Customer loyalty : Strategies that work in 2023!
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Customer loyalty : Strategies that work in 2023!

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82% des entreprises reconnaissent qu'il est moins cher de fidéliser un client que d'en attirer un nouveau. Le programme de fidélisation est le meilleur moyen d'augmenter votre chiffre d'affaires ! Que vous soyez commerce de proximité, startup, site e-commerce : découvrez comment faire exploser sa fidélisation client, avec les 8 stratégies les plus efficaces du moment !  

customer loyalty infographics

 

[.is--yellow-highlight]Customer loyalty[.is--yellow-highlight]: what exactly are we talking about? 

 

Customer loyalty at a glance

Customer loyalty is not the same thing as repeat business. Loyalty is the probability that a customer will remain loyal to your brand (and prefer it to others). 

Loyalty refers to all the [.is--yellow-highlight]strategies, tools and tactics used to keep customers coming back[.is--yellow-highlight] and becoming regulars!

According to another Deloitte definition, loyalty is a tacit contract between a brand and a customer, who enter into a mutually beneficial relationship

Loyalty isn't just about customer retention. It's about building long-term relationships. Basically, once customers visit you, you need to do everything you can to keep them coming back. In particular, with the 8 customer loyalty levers we're going to explore in detail (direct access).

  

Why is loyalty so important?

We don't need to spell it out for you: it's either very expensive, very time-consuming, or very difficult to bring in new customers. (If you don't think so, congratulations! You can close this window and get on with your dream life). For the rest of us, it's essential to build customer loyalty with the right tools. It's just as important as customer acquisition (if not more so!).

Building customer loyalty is a common goal for all companies. It works just as well for B2B companies, SaaS, startups... as it does for small retailers with physical outlets.

 

The benefits of customer loyalty

  • Better anticipate your income
  • Receive (and give) more value from every customer
  • Generate word-of-mouth about your brand/website
  • Reduce customer acquisition costs
  • Increase profitability
  • Get (many) more real positive reviews
  • Reduce customer volatility in relation to your offer
  • Stand out from the competition
  • Exchanging with loyal customers
  • Creating an emotional bond

 

 

8 clear-cut statistics on customer loyalty

  • 82% of companies admit that it costs less to retain a customer than to acquire a new one. 
  • 62% of consumers use a loyalty program at least once a week(Deloitte). 
  • 59% of customers believe that once they are loyal to a company, the relationship lasts a lifetime(Acquia).
  • A 5% increase in your loyalty rate increases your profits by 25% to 95%(Microsoft).
  • It's estimated that you're 14 times more likely to sell to an ex-customer than to someone who's never been with you.
  • For 97% of customers, customer service is a key factor in choosing to remain loyal to a brand (Microsoft).
  • 66% of large retailers offer a loyalty program(Deloitte).
  • Customer retention is the main use of SMS marketing.
  • 42% of consumers are willing to try other brands and products. 8% never want to try new products. 
  • 88% of customers say they need to make 3 purchases from the same brand to become loyal to it. 
  • In the United States, each consumer is enrolled in an average of 16 loyalty programs.

What are the best customer loyalty tools? 

  1. CRM (Customer Relationship Management): Customer Relationship Management software enables you to collect and centralize the data you need to offer your customers and prospects an exceptional customer experience, from acquisition to retention.
  2. Satisfaction surveys: Satisfaction surveys gather customer feedback on the company's products and services, enabling us to better understand and satisfy their needs.
  3. Social networks: Use them to communicate with customers, answer their questions and solve their problems.
  4. Self-care tools: Autonomous customer support tools enable customers to solve their own problems, enhancing their experience and strengthening their loyalty.
  5. SMS or email marketing: SMS and email marketing can be used to maintain contact with customers, provide them with personalized offers and keep them up to date with company news.
  6. [.is--yellow-highlight]Loyalty programs with rewards[.is--yellow-highlight]: Rewards programs build customer loyalty by offering exclusive benefits, such as discounts, gifts or loyalty points.‍
  7. Loyalty cards: Loyalty cards reward loyal customers with exclusive benefits.‍
  8. Referral system: Referral systems build customer loyalty by offering them exclusive benefits if they recommend the company to their friends and family.

Loyalty rate: the formula  

 

How to calculate your customer loyalty rate in a single formula

The first step in building customer loyalty is to know where you're starting from! To do this, it's vital to calculate your customer loyalty rate. This is also known as the customer retention rate: synonymous, they are calculated according to one and the same formula. 

