Build Customer Loyalty: Respect, Not Gimmicks
Is customer loyalty a big deal? You may think the loyalty hype is just that: hype. However, consider this most up-to-date research:
- Acquiring a new customer can cost five to seven times more than retaining an existing one.
- Customer profitability tends to increase over the life of a retained customer.
- Satisfied repeat customers are some of the best referral sources.
Customer loyalty is a big deal, and if these stats don’t motivate you to hone your customer retention strategies and make customer loyalty one of your Key Performance Indicators (KPI), then sooner or later your customers will tell you.
Don’t wait until you see it on Yelp: Loyal repeat customers are the best advocates your business can have. Yet many customer retention initiatives don’t address the fundamentals underpinning true customer loyalty. Instead, they offer rewards intended to encourage repeat behavior.
Solid relationships are built on universal principles of respect, courtesy, and good service, not gimmicks. They include:
- Listen to your customers.
- Over-deliver on customer-related KPIs.
- Be open and honest about things such as pricing, parts, and return policies.
- Empower your employees to do what’s right for the customer.
- Fix what goes wrong promptly and cheerfully.
- Communicate regularly.
- Express appreciation for your customers’ businesses.
A few more things to consider: Customer loyalty develops over time and is based on customers’ overall experiences. This includes the quality of your products and services, the convenience of your location, the appearance of your premises, your level of knowledge and professionalism, and various other attributes, both tangible and intangible.
Also, bear in mind that relationships take care and nurturing. It’s up to you to create the conditions that generate not only satisfied customers but true customer advocates.