PwC found that customers are more likely to be loyal to a brand when they feel appreciated. Loyal customers are more likely to purchase again or to share their experiences. The problem is, with customers able to research their purchases at the click of a search engine, how can we effectively build customer loyalty?
The good news is, there is a way and we’re sharing it with you here. But, first, let’s take a closer look at what customer loyalty really is.
What Is Customer Loyalty?
Market Business News defines customer loyalty as the likelihood that your customers will continue to purchase from your company. Customer loyalty looks quite a bit different than it once did decades ago. Before the digital age, customers were likely to be loyal to their local shops. Proximity was more important than price or customer experience because the shop owners were known and liked on a personal level.
Customer loyalty looks a bit different these days…and is more important than ever.
Why Customer Loyalty is More Important Than Ever?
In the digital age, there are exponentially more opportunities to find products and services you are looking for. This is a wonderful thing for customers but can be a nightmare for businesses. However, changing your strategy to ensure customers keep coming back is going to be key.
A well-known marketing statistic found that it costs businesses 5 times as much to gain new customers as it does to get existing customers to purchase once again. However, according to Forbes, selling is much different now and personalization alone can increase consumer spending by up to 500%! Customer loyalty plays into this statistic a great deal, which is why it is more important than ever.
Specific reasons for this include the fact that loyal customers are more likely to purchase again. Good experiences cannot be overrated to get customers to repurchase. Loyal customers also tend to be your best salespeople and brand ambassador by getting the word out to others about their satisfaction with your products, services, and organization.
The fact that loyal customers will also offer real, useful, constructive feedback should not be overlooked. This kind of feedback can be invaluable with future products or customer interactions.
Of course, the customer lifetime value (CLV) rates of loyal customers are going to be much higher than those of non-loyal customers as it increases the average time a customer will keep purchasing from your company. This is a useful metric to keep track of while you build loyalty.
Guide to Building Customer Loyalty
With all this being said, we have compiled a guide to building your customer loyalty that includes the essential tips to follow in order to reach your goals for customer loyalty and retention.
1. Improve your customer service
The first thing you can do is make improvements to your customer service in order to ensure your customers have an optimal experience and come away from customer service interactions highly satisfied. This is extremely important in the digital age as consumers have so many more opportunities to research and find other products just like yours from around the globe at possibly competing prices.
In order to begin this step, you’ll want to start with creating a customer service strategy. Determine what it is you want to achieve and how. Next, make sure you have a full understanding of your customer segments so that you can speak to them individually about their specific needs.
Ensure your customer service is on par with your brand identity. If your customer service isn’t living up to the values you state are part of your brand identity, you’re never going to reach your customer loyalty goals.
Of course, strategizing about your customer service and designing an optimal experience is one thing, but delivering on it is another thing entirely. Make sure you have metrics in place to know you are delivering on your customer service promises.
2. Improve response time
Customers want to know that they are heard and they want to be heard immediately. Improving your response time so an irate customer doesn’t get even angrier by waiting another day for your reply is going to help significantly, as is responding to questions of prospective customers in a timely fashion.
The steps that you can take in order to improve your response time include the following:
- Plan your communication – Make sure you have the means for your customers to reach you immediately and that you have representatives or chatbots available to get back to them within a short period of time.
- Focus on customers’ needs – The old adage “the customer is always right” is popular for a reason…it works. Make sure you focus on what they need.
- Use all channels to communicate – In the digital age, this means you need to be available by more than just phone and in person. You will want to be able to be reached via your website, social media, chat functions within your messaging apps, etc.
- Maintain positive body language – Yes, even when you are in touch with your customers virtually, maintaining positive body language will help you be more positive and it will be noticed by your customers.
3. Encourage customer feedback
Asking for feedback from your customers has a few advantages. First, it shows you really truly care about them and their opinion, which can have a huge impact on their loyalty to you. Second, it can be valuable to you for your future strategies since you are hearing it directly from your users. You’ll also be sure that your current customers will like what you do in the future if it’s based on their feedback.
There are several ways you can ask for their feedback. There are the traditional ways of calling your customer or sending them an email, for instance. However, in the digital age, there or numerous more effective means to ask for your customers’ feedback, including having them respond to a survey on your website. A popup on your website is another useful means to get a quick reply from customers.
Just as important as hearing from your current customers might be hearing from those that have purchased previously, but have stopped buying. Find out why that is.
And, of course, make sure you respond to the feedback you receive thanking them for participating.
4. Do not ignore the little things
Another essential way to build customer loyalty is to remember not to lose focus on the little things that make a big difference. Make sure you are really listening to your customers when they are talking, for instance. Don’t just pacify them so you can get them off the phone. Let them know what they have to say is important. You’ll also want to be transparent when talking to them so they don’t think you’re being elusive.
Also, try to personalize their experience. When sending marketing emails, for instance, use automation tools to personalize each and every one of them. You will be able to fill in their first names and target them based on their expressed wishes or previous purchases.
Offering incentives is something small that can make a big difference, as is offering a loyalty program. Giving your customers a reason to purchase once again or to stay with you despite having other options can be huge for customer retention.
Of course, in the digital age, it is now possible to provide your customers with actual social proof of your awesomeness. Social media allows you to have a positive influence that can be seen by everyone. Everything from customer reviews to celebrity endorsements can be highlighted on social media and accessed by everyone.
5. Customer relationship management
The digital age also offers countless tools at your disposal to help build your customer base and their loyalty. Perhaps the most effective tool is a customer relationship management (CRM) software like Agile CRM that will not only allow you to add and store all of your customer information in one place for everyone to access, but allow you to use this information for your campaigns to keep them interested in your products, building loyalty.
Such a powerful tool can also help you analyze your effectiveness in retaining your customers so you can plan for the future. You will also be able to track referrals and feedback in the same place, making all of your information accessible in one tool. Leveraging technology in the digital age could be the key to your success.
Customer loyalty is more important than ever in the digital age with so many options for consumers. The good news is, following this guide, you can build a loyal following that will help you continue to grow because your customers will prefer you and your products, even if they find less expensive or quicker options.
According to SuperOffice, the #1 reason customers leave a company is that they believe you don’t care about them. Follow this essential guide and your customers will definitely feel cared about and you will undoubtedly see the difference customer loyalty will make.