First of all, how do you get loyal customers? By making every customer interaction a delight for them.
Customer loyalty doesn't come from the best customer service or product quality, but from how customers feel about your brand from an emotional connection.
Doesn't it feel great when a customer service representative goes above and beyond to help you? Or when your favourite service provider remembers the details of what you like and how you like it? Now imagine if that positive customer experience happened every single time. Customers who enjoy that kind of attention to detail and experience doing business with your company will return.
Feeling liked, treated like a hero, and recognised when placing an order, your prospects and customers (or clients, patients, members, etc.) will form a lasting bond with your business.
Not convinced yet on the business case for loyalty? Here is an overview of seven ways customer loyalty pays off. Some are more obvious than others. However, all of them are worth mentioning so that you are aware of these vital benefits. They are:
1. Greater consumer spending
Loyal customers buy more - and are often willing to pay more. Understandably, this creates a steadier cash flow.
2. Referrals mean lower customer acquisition costs.
Loyal customers refer others to your business - saving you the marketing and advertising costs of acquiring customers.
3. Loyal customers can quickly become advocates.
A loyal customer's endorsement can surpass the most extravagant marketing efforts. For example, a low-budget film can become a blockbuster hit thanks to positive word of mouth. Megastars and publicity blitzes sometimes can't prevent high-profile films from flopping - the 'word on the street' is more powerful.
4. Loyal customers and loyal employees go together.
Thriving companies with high customer loyalty usually have loyal employees who are genuinely engaged in their work - and dedicated employees save you money in various ways. You don't have to spend money attracting, hiring and training new employees, and you have knowledgeable people at all levels of the organisation serving the customers and each other. And those employees improve over time, and in a culture that values them, they can be responsible for both business process improvements and significant profit improvements.
5. Greater loyalty levels coincide with business innovation.
Thriving companies with high customer and employee loyalty are generally known to outpace their competitors in innovation.
6. Loyal customers' feedback helps to improve the business.
Loyal customers understand your processes and can offer suggestions for improvement. Their feedback can help with research and development efforts as well as improvement efforts.
7. Improved customer retention means more significant profit.
An increase in your customers' retention can boost your bottom line profit.
Today, customers have more choice than ever. Whether they're purchasing products online or in-store, deciding where to dine, or where to go on vacation, they're making their decisions based on the customer experience they receive from the brand.
Poor-quality experiences are quickly forgotten and never recommended**. Still, great ones are shared with friends and family, creating positive word-of-mouth and generating the benefits outlined in this article.
** Loyal customers forgive mistakes more readily.
Why share seven benefits when there is an opportunity to add more value by squeezing in a bonus number eight to the list! Loyal customers are more forgiving when you make mistakes - even big ones (especially if you have a system in place that empowers employees to correct errors on the spot. Then loyal customers become even more loyal!)
If you would like to learn more about building the foundations of loyalty, you can join on our Customer Experience Growth Program or feel free to get in touch. Alternatively, subscribe below. Whether you want to build on your current success or seek support in dealing with a challenge - we've got your back!
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