In conditions of high competition of producers of goods and services, the consumer becomes a key figure, and marketing technologies come to the fore . Associated with them is such a thing as customer loyalty . This is the basis that promotes sales growth, the formation of a positive image of the enterprise, increase its competitiveness.
Is customer loyalty a fashion brand or a real basis for success?
Researchers managed to prove that a new buyer costs the company several times more than the one who has already made a purchase and is ready to continue cooperation - and because of his loyalty.
In marketing, customer loyalty is loyalty, commitment to a particular company, brand, product. The first attempts to achieve such an attitude on the part of buyers were made almost a hundred years ago in the United States. However, the heyday of this process occurred in developed countries in the last decades of the XX century.
Western marketers linked customer loyalty with the company's customer focus, rightly believing that these were two sides of the same coin. Customer retention programs were built for the specific needs of the target groups - and this led to the desired result: the share of loyal customers grew, the company's profit increased.
In the 21st century, loyalty marketing began to gain popularity among Russian manufacturing and trading companies. This was due to a change in the economic situation in the country: domestic industry started working, real incomes from the population increased, and solvent demand increased. And now, focusing on Western experience, Russian enterprises began to introduce ready-made programs that have worked well in developed countries. But not all of them reached their final goal and a significant increase in customer loyalty was not always observed.
The lack of return on these programs is not related to their inefficiency. The reasons lie in a different plane: companies did not study their consumers, did not understand their priorities when making purchases, and also did not motivate staff to provide quality customer service.
Portrait of a loyal customer
The company in its activities should focus on the target audience - those people who will be interested in the offered goods or services. However, only a few customers can become loyal customers. Their main features are:
- satisfaction with cooperation / purchases;
- friendly attitude to the company, to its products;
- the formation of a positive image of the organization in a private conversation or social networks;
- regularly made purchases;
- loyalty to the company when competitors with similar offers appear.
From these criteria, the conclusion suggests itself: a regular customer is one who periodically makes purchases at the company; loyal - a customer who receives satisfaction from regular acquisitions in this company. Consistency has rational roots and is based on the convenient location of the store / company, low prices, constant discounts, high quality goods. Customer loyalty is his behavior associated with the emotional component. It arises as a reaction to friendly and prompt service, quick resolution of problems, attention to the needs of the buyer.
Loyalty Factors
Potential buyers want to see a set of certain characteristics in the products they offer - high quality, a wide range of possibilities when using it, novelty, optimal price, etc. In addition, they expect a positive attitude from the company to themselves and their problems associated with the acquisition and consumption of goods.
The task of management is to study the needs and requirements that affect customer loyalty. This will determine the main factors that contribute to the formation of customer loyalty. Practical experience shows that these factors include:
- company priorities in the field of quality;
- breadth of assortment;
- the possibility of ordering (manufacturing) goods that are not in the catalog;
- positive experience of customer interaction with the enterprise staff when placing an order;
- flexible system of discounts and bonuses;
- related services demanded by the buyer (delivery, including free delivery; customization, installation of complex equipment; packaging or processing of products, etc.);
- success, fame of the company, its participation in socially significant projects.
This is not a complete list of loyalty factors, as buyers differ in their ideas about the ideal seller or manufacturer. To understand the priorities of clients, it is advisable to periodically conduct opinion polls in the target group. Only in this case it is possible to understand what is most important for the buyer - discounts, features of the assortment, additional services or the nature of the relationship in the chain “buyer - company employee”.
Loyalty indicators
Customer loyalty to a particular company can be measured using a variety of techniques. The main indicator of customer loyalty is the NPS (Net Promoter Score) index, which was proposed only at the beginning of the 21st century.
Its essence lies in the fact that the client must determine how much he trusts the company, brand or product, how confident in them, to recommend to his best friends and close relatives. The answer is selected from the least probability of a recommendation (1 point) to its highest probability (10 points).
