Your guide to loyal customers
22 November 2023 | Customer Loyalty
22 November 2023 | Customer Loyalty
Customer loyalty is a trendy word. It's not uncommon to talk about how we can get more loyal, returning customers. But what does customer loyalty really mean? Why do you want loyal customers? And what is the difference between concepts such as customer loyalty, customer experience and customer journey?
Customer loyalty is a broad concept that includes many parameters. There isn't really a clear definition, but Wikipedia says the following about customer loyalty:
”The loyalty business model is a business model used in strategic management in which company resources are employed so as to increase the loyalty of customers and other stakeholders in the expectation that corporate objectives will be met or surpassed. A typical example of this type of model is: quality of product or service leads to customer satisfaction, which leads to customer loyalty, which leads to profitability.”
• An ongoing, emotional relationship between your company and your customer.
• Positive customer experiences that give you satisfied customers.
• Credibility – the customer can trust your business.
• That the customer can come to terms with your company's values.
• A customer's willingness to engage with your business and make repeat purchases.
All in all, it's about the total value – from both the service/product and perceived emotions – that the customer gets.
Unfortunately, there is no quick fix to getting loyal customers, but by being aware of what it is and what drives customer loyalty, you can build a customer journey that will eventually lead to more loyal customers.
The sum of all interactions a customer has with a brand or company over time.
Includes the impression the customer gets of a company through all the interactions it has, such as activity on the website, use of the product/service, meeting with staff and advertising on social media. The customer experience mainly includes the product and the staff.
Reflects how well a customer's expectations are met by a product or service.
A combination of a successful customer journey, satisfied customers and positive experiences and impressions can together create stronger customer loyalty.
There are some elements that you need to have in place in order to work towards more loyal customers. Below, we list six fundamentals that we believe you as a marketer should be aware of in order to drive customer loyalty.
Collect data from e.g. email marketing, sales and purchase history. Data is your best friend to better understand your loyal customers!
Data is worth its weight in gold – if you actually learn from it. Therefore, be sure to analyze your data to make better decisions and optimize communication with customers.
How can you segment your customers to drive customer loyalty? Do you keep track of your gold subscribers, season ticket holders and those who make more than X purchases per year?
How can you as a marketer contribute to increased customer loyalty with the help of various marketing initiatives? On the one hand you need to take ownership of the customer journey through adapted and relevant communication, and on the other hand you need to find your "reasons to talk". How can you give your customers added value through communication?
By personalizing your communication, you take it to the next level. Personalization is a process of tailoring offerings and communications to your unique customers, and it's more than saying someone's first name and sending product recommendations.
To understand your most loyal customers, you need to listen to what they say, think and do. Be sure to collect feedback through reviews, surveys, and social media engagement.
A measure that estimates the total value a customer is expected to bring to a company throughout their relationship.
An index based on a single question: "On a scale of 1 to 10, how likely is it that you would recommend the company/service/product to a colleague or friend?" The responses fall into three categories: critics, passives and ambassadors.
A measure used to assess customer satisfaction with a specific interaction, product or service. Usually a survey question where customers are asked to rate their satisfaction on a scale, often from 1 to 5 or 1 to 10.
The percentage of existing customers who remain customers after a certain period. Reflects a company's ability to retain existing customers and prevent them from switching to competitors.
Psst! It's better to start simple than not to start at all. Choose one of the ways you want to measure, google the formula for how to measure it and start the journey towards increased customer loyalty!