All companies aim to have loyal customers: as many customers as possible and, if possible, forever. That is why Customer loyalty represents such an important issue in all successful companies.
This saves acquisition costs – as a rule, acquiring a new customer is 6-10 times more expensive than keeping an existing customer – and minimizes the risks for the company.
Well, loyalty is not always loyalty. If a company wants to have loyal customers, it should first be clear about the different types of loyalty there are and what instruments of customer loyalty there are.
With some products – software, machines, systems in production – the customer is committed to a certain system for a longer period of time.
In fact, with their decision, the customer is then loyal to the chosen solution and the company. If IT decides on corporate software, a decision has been made for many years to come. The large investments in such a system do not allow a simple switch to another solution, even if you are later dissatisfied. This can also be applied analogously to the B2C market. Here, too, a technical loyalty arises.
Contracts create a temporary bond between the customer and a company, for example in the case of leasing contracts for a car.
However, the company’s ability to use this mechanism to retain customers is in fact not particularly high. If the customer does not terminate his expiring contract, the customer relationship is available at the end of the contract period.
When a company creates financial incentives for customer loyalty, voluntary loyalty can arise.
Loyalty rewards and vouchers are instruments that are used to retain customers over the long term.
The harder and longer a customer collects points, the more valuable the rewards they can choose as a reward for their loyalty. Economic loyalty is the most common in practice because the mechanism of financial incentives can be clearly controlled and evaluated by the company. The cause-and-effect principle can also usually be analyzed well.
A guarantee, a special customer hotline for “special” and loyal customers, after-sales service, information and additional services of a non-monetary nature can also generate loyalty among customers. This additional service gives a certain exclusivity, which has a high attraction and loyalty for some customers.
A guarantee, a special customer hotline for “special” and loyal customers, aftersales service, information and additional services of a non-monetary nature can also generate loyalty among customers.
This additional service gives a certain exclusivity, which has a high attraction and loyalty for some customers.
The strongest and at the same time the most difficult way to bind a customer to the company is an emotional bond. This only happens voluntarily and cannot be forced. The creation of a personal “bond”, the creation of a “we-feeling”, is based on many factors. The product and performance must be right, the service must work and the brand must also be attractive.
In a digitized world, it is important to inspire customers with services and products in such a way that they are voluntarily loyal to a brand or a company. The aspects of simplicity and trust in particular offer enormous potential for developing successful long-term strategies for customer loyalty.
Regardless of the mentioned types of loyalty, the technology is more important than ever in the company to achieve the goal of Customer loyalty.