Strategies to Enhance Loyal Customer Value

If you’re a business owner who wants to increase the value of loyal customers, you have two main ways to achieve this goal: Earn repeat business or encourage loyal customers to spend more. These two approaches serve as the bedrock for increasing customer value, but how you accomplish these goals can vary.

Below, we’ll examine some ways to increase the value of loyal customers through various marketing strategies and how to determine a customer's value in different situations. By the end, you’ll have a fuller understanding of customer value. Still, you’ll also be armed with some ways to encourage greater spending from existing customers while turning new customers into repeat customers.

How to Determine Customer Value

As a business owner, you value all of your customers, and it’s typically not a good idea to treat customers as statistics in a dataset. That said, you need to be able to quantify and qualify customer value if you want to increase that value successfully.

Below are a few standard ways of formulating customer value using data:

Customer Lifetime Value (CLV)

One way to measure a customer's value is through the customer lifetime value formula. This formula multiplies the average purchase value produced by a customer by the frequency of purchases. The result is then multiplied by the customer's lifetime value.

Measuring CLV can tell you about existing customers and the monetary value they represent. Still, this type of customer data doesn’t reveal much about how customers feel about a product or service. If, for example, your product or service is a commodity, it may just be that you’ve increased the percentage value of a customer by having the lowest price. This does little to improve loyalty or value, as CLV may increase or decrease once your prices change.

Customer Satisfaction Score (CSAT)

A CSAT score may be a better alternative to CLV since it measures a customer’s satisfaction with things like customer service. You can derive CSAT scores from things like customer satisfaction surveys.

When you combine a CSAT score with retention rate data, you may start to get a better sense for how customers feel about a product or service. This can help you determine the best strategies for retaining customers.

How to Retain Customers to Build Loyalty and Value

Now that we’ve covered some ways to measure a customer’s value, we must look at how to build loyalty to increase value. Remember that customer retention is essential to increase the value of loyal customers. You need to give customers a reason to repeatedly return to increase value.

Every business is unique, but the following are some tips you can use to increase long-term retention, loyalty, and value from your customers:

Retain Your Best Employees

Retaining valuable customers starts with retaining valuable employees. Your staff makes up the backbone of your company, and they are the ones who ultimately dictate the customer experience on a day-to-day basis. This means you need to have a plan to retain quality employees who provide top-quality customer service at every touchpoint.

The best employee retention strategy is the one that speaks of your workers' needs and desires. For some companies, offering employee incentives based on performance may be the key. For others, supporting employee retention by making the workplace more comfortable may be the way to go. Still, creating an employee retention program that combines approaches may work best for others.

It’s also a good idea to have regular check-ins with your staff. During these times, ask them how they’re doing and if anything needs to be addressed regarding workplace happiness. Anonymous surveys can be one way to handle this if you want to keep things unobtrusive; however, face-to-face meetings may be more personal and show that you’re truly invested in the well-being of your employees.

Give Customers a Reason to Remain Loyal With a Rewards Program

Although your company’s products and services are stellar, a little bit of enticing never hurts when it comes to building brand loyalty. Loyalty programs can be fantastic ways to keep customers returning while encouraging them to spend more simultaneously.

A customer loyalty program can include discounts on purchases made within a specific time frame and incentives for making purchases above a certain monetary threshold. You can also consider including special perks in a rewards program, like offering access to early deals or new products before they’re available to the general public.

You might also consider adding incentives for referring new customers within your customer loyalty program. This gets existing loyal customers to act on behalf of your company to actively seek out new business for you. Because these customers are already loyal, they’re more likely to praise your brand when referring to new business. This ultimately makes it easier to close sales since new customers already have a good feeling about your brand.

Use Social Media as an Extension of Your Customer Service Team

Social media may be filled with ads, but your company can cut through the clutter by using social media as an extension of your customer service team. Use this technology to build customer relationships rather than focusing your social media strategy on talking up your products and services. Strong relationships with customers where they feel like a part of the brand can build loyalty and value.

This doesn’t mean you can’t incorporate your products and services into your social media strategy. It just means you shouldn’t focus on pushing your products and services. Instead, look for ways your brand can solve customer problems or anticipate and meet needs using your products and services. When you form authentic relationships using social media, you also get the added benefit of holding an ongoing conversation 24 hours a day.

Social media platforms are ideal for building customer loyalty because they allow users to quickly and easily share content. The key here is consistent branding. Instead of posting cute kitten videos on your social media profiles just to get engagement, produce content that connects your brand with the audience.

While cute kitten videos are more likely to get engagement, they don’t necessarily relate to your brand. Unless you sell cute kittens, posting this kind of content isn’t going to lead to customer retention since it doesn’t further the connection between your products and services in customers' minds.

Remember That Customer Value Isn’t Always Tied to a Dollar Figure

It’s also a good idea to re-frame how you look at customer value if you focus only on your bottom line. Happy, loyal customers are likelier to become brand evangelists, meaning they are more likely to spread the word about your company, products, and services.

Even if a customer never makes another purchase from your company again, they may still hold value by spreading the word to dozens of other people who may become customers. This type of value is harder to quantify, but it can pay off for years when a customer leaves a positive public review for your company online.

Building Customer Value Takes Time

No matter how you increase loyalty to build customer value, remember that any good relationship takes time to build. Experiment with different options, set your expectations accordingly and work with a digital marketing professional if you’re having trouble connecting with your customers.

Contact E-Marketing Associates to Start Building Brand Loyalty & Customer Value

E-Marketing Associates provides personalized SEO small business website solutions that keep customers coming back! Contact our team today to learn how we can create a personalized digital marketing strategy for your business.