Driving customer loyalty is crucial for businesses to thrive. With customer acquisition costs and competition higher than ever before, the customer tolerance for poor experiences with a business has shrunk. After all, why should customers settle for a poor product or service, or a bad experience with your customer services team, when it takes five seconds and a quick Google search to find another brand to do business with?
As a result, brand reputation and customer loyalty are critical. This high level of competition is leaving many customers with decision fatigue and wondering who they can trust. Ultimately, customers want a quick service, to have access to all the information they need, and to know they can trust the business they’re buying from. However, trust now goes even further beyond ‘can this brand reliably deliver this product in good condition?’ — trust in today’s arena extends to ethical practices and values.
Due to the insurmountable level of competition online and offline, gaining customer trust is more important than ever. Many online shoppers say they trust word-of-mouth recommendations and organic referrals over marketing and what a business says about itself. So, how can you acquire loyal customers, whilst also encouraging your current customers to become brand advocates — promoting your business on your behalf to their friends, family and colleagues? This is where customer loyalty comes into play.
What is customer loyalty and why is it important?
Creating customer loyalty (also referred to as customer retention, brand loyalty and brand advocacy) means building a long-lasting and ongoing positive relationship with your customers.
Loyal customers are:
- Less likely to go to competitor brands
- More likely to organically refer you to their friends, family and colleagues
- Often willing to pay more for a great customer experience
- Willing to pay a premium for a product or service that really works
- 60–70% more likely to purchase additional and repeat products or services from your brand
- More likely to purchase additional and repeat products from your brand
- More resilient to one-off poor experiences, price hikes or difficulties
- Likely to provide honest customer feedback
On this last point, research has shown that 97% of customers are more likely to stay loyal to brands that listen to and implement their feedback. By gathering customer reviews, asking for feedback or creating customer surveys, not only will you gather valuable insights, you’ll also prove to your customers that their opinions are valued and heard.
So, the benefits of customer loyalty cannot be ignored. Time and again, businesses have fallen flat by focusing only on new customer acquisition — this is costly, and leads brand's to neglect their current customer base.
While you might scoff reading this — and in theory it sounds simple to focus on your current customer pool — think about your own business. Does your marketing spend on Google Ads, social media, PR and advertising far exceed that of current customer communications? Are the targets of your sales and marketing teams based solely on driving new leads, traffic and revenue to your business? Do most of your customer service enquiries come before purchasing? These signs may mean you’ve inadvertently focused on new customer acquisition, rather than taking care of your current customers. Don’t forget, once lost, previous customers are very difficult to re-acquire unless they have a poor experience (or a series of bad experiences) with your competitor.
The latest burst of online competition means that online marketing practices are more expensive than ever before. Bidding to get in front of your target audience through social media and search engine marketing has become more and more costly, while big brands are sinking money into driving online presence and standing out amongst the crowd. Keeping a tight grip on your current customer base should be your priority.
Generally speaking, you can create positive customer relationships and drive loyalty through the following means:
- Providing great customer service before, during and after purchasing
- Clearly articulating and living your brand values and ethics
- Creating and delivering an excellent and reliable product or service
- Personalised communications post-purchase
- Loyalty schemes, VIP opportunities and discounts
So, how can you show your customers that you value them and thereby create brand advocates? Below, we’ve outlined our top 12 customer loyalty appreciation ideas.
Customer loyalty appreciation ideas
1. Customer loyalty programme
One obvious go-to method of creating customer loyalty is through a loyalty scheme or programme, and there are a couple of different ways you can go. A simple solution would be to award customers points based on the value of their purchases, for example, one point per £10 spent. Perhaps when customers gain ten points (£100 spend) or purchase three times in the space of a year, they could receive a discount code on their next purchase, a free product, free shipping for a year or access to exclusive products. Of course, you can tweak these based on the value, and how often they purchase, your products.
A simple example of this is used in coffee chains such as Starbucks and Costa. Costa rewards one ‘bean’ (their rewards programme currency) for each drink purchased. Once a customer has earned eight beans, they can claim a free drink — they can also get a free slice of cake on their birthday. This is a great example of creating brand loyalty with rewards that are attractive and easy to obtain.
A more complex (but brilliant) way to reward customer loyalty is to create a tiered system. The only minor downside to Costa’s reward scheme is that those who buy from Costa multiple times a day, every day, or in bulk for offices won’t get any more perks than those who purchase once every month or so. A tiered loyalty programme addresses this and rewards your most active and high-spending clients with additional perks.