Retention rate = (E-N) / S

Explanations:

  • S (as in start) is the number of customers at the beginning of the period studied.
  • E (as in end) is the number of customers at the end of the period.
  • N (as in new) is the number of new customers during the period.

(Multiply the result by 100 to obtain a percentage).

Example:

At the beginning of June, we had 300 customers (S).

At the end of June, there were 325 customers (E).

In June, 40 new customers were added (N).

 

Retention rate = (E-N)/S = (325-40)/300 = 0.95 = 95%.

The loyalty rate is therefore 95%. This means that 95 consumers remained loyal during the month of June.

 

Calculate your online loyalty rate

  

Increase my retention rate with an intelligent loyalty program :

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[.is--yellow-highlight]How customer data has become the key to building loyalty[.is--yellow-highlight]

 

Customer loyalty is governed by data! Managing it is a blind spot for many companies, from large retailers to small businesses. Taking all sizes into account, only 42% of companies are able to accurately measure the lifetime value of their business(source). 

Behind this need for data, customers want their favorite company(s) to take an interest in them. 75% of consumers say they would be more loyal to brands that understand what they want, and personalize their experience with a CRM. 

Data (through an enriched customer file) is the key to offering more personalized experiences. Together with contact information, it enables appropriate, spam-free communication. It ensures maximum customer retention through the SMS marketing channel. To achieve this, the main loyalty lever is the enriched customer file. 

 

The 6 best indicators of customer loyalty   

Data also means measuring the right KPIs to assess the impact of your loyalty strategies. Here are the 6 best metrics to measure the quality of your customer loyalty: 

  • ‍Customer retention rate (or loyalty rate): see above ;
  • ‍Customer lifetime value: this is the average profit generated by each of your customers over the course of your interactions, with no time limit ;
  • ‍Repeat purchase rate: this is the percentage of customers who make a second visit or purchase ;
  • ‍Recurring monthly income: for companies offering a subscription ;
  • ‍Attrition rate (or churn rate): this is the percentage of customers who stop using your services during a given period ;
  • ‍NPS (or net promoter score): this shows the proportion of customers who would be willing to recommend your services.

 

How do you build customer loyalty?

 

We could simply say that for a company that wants to build customer loyalty, it's enough to offer the best possible experience. But that's not enough! To really stand out and build loyalty over the long term, you'll need to offer a convincing Customer XP, but also activate one of the 8 levers below - including the main tool: the loyalty program. Bonus: 5 innovative examples to inspire you.  

 

5 Examples of innovative loyalty programs

  1. ‍Sephora: Building loyalty through emotion with 3 loyal customer statuses;
  2. ‍Adidas: Rewards sports practices and generates the use of its products;
  3. ‍PokeMoon: Tiered rewards that spread the lifestyle associated with your brand;
  4. ‍L'occitane: Loyalty that rewards eco-friendly practices;
  5. ‍Starbucks: The power of a virtual currency in an app.

 

Find out more about these innovative loyalty programs in our dedicated article: 7 innovative loyalty programs (and how to get inspired).  

I'm discovering how to do what they do:

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8 tips for building customer loyalty

1 - Offer a top-notch customer experience

If there were only one loyalty lever left, it would be this: ensure that your customers have the best possible experience when they come into contact with your brand, whatever your offering. Product, service... It's all about satisfying their expectations, and even - why not - going beyond them.

 

The customer experience is the most important loyalty lever: if we neglect it, other strategies will flop. This is normal: we're dealing with the rational part of the purchasing act. The quality of your product (and of the order, payment, customer service, etc.) is the indispensable foundation on which you'll build the other loyalty tactics below.  

 

Loyalty drivers :

  • Offer a product or service that fully meets your customers' expectations;
  • Offer that little something extra that surprises them and makes you stand out from the crowd.

 

2 - Focus on customer service

Build loyalty like Amazon! Want to know how Amazon became the most valuable company in the world? By embodying the motto "the customer is king"! At every interaction with the customer, whether via CRM or live, offer the best possible level of service. In particular, after-sales service must offer advice, accessibility and rapid response... This shows customers that they are important, and is also a huge loyalty-building lever. 

