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Built for
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Building Customer Loyalty
Advocates are crucial to growth
Picture your ideal customer. Imagine how they might experience your brand,
and customer retention. But in
order to turn a customer into
an advocate, you first need to
from discovery to purchase and beyond — what they’re thinking, how they
establish customer loyalty.
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react to and interact with your brand, what they purchase and why.
Your ideal customer is not just interested. They don’t just treat your business
with respect, or come back every Thursday to make a purchase. They’re
actively involved in the growth of your business. They love it. They’re so
excited about what you’re doing that they bring other people through the
door. When they talk about your brand, they glow.
That’s what you call a brand advocate. Advocates are crucial to growth
and customer retention. But in order to turn a customer into an advocate,
you first need to establish customer loyalty.
For small businesses, loyalty is what distinguishes a dedicated customer
from a casual buyer. Eventually they’ll want to tell other people how great
the business is, essentially acting as a form of organic advertisement.
Loyalty can be generated in many different ways. Think about big brands
with passionate followings — Apple, Amazon, Google. What makes fans
so excited to use their products? You’ll probably find a different answer in
each case. For Apple, it’s the simplicity of their devices; for Amazon, it’s
convenient shipping and customer service; for Google, it’s the quality of its
search engine.
If a brand is particularly good at something, it can generate loyalty by
focusing on those qualities and making sure they exceed customer
expectations. The key is to find those differentiators that already make
your brand great.
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For small businesses, the principles are the same: Find elements that other
people can rave about — or better yet, are already raving about — and build
on those things.
This guide will help you understand what customer loyalty is, how it positively
impacts your company, what turns casual buyers into loyal customers, how
to develop a plan for increasing loyalty to your brand, and how to put that
plan into action.
What is loyalty?
Before we get into the whys and hows of building customer loyalty, let’s
look at what it takes to be considered a “loyal customer” in the first place.
Loyal customers are often the result of a positive experience or series of
experiences. Those customers are more likely to return to your business,
more enthusiastic about making purchases, and are prime candidates for
becoming brand advocates — customers who promote the brand of
their own accord.
Loyal customers are
often the result of a positive
experience or series of
experiences. Those customers
are more likely to return to
your business...
It’s easy to see why these types of customers are desirable for brands to
cultivate. Not only are they repeat buyers, but in large numbers they can
drive down the need for marketing and become great sources of honest
feedback.
Try to think of some brands that you are loyal to. It should be easy — maybe
you love a particular brand of shoes because they last forever, or maybe
you’re partial to a brand of hot sauce because it’s made locally.
These are brands you are proud to “like” on Facebook; the brands you’re
happy to bring up in casual conversation because you believe others would
truly benefit from them, or even because mentioning them will make you
seem interesting or in-the-know.
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To bring you to that point, these brands had to provide you with some kind
of experience that hit a switch in your brain and convinced you theirs
was a brand worth supporting, whether it was bringing forth the realization
that you’ve been wearing the same pair of shoes for four years or the pride
you feel in being from the same town. It’s through experience that we create
emotional bonds.
Bands do this exceptionally well because their product is an emotional
experience. Fans who refer to themselves as Deadheads or Little Monsters
Fans who refer to
themselves as Deadheads or
Little Monsters do so
because they feel connected not
only to the artists but also to
other fans. Trekkies, Whovians,
and Twihards are born of that
same bond.
do so because they feel connected not only to the artists but also to other
fans. Trekkies, Whovians, and Twihards are born of that same bond. Fandom
and loyalty are one and the same.
That’s what we mean when we say loyalty — a connection that is so strong
that customers want to associate themselves with the brand.
Why is loyalty important?
The most obvious benefit that loyalty provides is retention. Loyal customers
return to spend more money. When a brand makes an emotional connection
with its customers, those customers are going to be more willing to put their
hard-earned money into the brand, and they’re probably going to be happier to
do it.
In the digital media industry, where products mostly consist of intellectual
property that can be easily pirated or copied, some brands rely entirely
on loyalty to make sales. Even content creators who make their money
through paid advertising sometimes rely on loyal customers to turn off
Adblock and actually watch the ads.
Loyalty also combats negativity. If you goof up a product or if an employee
makes a mistake, having a strong base of loyal fans can help to minimize
the damage. At the very least, they’ll be more willing to accept an explanation
and forgive the faux pas.
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There are other benefits: Loyal customers are more likely to purchase
special promotions, deluxe editions, and preorders; they’ll follow you on
social media; they’ll give you feedback; they’re also more likely to become
advocates for your brand, which we’ll discuss in further detail later on.
Finally, loyal customers can provide a solid foundation for future brand
development. As you go through the process of building loyalty, you’ll find
it’s a two-way street. You’ll get to know your customers a little better and
find out what they love about your brand; you may also find out what they
don’t like about your brand.
How do you build loyalty?
So now you have an idea of what loyal customers can do for your business
and why it’s important to have them, but that knowledge alone doesn’t
actually help you establish a loyalty base. This section will give you advice
on how to get the ball rolling on that.
