Customer loyalty is a customer's willingness to continue buying from a brand repeatedly or to conduct repeated businesses with a company, even in the presence of competitor companies. It indicates the extent to which customers are devoted to a company’s products or services and if they choose one brand over its competition. Customer loyalty is positively related to customer satisfaction. Gauging it tells the company how well its product or service fared in the consumer market. If customers are happy, they consistently favour the brands that meet their needs. Customer loyalty is paramount to a brands' success, this is because loyal customers buy frequently, advocate for the brand and act as its brand ambassadors and thus, increase its revenues. It can grow business faster than sales and marketing.
Brand loyalty stems out of a firm’s consistent effort to deliver the premium products and excellent services, every time. It is thus the result of a positive customer experience, customer satisfaction, and the value of the products or services the customer gets from the transaction.
How to achieve Customer Loyalty
Organisations must give special attention to customer service, to retain their existing customer base by increasing customer loyalty. They must have a good percentage of loyal customers for many other reasons stated before. To do the same, they can follow the rules mentioned below.
Provide a Premium Brand
Before customer service or loyal customer base comes into the picture, the product or services that the company offers must be worth having fans lining up. For no matter how good the company’s customer service is, if its core product does not do what it claims to, it has no worth. This means that the company must provide top notch products or services. To avoid frustrating loyal customers, companies must ensure that your product or service doesn’t diminish over time.
Identify the best customers
According to the Pareto's rule, or the 80/20 rule of buying and selling, 80% sales come from 20% customers. These 20% of customers are the ones who are most likely to become loyal if given the chance. Any aspiring company should never take them for granted in the modern business landscape. To convert these satisfied customers into loyal customers, the company must identify them first. The company can do this via surveys, social media or any other channels.
Share the company’s values
Every company has a set of values. These values give the company a vision and a path to move forward. The product or services too should reflect the same core values. This is because the customers will recognize a particular brand through these values. If a company's values, products and services resonate with the needs of targeted customers then it provides a genuine value proposition to them. In this way the company has a set of customers that it personally caters to. It is this set of customers that will stay loyal and can be eventually turned into brand ambassadors.
A company should let their customers know what their values are. It helps in building a personal relationship with the customers as well as gives them a sense of belonging and ultimately makes them loyal as well. That is why shared values are considered to be the largest driver of customer loyalty. Thus, if a company wants loyal customers, it needs to tell its customers what it stands for.
Provide excellent customer service
Customers have themselves mentioned that excellent service is what creates lifelong customers, avoids negative word-of-mouth and differentiates a company from its competition. A company should listen to its customers, take their feedback and address their concerns a timely manner. They should also make it easy for customers to get in touch with a company representative and communicate. A company can even convert dissatisfied customers
into satisfied ones and ultimately make them loyal.
Create a sense of community
The company can make a literal community and allow this bunch of customers’ special privileges or a sort VIP treatment. One such behavior can convert a set of recurring customers or satisfied customers into loyal customers. The loyalty of the customers multiplies when they feel that they belong with a group or community.
Never neglect the existing customers
There is an old saying – ‘One old friend is better than two new ones’. Similarly, one old customer is better than two new customers. There are many reasons for it, the primary ones being that it takes more time, effort and money to make new customers and the old ones are more likely to stay. If a company forgets its existing customers while trying to reach out to new customers, it could be a big mistake.
Hire the right employees
A company is as good as its employees for they are the building blocks of a company. Employees are also important for improving customer loyalty. The concerned departments should be given the proper training and tools to enhance the customer experience. Every employee should live and breathe the company’s culture and message each and every day. He/she must be satisfied and must also be engaged with the company to deliver results that are the most aligned with the company's objectives.
Collect Customer feedback
is the information provided by the clients about a product or service or about general experience they had with the concerned company. This information reveals if they are satisfied or dissatisfied with it. Through this medium, customers share their opinions and suggestions with the company. When companies act on their customer’s feedback then it enhances their experience, which in turn increases customer satisfaction. After collecting customer feedback, the companies must incorporate it in their businesses. Real time improvements incline the customers to come back for more.
You want to give customers a reason to keep coming back. And, that’s when incentives come into play. It could be something as simple as a discount on their next purchase or giving them a free drink after their tenth purchase. They can offer a loyalty program or a reward system or even an exclusive members’ club for them to avail special privileges.
Posted in Analytics, Customer Feedback, Customer Satisfaction, Surveys
Tagged brand ambassadors, customer effort, customer experience, customer loyalty, customer satisfaction, Net Promoter Score