Customer loyalty is an essential factor which can make or break any business, there are few factors more important to sustained success than customer loyalty.
Businesses with a high degree of customer loyalty can count on repeat business, making it far easier to project income and manage cash flow. And they can market much more profitably, as studies have conclusively proven that it’s far less expensive to generate a repeat order from a previous customer or client than it is to go out and find new buyers.
So how can you improve customer loyalty in your business? Start by answering this critical question:
“Why should a customer choose to do business with me instead of with a competitor?”
If you don’t have a good answer, chances are your customers aren’t going to be very loyal. They’ll leave as soon as a competitor gives them a good reason to do so. Today we will look at two particularly strong ways to “answer” this key question:
- You can invest into creating superior products or services. If your customers can’tget these products and services elsewhere, they’re essentially “stuck” with you… and that’s a good thing! But maintaining this type of competitive advantage requires a consistent mindset of innovation in order to stay ahead of competitors in your market.
- You can invest into relationships by delivering such a high level of service that your customers wouldn’t dream of leaving. But, critically, these relationships can’t be dependent on you personally– you need to systemize your customer relations so that the relationships live on without your direct involvement. It’s also important that you continue to produce quality products and services… because at the end of the day, if you can’t come close to matching the competition, even great relationships won’t save you.
Now, there is a lot more that could be written about customer loyalty. And the two strategies outlined above aren’t an “either-or” approach. A smart business focuses on innovation and quality products and services, while also putting a premium on relationships. Pursue these dual goals and your customer loyalty will improve.
Questions or comments? How do you enhance customer loyalty in your business? Leave a comment below and share your thoughts!