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How to Build Brand Loyalty

Katharine Paljug
, writer
Dec 31, 2018
Image Credit: / Shutterstock
> Marketing

Cut through the clutter of options and gain the trust of loyal customers.

The internet has changed the way consumers shop, presenting them with a seemingly endless variety of choices. No matter what type of business you run, there are always new companies offering a better – or at least cheaper – version of what you are already selling. 

The good news for companies is that this might not matter: millennials, studies have found, are the most brand-loyal generation out there. More than 50 percent of them say they are very loyal or quite loyal to their favorite brands. 

So how can your business cut through the clutter of options and gain the trust of these loyal customers? 

According to Will Fraser, CEO of customer-loyalty platform SaaSquatch, you first need to understand what actually inspires consumer commitment in the age of the internet.

Focus on customer experience

"User experience can be a key factor of customer loyalty," said Fraser. 

You can probably think of examples of this from your own experience as a consumer: when a company makes returns easy or their employees are always pleasant, you are more likely to choose them than the competition, regardless of other factors. 

Creating a positive customer experience is within your control, and Fraser emphasizes that businesses need to be alert to all its aspects, from making your website easy to use to resolving concerns efficiently. Otherwise, even loyal customers may hear about problems and be put off. 

"With the internet, consumers are always connected, have more data available than ever before and are quick to share good and bad experiences anywhere people will listen," explained Fraser. "This mean the cost of a bad customer experience is greater than ever before."

Offer the right rewards

When someone hears the words "customer loyalty program," rewards are probably the first thing they think of, says Fraser. 

"The challenge today is providing rewards that also work with your modern business model," he added. 

If you use a rewards program, choose one that inspires a long-term relationship with your customers. Customers who take advantage of a one-time or shotgun offers, for example, are unlikely to feel a strong sense of loyalty. 

Likewise, flashy tactics like points programs or gamification are unlikely to interest most consumers. 

"Points programs are great for your credit card ... however, this model just doesn't connect with the majority of modern products and services," Fraser said. "Badges and false gamification aren't fooling anyone these days. Don't try to make your website or app into a game, unless it is one." 

Instead, focus on rewards that fit both your customers' purchasing habits and the type of business you are running. These rewards, unlike one-time offers, inspire customers to keep coming back for future purchases. 

"This might be a credit if someone orders three [times], a discount when someone refers a friend or a gift card when you complete your customer profile," said Fraser. "The interesting thing is that rewards really do motivate people regardless of their spending habits and income."

Share your company values

Millennials, more than previous generations, care strongly about social responsibility and corporate accountability. They want to see not just what you are selling, but what values motivate your business and influence your decisions.

"Corporate values can be a great reason for a consumer to stay loyal to your brand," said Fraser. "Toms [Shoes] is a great example of a company who has used their values to drive customer loyalty." 

However, to connect with customers over your values, you also need to show these values reliably over the course of your brand's life. Especially in the age of social media, enforcing your values inconsistently at different levels of your supply chain or workforce can lead to backlash from disappointed consumers. 

"This can make it hard to implement," said Fraser, "but also a potentially strong competitive differentiator if you truly believe in your values."

Know your numbers

Like any aspect of running a business, consumer loyalty is something that needs to be tested, measured and improved over time. According to Fraser, "data and testing is your path to profitable customer loyalty." 

Customers will respond differently to certain initiatives. Some may be strongly influenced by a marketing campaign centered around your corporate values, and that may be enough for them to start using your products and stay loyal for the rest of their purchasing life. Others may be more persuaded by different rewards programs that encourage them to make repeat purchases. Others may simply love your products, regardless of other factors, and stay loyal no matter what as long as they can still get their favorite toothpaste or work with their favorite technician.   

"Test different campaigns and programs across your users. Find out which users respond to which things," advised Fraser. "To succeed at customer loyalty you need to think about the entire customer lifecycle... from first acquisition all the way to customer reactivation."

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Katharine Paljug
Katharine Paljug
Katharine Paljug is a freelance content creator and editor who writes for and about small businesses. In addition to Business News Daily, her articles can be found on Your Care Everywhere, She Knows, and YFS Magazine. Visit her website to access her free library of resources for small business owners.
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