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What Factors Drive Customer Loyalty?

4 min read
We know that having loyal customers can do wonders for your bottom line. But how do you make that happen?

Here are 4 key drivers of customer loyalty.

1. Great customer service

They may love your product or service, but if your customers don’t feel valued and respected when they do business with you, they’re unlikely to form a positive emotional connection to your brand. Certainly, customers appreciate friendly and pleasant service when they make a purchase. A good experience in retail goes a long way. But what’s often more powerful is how you receive feedback and what you do with it when you get it.

Customers who feel listened to and looked after when something goes wrong, or if they need support after a purchase, are likely to have positive emotion towards you in the future, and to tell others good things instead of bad – whether that’s via social media or face to face. Increase customer communication and customer satisfaction should follow.

2. A true understanding of the customer journey

Traditionally, businesses have measured success in terms of sales. But as our understanding of customer experience becomes more sophisticated, we can see that each purchase is part of a larger picture – the customer journey. This includes your marketing and customer-focused advertising, your retail experience (whether online or offline), reviews about your products and those of your competitors, and what happens after a specific customer receives their product or service.

Together, all these touchpoints have an influence on customer loyalty, and by considering the journey as a whole you can target your efforts on the places they’ll have most effect. That might mean improving response times, ironing out pain points in your website or booking engine, or simply managing customer expectations by clearly communicating the way you work.

3. Long-term strategy, not short-term reaction

Why do customers leave companies they’ve been loyal to? Overwhelmingly it’s because they don’t feel the company cares about them. In the short-term, it’s relatively easy to please most types of customer with introductory discounts and loyalty perks. They’ll probably appreciate their good luck and come back for more. But what about customers who’ve been loyal for longer? Too often, businesses take these kinds of customers for granted, assuming that their attachment to the brand is strong enough to be self-sustaining.

In fact, all customers need to feel cared about in order to stay loyal. And what’s more, the part of your customer base that’s been with you over the long haul will expect their status to make them more valuable, not less. With a long-term customer retention strategy, you can proactively improve the experience for every segment within your customer base, and make them all feel suitably valued.

4. Employee experience

What does employee experience have to do with customers? More than you might think – it can actually be a strong driver of loyalty. Take Starbucks for instance, where 87% of customer affinity for the brand is driven by how it treats its employees. That stat alone indicates that positive employee experience can be highly profitable, as well as making your workplace a nicer environment.

Customers warm towards brands who treat their people well, certainly. But more importantly, engaged employees who are part of a company culture that values them are much more likely to extend the same positive treatment towards customers. Giving staff autonomy, respect, a good work-life balance and pay that they feel is fair for the work they do will all feed into your customer loyalty outcomes.

Want to learn more about how to increase customer loyalty and boost customer retention? Dig deeper with our guides.

See how you can reduce churn and increase loyalty