have with your customer even more valuable. Because the more technology sits between businesses and consumers, the more valuable a direct relationship becomes.

2:43 That's why loyalty matters. That's why trust matters. That's why customer experience matters. And that's why marketing cannot end when somebody buys. In many ways, that's when some of the most valuable marketing begins. This connects directly to something I talked about in episode eight. I told you the story about an executive who wanted more market share. I explained to him that sometimes a pie is only so big. There are only so many customers in a particular market. And his answer to me was, "Then bake more pies."

3:12 I still laugh when I think about that. But underneath that story was a serious marketing lesson. There's only so much attention. There are only so many potential customers in a specific market. And eventually, constantly trying to find another person becomes more difficult and even more expensive. So before you bake another pie, maybe you should ask, "What are we doing with the slice that we already have? Are our customers coming back? Are they buying more frequently? Are they buying more from us?

3:42 Are they referring other people? Why would they choose us again if a competitor offered them something cheaper?" And maybe most importantly, have we given them a reason to care whether they ever do business with us again? Because there's something I want every business owner, marketer, and leader listening to this to remember. A transaction gives you revenue. A relationship gives you another opportunity to earn revenue. Those are two different things, and too many businesses are built almost entirely around the first one.

4:10 Think about what we do. You spend money getting somebody's attention. You spend money generating the lead. You spend time convincing them. You finally get them to buy. And then what do you do? You go looking for somebody else. Think about how crazy this is. We spend all this money acquiring customers. Then we treat the customers that we just acquired like yesterday's news. Your next growth opportunity may not be another customer. It may be another reason for your existing customer to choose you again.

4:38 And here's a company that clearly understands the value of that relationship. Starbucks. Earlier this year, Starbucks redesigned its rewards program around three levels. Green, gold, reserve. When Starbucks announced the new program, it reported 35.5 million active rewards members in the United States. That's an enormous number, but it's not actually the number that interests me the most. Here's the number that caught my attention. Starbucks rewards members generated nearly 60% of the US company's operating revenue in the fiscal year 2025.

5:13 Think about that for a second. Nearly 60%. Now suddenly, loyalty doesn't sound like some cute little points program, does it? It sounds like a growth strategy. Starbucks has talked about using rewards to deepen engagement, create more personalized experiences, and ultimately increase customer frequency and transactions. In plain English, how do we give somebody who already buys Starbucks another reason to choose Starbucks again? That's marketing. Airlines have understood this for decades. Hotels understand it.

5:46 Credit cards, credit card companies understand it. Grocery stores understand it. Some of the most sophisticated businesses in the world understand that the first sale isn't the finish line. It's the beginning of the relationship. Now, you may be thinking, "Bob, that's great. I'm not Starbucks." Of course you're not. You don't need thirty-five million rewards members. You don't need an app, and you certainly don't need Starbucks' marketing budget. You need the principle. Starbucks is asking, "How do we get someone who already chose us to choose us again?"

6:15 Your business should be asking the exact same question. Whether you have thirty-five million customers, thirty-five thousand three hundred and fifty or thirty-five, the principle doesn't change. Let's make this practical. Let's say you own a restaurant. Someone comes in for dinner. They have a great meal. They pay, they leave. What happens tomorrow? What happens next week? What happens next month? Do you have any way to communicate with them again? Did you give them a reason to join your email or text list?

6:44 Do you know if they haven't visited in sixty days? Can you invite them back? Or are you simply hoping they remember you in the next time they're hungry? That's not a retention strategy. That's hope. And hope is a terrible CRM. Maybe you own an auto repair shop. Someone trusts you enough to spend fifteen hundred dollars repairing their vehicle. That's a big deal. What happens afterward? Do you follow up? Do you thank them? Do you remind them when their next service may be due? Do you provide useful information about maintaining their vehicle?

7:15 Do you make it easy for them to come back? Or do you disappear into your database until something breaks again? Maybe you're a consultant, maybe you're a realtor, maybe you're an insurance agent. Maybe you're building your own personal brand. The principle doesn't change. Stay valuable after the transaction because the customer relationship shouldn't disappear when the credit card clears. Here's a question every business owner should be able to answer. What happens after somebody buys from you? Not operationally.

7:44 I don't mean we send them a receipt. I mean rationally. What happens next? What do you continue creating value, or how do you continue creating value? How do you stay relevant? How do you earn another conversation, another purchase, a referral? Because if your entire marketing strategy ends at the sale, you're leaving one of the most valuable parts of marketing untouched. And this is where I want to make an important distinction. Customer retention is not simply sending people more promotions. Sometimes businesses hear, "Stay connected with your customers," and immediately think, "Great.

