In today's competitive market, businesses must deliberately cultivate customer loyalty to retain their existing customers and attract new ones. This is because, at any given point, competitors are working to widen their reach and get new paying customers (what the experts call ‘market share’). This means the options are increasing for both your existing and potential customers.
Customers are the pillar of a business. Without their constant support and patronage, your business will crumble. Thus, to achieve customer loyalty as a business, you must strive to build a strong relationship with your customers and prioritize their needs.
Now to the question of the day. What is customer loyalty?
Meaning of Customer Loyalty
Customer loyalty refers to a customer's willingness to continue doing business with a particular company or brand. It is the extent of the customer's satisfaction with the products or services offered by the company and the likelihood that the customer will continue to purchase from the company in the future. Customer loyalty is beyond a one-time or a seasonal sale. For instance, when a customer only buys your product during a sales discount or flash sale, that may not count as loyalty. Customer loyalty is the ‘come rain or sunshine’ situation, where a customer buys from your brand, especially when they should have alternatives.
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As a business, it is essential to be intentional about building a formidable relationship with your customers. The stronger the relationship, the better your chances of retaining your customers, hence the need to build customer loyalty.
Benefits of Customer Loyalty
- Steady Business Income
- Better Brand Flexibility
- Easier Conversion Process
- Free Word-of-mouth Marketing
- Provide Insights for Better Decision-Making
Steady Business Income
In entrepreneurship, loyal customers are a big deal. You can trust them to consistently purchase your product. This results in consistent cash flow for your business. Also, loyal customers have a higher chance of increasing their purchases over time. This is because they already trust your brand and have formed an emotional bond with you.
Better Brand Flexibility
When your business has a strong, loyal customer base, you have enough room to take certain business risks that should ordinarily put you at a disadvantage.
Let’s use a campaign video by burger king as a case study. Burger King made a campaign to support its competitor, McDonald’s, for a flagship event. All the proceeds from that day’s sales were to go to charity. In the campaign, Burger King encouraged customers to eat at McDonald’s for that day. Initially, the customers were confused, but they commended the brand when they realized it was for a good cause. Although tricky, this strategy was effective in appealing to the emotions of the customer base. By presenting themselves as dedicated to good works and charity, even at the expense of their business, they further inspired trust in the hearts of the customers.
Image taken from Strikingly product
Note that your business must attain credibility before pulling that kind of ‘stunt.’ If you are a small business owner, you should exercise a little bit more caution. This is not to say that big businesses can afford to be careless. However, your customer loyalty game must be top-level before you do this.
Easier Conversion Process
Loyal customers are easier to convince than new customers. A loyal customer already knows a lot about your brand, so getting them to buy your new product will be easy. On the other hand, a new customer will need more intense inbound marketing before they can trust you enough to buy your product. This means more marketing costs and a relatively lower conversion rate.
Free Word-of-mouth Marketing
Loyal customers can be your unpaid personal marketers or influencers. When you have gained your customers’ trust, they automatically become fans. If you use online marketing for your business, this can result in ‘viral marketing.’ Viral marketing is when a product or an entire brand experiences sudden popularity over a period. Viral marketing is usually a direct effect of word-of-mouth marketing. For instance, a food brand will likely get more customers from the influence of loyal customers who tell their friends. Those friends also their circle, and there goes the brand spiraling into a viral one. This will help increase your profit margin and keep you in the business longer.
Provide Insights for Better Decision-Making
With honest feedback, loyal customers give you practical insights relevant to your business. They let you know what is working and what needs improvement. Loyal customers may sometimes give negative feedback. This should, however, not have to happen repeatedly or linger. The more dissatisfied a customer feels about your product, the likelier they are to find an alternative. Thus, when you receive negative feedback, you must immediately work to change whatever the complaint is about.
Let us look at how to build customer loyalty.
How to Build Strong Customer Loyalty
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Efficient entrepreneurship requires you to know how to build customer loyalty. Here are tips and tricks you should employ in building customer loyalty.
1. Research your customers
The research can be simple or otherwise. Find out what they need, when they need it, and how they want to be served. You will get a better picture of what your audience likes. You will also discover how best to connect with them, and you can use that information to improve customer experience.
2. Tell Your Story
Everyone loves a good story. Even better, your customer wants to hear your story. It could be your history as an organization or a notable event that changed the course of your business activities. Whatever it is, weave your brand story around a concept your target market is familiar with. That way, you get to their heart, and if you have your customer’s hearts, you have their money. They resonate better with your brand, so they are more inclined to trust you enough to buy from you.
3. Create Reward Systems
Nothing is sweeter than a customer bonus gift. This will help in building customer loyalty because they will be motivated to stay in business with you. The reward system could come as a gift, a shopping voucher, a good discount, or free delivery on orders. For instance, Coca-Cola created a friendship campaign where they put two bottles of coke for the price of one at the top of a vending machine about 10-15 ft tall. The whole concept was to get your friend to lift you to reach the height, get the drinks and share them with your friend. This was a superb campaign that drove massive engagement for the company and promoted and rewarded teamwork/friendship.
4. Stay In Touch
This should be an avenue for keeping your users abreast of the recent happenings in your business. Keep them Informed about new changes, price increases, seasonal offers, and more. Don’t forget to constantly remind them about their contribution to your company's growth. No one gets tired of hearing that. Your customer certainly won’t.
One good way to keep in touch is through email newsletters. When you build a website with Strikingly, you can build an email list from the sign-ups on your website. Your newsletter can be educational messages that may or may not relate to your brand, the newest discount offers, or personalized messages.Of course, you can also use some fun, if your brand tone is not strictly formal.
Image taken from Strikingly Product
5. Be Flexible
Be open to new ideas and innovations. Listen to your customers. The best ideas could come from them. Your customers should be the first you consider when creating a product or improving an existing one. People love to feel valued. Your customers want to see that you think their suggestions work. Loudly ask for those suggestions, and loudly use them when relevant.
6. Location and Language Matters
This is where you apply the knowledge you learned from researching your customers. Discover the platforms your audience use, and meet them there. For example, if you sell female clothing for young ladies, you will likely find them on Instagram and Pinterest before Facebook. Don’t forget, you should tone down on the formality for this kind of audience. For instance, when you target a LinkedIn audience, you should use formal language.
7. Create Avenues for Customer Feedback
Customer feedback is like a mirror to your business. It exposes otherwise gray areas and helps with unbiased assessment. If maximized, it is a great way to build loyalty. You must be deliberate about collating feedback. A Strikingly website allows you to create comment sections and message boxes where your site visitors can leave their feedback.
8. Constantly Improve Customer Experience
Improving customer experience is a great way to influence customer loyalty. People will return to you if they can see your constant growth. Bigin by Zoho and Hubspot CRM are examples of tools that aid Customer Relationship Management. They help you keep track of transactions and automate some parts of your customer relationship process.
In summary, customer loyalty refers to a customer's ongoing commitment and support to a particular brand or product. This can be demonstrated through repeat purchases, positive word-of-mouth recommendations, and a willingness to spend more on the brand. Customer loyalty is essential for businesses because it can lead to increased customer retention, more revenue, and profitability.
To improve customer loyalty, you need a solid online presence and ease of access. The first step to getting your business online is getting a free website with Strikingly. Strikingly websites allow you to connect your email, phone, and social media platforms, making it easy for customers to access you across different channels.
