Almost all successful businesses have one thing in common. They all have some customers who are the most satisfied and are truly loyal to the brand. Customer Loyalty doesn’t make it by itself among the customers. It is your actions and zeal for Customer Satisfaction that result in Customer Loyalty. It will not be wrong to say that you have to earn Customer Loyalty.
When you put all your efforts into providing maximum satisfaction to your customers, they will stay with you and offer you more business. Not only this, when customers become loyal, they are likely to bring more customers into your business. Researches suggest that satisfied customers in the US share their positive experiences with around 11 other people.
“Do what you do so well that they will want to see it again and bring their friends” - Walt Disney
This article will provide some sure-shot tips and strategies to motivate your customers to make more purchases and increase Customer Loyalty. We will also explore examples of some big brands following such practices and successfully getting good Customer Loyalty. Before we move on to this, let's learn what Customer Loyalty is.
Already know what Customer Loyalty is? Jump directly to Strategies and Tips to Create Customer Loyalty.
What is Customer Loyalty?
Customer Loyalty is an emotional and fulfilling relationship with your customers that drives them to choose your brand over your competitors. Customer Loyalty is generated from a great Customer Experience that satisfied the customers by fulfilling their needs and requirements the way they want.
When customers become loyal to your brand, they make repurchases and also encourage their friends and known ones to try the brand. Even if you launch a new product or service, it is easier to sell them to your existing customers than to attract new customers. The reason being, already existing customers have prior experience with your brand, and they trust you. Researches suggest that loyal customers are six times more likely to purchase a newly launched product even in a different range than new prospective customers.
Strategies to Create Customer Loyalty
Let’s list some great tips and strategies to help you create Customer Loyalty for your business.
Tips to Create Customer Loyalty
- Focus on your USP, values and communicate them
- Provide the best Customer Service to All Customers
- Motivate your Loyal Customers to Spread the word about You
- Offer Discounts on Repurchases and Bulk Purchases
- Start a Customer Loyalty Program
- Establish Connecting Platforms
- Collect Customer Feedback
- Make Continuous Improvements
- Work on Social Responsibility
- Respond to, and take action on Customer Feedback
Let’s learn how these ways can help you create and increase Customer Loyalty for your business.
1. Focus on your USP, values and communicate them
When you work to create Customer Loyalty, you should first focus on your strengths. You should analyze what the strong aspects of your business are, for which customers would become loyal. You should focus on your Unique Selling Point that makes you outstanding from your competitors.
You should set your values and mission and then communicate them to your customers well. When you decide on your values, make sure you stay firm on them and share them with your customers.
2. Provide the best Customer Service to All Customers
Customer Service is one of the critical determinants of Customer Experience, and Customer Loyalty is majorly affected by the experience you provide to your customers. 69% of the US customers agree that customer service is very significant in determining their loyalty towards a brand.
People are ready to pay more for excellent customer service and experience. When it comes to giving customer service, it’s not about providing extraordinary service to the new customers only and ignoring the existing ones. Instead, you need to pay more attention to your current loyal customers as well. Even one bad experience can ruin your Customer Loyalty. Studies suggest that 33% of US customers consider switching to other brands with just one bad customer service.
So when it comes to Customer service, ensure to provide extraordinary service to your customers each time they make purchases or visit your store.
3. Motivate your Loyal Customers to Spread the word about You
When you get to understand your values and USP and work to provide the best customer service, you will build some genuinely loyal customers. Your next step is to recognize them and motivate them to spread the word about you.
The ways of measuring Customer Loyalty like repurchases data,Customer Feedback data, and NPS survey results can be most helpful for this purpose. Look for the customers that talk about you on social media, tag you, or give positive comments about you. Delight those customers with something unexpected like a gift or a discount coupon and ask them to refer your brand to their friends and family. Encourage some more incentives for referrals. Doing this will help to empower their loyalty and create more customers.
4. Offer Discounts on Repurchases and Bulk Purchases
Encouraging repurchases and bulk purchases are an excellent way of increasing Customer Loyalty. It will help if you offer discounts on repurchases and bulk purchases. Some companies focus more on attracting new customers but ignore their existing customers, giving all the special benefits and discounts to new customers. This is like penalizing loyalty and encouraging disloyalty.
Instead of this, reward your existing customers and incentivize repurchases. This will encourage them to stay longer with your brand and enhance Customer Loyalty.
5. Start a Customer Loyalty Program
Customer Loyalty programs are those that focus on recognizing and rewarding the customers that stay connected to a brand and make purchases repeatedly for a long time. Researches suggest that 70% of the customers are more likely to refer a brand to their known ones when it has a rewarding loyalty program. In a loyalty program, several approaches are followed to reward and encourage Customer Loyalty.
- You can introduce a perks and points system for encouraging repurchases. In the Points system, customers earn some points on every purchase. These points get accumulated and can be redeemed with a free gift or a discount coupon, or special services.
- You can introduce Loyalty Cards, which the customers load up with cash balance and get extra rewards and discounts by spending through those cards.
- You can create referral programs where customers get cashback or extra spending power with each referral.
You need to make sure that the loyalty program provides value to the customers; otherwise, customers will not engage in the program even after being a part of it. Researches suggest that 65% of the customers do not engage with all the loyalty programs they have taken membership for. The reason being they do not feel the program is worthy.
So when you go for a loyalty program, do not just create it for the sake of having one. Instead, focus on it as a project and make it beneficial for the customers who join it. In this way, these referral programs can prove to be very helpful in generating and increasing Customer Loyalty.
