How to Build Customer Loyalty (and Why You Need to)

We’ve all heard the phrase: “if you give a man a fish, you feed him for a day, if you teach a man to fish, you feed him for a lifetime.” But how does this apply to business? Giving a man a fish is like only attracting new customers. They give you their business for a day, but that’s it. Teaching a man to fish is like building customer loyalty. A loyal customer is one that returns frequently and continues to give you their business. These are the customers that will make the biggest difference in your business.

Why Promote Customer Loyalty?

Returning customers spend up to 67% more on average than new customers (according to HubSpot). Customers are your best resource for word-of-mouth marketing. This has consistently been more effective than traditional marketing because people already trust the source. On top of this, selling new products to old customers is significantly easier than selling new products to new customers. This means there’s less of a marketing cost to you.

How Can You Promote Customer Loyalty?

Communicate with the Customer

  • Customer service is key. Research has shown that 60% of customers will abandon a business after just one bad customer service experience. Having good customer service can prevent this customer turnover.
  • Customers want to feel heard. While customer service is one way to do this, another way is to interact with them online. When they leave a review of your business or comment on your social media, reply to them. Doing this allows them to feel that you see and appreciate their input.
  • Customers want to understand your values. In this age of unlimited options, what sets a business apart the most is good values. Customers are willing to be loyal to a business if they see that that business cares about the same things they do. The way you do this is by keeping your values prominent: hang them in your store, publish them on your website, like this, or post them on your social media. This gives customers more compassion towards you and your business.

Allow the Customer to Communicate with You

Customers will be more loyal if they feel that their input is valuable to you. Integrate a chat feature on your web page like this one, promote customers reviewing your business on sites like Facebook or Yelp, and provide opportunities for surveys. You can do this with a form on your website, a text message, or an email. This is another way your customer can feel heard and valued.

Make a Rewards Program

Debit Card in Hand, How to Build Customer Loyalty (and Why You Need to)

This can be integrated into your Point of Sale system, Square and Bindo both have options for this. You can ask for their email or phone number for text and email alerts. You could also create a punch card system. This requires a little more effort; you have to first decide what your most popular product is and how many you need to sell before you can justify giving one away for free. Another option is to create a subscription service, like Amazon Prime. This entails figuring out what your customer is willing to pay consistently for. This could be a single scoop of ice cream every week or a free soda with the purchase of a meal: whatever motivates your customer to consistently spend money.

Be Specific

Marketing towards loyal customers is different than marketing to new customers. You don’t want to sell them things they already have or don’t have any use for. So how can you decide what your loyal customer wants? Research it. Understand who your customers are and what they’re willing to buy. Communicate with them in ways they’ll be receptive to.

Be Consistent and Informative

If your rewards program is through email or text, don’t message them things they don't care about and risk becoming spam. Message them consistently throughout the week with content or sales. Offer them valuable information relating to their life. You could use blog posts or other information about how to use your products. If your business is an ice cream shoppe, consider sending posts like this one about the benefits of eating ice cream. This will build trust because they know you don’t only want to sell them things, you also want to educate them.

Point of Sale Macaroons, How to Build Customer Loyalty (and Why You Need to)

Customer loyalty is an integral part of every business. There are many ways to build customer loyalty. Allowing your customers to feel heard with good customer service or giving them the incentive to come back with a good rewards program are two important ones. Be sure you don’t forget what good business is really about: the customer.