Customer loyalty is the ability to make customers continue to use a service and/or buy products from a company through a good experience. But to retain customers, it is important to go beyond retention, it is necessary to win them over and engage them, making them promoters of the brand.
Today, any business needs to build a loyal customer base to stay relevant and drive brand growth. Especially in the moment we are living in: market growth and increased competition. Therefore, we cannot underestimate the importance of Customer Loyalty.
Winning the customer is essential for them to continue to support your brand, even with the emergence of new competitors. Check out in this post all about loyalty and 16 ways how retain customers.
- What is customer loyalty?
- Why retain customers?
- How to measure customer loyalty
- 16 ways to retain customers in your business
- Valuing experience is the way to retain customers
What is customer loyalty?
Customer loyalty is closely related to retention, that is, with the ability to make the consumers continue to use a service and / or buying products from the same company.
But retaining customers goes far beyond just retaining them. It also means conquering and engaging them, making them Promoters of business.
Why retain customers?
Did you know that customer loyalty is 5 to 25 times cheaper than conquering new consumers? So it is! But if that's not enough to convince you, check out the main advantages of investing in customer loyalty below.
- Generate more profit with less cost
- Provides greater revenue predictability
- Contributes to the improvement of your services and products
- Makes you a reference in the market
- Helps to win new customers
Generate more profit with less cost
As we mentioned earlier, keeping customers is 5 to 25 times cheaper than attracting new ones. This means that by investing in customer loyalty you can generate more profits with much less cost. One of the main reasons for this is that loyal customers — who use your services longer — have a lifetime value (LTV) higher, which ends up decreasing the relative cost of acquiring customers (CAC) and generating a better return on investment (ROI).
Provides greater revenue predictability
When you have a loyal customer base, it is easier to have revenue predictability, because by identifying their purchase profile, you can know more or less how much they will spend on yours. and, consequently, how much it will profit in a given period.
Contributes to the improvement of your services and products
Loyal and engaged customers tend to follow the company and its news; and to actively participate by sharing feedback and insights. This contributes to the improvement of services, products and processes as a whole. After all, there is no one better than the customer to say if your services and products are generating a satisfactory experience.
Makes you a reference in the market
In addition to the profits and improvements that this strategy brings, customer loyalty is also capable of making your brand a reference in the market, through recommendation they do to friends, family, and other consumers—the famous word-of-mouth marketing.
Helps to win new customers
Who said that keeping and retaining customers is not a way to attract new customers? Although we say that it is cheaper to maintain than to acquire new customers, one thing does not exclude the other. After all, being a reference in the market and relying on word of mouth marketing from loyal customers is a great way to get the attention of more people and generate trust and interest in your brand.
How to measure customer loyalty
A very important step in customer loyalty is analysis. Only then is it possible to understand if you are really succeeding in this strategy and what to do for better results. Check below the main ways to measure customer loyalty.
- Net promoter score (NPS)
- repurchase index
- social monitoring
- Miscellaneous research
- Channels open to listen
Net promoter score (NPS)
The net promoter score (NPS) is one of the best known and most used ways to measure the customer satisfaction and, consequently, a good thermometer to measure or predict loyalty. After all, your consumers will only become loyal if they are satisfied with your service and/or product.
NPS consists of asking customers the following question: “on a scale of 0 to 10, how much would you recommend our company to friends?”. Based on this, it is possible to identify how many of your customers are promoters (9 and 10), detractors (0 to 6) or neutral (7 and 8) and, based on that, make decisions to improve your business.
Then, to get your NPS, just fill in this formula with the percentages of customers at each level: NPS = % of promoting customers – % of detracting customers.
Identifying your customers' level of satisfaction and what they think is essential to create an action plan, reduce detractors, increase promoters and, thus, retain customers.
Another way to measure customer loyalty is to analyze the repurchase rate of consumers. With it, it is possible to know what percentage of your sales in a given period was closed by someone who has already purchased your product or hired your service.
To calculate this repo rate is very simple. Here's how it works: if you made 100 sales in a month, 70 of them were from new customers and 30 were from people who have already bought from you, then your repurchase rate is 30%.
Social monitoring is also a good way to measure customer loyalty in your business. It is a monitoring that proposes to observe and analyze what people are saying about the brand on social media.
In this specific case, you can focus the look of this analysis on your customers.
In addition to the more conventional analyzes, it is also interesting to create other types of surveys that help identify how your customers are feeling about your brand and services and why they are loyal or not.
Channels open to listen
Although these indicators and surveys are important, your client will not always show what he feels through them. In some cases, they will express themselves spontaneously through other channels, such as email, blog comments, messages on social networks or even WhatsApp. That's why it's important to keep all channels open to hear what your customers have to say in the way they feel most comfortable.