Know your brand
The first step is to understand your own brand, what it offers, and what you
want to be for customers. A poorly branded business will have a tough time
winning customers over. If they come to you expecting one thing and find
another, it’s probably not going to be a positive experience. That’s a problem.
...benefits: Loyal customers
are more likely to purchase
special promotions, deluxe
editions, and preorders; they’ll
follow you on social media;
they’ll give you feedback; they’re
also more likely to become
advocates for your brand...
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Make sure that your brand:
•
•
•
•
•
Has clear values
Understands its market
Meets expectations
Fosters brand culture internally
Is consistent
All of these things will lay a foundation that’s critical for building loyalty, but
don’t get ahead of yourself. If you try to build loyalty before you’re ready,
you risk ignoring your occasional customers, who may also represent a
sizable piece of your revenue. Those customers are important too!
The reason why establishing a clear brand identity is so important in fostering
brand loyalty is that it gives customers something concrete to connect with.
Even if you have a great product, if your image is vague or underdeveloped,
you may not make any impression at all.
Here’s a simple example to get you thinking: Home Depot, a home improvement retailer, hosts “do-it-yourself” workshops each month to help customers
Learn about your customers...
understand its products and put them to better use — a great example of
they will give you insight into
how to not only exceed customer expectations but also engage them and
what is already working for
your brand
create a positive, lasting experience.
Know your customers
Building loyalty will be a different journey for each business, so one way to
figure out the best approach is to learn more about your customers. They
will give you insight into what is already working for your brand. Keep in
mind that we’re focusing on your brand’s image and how you interact with
and engage customers — things you can easily improve on — not your
primary product or service.
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Tim Hortons was ranked by Canadian Business as the best Canadian
brand overall. It scored well across the board, but it stood out particularly
in Reputation (“trust, admiration and respect, good feeling and overall
esteem”) and Citizenship (“supports good causes and protects the
environment”). It is important to realize how important those types of
peripheral qualities are when trying to win over customers and create
a positive experience.
You’ll want to find out what attracted your customers’ attention in the
first place. For some businesses, this is easy. You can check Yelp if you’re
on there and read whatever reviews are posted — the good and the bad.
Establish an online presence and see what people are saying about you.
Even if you don’t want to tweet, it’s worth being on Twitter to put an ear to
the ground. The Internet can be a harsh place to go for feedback, but
negative and neutral feedback is just as important as a rave review. If you’re
serious about building loyalty, you need to find out what’s keeping people
from getting there.
Another method for uncovering feedback is to simply ask for it. This can be
You’ll want to find out
what attracted your customers’
attention in the first place.
For some businesses, this is easy.
You can check Yelp if you’re on
there and read whatever reviews
are posted
done by actively seeking out opinions from your customers or accomplished
more passively by creating a survey. WestJet, for instance, has a feedback
link right at the top of its home page that leads you straight to an open-ended
survey form with just a few fields to fill out. It’s quick, easy, and painless.
Customers can do it on their own time, at their own convenience.
Making the feedback process easy on the customer is a great way to
get more feedback. You can (and should, if you have the chance) speak with
customers in person for direct input, and many brands do that successfully,
but that approach overlooks customers who are unwilling to give you their
honest opinion in person.
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A survey allows you to ask questions that might sound awkward in person,
and it will likely provide you more truthful responses: “What could we do
to improve?” “Were you happy with customer service?” “Would you
recommend us to a friend; why or why not?” Make sure to offer a text
field for additional comments.
Gathering feedback allows your brand to do a number of things, and
these will vary for each business depending on its needs and the responses
received. It could help you recognize holes in customer service, improve a
product, or address pricing issues. Not every comment you receive will be
immediately plausible, but you will get a better idea of how your brand is
perceived and what changes will potentially improve customer experience.
For example, you might discover that customers are reasonably happy
with the brand but would not recommend it to friends because they don’t
think their friends would be interested — maybe the product is very technical
or niche. In that case, you might want to look into developing a brochure or
website that clearly explains your product or service, something customers
can use to explain it to friends and perhaps get them interested.
Know what works (and what doesn’t)
Gathering feedback
allows your brand to do a
number of things... It could
help you recognize holes in
customer service, improve a
product, or address pricing
issues.
Each business will have something different to offer its customers, but being
aware of the way other businesses are building loyalty — and finding out
whether or not their methods are effective — is a good way to learn. While
a business’s products or services may be unique, its methods for building
loyalty may be largely transferrable to your own business.
The best way to begin researching is to check out your competitors.
This could be as simple as visiting a competitor’s store or going to their
website and taking notes. Social media is a great place to look because a
lot of the customer feedback is public. Paying a visit will show you what
they’re doing; paying attention to the feedback they receive will clue you
in on what’s working and what isn’t.
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Take loyalty programs, for example; they’re popular, but are they effective?
86%
What impact do they have on customer experience? According to a survey
from Hotels.com, 86% of Canadians do participate in a loyalty program,
of Canadians do
participate in a
loyalty program
so it would be foolish to ignore the approach. If you do opt for a loyalty program,
know why they’re popular and where to draw the line.
