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How to build customer loyalty

Customer loyalty matters because selling more to existing customers is easier, and cheaper, than finding and selling to new ones. Not only do loyal customers tend to buy more, they also buy more regularly. And they will frequently recommend your business to others.

But how exactly should a small business go about building customer loyalty?

Customer care experts identify four critical steps:

  • make customer care a key part of your business strategy;
  • offer excellent service as a non-negotiable basic, not an add-on;
  • encourage and listen to customer feedback; and
  • communicate effectively with customers.

In this article, we focus on making customer care an essential part of your business strategy, and the daily implementation of that strategy.

Make customer care a key part of your business strategy

Effective customer relationship management means organising your entire business to focus on the needs of customers.
List your top key accounts, and give them the best service.

Make sure customer-facing employees have access to all the information they need to serve customers efficiently. Give them the power to make certain decisions independently.

Draw up a set of procedures and standards to be used wherever customers have direct contact with your business.

Learn about your different customer segments

Find out what, when and how customers buy and use this information to improve the service you offer. Use your database to record information about your customers’ buying habits so you can tailor your offer and service. For example, a travel agent could send customers information about their favorite resorts at the time they normally book holidays.

As part of your sales and marketing strategy, set out the levels of service you plan to offer your different customer types. For example, you might assign key account managers to your largest or most profitable customers.

Find out more about your customers by generating opportunities for feedback, and develop a brand around your company, products or services. If customers can identify with your company and feel good about it, they will be more likely to remain loyal.

Create a consistent, clearly defined identity for your business or product. Advertise to build brand awareness of your product or service.
Design and deliver a “customer experience” to address how you handle customers when they contact you, whether by phone, letter or e-mail.

Do you address customers by their first names or use a more formal form of address?

Follow up queries with a “thank you” letter, e-mail or phone call.