The terms customer loyalty and customer retention are oftentimes used interchangeably. Although customer loyalty and customer retention are closely related, they are not the same. Customer retention refers to a business's ability to turn new customers into repeat clients. Customer retention focuses on the customer lifetime value and avoiding existing customers switching to a competitor. Customer retention utilized as a performance metric indicates how happy customers are with a business's products or services.
Customer loyalty measures the likelihood of a new customer becoming a repeat client. Customer loyalty can refer to the relationship of a client with either a company or brand. Loyalty is accomplished through a business supplying outstanding customer service and a great customer experience overall. For businesses that sell products, customer loyalty is accomplished through a high quality product with great value.
Customer loyalty and retention are closely aligned with customer acquisition strategies. Customer acquisition refers to new customers attained by a business who purchase a product or service offered. Although customer acquisition is crucial for business growth, customer retention and loyalty must not be overlooked. Best practices for increasing both customer loyalty and customer retention include investments in-
1. Loyalty Program
A loyalty program is a long term cost effective way to boost customer loyalty and customer retention rates. Customer loyalty is fostered by a loyalty program that supplies a unique customer experience every time. A loyalty program helps to make sure customer churn decreases and customer retention rates rise. The customer churn rate is commonly referenced when evaluating retention rates and business strategy particulars.
A loyalty program can link with social media accounts or an email address to supply marketing opportunities. A loyalty program that requires a customer email address can be used for email marketing campaigns in the future. Social media accounts linked to loyalty programs can also provide valuable data. A small business can even get creative with its loyalty program offering. For example, points could be awarded when customers start referring new customers to the business. Birthdays and special holidays are great opportunities for points awarded to loyalty program participants.
2. Social Media
Best practices for increasing customer loyalty and customer retention rates generally involve social media. Social media is increasingly popular and is not going anywhere anytime soon. Businesses that utilize social media to increase customer loyalty and customer retention rates have a competitive edge.
Businesses can use social media to engage with both new customers and existing customers. For example, a small business could recognize existing customers that are especially loyal with a personalized thank you. New customers can be identified and engaged with through paid social media advertisements. Discount codes and incentives sent via social media are a great way to retain existing customers and acquire new customers.
3. Self Service Kiosks
Customer service and the entire customer experience are revolutionized with self service kiosk capabilities. A self service kiosk is an electronic ordering system that instantly connects with point of sale systems. Benefits of self service kiosks include reduced customer wait times and easier order processing.
In fact, self service kiosks let customers start ordering without necessarily engaging with staff members. The customer experience can be customized with self service kiosks that offer loyalty program and social media account compatibility. Self service kiosks complement business strategy through streamlining restaurant operations.
Best practices for self service kiosks include staff members regularly taking time to make sure the kiosk is working correctly. A self service kiosk that is not working properly will negatively impact customer service capabilities and the customer experience overall. In order to maintain customer service levels, customer support must be readily available for kiosk problems.
If a kiosk is having issues, the manufacturer must offer excellent customer support capabilities of their own. Self service kiosk manufacturers may be contacted via a help desk email address or live chat customer support online. Businesses can request demo software from the manufacturer to make sure customer support and customer service capabilities are efficient.
Key Takeaways for Customer Loyalty and Retention Strategies
Customer loyalty and customer retention are top business considerations.
Strategies for increasing customer retention and customer loyalty range from investments in loyalty programs to self service kiosks.