Loyalty Today
Let us begin by looking at the current state of customer loyalty.
SendPulse offers a good starting definition of customer loyalty: “Customer loyalty is a measure of a customer’s likeliness to do repeat business with a company or brand. It is the result of customer satisfaction, positive customer experiences, and the overall value of the goods or services a customer receives from a business.”
Here’s more from SendPulse:
When a customer is loyal to a specific brand, they are not easily influenced by availability or pricing. They are willing to pay more as long as they get the same quality product or service they are familiar with and love. Other characteristics of a loyal customer include the following:
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they are not actively searching for different suppliers
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they are more willing to refer a brand to their family and friends
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they are not open to pitches from competing companies
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they are open to other goods or services provided by a particular business
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they are more understanding when issues occur and trust a business to fix them
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they offer feedback on how a brand can improve its products or services
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as long as there is a need, they will keep purchasing from a business
Hubspot adds:
Customer loyalty is something all companies should aspire to simply by virtue of their existence: The point of starting a for-profit company is to attract and keep happy customers who buy your products to drive revenue.
Customers convert and spend more time and money with the brands they’re loyal to. These customers also tell their friends and colleagues about those brands, which drives referral traffic and word-of-mouth marketing.
Customer loyalty also fosters a strong sense of trust between your brand and customers — when customers choose to frequently return to your company, the value they’re getting out of the relationship outweighs the potential benefits they’d get from one of your competitors.
Since we know that it costs more to acquire a new customer than to retain an existing customer, the prospect of mobilizing and activating your loyal customers to recruit new ones — simply by evangelizing a brand — should excite marketers, salespeople, and customer success managers.
So, customer loyalty = customer delight = more spending = less churn and more referrals = higher profits = happy customers and happy brands! And yet, look at the brands we do business with and whom we are loyal to – are we truly getting a differentiated experience from those brands? It is a question we will return to later in the series.
Tomorrow: Part 5
