How to create loyal customers | Incentive&Motivation

Loyalty And Marketing News: How to create loyal customers

How can you create a successful loyalty programme? We caught up with Chris Baldwin, Director of Consumer Promotions and Loyalty at Sodexo Engageto try and answer the question: Is there such a thing as a loyal customer – and if there is, how can you make customers loyal to you and your brand? 

“Whether you’re a high street retailer or a B2B logistics firm, when it comes to customer loyalty, everybody is asking the same question: what makes a customer loyal?

After all, the value of customer loyalty can’t be underestimated. Research suggests that it is six to seven times more expensive to attract a new customer than it is to retain an existing one. Plus, loyal customers provide brands with a steady stream of revenue. So, in these times of uncertainty, businesses should be looking more than ever to reward those customers who continue to buy their products and services.

But what is the magic formula for creating a successful consumer loyalty programme?  First, it’s important to understand that loyalty can’t be bought; it needs to be earnt. Second, it doesn’t happen overnight. Customers become loyal when they repeatedly enjoy great experiences with your brand – but that only happens if they feel strong positive emotions on each purchase.

The best brands

We recently surveyed 7,000 consumers to find out the brands they’re most loyal to, as well as the reasons behind their loyalty. Our Brand Loyalty Index questioned respondents on a number of variables including how long they had been loyal to a particular brand and why, their likelihood to recommend the brand or to switch brands if a cheaper alternative became available, and the quality of the brand’s customer reward scheme. Samsung topped the index, with Apple and Marmite coming a close second and third.

The fact that Samsung came top of the tree shows how important customer loyalty really is, as consumers were able to look past and forgive the brands recent issues with its faulty Galaxy phone and stick by the brand. M&S Food also performed well, ranking as the top supermarket for customer loyalty, largely due to its points-based ‘Sparks’ loyalty scheme, which provides discounts that add real value to the customer’s shopping experience.

Loyalty is changing

Loyalty programmes like these have an important role to play when it comes to keeping hold of customers – but they need to add value. After all, technology now makes it possible for consumers to have a massive range of products – and the best deals – at their fingertips. As a result, the average consumer is much less likely to develop an allegiance to a particular brand or product.

So, what can brands do to increase loyalty when it seems harder and harder to earn? First, brands need to know what their customers want and expect from these schemes. In an increasingly competitive market, brands should strive to ensure they consistently meet their customers’ expectations in this area – or better yet, exceed them.

The savviest businesses already know the secret to achieving this goal. The digital revolution may be putting a strain on customer loyalty, but it can also be used to the benefit of a brand.

Using loyalty programmes

Companies have used loyalty cards to reward faithful consumers with in-store discounts and access to exclusive deals for years. But, other than a select few, most of these cards get tucked away in a drawer somewhere, never to be used again. In fact, 92% of British consumers have at least one of these cards, but they are the least likely to use them compared to other global consumers.

The good news for retailers is that the latest apps and online portals now make it quick and easy for consumers to redeem discount codes and for retailers to ensure repeat purchases by sending notifications direct to their handset. Some portals even give consumers the chance to choose their own loyalty reward.

By personalising their customer rewards, companies are able to create a more valued loyalty scheme and build stronger relationships with their customers. After all, not all customers will want cinema vouchers or a discounted meal in a restaurant. Some may prefer a store voucher or the chance to enter a prize draw for a trip abroad.

With so many different brands offering so many different products, a fun and flexible reward scheme is a great chance for brands to get creative and express their brand’s personality. Modern customers may be fickle, but rewarding loyalty is a sure-fire way to keep them coming back for more.”

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