The customer loyalty index allows us to distinguish three types of consumers :
- critic / detractor - a dissatisfied client leaving bad reviews (the probability of recommending to close people is from 1 to 6 points);
- neutral - the buyer is satisfied with the cooperation, but generally does not show recommendative activity (from 7 to 8 points);
- a loyal client (also called a promoter) is a satisfied client recommending the organization to his family and friends (from 9 to 10 points).
According to the results of the survey, NPS is calculated - customer loyalty as a share of promoters in the total number of respondents.
Another, no less important, indicator of customer loyalty is the level of their outflow. It is equal to the ratio of buyers who for a year refused cooperation (purchases), to the total number of customers. The repeat purchase rate is calculated based on the number of times a product is purchased for a particular brand for 10 total purchases.
Levels and stages of customer loyalty formation
Marketers distinguish three ascending levels of loyalty, namely: satisfaction with the purchase, commitment to a particular brand, the formation of partnerships between the client and the organization.
The formation of consumer fidelity implies the following stages of customer loyalty development:
- Awareness of potential buyers through advertising on the company's products or services.
- Maintenance of a new client from the moment of purchase, the use of discount systems.
- Working with regular customers through the creation of additional emotional value associated with repeated contacts. Signs of attention, small presentations are important. The reasons for constancy should be clarified.
- Maintaining high quality products and services by the company, studying and satisfying customer requests in order to transfer it to the category of adherents.
At the first stage, the buyer learns about the existence of a product (service) with the necessary characteristics, and he also creates an image of the product. If it is positive, then a purchase is made. For the emergence of loyalty, it is necessary to comply with the acquired existing expectations.
The second and third stages are marked by the fact that an idea of the organization and its relation to customers is laid down and fixed on them. The fourth unites, cements everything positive that was offered to the client earlier.
The main approaches to the formation of customer loyalty
There are several basic approaches that allow you to create a loyal customer. The following are most common:
- stimulation of consumption, aimed at constant study of the demand of target customers and the development of proposals to most fully satisfy it;
- differentiation of offers, which allows to create a unique value for a client or service and stand out among competitors, for example, through the use of new technologies;
- identifying the buyers who can be the most loyal, and building long-term cooperation programs with them;
- erection of high switching barriers with the help of loyalty programs.
These approaches are interconnected with each other. So, the most perfect loyalty program will not work if the buyer is offered products that are not interesting to him, are not in demand. When a brand stands out among similar ones, differing in quality, special useful properties, the number of its followers will only grow.
Loyalty programs
The loyalty program is a combination of various marketing activities. It allows you to stimulate customer loyalty to both the company itself and its products, declared life values. This leads not only to repeat purchases, but also to the consumer maintaining a positive image of the organization.
The most common are bonus programs that give you the opportunity to earn points when making a purchase. When they accumulate a certain amount, they are exchanged for any product of the corresponding value. Some advanced foreign companies accrue points for a healthy lifestyle, its propaganda in social networks based on a personal example.
Sometimes the amount of purchases is taken into account; when it reaches a predetermined threshold, this will give the right to free delivery, participation in a win-win lottery, priority access to new products, an increase in the percentage of discounts, etc.
Instead of a conclusion: the main rules for creating a loyal customer
The main indicator of customer loyalty is their loyalty to the company, brand. Therefore, when developing measures for its formation, it is necessary to take into account the following simple rules:
- the goods or services offered must fully comply with the buyer's idea of their quality, characteristics, and benefits;
- staff behavior must be customer-oriented - friendly, helpful, aimed at solving the problems of the buyer;
- you should choose a loyalty program that provides both material benefits from regular purchases (saving money) and moral satisfaction from purchased goods and services (a prestigious brand is a quality standard; purchasing products from a company that cares about environmental protection, etc. .).
This approach will bring its results in the form of a noticeable layer of loyal customers that can increase the organization’s profit and strengthen its positive image.