 

Loyalty drivers :

  • Turn around unhappy customers with impeccable customer service
  • Help satisfied customers make the most of your products
  • Highlight other products that extend the customer journey (upsell and cross-sell)

 

3 - Offer an intelligent loyalty program 

With this3rd strategy, you can offer your customers rewards that will keep them coming back. Okay, that's what all loyalty programs do. But don't stop there: build loyalty intelligently, using customer data.

customer loyalty

 

Customer data enables you to target the customers you need to retain as a priority, for optimum results! And yes, when it comes to loyalty, Pareto's law applies: depending on your sector, it's likely that 20% of your customers will generate 50% to 80% of your revenue... To grow this hyper-profitable core, detect those who have the potential to become VIP customers. An intelligent loyalty program can detect them as early as the second visit! You can then target your best loyalty actions at them: sales reminders, SMS marketing, incentives for repeat purchases, reminders when a reward is close at hand, special offers, events, etc... 

 

Loyalty drivers :

  • Offer a loyalty program with engaging rewards
  • Collect customer data with every interaction with the loyalty program  
  • Treat your most active customers first

 

4 - Revive your dormant customers

It's been said: in certain sectors of activity, it can be 14 times more likely to sell to an existing customer than to a new one!

 

This loyalty lever is dormant customers: they've already bought from you, but they tend to forget about you if you do nothing. This is a huge source of sales with targeted retargeting! The advantage is that you have their contact data, if you've made the effort to collect customer data (if not, look here). And with an enriched customer file, you'll be able to deploy customer follow-up campaigns with the highest ROI.

 

Loyalty drivers : 

  • Collect data on your customers
  • Call back customers who have forgotten you for several months

 

5 - Learn from unhappy customers

The power of customer reviews goes beyond generating e-reputation. Negative reviews are also an important source of improvement. In fact, they can reveal why certain customers don't stay loyal. Negative reviews are therefore valuable information.

 

The main difficulty is that most of your unhappy customers won't say anything to you. They'll simply cut the relationship short. For this, you can organize a customer satisfaction survey. As well as responding to unhappy customers, you can take their feedback into account to improve your XP customer experience.

customer loyalty

 

Loyalty drivers :

  • Respond to all Google or Tripadvisor reviews, both positive and negative
  • Conduct a satisfaction survey
  • Use negative reviews as opportunities for improvement

  

6 - Offer content with high loyalty-building power  

Advice, tutorials, tips, guides and FAQs... Today, it's very easy to offer content about your products or services. It's an engagement lever that more and more businesses, right down to the local shop, are seizing on. After all, you're in the best position to talk about your products and the problems they're designed to solve!

 

When it comes to media, you're spoilt for choice: website and blog, but also social networks, emailing, SMS... By offering post-purchase content, you can re-engage customers, position yourself as a specialist and generate loyalty.

 

Loyalty lever :

  • By offering them quality content, you show your customers that your relationship goes beyond a simple purchase.

 

7 - Build loyalty on all channels at once 

The key word in customer loyalty is omnichannel. All too often, customer loyalty is conceived for a point of sale, or for a website, but rarely for both. Yet omnichannel is what customers want. They want to interact with you whatever the contact channel.

 

To activate this lever, it's vital to use an omnichannel loyalty player like Hey Pongo. It will enable you to generate customer data from all your points of contact: physical point of sale, website, social networks, etc...

 

Loyalty drivers : 

  • Implement an omnichannel loyalty strategy
  • Collect data at every point of contact with your customers
  • Reward loyal customers

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8 - Reporting: measure customer loyalty

Reporting is almost a lever in its own right. It's the key to knowing whether your loyalty strategy is bearing fruit! With the right indicators, you can dispel the fog of war and know exactly at what stages customers are abandoning you.

 

The Net Promoter Score (or NPS) is an overall indicator of customer satisfaction, and therefore of loyalty. The loyalty rate (see above) is also useful for providing a general overview. But to get down to the nitty-gritty, the enriched customer file is indispensable. It enables you to identify your customer categories (VIP, loyal, occasional, at risk of disappearing...) and how to revive them by segmenting your base. This is exactly what Hey Pongo offers, a customer loyalty system that generates large volumes of data to provide you with all the indicators that matter, in real time.  

 

Loyalty drivers :

  • Choose one or more customer loyalty indicators
  • Use them to make long-range business decisions

  

Conclusion

 

Customer loyalty is more than ever within your reach with Hey Pongo. Equally suited to online and local businesses, its omnichannel program builds loyalty by generating lots of customer data. The results are exceptional, from the Mamé Kitchen restaurant (700 customers signed up in one month) to e-commerce startup Le Deal Ultime (21,000 site visitors transformed into contacts, +6000€ in sales in one month).

 

Want to start building customer loyalty? Discover the Hey Pongo solution:

 

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