8:19 More emails, more coupons, more text, more offers." But that's not necessarily a relationship. Sometimes that's just another form of interruption. Remember what we talked about in episode eight, attention has to be earned. Instead of asking, "How often can I market to the customer?" Ask, "How can I continue being valuable to this customer?" That's a completely different mindset. Maybe it's useful information. Maybe it's early access. Maybe it's recognizing your best customers. Maybe it's inviting them to something special.

8:48 Maybe it's checking in when they're not asking them to buy-- when you're not asking them to buy anything. Sometimes one of the most powerful message you can send a customer doesn't consain-- contain an offer at all. It simply just communicates, "Hey, we remember you." And I think businesses sometimes misunderstand loyalty. Loyalty isn't poi- uh, isn't a points program. Points can encourage loyalty. Discounts can encourage another transaction. Rewards can increase frequency. But none of those things automatically create loyalty.

9:19 Real loyalty happens when somebody has another option, and they choose you anyway. That's the test. If the only reason someone stays with you is because you're giving them twenty percent off, you may not have loyalty at all. You may have rented their attention until somebody else offers twenty-five percent off. And that's why customer experience is so important. You could have the greatest loyalty program in the world, and if the experience is terrible, eventually the points won't save you. You can automate birthday messages.

9:47 You can send personalized offers. You can build beautiful email campaigns. But if somebody walks into your business and nobody acknowledges them, if you don't return their phone call, if your product doesn't deliver, if you make a mistake and refuse to own it, your marketing technology cannot rescue the experience. Retention isn't simply a marketing responsibility. It's a business responsibility. Marketing can help create the relationship. Sales can help develop it. Technology can help maintain it.

10:16 But the entire organization has to deliver on it. Remember, marketing makes the promise, and the customer experience keeps that promise. And when you consisten-consistently keep promises, promises, the customers, they come back. So here's something I want you to think about. You probably have a marketing budget for acquiring customers, but do you have a strategy to keeping them? Those are not the same things. Before you spend another dollar asking a stranger to choose you, I want to ask you, have you done lately to...

10:45 What have you done to give an existing customer a reason to choose you again? Because sometimes growth isn't hiding another lead. It's hiding in the customer database that you already have. Now, let's get back to AI for a second because I think there are two different AI conversations happening in the m- in marketing right now. The first one gets almost all of the attention. How can AI help me create more? More content, more emails, more advertisements, more videos, more campaigns. And yes, AI can absolutely help you do all of those things.

11:16 But it's becoming much more interesting in the second conversation: How can AI help me understand my customers better? Think about the information businesses already have. They have the purchase history, frequency, average transaction, products purchased, appointments, the website behavior, email engagement, customer service conversations, reviews, questions, maybe even reasons customers stopped buying. For years, a lot of that information has been sitting in different systems doing absolutely nothing.

11:45 AI gives businesses an opportunity to start connecting those dots, not so we can bombard customers with more marketing, so we can become more relevant to them. There's a big difference. Everybody wants to use AI to create more content, but I think one of the biggest opportunities with AI has nothing to do with creating content. It's understanding your customer. Because the company that understands the customer best doesn't always have to shout the loudest. It knows when to speak. It knows what to say.

12:13 And maybe most importantly, it knows when to shut up. Imagine you have ten thousand customers in your database. Instead of sending all ten thousand people the same promotion, what if you understood them differently? These customers haven't purchased in ninety days. These customers purchase every month. These are some of our highest value customers. These customers bought this product but never bought the related product. These customers used to buy frequently and then suddenly stopped. Those are completely different conversations.

12:42 Yet businesses often treat all of those customers exactly the same. Everybody gets the same every email, everybody gets the same coupon, everybody gets the same message, and then we wonder why people stop paying attention. AI can help us become smarter about that. But, and this is important, AI still needs a strategy. AI can identify patterns. It can help segment customers. It can help personalize communication. It can help automate follow-up. It can help identify customers who may be disappearing.

13:11 But somebody still has to decide, what experience are we trying to create? Technologies doesn't get to make the decision for you. And here's an exercise I'd love for businesses to do. Ask yourself, do you know when a good customer stops being a good customer? Not because they complained, not because they asked for a refund, not because they told you they were leaving. They just disappeared. Maybe somebody used to buy from you every month, and it's been four months now. Do you know why? Maybe somebody used to visit your restaurant every Friday.