One brand that does this really well is makeup giant Sephora and their Beauty Insider loyalty scheme. There are three different tiers of benefits based on a free to join tier, $350 spend tier and $1,000 spend tier. Respectively, each tier gives 10% off seasonal events and free shipping on orders of $50+, 15% off seasonal events and free shipping on orders of $35+ and 20%, free shipping on all orders and the ability to exchange 2,500 points (1 per $1 spent) for $100 off a purchase. On top of this, they also offer a choice of free mini gifts for customer birthdays and exclusive (free to attend) beauty classes for members. This system gives everyone a fair chance to earn discounts while rewarding the top buyers.
2. Branded merchandise
Depending on your brand and what you sell, branded merchandise could be a good option. Again, this can be sent once the customer has achieved a certain lifetime order value, or you could give your customers a choice of what they’d prefer to receive — the second option is even better for brand advocacy.
Pens and USBs are old school, so create something modern and useful that your target audience will enjoy. Bottle openers, phone holders, hand sanitiser lanyards and thermal water bottles are all great examples of things that will be used regularly by your customers. Not only will they enjoy their gift, but they are also likely to use it, which is more free promotion for your brand!
3. Pre-sales and previews
Pre-sales and previews are great for ecommerce brands, particularly in areas such as fashion or beauty. You can set up pre-sales around 24–48 hours in advance of making your products available to all customers, giving loyal customers the chance to preview, reserve or purchase ahead of time.
This is a huge perk for customers, and may even work backwards in creating customer loyalty. Instead of rewarding customer loyalty, you can create customer loyalty with benefits such as this — encouraging them to reach the required order value, tier or points to gain access.
4. Offer personalisation or free upgrades
Personalisation — ensuring that customers are divided into segments so they’re not being targeted with advertising or emails for things they’ve already brought — is a brilliant way to drive customer loyalty.
While plenty of brands offer personalisation options, consider offering these ‘upgrades’ for free to previous customers. Whether you’re selling a product that can benefit from adding a name or initials, different colour or styling options, you might consider offering these for free to previous and loyal customers. Perhaps there are add-ons, larger options or complementary products that you can offer to your current customer base. This is also an effective way of encouraging cross-selling and up-selling — your customers may not have considered buying these previously, but with free personalisation, they may do.
5. Free gifts and gift cards
Free gifts are another great way to both create and maintain brand loyalty. It doesn't have to be expensive and can be something as small as a bag of sweets with each package or a selection of stickers. For high-value items and services, consider gifts along the lines of vouchers or gift cards. We’ve seen this work particularly well for service suppliers such as gas, electricity, internet and mobile phone providers, who offer things like £50–£100 vouchers or cards to switch to them.
Compare The Market does this really well. By switching suppliers or purchasing insurance through them (a price comparison site), not only do customers often receive a gift card from their new supplier, but Compare The Market also gives 50%-off tickets for certain restaurants or cinemas for a year. While this normally has nothing to do with what they’re selling, this is a great example of knowing your target audience well and giving them what they want. So, consider universally known gift cards such as for Amazon or Tesco, or a pre-paid cash card such as the BT Reward Card that can be used anywhere.
6. Contests and competitions
Running regular contests and competitions is a great way of keeping current customers engaged while prospecting at the same time. The competitions can be easily created through social media and email marketing campaigns and can have a wide range of themes — on social channels, they can be voted on by whoever gets the most likes and engagement, for example.
- Create a landing page and have customers earn points for each person they successfully refer
- A competition for the best name or tagline for a picture or product
- A pub quiz or community knowledge quiz
- Where’s Wally (or your company mascot!)
- Ask them to upload a selfie about how your product makes them feel
- Get them to take a photo of your product in an exciting place
- Encourage them to share a post of yours for the chance to win
You can double-up on your efforts by creating a contest or competition when you’re about to launch a new product — perhaps the winner can receive it early for free or get a voucher. A contest or competition is another way of creating user-generated content that you can share on other platforms. By encouraging customers to share selfies or product images, you’ll be able to use this content (with permission!) in your own marketing and on places such as Instagram. Create a hashtag for your competition for an even wider reach, and run it across multiple platforms such as Facebook, Twitter and Instagram.
7. Customer appreciation event
Something we’ve covered in a previous blog is customer delight. Going beyond delivering excellent customer service, customer delight is about surprising customers in a way that makes them truly happy.
A great way of doing this is through a customer appreciation day or week. Although it will require some planning, you can create an event (online or in-person) to coincide with this week for your customers to attend. Perhaps people purchasing in that day or week will all benefit from a free add-on or upgrade, free shipping or double points or rewards for any purchases placed in that period. It’s also a great time to run daily competitions and giveaways to drive plenty of engagement.
This is a really simple way of saying thank you to customers for their loyalty while creating a big buzz around your brand!
8. Acknowledge special dates
Communicating with your customers on special dates is a great way to personalise your communications and show that you keep tabs on your customers individually! Sending a discount code for an upcoming birthday, offering a free small gift or a special offer to be used on the week of a customer’s birthday is a great place to start.
Another special date could be the anniversary of their first purchase with you or the initial contract or subscription start date. Send an email, thank you note or gift in the post acknowledging the milestone - this gives you an opportunity to show your appreciation for your customer and to strengthen the relationship between business and clients.
9. Let customers share their preferences
We’ve spoken about personalisation, and understanding your customers' preferences is key. There are a couple of examples of this lately which really showcase how much a business genuinely cares about their customers — opportunities for this are tricky and sometimes appear self-serving, but this has no (obvious) benefit to businesses other than demonstrating kindness. Credits are due to online florists Bloom & Wild for starting this ‘trend’:
Before holidays such as Father’s Day, Mother’s Day and Christmas, brands are now asking customers if they’d like to opt-out of communications. With so many adults bereaved and grieving, the loss of parents, animals and children can be triggered by such communications, and businesses are now giving customers the opportunity not to receive them.
10. Collect feedback
One mutually beneficial way of showing your customers how much you value them is by asking for their feedback. You can do so by sending emails, creating customer surveys or by facilitating in-person focus groups. By asking your customers for their opinions, you can gather useful data to improve their experience with you, as well as the experience of future customers.
- Prize draw entry
- A discount code on their next purchase
- A monetary figure off their next purchase
- A voucher or pre-paid money card
- A free gift
- Free shipping on their next order
If you're asking for them to spend time attending an online meeting or focus group, you should pay travel costs and the cost of their time — usually £25–£50 an hour is appropriate.
Once you've collected the feedback, it’s important to follow up with the results of the insights you’ve received. For example, if customers have a problem with a certain element of your product, let them know how you’re planning on rectifying this and when they can expect an updated product. Once the issue has been resolved, touch base with customers again to let them know. With plenty of customers believing that companies don’t utilise their feedback, demonstrate that you do by showing them how it has been used to make things better.
11. Respond online
A great way to keep customers engaged and demonstrate their value is by always replying online! Whether to social media comments, inbox messages or complaints gathered by social listening, there's no excuse not to respond. Start conversations with customers, respond with emojis (where appropriate) and keep the tone light, especially on social media. By doing so, you’re adding personality to your brand while building a long-lasting bond.
12. Random acts of kindness
Random acts of kindness are another way to create customer delight, exceed expectations and create brand loyalty.
Brands such as Lush and Pret A Manger give their in-store staff the ability and discretion to offer full-sized products and free drinks to customers. Often, these moments will truly make a customer’s day and won’t be forgotten for a while. Lush accompany their random acts of kindness with a Pay It Forward card, encouraging the recipient to then create a random act of kindness for another person. This is very much in-line with their ethics, values and beliefs as a brand, and this helps to reinforce it in their day-to-day operations.
Many small businesses are also offering Pay It Forward campaigns, where restaurants, coffee shops and cafes are allowing customers to pay for an additional coffee or meal with their own purchase, which can be claimed by someone in need.
For online businesses, random acts of kindness can be as simple as a handwritten note in their package. If you're selling a product that you know is a gift, wrap it for free for your customer. Remote customer service teams should be given the autonomy to offer discounts, upgrades or free gifts at their discretion too — this can help ease customer problems and make the day of customers who are displaying kindness.
Customer loyalty gifts and tokens of appreciation don’t have to be expensive or time-intensive to create. However, using some of your marketing budget to keep current customers happy is an excellent use of resources that will pay huge dividends and deliver a great ROI. Don’t forget that brand advocates promote your brand for free, bring in new customers at a very low cost and are more likely to continue to purchase from you. Your current customer base is the lifeblood of your business, so implement a few of the above customer loyalty appreciation ideas to give back, and by doing so, new customers will also benefit from these perks, creating a cycle of positive customer relationships.