Churn, loss, turnover...fancy words that mean "losing customers". For a Rent to Own company, how valuable is a loyal customer? How do you define customer loyalty? 

Loyalty
Webster defines loyalty as "A feeling or attitude of devoted attachment and affection". Does this sum up your relationship with customers? How do you measure RTO customer loyalty? What can we do increase customer loyalty, and what affect will it have?

Measuring loyalty
You can't measure a 'feeling or attitude' directly. But you can measure the effects of customer loyalty by tracking 2 key elements...

• Length of relationship
• Keep Rate

'Customer count' is an important indicator of your ability to get people in the door, but by itself doesn't tell us much about customer loyalty. If you have 500 customers that only stick around for 3 months each...give your Marketing department a raise and develop a store level plan to build and extend customer relationships.

Length of Relationship
"The uninterrupted length of time a customer has one or more active agreements." Look for 'gaps' in the relationship. Why was the agreement terminated? What, if anything could have been done to extend the agreement?

Keep Rate
"The percentage of agreements that go, uninterrupted, to term". This number tends to differ slightly based on the merchandise rented, the payment, etc. In general, the higher the keep rate, the more profitable the agreement. Reported keep rates vary drastically from a low of 10% to a high in the 70's. This wide range is due in large part to methods of measurement rather than actual differences.

Remember...
When a customer returns merchandise...they don't 'go without'. They very likely went to a competitor. They went to a competitor for a reason. That reason is most likely 'Perceived Value'. A HUGE part of a Rent to Own customer's perception of value is the relationship with store level employees.

Look at your inventory, your service, and most importantly, yourself, through your customers eyes. Do you see value?