Share On

Customer Loyalty refers to the tendency of the customer to continue availing the products, solutions or services from the previous supplier or seller, owing to satisfaction in the usage of the product despite situational changes. It is a measure of success for the seller as customer retention drives multiple positive impacts for a business. Customers could be loyal either to a specific product of the company or to the company brand as a whole.   

Here are some effects of customer loyalty:

  • Expenditures on loyal customers is lesser compared to costs incurred on attracting new ones
  • Loyal customers buy more thereby greatly increasing revenue
  • Customer Loyalty directly reflects on the brand’s image. An enterprise commanding a large loyal customer base has higher brand value
  • Loyal customers attract more customers
  • Leads to growth and sustainability for a company

Key Drivers of Customer Loyalty

The reasons for a customer being loyal are many. These reasons range from the business perspective, product nature, product quality, marketing skills, business ethics, company reputation to the methods of service delivery and customer service, and determine customer retention.

From a customer’s perspective, other than all the points mentioned above, the reasons can dive deep into sociological and psychological aspects too. Despite being totally fond of a product, a customer could attempt to try new products in the market. A customer might withdraw buying a product due to financial reasons or shift to a new product based on better offers. Sociology has a big impact on loyalty, as it is the inherent tendency of people to support products which are renowned and hold a larger user base.   

Different Types and Degrees of Loyalty

  • No loyalty at all  
  • Loyalty based on past habits
  • Loyalty that arises due to sudden situations like price decrease
  • Complete loyalty where a customer always buys from the same brand regardless of the situations

Some Methods to Measure Customer Loyalty

  • Customer Value
  • Sales Per Customer
  • Active Customer Volume
  • Visit Frequency
  • Retention Rate
  • Net Promoter Score
  • Engagement Index

Establishment of Customer Loyalty

Establishment of customer loyalty involves ensuring customer relationship management and determining the factors that affect the customer’s preferences. This is done by updating the products or service delivery approach and building a good brand image to attract the masses. Enterprises also deploy Loyalty Business Models to deliver the right quality of product or services leading to customer satisfaction, increased customer loyalty, and hence, ensuring profitability. Companies like Apple drive an almost legendary brand loyalty with its novel devices that even transcends into the emotional status of a consumer.

In a world of software solutions, some organizations provide customer loyalty software to better aid Customer Relationship Management for a client. This includes better feedback mechanisms and building online communities that better connect providers with customers and mechanisms to ensure customer retention like loyalty points, loyalty club or e-gifts.




Improved Customer Service Through GPS Vehicle Tracking

White Paper By: Fleetmatics

Great customer service is the essence of any business, it is essential not only to sustaining your business, but to growing your business. For field-service businesses and particularly companies that rely on fleet vehicles to deliver their goods and services – customer service has its own unique parameters and equally unique solutions. In a world of tight budgets, increased competition...

Speech Analytics: Convert Voice of The Customer Into Business Success

White Paper By: CallMiner

Speech analytics as a technology is used to analyze customer conversations taking place through phone and/or interactive voice response (IVR) during or after the call. Don’t just analyze data, use speech analytics to deliver actionable guidance to employees to support them in doing their jobs. Research shows that 37% of speech analytics users currently use voice biometrics in support...

Improving the Guest Experience: How Technology is Changing the Hospitality Industry

White Paper By: Intelity

With the technological advancement, there is a progression in the average traveler’s idea of what sort of service they should receive when staying in a hotel. That service will likely revolve around enhanced guest satisfaction through the efficiency of modern technological innovations. Technology is introducing new tools for the industry, which are becoming readily available for the...

Rethinking customer experience

White Paper By: Altivon

Rethinking the customer experience provides a clear path to customer satisfaction, retention, advocacy and sustained sales growth. Customer effort has a big impact on the customer experience and is measured by customers with every interaction. It drives their impression of your company and can drive them away. It is driving companies to rethink customer experience. This whitepaper on...

What Will You Do When the Phones Stop Ringing?

White Paper By: Altivon

It is quite probable, of course, that the phones will not stop ringing altogether. But the contact center that is prepared for such an eventuality will be better positioned to be responsive to customers no matter how they choose to reach out. And after all, aren’t customer satisfaction and retention the mission of the contact center? This whitepaper on “What Will You Do When the...

The Customer Journey Management Methodology - A 3-Step Approach to Ensure A Successful Result

White Paper By: QMATIC

Customer Journey Management is defined as managing the customer’s experience from initial contact to final service delivery. Customer journey mapping methodology is used to understand the flow of experiences a customer has with an organization in order to be able to deliver the best possible solution for every unique situation. This descriptive whitepaper is devoted to describe...

follow on linkedin follow on twitter follow on facebook 2018 All Rights Reserved | by: