As a business, it can be easy to assume that your customers' loyalty to your brand is a given. After all, they follow your social media accounts, subscribe to your newsletter, visit your shop or website, and sometimes choose to buy your products over those of your competitors. But these factors are not really true indicators of customer loyalty, and customer loyalty should not be taken for granted or measured by assumptions. Ask yourself: are your customers really happy? How can you know that for sure? It costs five times more to attract a new customer than it does to retain an existing one, so being able to confidently and accurately answer this question is crucial to running a cost-effective business. So, what is the best way to measure customer loyalty? Customer loyalty surveys are a great place to start.
Think about your favourite brand, the one you return to time and time again. It doesn't matter what their competitors offer in terms of price, branding or availability — there is very little, if anything at all, that would make you shop elsewhere. You are always recommending them to your friends, family and workmates, and you know that this brand offers something that their competitors simply don't. Your consistent decision to shop with your favourite brand is customer loyalty, and it is this consistency that is key.
Securing this level of trust and loyalty between your business and your customers translates into a steady stream of repeat, reliable business and a promising future for your company.
Customer loyalty surveys are specially designed surveys that have one objective: to measure how loyal your customers are to your business. They ask questions about how likely your customers are to recommend your brand, products or services to their friends and family, and how likely they are to use your business again. Customer loyalty surveys are also effective in uncovering what your customers like, love or hate about your brand and offering. These insights are invaluable, taking you right to the core of how your customers feel about your business.
Customer loyalty surveys remove any assumptions you and your colleagues might have about how your customers feel about your brand and replace speculation and guesswork with data. Once you have these insights, they can be analysed and turned into a roadmap of actions for business improvement.
Customer loyalty surveys are also a great way to make your customers feel seen, heard and appreciated. By actively collecting their feedback, you are opening up a dialogue which in itself can improve customer loyalty. You are showing your customers that their input and feedback is valuable and that their experiences and opinions matter.
Another benefit of customer loyalty surveys is that they can give you an edge over your competitors. Finding out why your customers prefer your brand to theirs and are willing to stay loyal to you — or why their loyalty may be waning — is like gold dust. Armed with this information, you can do more of the things your customers love, and improve the things that could be turning them away or making them doubt your brand.
Choosing which kind of customer loyalty survey to use will depend on what kind of information about your customers you want to collect and measure. The three key types of information are:
- Advocacy — Which is how likely your customers are to recommend your business to other people. This is more commonly referred to as Net Promoter Score®.
- Repeat purchase — Which is the extent to which your customers will buy from you repeatedly or more often.
- Customer retention or lifetime value — Which is how true to your business your customers are and what their monetary worth is.
Once you know which area you want to focus on, it is time to decide how you intend to measure the responses to your survey questions. You have a few options to choose from:
Open-ended survey questions
If you're looking for qualitative feedback from your customers that will give you very in-depth, personalised and rich data, then opt for open-ended survey questions. They pose a question and give your customers the opportunity to input their responses into an empty, free text field. This means that your customers can feel free to answer the question in any way that they choose, and go into as much or as little detail with their answer as they like. Here is an example of an open-ended survey question:
The Likert Scale is designed to simply assess whether your customers agree or disagree with the question, and to what extent. It can appear as a 5 or 7 point scale, with the options usually ranging from 'strongly disagree' to 'strongly agree'. The Likert Scale is a popular choice for surveys because it uses a universal method of collecting quantitative data, making it very easy to understand, analyse and draw conclusions from.
Dichotomous surveys are short and simple — the respondent can choose from just two responses. They are fast and easy for the survey taker to do, and also for you as a business to analyse.
Now you know the types of customer loyalty survey available to use, it's time to determine what kind of questions you will ask. You should create questions that have a clear intention or metric behind them. The below examples are a great place to start, and each can be tweaked to suit the style of survey you want to use.
