Customer Loyalty Starts with Customer Service

Did you know it can cost up to 5–7 times as much to acquire a new customer than it can to retain an existing one? That difference in itself should be reason enough to invest greater efforts and strategy into building a loyal customer base. Marketers will rattle off the various ways by which you can activate and engage previous or current customers to foster loyalty; from email to experiential, these strategies are often effective, albeit potentially pricey. We’re here to explain the ways you can build off the things you are (or should be) doing already to achieve equally effective results.

Customer Loyalty Benefits Your Bottom Line

Across nearly every industry, not only are loyal customers return purchasers; they also help your business predict and generate future revenue. A recent Forbes Insights study – Retentionomics: The Path to Profitable Growth – showed that customer retention plays an essential role in driving referrals, incremental purchases, reduced marketing costs, predictable revenue, and more.

What Drives Loyalty?

Have you ever recommended a specific company to a friend or family member? Chances are, you weren’t being paid to do so, and through your recommendation, you saved that company the money they would have spent to attract that friend or family member through traditional marketing and advertising.

Now the real question: why did you recommend that company over any of its competitors? Looking beyond the product or service they offer, most likely, it was because:

• You had a memorable, positive experience with the company previously
• You received great customer support
• The company offers an irresistible rewards program
• The company shares your values or beliefs
• You left an interaction with the company — in-person, via phone or email, or on social media — feeling like you connected with someone on an authentic, human level.

Customer Support Can Make or Break Customer Loyalty

Customer support agents and social media managers are a customer’s first, and typically most frequent, point of contact with your company. How they deliver support and social media customer care hugely influences the way existing and potential customers perceive your company.

We published an infographic not too long ago that covered how customer service affects business. In case you weren’t sure whether customer service and social media support can impact customer loyalty, take a look at these stats:

• 39% of consumers continue to avoid vendors two or more years after a bad experience.
• 52% of consumers confirm good customer service entices them to buy more from a company.
• 42% of consumers purchased more from a company following a good customer service experience.

While there’s a fine art to the customer service and social media engagement strategies that are ideal for your brand, industry, and audience, there are a few overarching tactics that help drive loyalty across the board:

1. Create a personal, human connection.

This starts with using the customer’s name (and spelling it correctly in written communication). If Starbucks cups are any indication, customers really don’t appreciate when you ask for their name only to butcher it.

Your customer service agents should have the autonomy to customize interactions so that they are genuine and customer-specific; don’t limit them to reading or copy-pasting from a script.

2. Show genuine interest in the customer.

For example, if you’re a pet supply company and a customer is looking to purchase a dog sweater, ask them what their dog’s name is or what kind of dog he is. People love to share about themselves and will remember that you gave them the opportunity to connect in that way.

3. Go above and beyond.

Give agents the tools and autonomy to go above and beyond for a customer. Perhaps a customer mentions their recent marriage or a new baby — it costs you only a few minutes and postage to send them a handwritten congratulations card. If your company has branded swag, consider sending some items to a longtime customer or someone who regularly interacts with your brand on social media.

4. Make your company values known.

When consumers choose to be loyal to a brand, it’s not just the products and services that make the difference; they look for companies that share similar values or encourage a culture they can relate to. Consider listing your brand’s core values on your website or sharing your latest volunteer outing on social media. Build a social media engagement strategy that doesn’t just focus on what you sell, but what you do and who you are. And more importantly, make sure your employees embrace those same values during each customer interaction.

5. Show customers you appreciate them.

Saying “thank you” is one thing, and it’s important to always thank customers — for purchases, feedback, patience, loyalty, effort, and more… But in addition to saying it, find ways to show it.

When was the last time your server at a restaurant delivered your bill along with a handwritten “Thank you! :)”? It didn’t take your server more than a few seconds to add that to your bill, but it’s the effort of that human touch that makes the experience more personal. This same type of thing can be replicated digitally — use the customer’s name, acknowledge their history with the company, and thank them not just for their recent purchase, but for their loyalty.

6. Offer a rewards program with real rewards.

Many retailers offer customer loyalty programs designed to encourage repeat purchases. At a number of grocery stores, for example, customers can accrue points which they can redeem for discounts at affiliate gas stations. At many restaurants, customers can earn free or discounted items after certain number of purchases or visits (ten is usually the magic number).

If your company has, or is considering establishing, a loyalty program, make sure it’s relevant to your brand and your customers. Be sure to measure success by involvement, not signups, and welcome your customers to provide feedback on how a program can be improved to meet their needs. And, if your loyalty program requests customers provide their birthdate, make sure to use that bit of information to send them a birthday gift — one that’s relevant and entices them back to your brand.