Every merchant wants to increase customer loyalty. Along with attracting new customers, loyalty is the lifeblood of your operation. For growing businesses, customer loyalty is key to expanding reach, increasing engagement and driving revenue.
The Loyal Customer
Loyal customers are no doubt your best customers. For businesses, it costs five times more to acquire a new customer than it does to retain existing ones. The probability of selling to a new customer is between 5 to 20 percent. Compare that to the likelihood of selling to an existing customer, which ranges between 60 and 70 percent.
Keep in mind that loyal customers serve as your brand’s ambassadors. Think of them as a part of your marketing team, as they refer family, friends, and colleagues to your e-commerce site.
Customer loyalty and brand loyalty are not synonymous, however. Customer loyalty relies heavily on price. If they can buy the same item at another retailer for less, that’s where customers will make their purchases. There’s no emotional connection. Brand loyalty, on the other hand, involves trust. Customers recognize the quality of your brand and remain loyal even if they might find a lower price at a competitor.
It makes economic sense to spend the time and effort to nurture customer loyalty. Below are some key insights about the best ways to do so.
1. Prioritize Brand Voice for Customer Loyalty
No one needs to tell a retailer that they face ample competition. Your brand voice differentiates your business from other retailers who cater to a similar customer demographic. Brand voice allows you to forge connections with customers as they learn more about you. It also tells customers what exactly your products are about and why they should trust you.
Think of some top brand voices and what they bring to mind. No one mistakes Starbucks for Dunkin or Patagonia for Lululemon, as each has a powerful, distinctive voice reflecting a specific brand personality within an industry. Ideally, businesses should aim to create a consistent, strong voice for their brands across all platforms.
2. Provide Unparalleled Customer Service
It’s difficult to achieve brand loyalty without prioritizing customer service. Exceptional customer service is part and parcel of the eCommerce experience. A customer service issue that you can resolve quickly and fairly promotes your brand. Customers will tout retailers because the customer service can’t be beaten, whereas retailers with consistently poor customer service can’t establish customer loyalty. It’s all part of the trusting relationship you want to build with your customer base.
3. Initiate the Right Loyalty Programs
With loyalty programs, merchants can reward customers with points for various activities. Besides purchases, such activities may include social media “likes” or reviews. Customers can then redeem their accumulated points for merchandise on your site.
4. Offer Consumers A Private Label Credit Card
Adding a private-label credit card program to an existing tender-neutral program (such as Loyalty Lion or Yotpo) can significantly boost customer LTV. There are 3 reasons why private-label credit cards drive greater loyalty than tender-neutral programs:
- Customers are more likely to redeem rewards that they feel they have “earned” (for example, by using a particular payment method) than rewards they were given “for free.”
- Customers with a private label credit card enjoy the benefit of a credit line that they can use at a particular brand/store, which gives them greater purchasing power.
- The seamless checkout provided by branded cards is another inducement. Customers want an easy, fast way to order online purchases. When the entire transaction takes place with one click within the branded environment of your website or mobile app, customers feel confident about your store, and their purchases and are connected to your brand.
Drive Loyalty with a Private Label Credit Card
It’s no question that aiming to increase customer loyalty is at the top of every merchant’s to-do list. As your partner, Tandym can help your eCommerce business drive loyalty and boost revenue through a customized digital store card. Request a demo today.
Sources:
Forbes: Don't Spend 5 Times More Attracting New Customers, Nurture The Existing Ones (forbes.com)
Invespcro: Customer Acquisition Vs.Retention Costs [Infographic] (invespcro.com)