This question is designed to find out how willing your customers are to promote your company and put their own reputation at risk. If you provide a fantastic customer experience and have a loyal customer at the other end of the survey, they will be more than happy to sing your praises to anyone who will listen.
This is it! The big question for discovering how loyal your customers are. It can also help you to forecast for customer retention and churn, which is the percentage of customers who stop using your business over a specific timeframe. Asking who your attractive competitors are might feel cheeky, but this information could prove vital in shaping your strategy going forward.
This question is product or service-specific and serves as a fantastic temperature check for companies who want to know how loyal their customers are to the things they sell. If the product or service in question is owned by your business, you can use this data to better understand how it is being received by your customers and how much purchasing power they hold. If you sell on behalf of other manufacturers or providers, this data can help you to shape your product strategy and focus on goods or services that your customers actually want more of.
Loyalty programmes are great. They reward your customers as they spend more and more money with your business. The answers you receive to this question can reveal how invested your customers are in your business (i.e. do they see themselves purchasing from you often enough to warrant a program like this?). You can also use the replies to target any future loyalty incentives to customers you know will be interested.
Simple and straight to the point. You can supplement this question with a follow-up question of 'why?' if you're interested in getting richer data.
This is a fantastic question for planning ahead and better understanding any threats or risks for your business. Find out if your customers are price-sensitive, attracted to new product launches, want to shop from someone who is committed to CSR and charity work, or even need to update their website. There are hundreds of reasons why your customers might choose to leave your company at a later date, and this question will help you get ahead of this happening.
For your customers to be loyal to your business, they need to trust your brand. This question will highlight how trustworthy your brand is perceived to be, and whether there is a group of customers that need extra attention in terms of building trust up.
Customer loyalty — the thing that every business wants, but not every business can say they have. An assumption or uninformed guess about how your customers feel about your brand will always be unfounded, and unfounded beliefs are not strong enough to build a successful business on. Measuring and improving your customer loyalty is key to keeping hold of your most valuable customers, and will help you to keep control of the costs associated with new customer acquisition.
Customer loyalty surveys are your gateway to data and facts about how your customers feel about your company. They remove the need for assumptions and doubt, replacing them with hard statistics and actionable insights. They also make your customers feel included in your journey as a business, and appreciated. Surveys are the start of a conversation between your company and your customers, through which feedback can flow. Once they know you value their opinion and experience with our brand, even customers teetering on the edge of switching to a competitor might be more likely to stick around to see what you do next with the feedback they gave. Plus, don't forget that there is a good chance that your competitors don't have a customer loyalty strategy in place. Implementing them in your processes and workflows might mean gaining a strong competitive edge!
Having a clear set of customer loyalty metrics to measure, benchmark, optimise and track is what differentiates successful customer loyalty strategies. It is imperative that you understand how you are currently performing, and how you improve or decline over time. If you're not measuring your performance and analysing your data, how will you ever get value from your surveys? Look at NPS, repeat purchase rate, customer lifetime value and retention rate to really understand where the loyalty of your customers is and whether any initiative you do to improve it works.
You can design your loyalty surveys to suit your brand and the questions you need answering. Do you want short, sharp and easy-to-analyse data that gives a clear indication of how loyal your customers are? Or would you prefer rich, qualitative data to really understand how your customers feel about your business and how this could change? Maybe it's a mix that you need. Whatever your answer is, there is no right or wrong way to proceed. Just keep in mind what you are trying to achieve and it will be easy to create surveys that work for you and your customers. You can always test the different survey types to see which works best!
The example questions we've listed above should be used as a starting point for your surveys, and as inspiration for other questions that you can ask. It is vitally important for businesses that want to grow a strong customer base and thrive in a competitive market to stay close to their customers and really understand where their loyalties lie, and why. Armed with these insights, you will be in a great position to analyse your feedback and create an actionable strategy based entirely on data. As you roll your strategy out and work to improve your customer loyalty metrics, you should see positive progress over time.
Net Promoter® and NPS® are registered trademarks of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld.
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