13:40 Now you haven't seen them in eight weeks. Do you know why? Maybe somebody regularly used your service and then just suddenly stopped. Do you know why? Because sometimes customers don't break up with businesses. They just quietly leave. And by the time you realize they've already gone, they may have already developed a relationship with somebody else, another business. One of the most dangerous customers isn't the customers who complains. It's the customer who just disappears. The customer who complains is still talking to you.

14:07 They're giving you an opportunity to fix something. The customer who quietly leaves, you may not even know you lost them. Sometimes listening to your customer isn't about reading reviews. It's about noticing who stopped showing up. There's another phrase marketers love, personalization. For years, personalization meant putting somebody's first name in an email. "Hi, Bob." Wonderful. We've cracked the code. But real personalization isn't knowing someone's name. It's understanding their behavior. What matters to them?

14:38 What have they already purchased? What might they need next? When do they want to hear from you? And when they don't, that's where AI can become incredibly powerful. Not because it makes marketing feel more robotic. Ironically, used correctly, AI can help marketing become more human because relevance feels human. Remembering feels human. Listening feels human. Understanding feels human. And maybe that's one of the greatest opportunities AI creates for marketing. Using artificial intelligence to help businesses behave more human.

15:11 Not more automated, more attentive. Not more messages, more relevant messages. Not more marketing, better marketing. But there's a warning. Don't confuse personalization with surveillance. Just because technology allows you to know something about a customer doesn't mean you should use everything you know, 'cause trust, it matters. Privacy matters. Judgment matters. The goal isn't for your customer to think, "Wow, they know everything about me." The goal is for the customer to feel, "They understand me."

15:41 Now, let's make this actionable. If you're running a small business, doing the marketing all by yourself, or you have somebody helping you, or you work with an outside agency, you can start building a retention strategy right now. I'll start with five things. Number one, know your cu- who your customers are. Can you communicate with them after they purchase? Do you have permission to email them, text them? Do you have a CRM, a customer database? Even a well-managed spreadsheet is better than having no system at all.

16:10 Because if every customer becomes anonymous the second they leave your business, you're starting from zero every single day. Number two, know when they should come back. This is different for every business. A restaurant may want somebody back next week. A dentist may expect six months. An auto service business may have mileage or service intervals. A retailer may look at a purchase frequency. Know what normal looks like because you can't identify unusual behavior until you understand the normal behavior.

16:39 Number three, give them a reason to return. And I'm not automatically talking about a discount. Maybe it's convenient service, exclusive access, recognition, useful information, an exceptional experience. Discounting, that's the easy part. Creating value is harder, but value is also much harder for a competitor to copy. Number four, notice when they don't come back. Thirty days, sixty days, ninety days. Whatever makes sense for your business, create a trigger. Not necessarily to sell them something, sometimes just to check in.

17:10 And number five, ask why. Talk to your customers, especially the ones who stopped coming. You may discover something uncomfortable. Good. That's information. Maybe your service has slipped. Maybe a competitor became more convenient. Maybe your prices have changed. Maybe their life changed. Maybe there was a problem nobody told you about. You can't fix what you refuse to understand. Businesses love asking, "How do we get more customers?" Here's another question. Why did our old customers stop coming?

17:39 Sometime the fastest path to growth isn't finding another person. It's fixing the reason the last person left. And there's another reason all of this matters. A loyal customer doesn't just create another transaction. A loyal customer can be- become something much more powerful, an advocate. They tell somebody else. They leave the review. They recommend you. They become part of your reputation. And suddenly, customer retention simply isn't about keeping customers. It starts helping you acquire customers.

18:09 Your existing customers begin creating your next customers. That's when the flywheel starts turning. So I don't want you to listen to this episode, agree with everything I just said, and then go right back to chasing the next customer tomorrow morning. I want you to actually do something about it. Look at your customers from the last ninety days and ask yourself five questions. How many came back? How many bought again? How many referred somebody? How many customers haven't returned? And then here's the big one.

18:37 Do we know why? Don't guess, actually look. Because you may discover that you've been spending thousands of dollars trying to acquire customers while ignoring people who already raised their hands and said, "I choose you." Think about this. How much money are you spending trying to get strangers to trust you while doing almost nothing for the people who already do? Acquisition gets attention. New leads look exciting on a dashboard, but a customer choosing you again tells you something incredibly important.

