Important Customer Loyalty and Profitability Tips


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It may be hard to believe just how tightly linked customer loyalty and profitability really are. It’s very easy, in the business world, to become hung up on the goal of customer acquisition, and lose sight of customer loyalty and retention.

Of course, subscription services like SaaS and communications understand the crucial nature of customer loyalty. Other businesses however are only now starting to see the importance to customer loyalty and profitability being viewed as truly causally linked.

So, exactly how can we ensure customer loyalty, and what about it is so significant in overall profitability? Aren’t new customers going to pay more than long term customers with things like locked in rates? Well, they will, but that is a one time large payment. Long term customers may pay less, but in the long run, their presence over time contributes more money than one-shot large purchases.

So, with this in mind, while a push for customer acquisition is a healthy thing for a business, if the loss of acquisition rates severely endangers even status quo when it comes to revenue, then your customer loyalty measures are broken and/or undeveloped to calamitous levels. So, let’s see how we can work to encourage customer loyalty. Bear in mind this will look costly at first, but when you see how it ensures profitability through long term patronage, the expense becomes moot.

The first crucial thing is to have good customer support and tech support where applicable. Be prepared to take the blame for things with your product or service, resolve issues or offer refunds or discounts when customers’ issues are not possible to be resolved. Show a concern not for your profit but for their satisfaction. Further demonstrate your commitment to this by making hold times less lengthy, and less psychological torture.

Incentivizing long term customers is also an age old way to ensure customer loyalty. Offering discounts or rewards for proofs of purchase is famously employed by McDonald’s and Coca-Cola, among others. A step further to go with this, also practiced by these companies, is reward-driven gamification of incentives to drive purchases and long term use.

No company has as of yet employed a long term, non-limited time gamification model for this, but it’s a matter of time before someone does. Maybe it’ll be you. Maybe it’ll be me, but it won’t because I just gave away my only good idea!

In the future, we’re likely to see this gamification employed in greater lengths to drive customer loyalty. One such possibility is rewards for purchases as well as rewards for tagging ads as they are encountered in daily life. This is a way to keep static ads viral, while keeping customers interested in the product.

One caveat though. Current incentive systems with rewards are obviously one-sided. For example, it will take ten hours entering the numbers from bottle caps, in order to have a free 20oz bottle of Coca-Cola delivered to your home a week and a half later. So, make your rewards worth the effort.

So, you can see how important customer loyalty and profitability are when viewed together, and now you see some basic ways to help drive such customer loyalty, including some neat new ideas for the future.

Republished with author's permission from original post.

Stefanie Amini
Stefanie Amini is the Marketing Director and Specialist in Customer Success at WalkMe, the world's first interactive online guidance system. She is chief writer and editor of I Want It Now (, a blog for Customer Service Experts. Follow her @StefWalkMe.


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