16 ways to retain customers in your business
Now that you know what customer loyalty is, the advantages of it and how to measure it, check out 16 ways to retain customers in your business.
1) Know your audience very well
A high-performance customer experience doesn't come without effort and, most importantly, without knowing who will be served.
Customers are the main pillar of the retail, so you need to understand what they want, like and need before anything else. Knowing your audience helps you define the product mix, in the way the store conducts communication and also in what to do to make the consumer satisfied and retain them.
But this essential information will not fall from the sky. To obtain them, you can, for example, formulate surveys and offer benefits to encourage responses.
2) Focus on the ideal customer
After getting to know your public, it becomes easier to identify who your persona is and who your ideal customer profile (PCI) is. With this information, focus your attraction and retention efforts on these types of customers. After all, in addition to being easier to win them over, the chance that they will be satisfied with your products and services is much greater and, consequently, so is their loyalty.
3) Put the customer at the center of strategies
Many companies still create strategies thinking about what will be easier, cheaper and more comfortable for the operation, but this is not the best way to effectively retain customers.
We don't mean that your store needs to be at a loss when it comes to customer service, but not looking at the consumer when planning can be the beginning of a disaster. And what once seemed more economical can end up having the opposite effect.
On the other hand, companies that put the customer at the center of their strategies and really care about them are, on average, 60% more profitable, as they have more satisfied, loyal customers who return to business frequently.
Remember: an effective “wow experience” results in satisfied consumers who do word-of-mouth marketing for your brand.
4) Position yourself as an expert
Another tip to retain customers is to position yourself as an expert in the field in which you operate, from the moment of sale. As an expert, you will tell consumers what is best to solve their pain and not just push your product or service. This makes him trust your company.
Another way to position yourself as an expert is by creating and sharing contents related to their means of operation and helping the consumer in decision making throughout the purchase journey. This can be done through a blog, on their own social networks, by email, with downloadable materials etc.
5) Ensure excellent service
It seems obvious, but many companies worry about crazy things and forget that customer service makes all the difference when it comes to customer loyalty.
Therefore, in the first place, ensure that your service team is well prepared to listen and solve customer problems with dedication and assertiveness. And remember that service starts with the sale and goes through all the people who communicate with the customer at some point: customer success; Support; among others.
With a well-prepared team, you can move on to other improvements, such as the use of tools e T that help to optimize the process and make it more efficient. But without forgetting the humanized service.
6) Surprise customers
After doing the basics well, ensuring excellent service, you can go further and surprise your customer by exceeding their initial expectations.
For that, small things can be enough, like a handwritten note; a toast; a discount coupon when making the purchase; or even creatively solving a problem.
This will certainly be registered in his mind and will guarantee many points for your brand, increasing the chances of loyalty.
7) Offer self-service experiences
You can be sure that your customer support team is very important in resolving many situations, but service cannot always afford to be just reactive.
The solution? Find ways to make your customer more independent in problem solving by offering self-service experiences.
After all, 7 out of 10 consumers say they expect to find self-service options on their website, such as support content, tutorials, case studies, etc.
Furthermore, the self service has some advantages that traditional customer support cannot provide. Check it out below.
- Reduced service SLA: Customers find information quickly and don't take up operator time. Also, if one person's problem is shared and resolved, it can help many others.
- The customer will always resort to this resource first in similar situations in the future, becoming a healthy habit and generating greater efficiency in the processes.
- The experience of a customer who can solve a problem on his own is high and the company becomes a reference for him.
8) Interact with the customer throughout the lifecycle
Engaging the customer with your brand throughout the sales cycle is an essential process to improve the experience and retain customers. Below, we list the best benefits of this strategy.
- Lifetime value (LTV) increases as the customer experience improves at every stage of the purchase journey.
- The return on investment (ROI) in marketing becomes greater.
- As conversion rates improve significantly.
9) Customize and optimize the experience
As we already mentioned, to retain customers, the experience must be positive throughout the purchase journey, and that includes optimizing and personalizing everything possible.
You can use tools to help optimize processes and even simplify some steps that are done manually. An example of this is the time of registration. Ask only for the necessary information and ensure that the system will remember this data in the future.
To personalize and make the experience more individualized, call the customer by their first name in emails and messages, send first purchase anniversary discount coupons, etc.
And when we think of the e-commerce universe, that includes making navigation and search for products within the virtual store is efficient and unique.
One way to achieve this result is to bet on technologies of artificial intelligence that rely on navigation analytics to optimize, automate and customize the experience. The main examples of tools like this are the smart search and recommendation windows.