19:05 It tells you the first experience worked. That's a metric worth paying attention to. And please don't finish this episode and immediately start searching for customer retention software. That's not where I want you to start. Start with the customer. Technology, that comes later. You could literally begin with a spreadsheet. The customer name, last purchase, purchase frequency, last contact, what did they purchase? Then look for patterns. Who are the best customers? Who hasn't come back? Who used to buy frequently?

19:33 Who deserves a thank you? Who might appreciate hearing from you? You don't need sophisticated technology to care about customers. You need discipline. Technology can help you scale it. AI can help you understand it. Automation can help you execute it. But none of those things can replace actually caring whether the customer comes back. And here's a principle I think is gonna become increasingly important in the age of AI. Don't automate something you haven't learned how to care about manually. Before you automate the customer relationship, understand the customer relationship.

20:07 Before you personalize at scale, understand what your customer's value is. Before you build another workflow, understand the experience you're trying to create. Technology should scale the experience. It shouldn't become the experience. For the next 30 days, pick one of the existing customers. Don't try to fix everything. Maybe it's customers who haven't purchased in 90 days. Maybe it's your highest value customers. Maybe it's your first customers. Pick one group, then ask, "What could we do to become more valuable to these people?"

20:37 Notice I didn't ask, "What can we sell them?" That's intentional. What can you do for them? Maybe you personally call 10 customers. Maybe you send a thank you note. Maybe you ask them to know y- to ask them about their experience, how it was. Maybe you invite them to something. Maybe you provide information that helps. Maybe you surprise your best customers. Maybe you simply ask, "What could we have done better?" Then listen and measure what happens. Do they come back? Do they engage? Do they buy again?

21:04 Do they refer somebody? Do you... Did you learn something? That's marketing. Not because you created another advertisement, because you strengthen a customer relationship. We spend so much time asking, "How do I get another customer?" Maybe once in a while, we should ask, "How do I become the kind of business my customer doesn't want to leave?" That's a much harder question because now we're not talking about a- an advertising trick. We're talking about the business itself, the product, the service, the people, the experience, the follow-up, the promises we make and whether we keep them.

21:36 You can't hack your way into loyalty. You have to earn it. Marketing has become incredibly good at finding people. We can target audiences. We retarget to website visitors, track behavior, automate emails, generate content with AI, optimize campaigns, and now AI may increasingly help customers decide which businesses they even consider. That's extraordinary. But none of this changes one of the oldest truths in business. People come back when the experience gives them a reason to come back. So yes, keep acquiring customers, run advertisements, create content, generate leads, grow your audience.

22:11 I'm a marketer. I'm certainly not gonna tell you to stop marketing. But acquisition and retention shouldn't be competing ideas. They should be part of the same strategy. Acquire the right customer, deliver what you promise, create a remarkable experience, stay valuable, earn the next purchase, and eventually earn the recommendation. And that's how a transaction becomes a relationship. And that's how a relationship becomes growth. Maybe your next million dollars isn't hiding inside another advertising campaign.

22:41 Maybe some of it is sitting inside the customer you've already earned, the customer whose name is already in your database, the customer who's already walked through your front door, the customer who's already trusted you with their money. Before you spend another dollar trying to convince a stranger to choose you, give the person who already chose you a reason to choose you again. And if this conversation made you think differently about your marketing, make sure you're also getting the Discipline Over Comfort weekly brief.

23:09 Every week, I go deeper into marketing, leadership, business, AI, and execution with the ideas that you can actually use. This week's brief asks a simple question. You're doing a lot of marketing, but is any of it actually working? Because posts going out, emails being sent, ads running, videos being created doesn't automatically mean you have a strategy. Sometimes you're just busy. In the weekly brief, I give the four simple questions you can use to evaluate almost anything you're doing in marketing, and it's completely free.

23:39 You'll find the link in the description below this video, and that's how I want these two things to work together. The podcast is the conversation. The newsletter is the playbook. And while you're here, make sure you subscribe to the Discipline Over Comfort YouTube channel. Uh, we're building something here around business, leadership, marketing, AI, and most importantly, execution. No hype, no magic formulas, just ideas you can actually take back into your business and use. And if you know somebody who is spending all of their time chasing new customers while forgetting about the ones they already have, share this episode with them because sometimes the next growth opportunity isn't another customer.

24:16 It's another opportunity to serve the customers that you already have. I'm Bob Ciorio, and remember, discipline over comfort every time. Until next time. Bye-bye.