6. Establish Connecting Platforms - Social Media Channels, groups
Social media nowadays plays a vital role in the marketing of products and services. Researches suggest that 54% of people using social media use it for researching products and services. When you use it as a marketing tool, it can spread the word about you very quickly.
Create Social media webpages and platforms where your customers can connect. When your loyal customers connect on social media and praise your products and services, it becomes a medium to encourage customers and attract more customers to make purchases through your brand. Motivate your loyal customers to write reviews, stories on Facebook pages, and testimonials about their experience with you. Studies say that there are 500 million daily viewers of Facebook stories.
Along with attracting new customers, these things help your loyal customers know about the different products of your brands that other customers are using and motivate them to make purchases.
7. Collect Customer Feedback
Customer Feedback is essential for your business to know how your customers feel about your products and services and how they perceive their experience with you and your organization. Collecting Customer Feedback lets you know the strengths and weaknesses of the business that affect Customer Loyalty.
It helps to know Customer Experience, which is the most direct cause of Customer Loyalty. Customer Feedback Surveys like NPS Surveys are aimed to measure and manage Customer Loyalty and work on it to enhance it. You should make use of them to grow your Customer Loyalty.
8. Make Continuous Improvements
If you want to create and improve Customer Loyalty, you need to continuously improve and evolve as per the customers’ choices and market situations. While it is not good to keep changing your business objectives and values, you should try your best to fulfill the need of the hour.
Customers’ choices and preferences keep on changing from time to time. Loyal customers can switch to other brands if you do not accept changes and innovation. You can consider the case of Nokia mobiles where the company did not change their products to new prevailing technology and suffered a significant downfall in its market. So it is necessary to improve continuously and provide a better experience and latest products and services to the customers to encourage them to be loyal to your brand.
9. Work on Social Responsibility
Social Responsibility or Corporate Social Responsibility also drives Customer Loyalty to some extent. People like to engage more with brands that fulfill their social responsibility. Promote and sponsor social causes, provide donations to NGOs, and do something for the society that gets recognized.
Researches suggest that 40% of the customers seek such brands and trust those who contribute to society’s welfare. It can be helping your country in disaster management, sponsoring poor children’s educations, providing food to the needy, supporting women's empowerment, or helping your country fight with ongoing pandemics like COVID-19.
Supporting these social causes boost your reputation, and more people engage with you and spend money on a brand where they think a part of it would be used for a social cause.
10. Respond to, and work on Customer Feedback
When you take Customer Feedback, customers get a platform to share their views and express their emotions. But customers feel heard only when you respond to Customer Feedback and take appropriate actions wherever needed. It is as essential to respond to Customer Feedback as collecting it in the first place, or we can say even more!
Researches suggest that 83% of the customers agree that they get a sense of loyalty towards brands that respond to their feedback and resolve their issues. When you take Customer Feedback, respond to it, take actions accordingly and inform the customers what you have done for them; the customers feel they are being listened to, and their opinion matters.
This can change negative feedback into a positive one. On the other hand, if you leave the feedback unattended, it can worsen the situation and lead to customer churn. Therefore, make sure you respond to Customer Feedback and take appropriate actions to satisfy your customers if you want them to be loyal.
Now, let’s explore some examples where businesses could develop Customer Loyalty with their actions and approaches they followed.
Successful Examples of Customer Loyalty
Sephora is a multinational retailer based out in France. It has around 3000 brands that offer beauty products like beauty tools, beauty lotions, skincare, cosmetics, nail color, etc. Sephora’s intensive Loyalty program ‘Beauty Insider’ proves a unique kind of satisfaction to its customers.
Along with providing discounts and incentives with the points system, Sephora provides its customers access to a community of like-minded people. In this community, people can interact with each other, ask questions, talk about the topics they love, get exclusive experiences like being a part of beauty events, meeting brand founders, and getting a look of behind-the-scenes about how their products are made. The loyalty program has been successful with around 25 million customers being a part of it.
2. Amazon Prime
Amazon Prime is a paid subscription program that provides access to its users for additional services. It is a subscription with an annual fee and has proved to be a successful loyalty program. Researches suggest that Amazon Prime members make on an average 24 orders per year, double compared to the non-prime members giving two orders per year on an average.
Starbucks, a popular coffee giant, conducts an app-based loyalty program named ‘My Starbucks Rewards'. The app is very easy to use and allows its users to load money on the app and use it to place orders. The customers can place orders, track them from anywhere and collect them from the nearest branch.
Customers get stars for each purchase to redeem to get free drinks or other edible items. The program is convenient to use and has gone successful with around 23.4 million members connected with it.
4. The Body Shop
Not all loyalty programs are based on providing only incentives to the customers. Some provide inner satisfaction as well, like the charity program launched by The Body Shop. The Body Shop has made Animal Welfare a part of its program. Along with getting loyalty points and benefits, the customers can also choose to donate their rewards to a charity for animal welfare to an organization called ‘Born Free USA’.
This is an excellent example of fulfilling Corporate Social Responsibility (CSR). The brand has also included environmental responsibility as one of its core values which customers like.
Here is another perfect example of increasing Customer Loyalty through fulfilling CSR. TOMS, a famous shoe brand, promotes Customer Loyalty by donating a pair of shoes to a person in need with every purchase the customers make.
According to its website, it has given 7,049,436 shoes till now. Moreover, it donates one-third of its profits for social causes. Customers like these things as it gives them inner satisfaction, which results in increased Customer Loyalty.