How to Increase Customer Loyalty

Customer retention is one of the most important contributors to growth, especially when profits are slipping. But customer loyalty stretches far beyond simply enjoying the products or services a business offers. Truly loyal customers enjoy your company so much that they will promote it for free and go out of their way to support you.

There are five main reasons why increasing customer loyalty is important:

1. Word-of-mouth advertising: It’s real and it works. When people we trust recommend a service or company to us, we are more likely to check it out over advertising or promotions.
2. They’ll stick around: A customer who visits your business or purchases your services frequently is less likely to abruptly jump ship. They like what your company stands for and will stick with you when times are tough. Even in the face of, say, a shipping snafu or damaged product delivery, a loyal customer is more likely to give you the benefit of the doubt than look elsewhere for a similar product or service.
3. They’ll come back more often: Sometimes loyal customers frequent the business more than they logically should — even if they don’t need to — just to support the company.
4. They can act as a focus group: Many people take to social media asking for recommendations or opinions on products or services. Your loyal customer base will often answer those posts and share their insights. They will also share any feedback with you (good or bad) because they want to help your business succeed.
5. They’ll always take your side: Loyal customers will always choose your product or service over a competitor, which gives you a competitive advantage.

Strategies for Building Customer Retention

Understanding the benefits of customer loyalty is important, but you need to build strategies to gain that loyalty. Below are nine customer retention strategies to jumpstart your business again and reconnect with your customers.

1. Mission statement: Sometimes a brand inspires loyalty not through its products or services, but through what they stand for. There are many outdoor and active pursuit apparel brands, but one, in particular, is known for their strong environmental support and activism. Patagonia has a loyal customer base in a competitive market, and much of that is focused around their mission to save the environment.
2. Convenience: Make your products and services as accessible as possible. Create tools, such as apps or online ordering, to make it easier for customers to take advantage of your products and services.
3. Personalization: Coming across authentic and human is important when building relationships with your customers. Southwest Airlines is a very large organization that deals with thousands of customers daily. But if you check out their Twitter account, their customer service is personal and adds that human touch element most customers look for when trying to connect with a brand.

Southwest is able to carry on with responses like this because they’ve identified their audience personas and are communicating with them on channels those customers use frequently (for your business, this could be email, phone, etc.). Southwest encourages their customers to reach out through Twitter so they can continue to provide quick, efficient and friendly customer service.

4. Gamification: Typically gamification is recognized more as an acquisition tool, but it’s also effective with customer retention. Offering your customers rewards for completing valuable actions for your company is an effective way to use this tool. Think about rewarding current customers when they refer a new customer, for example. Or you could offer a discount or free gift once they reach a certain purchase threshold.

5. Subscriptions: Is there a way you can use subscriptions to bolster customer loyalty? For example, think about offering a subscription service that includes free shipping, faster delivery, priority booking, etc. You don’t have to charge a fee for a subscription model to gain customer loyalty. If you provide these benefits in the form of exclusiveness, it’s another way to leverage this approach and enhance your customer experience.

6. Education: One of the most valuable things you can offer your customers is new learning or advice. Your customer’s experience doesn’t end after they make a purchase. Let’s say you own a bicycle shop. Consider sending an email to your customer around the time when they should be conducting their first maintenance tasks, or when they should consider purchasing new tires. Informing them on how to better care for their bike proves that your business is still looking out for them.

7. Customer support: We touched on this a little earlier, but part of knowing who your customers are is knowing how they use their products — and if they need support, knowing where they turn to in order to get it. Customer services should be an extension of your brand. If your customers look to get their questions answered via Facebook, be sure you are on that platform and actively responding.

8. Delight: There’s a difference between satisfying your customers and delighting them. Blowout salon Drybar has gone above and beyond with their customer experience. For 45 minutes, customers get to relax, be pampered and drink a cocktail or fruit-infused water as they get their hair styled. These “extras” seem small (and are cheap to offer), but they make a lasting impression on the customer.

9. Apologize: We all make mistakes, and if handled improperly you risk losing customers. If a mistake does happen, communicate with your customer, apologize sincerely and explain how you will go about preventing it from happening again. You can do this privately with the customer via email, or even publicly on your blog depending on the type of mistake.

Every business is different, so customer retention strategies will vary. The importance of customer loyalty impacts almost every area of running your business. Without happy and satisfied customers continuing to buy from you, your business will not survive. Loyal customers are better for business, and they'll help you grow by keeping profits high.

Running a successful business can be stressful, and we know there will be times when you have questions. When you do, feel free to check out IncFile’s blog. There are tons of popular posts on important topics such as business marketing and sales that offer tips and advice to help you be successful as you start and manage your company.