According to the December 2010 Global Marketing Leadership Online Survey, marketers assign top priority to acquiring new customers (65 percent), increasing brand awareness (40 percent) and improving ROI on marketing interventions (39 percent). Customer loyalty continues to rank well below its actual worth in this misaligned hierarchical representation of marketing priorities.
But the changing business landscape makes more and more marketers look towards promoting customer loyalty. The realization that it is much easier to sell to an existing customer than a new customer is slowly settling in. It costs ten times more to convert a new customer than to retain an existing customer. Data over the years suggest that a 5 percent improvement in customer retention rates increase profits to the tune of 25 to 100 percent.
So how do marketers strive to generate loyalty among their customer base?
The first consideration is to maintain consistency across all engagement levels. Regardless of the product or service, a consistent voice, tone and action is essential to build trust.
The second consideration is to deliver value to customers. The bottom line is that customers go where they get the most value for their money. Most marketers try to understand what customers want and fulfill such needs. Marketers seeking loyalty strive to provide customers with the maximum possible value for their corresponding investment. At the very least, marketers need to define service and product features based on evolving consumer behavior.
Improved efficiency in communication and promotion initiatives invariably becomes a prerequisite to drive customer loyalty. Promoting loyalty requires increasing engagement levels by acting on data and analytics quickly.
In what ways can you increase loyalty with your customers? Have you met all of their current needs?