The key to developing an effective loyalty program is to balance
engagement with enthusiasm. If customers feel driven to participate
in order to collect rewards, but do not feel a sense of enthusiasm while
doing it, something is missing.
For 67% of Canadians who participate in loyalty programs, the deciding
factor is “free stuff.” How can your brand give repeat customers free stuff
without trapping them into repeat purchases? There are a lot of ways to
do that: periodic sales advertised through an opt-in newsletter, rewards
for recommending a friend, or just give them something cool at the door.
Conversely, try to avoid those “buy 100 get 1 half-off” deals that pressure
customers into more purchases than they want to make.
For a small business, a “loyalty program” could be as simple as remembering
what a customer ordered or writing their name on their coffee. Making
For
67% of Canadians
who participate in loyalty
programs, the deciding
factor is “free stuff.”
the process easier and more comfortable for return customers is always a
great move (assuming it’s done tactfully).
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Online, seemingly minor things can make a huge difference for customers.
Faster loading times, an FAQ page, simplified checkout, language options,
and enhanced security and privacy measures can greatly improve the
overall experience.
You can also check out what major corporations are doing. Their methods
won’t always apply to a small business, but the principles behind new marketing trends are often applicable.
Make a point to dig through some online marketing and business news
outlets for an hour each week, and it should be easy to spot tactics that fit
your business. You’ll quickly get an idea of what you need to do in order to
build a loyal customer base, and the more loyalty you build, the easier it will
become.
From loyalty to advocacy
Once you’ve recognized some strategies that work for you and begin to
build a loyalty base, the next step is to nurture your relationship with those
customers. Loyalty is not the end.
Advocates are customers who take their loyalty a step further and start
telling their friends about the brand, sharing it on Facebook, and even
getting involved in street teams or brand events. Advocates are customers
who advertise for free.
Online, seemingly minor
things can make a huge difference
for customers. Faster loading
times, an FAQ page, simplified
checkout, language options, and
enhanced security and privacy
measures can greatly improve
the overall experience.
Even in its infancy, Amazon did not use ads to promote itself. It relied on
customer satisfaction and word of mouth. The brand advocates took care
of everything. Advertising is fine, but no amount of marketing research can
match the ease and effectiveness of a personal recommendation from a
close friend.
Ultimately, you want customers who will tell their friends about you,
write reviews, share your posts, and contribute to your development.
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Keep them updated
Find out if your loyal customers want more information about what’s going
on with your business, and if they do, then consider setting up a newsletter
(opt-in, of course) or a blog that keeps them up-to-date. They will be
spreading the word about your business, so try to keep them in the loop.
Measure success
Take note of how your strategy performs. Don’t expect things to turn out
the way you hope every time, and don’t marry your plan. If it’s not working,
recognize the flaws and correct your course.
The most reliable way to gauge success is to look at sales, and the more sales
data you have access to, the easier it will be to determine how successful
you’ve been. If your business is able to keep track of same-customer sales,
this information is particularly valuable when building loyalty. But in general,
any increase in sales is a good sign.
Social media is another good way to track success if your strategy
involves social media. If you do have a strong social media presence,
don’t just look at your follower count. While that’s definitely important,
you should also monitor engagement (likes, shares, comments) as well as
The most reliable way to
gauge success is to look at sales,
and the more sales data you
have access to, the easier it will
be to determine how successful
you’ve been.
reach and clicks. Each of these figures has a unique value.
Shares, in particular, are indicative of high loyalty and advocacy. The people
who share your content like your brand enough to put it on their news feed.
That’s about as close as you can get to wearing a branded T-shirt online.
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Maintain momentum
Finally, when you know you’re doing something right and have evidence
that it’s benefitting your business and converting casual customers into
loyal advocates, keep the momentum going. Don’t just sit on it — improve.
Again, the steps you took at the beginning of this process are still important
when you’ve established an effective method of building loyalty. Continue
Continue to interact with
your loyalty base and look for
new opportunities to exceed
expectations, create stronger
emotional bonds, and address
concerns or weaknesses.
to interact with your loyalty base and look for new opportunities to exceed
expectations, create stronger emotional bonds, and address concerns or
weaknesses.
All of the brands we mentioned in this guide spent years developing and
perfecting their loyalty-building strategies. If they had stopped developing
these strategies as soon as they saw an increase in loyalty, they would not
be notable examples today.
Establishing a strong, effective plan for building loyalty is a job without
end, but it gets easier as you go.
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Conclusion
Loyal customers are one of your greatest assets, not just because they’re
returning customers, but because they can be one of your most valuable
sources of feedback, contributing thoughts and opinions that can help
bring in more loyal customers.
Starting a campaign to build loyalty is a learning process. Learn about
yourself, learn about your customers, and learn about the options that are
available to your brand. Take your time and make sure that the policies you
establish are what your customers want. A points program that appears to
work for Brand A or Brand B does not necessarily mean that a points program
is the way to go for you. Your business has its own intrinsic qualities, and
those are the things that will get people excited.
As with any relationship, you and your customers will learn more about
each other over time, and the way your brand establishes loyalty may
change. It’s a journey without end, but your brand will be better off for
taking it.
New – Take Charge of your business today.
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