The first facilitates the search for products, as it shows the results with high speed, phonetic correction, has the voice search, image search, geolocation and the personalized behavioral search, that is, it shows the most relevant results for each customer. The windows, on the other hand, facilitate decision-making, as they make personalized recommendations with the most relevant items for the profile of each consumer.
These features make the experience more pleasant, increasing conversion rates and customer loyalty.
10) Invest in an omnichannel shopping journey
build a purchase day omnichannel it is essential to make the customer more comfortable and to build loyalty. After all, more than 90% of consumers expect to be able to interact with companies through the channels they already use, that is, they expect an omnichannel experience.
Being omnichannel includes having multiple sales, communication and customer support channels and integrating them efficiently.
It is worth noting that this experience cannot be isolated. Every time the customer comes back to your store or comes in contact with your brand, the experience should be the same or even better. Because a single negative experience is enough for him to think a thousand times before doing business with your e-commerce again. And the worst: you can still become a detractor of the brand.
So, offer a continuous positive journey without friction. After all, that's what the customer expects from a consistent omnichannel experience.
11) Always be honest and transparent
Undoubtedly, being honest and transparent is one of the main ways to retain customers in any business, after all, this generates trust and the person feels free to continue consuming from that company.
If something doesn't go as expected, because unforeseen events happen, recognize the error, inform the customer about what happened and propose the best solution.
12) Share knowledge
In addition to positioning you as an expert, sharing relevant content and knowledge is also a way to help the consumer before and after the purchase and to enjoy your product in the best way, greatly increasing the chances of loyalty.
Some ideas to put this into practice are: create a help center, like the one from SmartHint; a corporate blog that addresses content related to its field of activity; share content, data and information about your company and segment on social networks; create e-books, infographics, manuals; Among other things.
13) Create loyalty programs
When you are doing the job very well, serving the customer well, bringing value to them, among other essential things, it is also possible to create loyalty programs that encourage that loyalty even more.
Many companies are betting today on cashback, which is to return part of the money spent so that the consumer can use it again in the same business. For this, the customer usually needs to register and inform the data and then every purchase he makes will be registered in the system, as well as money accumulated for when he wants to use it.
It is also very common to use gamification strategies. In other words, create a game atmosphere around your business, scoring the consumer according to the steps they take.
14) Monitor the level of customer satisfaction
You will only be able to truly retain customers if you monitor their satisfaction level frequently. Only then will you know what to improve, what to change and what to continue to do in your business.
To monitor this, use the indicators we mentioned earlier: NPS, repurchase rate, social monitoring, open surveys, etc. And of course, always be open to hear what customers have to say on any channel.
15) Collect social proof
When a person sees other customers using a product or service, they feel more responsive and comfortable for the buying decision. Therefore, collecting and disseminating social proofs it is very important to attract and retain customers.
In your e-commerce, social proof can come in a variety of formats, such as website testimonials, numerical ratings, case studies, posts on social networks and so on.
Your customer testimonials are more effective than many marketing strategies. According to surveys, 8 out of 10 consumers trust online reviews as much as they trust recommendations from friends.
16) Invest in promotional actions
The much-loved promotions couldn't be missed! In addition to attracting new consumers, they also help to retain customers. After all, who doesn't like a promotion?
If you have an e-commerce, abuse the Discount coupons and switch strategies. At times, you can send to customers who have not purchased from your store for a long time, in order to bring them back. In others, you can send it to those who buy frequently, as a way of giving them away.
But you can also create promotional actions that involve referring customers and whatever else your imagination allows.
Valuing experience is the way to retain customers
As you have seen throughout this text, offering the best experience for its customers is the ideal path to the best results and great loyalty opportunities.
Regardless of the size of your business, focusing on improving the customer experience will bring the best results in the medium and long term, after all, it can generate great opportunities and directly influence positive results for your company.
If you have an online store, get to know the SmartHint tools and see how they help to elevate the shopping experience within the site. And to continue offering a good experience in the next step, you can count on Aftersales, after-sales service automation solution for e-commerce.
Customer loyalty is the secret of large companies, which have managed to achieve success and remain there by knowing the customer well, placing them at the center of their strategies and offering the best possible experience. From small to big things.
By building customer loyalty, in addition to having a predictable income, you attract the attention of other people, as there is no better publicity than spontaneous and genuine publicity from those who actually use the service.
If you need to build customer loyalty in your e-commerce, get to know SmartHint! In addition to helping with loyalty, it also increases conversion rates, personalizing and elevating the shopping experience within your store.