Customer loyalty is one of the single biggest drivers of a brand’s profitability, growth, and longevity. Creating loyal customers, however, is a huge, huge challenge.
So much, so, in fact, that you might say that loyal customers are the Holy Grail of business.
Consider this statistic: “Fully engaged” customers (loyal customers that have a strong attachment to a brand) deliver a 23% premium over customers who aren’t fully engaged. Furthermore, it costs five times more to acquire a new customer than it does to keep current ones.
You simply can’t ignore how valuable loyalty is. Below are three proven ways to build customer loyalty and keep people committed to your brand.
How to build customer loyalty tip #1: Develop innovative new products and services
A recent study polled millennials and found that that 80% of them said that developing innovative new products and services is their main driver for customer loyalty.
So you’re next question is likely, “What defines innovative to this millennial market?”
That’s a great question, and it’s one you should absolutely be asking. To understand how this target thinks, what types of products they find innovative, and to really understand their attraction to products, you simply must conduct in-depth, in-person research. Surveys, polling, and monitoring data will not give you the rich insights required to understand what your core customers really want.
To truly understand your market, which will influence your product development, and ultimately influence customer loyalty, create a qualitative research plan. Annually, and whenever you’re exploring new product development, work with a third-party neutral research company that can conduct methodologically sound qualitative research, which may include focus groups, in-depth interviews, or ethnographic research. The issue is simply too important to “guess” and try to divine what your customers find innovative.
How to build customer loyalty tip #2: Improve the product quality
Secondly, your customers pay attention to product quality. In fact, the same study found that 74% of customers are loyal based on product quality. Don’t take shortcuts, and while you’re doing qualitative research, make sure your research company includes questions that probe into quality factors.
How to build customer loyalty tip #3: Be genuine. And mean it.
Finally, the third tip to build customer loyalty is to be genuine. Customers can see through shady practices, and customers now control a brand far more than companies themselves do. If you are opaque with your practices, mistreat employees, or take shortcuts with your manufacturing steps, rest assured that customers are likely to find out, and when they do, the fallout can cost you your loyal brand ambassadors.
Seek transparency, be genuine, and be honest with your customers. They will reward you with their loyalty.