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Customer loyalty: how to gain and measure it
Loyalty is one of the keys to success. It manifests itself in the fact that the customer chooses you, even if he has a reason to choose another brand. It is an emotional connection between the brand and the customer. If the customer feels trust and understands that your product fully meets their needs, they are unlikely to pay attention to what the competition has to offer. Loyalty also has a huge impact on your company's sales and profits. PAnDiKubiz Marketing constantly monitors customer loyalty using the tools described in the article below.
Loyal customers tend to spend more and are also less price sensitive. According to the annual Edelman Trust Barometer 2023 report, trust is one of the most important reasons why customers buy products or services. 59% of consumers are willing to make a purchase because they trust a brand.
Loyal customers tend to spend more and are also less price sensitive. According to the annual Edelman Trust Barometer 2023 report, trust is one of the most important reasons why customers buy products or services. 59% of consumers are willing to make a purchase because they trust a brand.
How to measure customer loyalty
The Customer Loyalty Index or Net Promoter Score (NPS) is a measure of customer commitment to a product or company. It is also known as the index of willingness to recommend a product. The metric shows the percentage of customers who are willing to recommend your product.
Ask your customers if they would recommend you on a ten-point scale. The classic scoring system in an NPS survey:
Analyse which customers have given you what kind of feedback. To calculate the NPS, determine the proportion of those who gave 9 and 10 points. Subtract from this the proportion of those who gave a score of 6 or less. This is your NPS. The number may vary depending on the niche. In some niches 50% is considered normal, in others 80%, in others 30%. It is worth focusing on 80% as a benchmark.
Once you have calculated the loyalty index, ask the customer one question: what do we need to do to get 10 points next time? The first thing to do is to listen to the answers of those who gave 7-8 points. It is easier to move them into the category of more loyal customers (promoters). Listen to your customers' comments, advise the experts at PAnDiKubiz. No matter how strange they may seem, if a large number of people have the same opinion, take it into account.
The Customer Loyalty Index or Net Promoter Score (NPS) is a measure of customer commitment to a product or company. It is also known as the index of willingness to recommend a product. The metric shows the percentage of customers who are willing to recommend your product.
Ask your customers if they would recommend you on a ten-point scale. The classic scoring system in an NPS survey:
- 0 to 6 - critics. They leave angry reviews about you, and if they haven't found a replacement for you yet, they will soon.
- 7 to 8 - Neutral. They're fine with you, but as soon as they see someone better, they'll be happy to leave.
- 9 to 10 - Promoters of your brand or product. Your long-term customers, the "freelance marketers" of your business. It's easier to get in touch with them, they often leave positive feedback and are responsible for word of mouth.
Analyse which customers have given you what kind of feedback. To calculate the NPS, determine the proportion of those who gave 9 and 10 points. Subtract from this the proportion of those who gave a score of 6 or less. This is your NPS. The number may vary depending on the niche. In some niches 50% is considered normal, in others 80%, in others 30%. It is worth focusing on 80% as a benchmark.
Once you have calculated the loyalty index, ask the customer one question: what do we need to do to get 10 points next time? The first thing to do is to listen to the answers of those who gave 7-8 points. It is easier to move them into the category of more loyal customers (promoters). Listen to your customers' comments, advise the experts at PAnDiKubiz. No matter how strange they may seem, if a large number of people have the same opinion, take it into account.
Tools to build and increase customer loyalty
Work on the product. This is the first and most important way. You need to constantly research your target audience and competitors to see if your product meets the market and customer expectations.
Work on the service. If your service is not up to date and does not meet customer expectations, you will not gain loyal customers.
Content marketing. Get it right. Write about things that are useful to consumers. Also talk about your products and how they improve their lives.
CRM marketing. This is an opportunity to work with different segments of your customer base to deepen relationships and build loyalty. With a CRM system, you can get information about different groups of customers and create personalised offers for them. It is worth sending not only product offers, but also something useful - something that people can use (tips, recommendations, instructions, etc.).
Word-of-mouth marketing. Anyone making a purchase decision will listen to the feedback of people they know. He will prefer the product that is praised by his friends. With the help of word-of-mouth marketing, you can get your products or services recommended. However, it is important to remember that it does not start by itself. You have to give the first push, and then customers will get involved in the process and attract others.
Dealing with negativity. If a negative review or comment appears somewhere, do not delete it. Any negativity is a reason to find out what went wrong and improve your work. Be sure to respond to the critical feedback. Remember that the response will be read by your potential customers. Its content may determine whether a new customer comes to you or not.
Loyal customers are the backbone of any business. They are the ones who form opinions about the company, write compliments, recommend to family and friends, prefer your product and are the last to go to your competitors. Value them like gold: they are true brand advocates. Loyal customers build trust in your company. People have little faith in advertising, but they do trust other people.
PAnDiKubiz specialists are ready to advise you on how to increase customer loyalty and increase the number of promoters and advocates of your brand.
Work on the product. This is the first and most important way. You need to constantly research your target audience and competitors to see if your product meets the market and customer expectations.
Work on the service. If your service is not up to date and does not meet customer expectations, you will not gain loyal customers.
Content marketing. Get it right. Write about things that are useful to consumers. Also talk about your products and how they improve their lives.
CRM marketing. This is an opportunity to work with different segments of your customer base to deepen relationships and build loyalty. With a CRM system, you can get information about different groups of customers and create personalised offers for them. It is worth sending not only product offers, but also something useful - something that people can use (tips, recommendations, instructions, etc.).
Word-of-mouth marketing. Anyone making a purchase decision will listen to the feedback of people they know. He will prefer the product that is praised by his friends. With the help of word-of-mouth marketing, you can get your products or services recommended. However, it is important to remember that it does not start by itself. You have to give the first push, and then customers will get involved in the process and attract others.
Dealing with negativity. If a negative review or comment appears somewhere, do not delete it. Any negativity is a reason to find out what went wrong and improve your work. Be sure to respond to the critical feedback. Remember that the response will be read by your potential customers. Its content may determine whether a new customer comes to you or not.
Loyal customers are the backbone of any business. They are the ones who form opinions about the company, write compliments, recommend to family and friends, prefer your product and are the last to go to your competitors. Value them like gold: they are true brand advocates. Loyal customers build trust in your company. People have little faith in advertising, but they do trust other people.
PAnDiKubiz specialists are ready to advise you on how to increase customer loyalty and increase the number of promoters and advocates of your brand.
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