While many companies concentrate on attracting new customers, knowing how to increase your customer loyalty is even more critical. After all, loyal customers spend more and recommend you to their friends. When it comes to ROI, research shows that if you can increase your customer retention by 5%, you can boost the revenue by up to 25%.
So, how does a company build customer loyalty?
Strategies to increase customer loyalty
We’ve compiled a list of ways to increase customer loyalty that aligns with digital marketing trends you can use for your business to drive sales or save your marketing budgets. Note that what works for one brand might not work for another, so adapt strategies so that they reflect your brand.
Concentrate on providing outstanding service
According to a SuperOffice survey, 45.9% of business professionals plan to focus on customer experience in the next five years.
And it makes total sense, as customers are willing to pay more after receiving a great customer experience — up to a 16% price premium on products and services. They’re also more willing to share personal information with a company that provides friendly service, which can be a lifesaver once third-party cookies become history in 2022.
What makes a great customer experience? According to PWC research, customers value speed, convenience, friendly service, and knowledgeable support. About 40% of respondents were even willing to pay extra for the same-day delivery.
Customers also expect technology to work, automation to ease their experience, the website design to be user-friendly. However, these benefits are less relevant if it’s not convenient enough to make a purchase.
Take American Express, which shifted its approach to customer service and started building customer relationships, putting them at the core of the strategy and understanding customer needs better.
How to win at the customer experience game:
- combine human support and chatbots for the best experience. Chatbots are indispensable when customers need standard questions answered, while as soon as something goes wrong, customers might appreciate knowledgeable customer support rep’s help.
- give your employees the power to make decisions for a better customer experience. For example, let your cashiers price-adjust without the hassle of calling the manager or enable them to accept returns.
- provide digitized experience for processes that can be automatized, for example, scheduling an appointment or even buying a car.
Put your customer front and center
The customer-centric strategy involves providing a great customer experience before and after the sale to promote customer loyalty and get your customers to return. This strategy focuses on building long-term relationships rather than finishing single transactions. While it all seems like a lot of work, becoming a customer-centric company makes sense for the business — according to Deloitte’s research, customer-centric companies are 60% more profitable than companies that don’t focus on customers.
Focus on customers penetrates all the companies’ processes to provide outstanding service from the point where they first hear of you to the purchase and beyond.
Another way to give your customers a spotlight is user-generated content. Share your customer reviews, feature customers who posted pictures using your product or told about you to their subscribers. It can also make your content more trustworthy. 55% of consumers trust user-generated content more than other forms of marketing.
In addition to sharing content, you can feature your customers’ stories. Here’s an example of Iz&Co, a jewelry brand that shares real-life engagement stories.
The shared stories are different and feature all kinds of photos, from love story photoshoots to spontaneous proposals, which shows how custom their product is. All the fluffy stories also help build an emotional connection with the brand.
Stay in touch
Establish a system to stay in touch with your customers even after the transaction. If you communicate regularly, you’ll be able to touch base, receive feedback that will help you improve, and see whether your company is meeting customer needs.
Use this opportunity to show customers that you care about them, notify them about changes, and share personalized offers with relevant communication channels like email or push notifications instead of just focusing on transactional or promotional messages.
Start with sending an email after the purchase, showing that you can provide more value. You can send an email with an upselling offer, survey, or information about your blog. Use channels your customers prefer.
Staying in touch with your clients is where automated messaging comes in handy with a push notification service like Gravitec. You can send transactional and informational push notifications targeted to specific segments and personalized for maximum effect. Coupled with multiple automation options, seamless migration, and rich notifications, creating your first campaign couldn’t be easier.
Every brand starts with defining its offer and voice across all communication channels. Make sure you define what helps you stand out. Use your communication as means to be recognized as being a certain way. Are your emails and social media communications cheerful but respectful or sassy and concise? Are you sharing how-to videos or creating memes?
Your product and website should reflect your brand’s personality, and your customers should get a consistent experience across all touchpoints to increase brand awareness.
Here are some tips to make sure your brand is consistent:
- develop brand guidelines. Check out Uber’s brand guide for inspiration.
- Ask for feedback
- Teach all the employees your brand standards, as well, make sure everyone knows what stands for best service in your company
Use CRM software to aggregate information about customers
All the communication can help you collect customer data, which can help you personalize your customers’ experience and make more relevant offers. It can also be useful once third-party cookies stop working. In addition to direct customer communication, you can also send polls and surveys to collect zero-party data — information consumers share intentionally with the brand.
To store your valuable data, you need a CRM. They are designed to keep customer information as well as save their path on the sales funnel. A CRM can also help you automate email sending. You might want to invest in a CRM that supports an omnichannel approach.
Start a loyalty program
According to Antavo’s customer loyalty report, over 90% of companies that measure ROI for their brand’s loyalty program have a positive ROI.
