Customer loyalty is an ongoing positive relationship between a customer and a company. It is what drives repeat purchases and makes existing customers choose your company over a competitor offering similar benefits. If it cost the same to replace customers lost through churn, customer churn would not be such a problem. Customer service teams that measure customer effort score can have a big impact on reducing friction and increasing customer loyalty.
Companies with zero customer loyalty are forced to play this game, offering ever-increasing discounts to attract new customers. Below is an email from Starbucks offering a reward (food or drink) to a customer after they have collected 125 stars in their interactions with the brand. When he's not discussing customer service, he's usually outdoors rock climbing or snowboarding. Start with smaller rewards for all customers in the programme, and then encourage repeat purchases by increasing rewards for each rung of the loyalty ladder.
The higher your CCR, the less likely your business will flourish, as you will have high customer retention costs. As an additional step to ensure customer loyalty, prioritise maintaining a high level of quality with the items you sell. Primarily, customer loyalty occurs when a person transacts with a brand (or buys a specific product) on an ongoing basis. According to The Loyalty Effect, a 5n increase in customer retention can mean a 25 l 100n increase in your company's profits.
Attracting customers is one of the hardest parts of running a business; keeping them is even harder. Introduce small rewards as a basic offer for joining the programme, then encourage repeat customers by increasing the value of the rewards as they move up the loyalty ladder. Customer loyalty goes beyond ensuring that a customer is satisfied with the services or products offered by your company. There are six stages of customer loyalty, and each stage increases the amount of loyalty the customer shows.
First, learn as much as you can about the brand's different customer segments, including their buying habits, their favourites, their comments about the products or the brand as a whole.