FAQ – Building Customer Loyalty

Although I have talked a lot about customer loyalty and its benefits, some of you still are not sure how to build customer loyalty. This is a topic worth going more into depth on, so I have answered the below FAQs to answer any other questions that might arise. If you have additional questions, ask them in the comments!

Why should I focus on customer loyalty? I can always get more customers.

You can get more customers, but that is going to cost a lot more that selling to existing customers. Numerous studies have shown that loyal customers buy more, more regularly. The lifetime value of a customer is a greater return on investment (ROI) than continually paying in marketing fees to acquire new customers – many of whom will not return for a second purchase unless you build customer loyalty!

I thought my store had good customer loyalty, but now I am not sure. Can I measure it?

If you notice you are losing customers, the first thing to find out is why (surveys are great for this!). The majority of customers leave because they are dissatisfied with the customer service aspect. Only a few leave because the dislike the product. People want to feel like valued individuals, so train your customer-facing employees – anyone on social media, the phones, or face-to-face – that all customers are important to the business and their job security. When employees treat customers in a friendly and efficient way, it is in their interest, as well as more fulfilling – so everybody wins!

Measuring loyalty mainly consists of tracking purchases over a set period of time, to see how often a customer buys from you. You can also distribute personalized codes, so you know when a new customer has found you as a recommendation from an existing one.

What are the most effective ways I can improve customer loyalty?

Easy: improve your relationship with the customer, via better service. It is unlikely you will be able to offer different products or services than your competitors, so build a rapport by offering better customer service than anyone else. Figure out the 2 or 3 most important service components to your business – turnaround? Efficiency? Adaptation to customer needs? – and focus on improving them.

The other most effective way to improve is training staff that customer retention is the main goal of the business. Teach them to ask customers for ideas for improvement, to welcome customers without overwhelming, and to understand the products they are selling before they face a customer. All company promises should be kept, and if they cannot, be honest as soon as possible with the customer. Be honest in all dealings with consumers.

Tell me more about my customer-facing employees. What key skills should they have?

Number one, they should remember that when they are talking to clients, they ARE the company! They need to keep in mind that anything they say or do creates a good or bad impression on the customer.

Secondly, employees should be knowledgeable and competent in their fields. Customers want answers on the spot, so you should empower them to answer questions with authority. This reassures the customer in your company competency.

Lastly, communication is key: make sure employees have good grammar and spelling. Mistakes in emails or on the phone leaves a bad impression, and ruin credibility.

Help! How do I deal with customer complaints?

When the customer contacts your company, the first thing to do is apologize! Employees should diffuse the situation with sympathy, listen to the facts, agree on what to do, and act. Most importantly, ensure you have a clear company policy in place. This makes it easier for employees to react appropriately.

Use complaints as an improvement tool. Every complaint is a customer telling you what you could do better to increase their loyalty; ask questions so you can be clear about the exact issue. Ask for additional feedback as well, to see if there are any other improvements that can be made.

When a problem arises, act quickly – especially on social media and other public review sites. People are watching to see what you do and how you handle it, and your response is an opportunity to demonstrate your commitment to customer service.

Is there a way to monitor my customer service?

Absolutely! First, make sure you are providing the appropriate service. Check in with customers after they contact you for feedback. Ask if you provide the same level of service as similar businesses, and what areas of service are most important.

Once you know this, monitoring is relatively simple. Measure how fast orders are dealt with, make spot checks on customer transactions, check the punctuality of deliveries, and measure complaint levels. If you see a downward trend, use your customer complaints to help fix it.