10 ways to increase customer loyalty

It's often said that it cost less to retain existing customers than to cultivate new ones. Repeat business is essential to any growing enterprise. So what can you do to encourage it? Katherine Evans, PR and marketing executive at 08Direct, offers her ten tips for increasing customer loyalty.

Customer service tips | Katherine Evans of 08Direct report released by Barclays Bank earlier this year, it was stated that just 53 per cent of small and medium-sized businesses are using tactics to keep their existing customer base happy and ensure that they will return to them for future business, writes Katherine (left). An increase of as little as five per cent in customer retention is thought to lead to as much as a 75 per cent increase in the average business’ profitability. Are you underestimating the opportunities that a customer holds for you once they're already part of your client base?
As a small business in today’s business climate, you have something to prove and if you don’t prove ‘it’ then the likelihood is that customers will simply come in the front door and leave, very quickly, out of the back. Don’t get me wrong, I’m not saying that wanting to attract new customers to your business is a bad thing – it’s great when you get them. But, considering the time, money and effort that goes into expanding your customer base, it is just as beneficial to your business to look after the customers you already have, so they stay loyal to you in the longer term. You’ve already done all of the hard work to pull these customers in, so why not develop your relationship with them further? Studies have shown many times over that if someone is made to feel special by a certain business, then they will go back to that business repeatedly, regardless of other changing factors. For example, if a customer already knows they are going to be well looked after, they will be more willing to overlook changes in price. For the customer, the importance of receiving top quality service can be a lot more important than paying the cheapest price.  Here are my top ten tips to help you retain customers and increase their loyalty.

1. A smile goes a long way

This is proven as the number one way to ensure your customers will keep coming back. In the Barclays report, 59 per cent of consumers said that a simple smile and friendly hello was what made them return to small and medium-sized businesses over and over.

2. Keep up with your customers

Your customers need to feel like you care about them and their business, if you're in the B2B sector. There are lots of way you can show this, from sending birthday and Christmas cards, calling, emailing or chatting on social media from time to time, to invites them to new product launches or askingfor their feedback on products and services they've bought. It doesn’t have to be a huge gesture; you just have to show you care.

3. Put yourself in their shoes

Customer loyalty | A pair of shoes The better you understand your customer service and how your staff interact with customers, the better you will be able to understand how your customers feel when buying from you or making enquiries. Putting your service to the test can also help you refine and improve your processes.

4. Be proactive

Keep up to date with your customers’ activity. If there’s something unusual with their account, for example, such as a decline in usage or spending, give them a courtesy call to ask why and whether there’s anything they’d like to change to help them get back on track. Many customers won't complain about a poor service but just keep quiet and move on. Watching trends and being proactive gives you the chance to deal with problems – and it'll impress your customer.

5. Create a loyalty scheme

These have been around for years, and they are a simple but effective way of encouraging customers to return to you. you could follow the example of coffee chains, for example, who use loyalty cards to reward customers with a free drink once they've bought a certain number. Offering rewards for purchases or referrals gives customers an incentive to return to you – and they benefit, too!

6. Be available

Customer loyalty | Libre sign If you promise to provide each customer with an account manager, ensure that their account manager is available to them when they need them. If you don’t provide account managers, be sure that your business is easily accessible – advertise contact details clearly and ensure that you respond to queries quickly. People expect that they can have 24/7 access to services, so make sure that you’re available to them, by email and by telephone.

7. Ask for feedback

Feedback from customers is one of the best ways to find out what they’re happy with and what they’re not. Understanding this and ensuring you overcome the bad points will keep customers returning to you. there's plenty of free software that will enable you to create a short customer survey, or you could contact individual customers directly.

8. Be flexible

When a customer comes to you with a complaint or problem, it's a perfect opportunity to demonstrate flexibility or a willingness to work to a satisfactory solution. You're also likely to find a customer who has had a complaint resolved becomes even more loyal as a result. The short answer – customers like to be listened to, respected and valued. Going out of your way to resolve a problem, even if it's at your own cost, demonstrates this.

9. Be honest with customers

Ok, not so honest that you trip yourself up – but if you know that there’s an error at your end, or there’s a problem with your products or services that you expect you’ll get complaints about, it’s better to pre-empt it and be honest, rather than face the wrath of hundreds of unhappy customers. Remember, the rule of thumb is that unhappy customers will tell more people about their bad experiences than happy customers will tell about their good. Everybody respects honesty, too, and they're likely to cut you some slack, providing you deal with the problem quickly and at no cost to them.

10. Say thank you

Whenever you’re aware of a customer helping to boost your brand’s awareness, you should show appreciation! Katherine Evans is PR and marketing executive for 08Direct, one of the UK’s leading providers of non-geographic numbers and call management solutions. 08 Direct works with thousands of businesses across the UK, helping them to provide a nationwide presence and good quality customer service.

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Photo credits: Nick J Webb (loyalty cards), Luz Adriana Villa A (shoes), Gisela Giardino (Libre sign) via Compfight cc

Have your say

Marshall Crawford
Marshall Crawford

Great update on enhancing customer loyalty! We can brief it as “Customer loyalty basically depends on the 4 Cs; product continuity, competitive prices, convenient place and appropriate communication.

Katherine Evans
Katherine Evans

Thanks for your comment Marshall!

The 'Four Cs' is a great way to remember the core values of building customer loyalty!

Katherine Evans
Katherine Evans

Thanks for your comment Marshall!

The 'Four Cs' is a great way to remember the core values of building customer loyalty!

Krish J
Krish J

Above 10 tips are really awesome and it should be noticed before creating loyalty programs. Responding to the customer's feed back is a good customer loyalty to increase the sales and brand loyalty.

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