Starbucks is a trailblazer among loyalty programs. Its loyalty program is convenient, promotes easy ordering and choice options for the gift basket. The loyalty program is a part of Starbucks’ mobile app experience, which lets them choose their gifts and order drinks ahead, making for a seamless experience. An app also contributes to using touchless interaction like scanning, which came to stay after COVID-19. Starbucks includes small perks to look for and big goals, such as a signature mug.
Here are some action items to make the most out of your loyalty program:
- create a seamless omnichannel experience for your customers
- collect data from the very beginning so that you can rock your personalization strategy
- add gamification to keep customers engaged with the program beyond purchases
- put your customer front and center. The loyalty program should enhance your relationship with the customer,
- offer members-only discounts, like getting a coupon before you announce a price increase
Take an extra step
Add a personal touch to your service, communications, or promotions when possible. After all, business with returning customers is about building relationships, which requires showing some personality. As we mentioned before, it can be achieved by empowering your employees, thanking your customers, or simply reacting to your customers’ actions.
For example, a Toronto restaurant has recently made the news, as a customer walked in a snowstorm only to find the restaurant is closed. The restaurant offered a man a free meal to praise his devotion.
However, we recommend using means of communication that notify your customers of a business affected by bad weather, like push notifications.
Or you can offer your customers a way to show off and see your product in action. For example, Vans offered a halfpipe in their stores, which could be used to practice whether the purchase was made or not.
Share your values
Research reveals that 71% of consumers prefer buying from companies aligned with their values. Sharing values also makes companies more trustworthy. Many brands help minimize environmental impact and start recycling programs or reuse materials to make more sustainable clothes, like H&M or Patagonia.
Other companies have addressed social issues, like racism or women’s health. Tommy Hilfiger even partnered with the online learning platform Future Learn to create courses covering important topics like community building or LGBTQ+ allyship, showing its commitment to making social change.
Sometimes, it’s more about stopping doing something than creating new content. Take Lush. Even though the brand has been quite successful on social media, it stopped posting anything and switched to social media alternatives in November 2021 to make a point that social media aren’t doing anything to support users’ mental health or provide a safe environment.
When choosing social issues to advocate for, make sure it aligns with your brand and its product so that it doesn’t come off as opportunistic or fake. A Kantar’s report on social media trends warns that inauthenticity can alienate your customers.
In his Golden Circle model, Simon Sinek recommends starting with questions that help you crystallize your brand’s value proposition and the values you want to broadcast.
Offer valuable content
Content is a way to reconnect with customers, attract organic traffic to your website and increase your website user engagement. In addition to building a blog on your website, you can also send newsletters, create how-to videos or post engaging content on social media.
Welcome customer feedback
Make space for customer feedback and welcome it. It’s your fastest way to learn what needs improvement. Let your customers express their thoughts and listen to them. If they feel heard, they’ll stay loyal.
Make sharing feedback effortless — ask for it in push notifications, or provide a form in an email. Once you get data, analyze your results, look for trends and ways to improve customer experience.
There are multiple ways to get feedback:
- live chat sessions
- customer support chats
- social channels
- user testing
- focus groups
Switch to a loyalty-focused business model
See if you can adapt your business model to be more loyalty-centric. For example, offer subscriptions instead of one-off purchases. For example, in gyms, customers will stay longer if they have monthly memberships. Gyms also offer discounts if a customer pays a year in advance, creating predictable revenue.
Beyond subscription, you can also offer bundle pricing or packages that offer discounted rates with multiple purchases. Consider ways to encourage automatic payments or paying in advance.
You can also provide customers with incentives on their second purchase. Offer coupons or personalized discounts to encourage them to return. For example, you can generate personalized discounts based on the customer’s name for a personal touch with a tool like Voucherify.
You can take a page out of an ecommerce giant’s playbook. As Amazon has a 93% retention rate after the first year, you might. Amazon Prime is a subscription originally created for faster delivery, which became popular with regular shoppers.
In addition to faster delivery, Prime offers special member-only sales and free access to streaming music and video content, and it works — Prime members spend three times more than non-Prime customers. Not many companies can boast the same budgets as Amazon, but you can offer additional perks that go with a subscription, create member-only events, or friendly refunds.
Start building your customer loyalty whether you’re just starting your business or have an established company. Show your customers that you care and provide outstanding service to reap benefits like increased revenue and referrals.
Loyalty can’t be created with one campaign, but there are multiple steps you can choose from to get started, as a journey of a thousand miles begins with a single step.
Here are tactics you can try:
- Provide great service
- Make your business customer-centric
- Stay in touch with your customers after the transaction is done
- Be consistent in your communications
- Use CRM software
- Start a loyalty program
- Take an extra step
- Share your values
- Offer valuable content
- Welcome customer feedback
- Switch your business model to a more loyalty-centric