How to Retain Customers besides Offering a Loyalty Card

customer buying fashion items

Many businesses strive to promote customer loyalty through retention for a lot of good reasons. First, they are likely to spend more.

One statistic suggests that increasing customer retention by only 5 percent can increase sales by around 125 percent. In another report, loyal customers may spend 10 times more than new ones.

Upselling to an existing customer is also easier and more lucrative. The chances of succeeding are between 60 and 70 percent. This isn’t surprising since these consumers already know the brand—and trust it.

Customer loyalty is also cheaper than customer acquisition. According to Business 2 Community, it may cost the business 6 to 7 times more than retaining an old one.

When companies think of customer retention, they’re often stuck with only one model: loyalty programs.

To be fair, loyalty cards work. The data from Yotpo revealed that over 50 percent of American consumers would join a loyalty program. About 15 percent of the members will interact with these programs every day.

However, it may not be enough. In her articles in Forbes, Blake Morgan also shared that over 60 percent will interact with less than 50 percent of the programs they belong to. Only 18 percent, meanwhile, engage with each program they signed up with.

You may need more than a loyalty card handed out to customers to keep them loyal. Consider then the following ideas:

1. Create an Exclusive Community

Customers are done being treated like a commodity or one of the statistics in any business. They want to be treated special, and what better way to do that than to create an exclusive community.

You can start a Facebook group or, better yet, work with a community app creator. An app will give you more control over the content, privacy, and people who can be part of the circle.

Then you can decide on the incentive. For example, exclusive members might have first dibs on new products before they are eventually launched in the market. They can get samples for free or at a meager discount.

Exclusive members may also have access to customer support that caters only to them. Their loyalty cards may also give them discounts to partner companies and even branches around the world.

cashier in coffee shop

2. Give Them a Sense of Purpose

In 2018, the Zeno Group conducted one of the biggest global studies in the market on purpose. About 8,000 consumers worldwide and over 75 companies and brands participated.

They discovered that customers are up to six times more likely to buy from businesses with a strong sense of purpose. Moreover, they are willing to defend these companies—how’s that for loyalty?

Think then of the effect if customers observe and become part of the company’s overall purpose or core value. This is what GE did when it launched a health-oriented campaign.

Under the Healthyimagination Initiative, the company poured billions of dollars to provide cost-efficient healthcare technologies. At the same time, it encouraged its customers to share their innovative ideas and solutions on the field.

The efforts seemed to have paid off. In one of the case studies, almost 90 percent of their customers felt more positive after being exposed to the program. This is on top of other gains, such as about a hundred thousand employees participating in its global health initiative.

3. Decrease Bad Customer Experience

In a 2020 report by Zendesk, all it needs is one bad customer experience for a consumer to leave the brand. If that isn’t enough, this customer may leave a bad review.

Research revealed that a company might lose 22 percent of its prospects (or about 30 new customers) for every negative review.

Expectedly, the more bad reviews the company generates, the fewer prospects they can attract and customers they can keep. In fact, four negative reviews can already increase the risk of losing 70 percent of your customers.

The good news is that brands can still transform these bad experiences into positive ones, encouraging customer retention.

Business News Daily, meanwhile, recommends an important step to improve the experience: add a human touch.

Companies should avoid using bots when customers are trying to complain. Instead, they might even need to move these customers away from interactive voice responses and emails as quickly as you can.

Businesses have to keep in mind that these individuals are less likely to be patient. Their frustration or disappointment can also drive them to make significant decisions, including leaving a negative review or letting go of the brand within the day.

Improving customer loyalty is both a science and an art. One doesn’t have to stick with the most common options to retain consumers into the business.

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Posted by: Faces from the Wall
Posted by: Faces from the Wall

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