There might be different approaches to improving customer loyalty compared to how you improve brand loyalty, but one thing is for certain: providing high-quality customer service will lead to meeting both of those goals.
You can boost your customer loyalty by lowering prices, but when a customer is loyal to a brand, they’re willing to spend more with that brand even if a competitor charges less. When a customer is loyal to a brand, they see something of themselves in that brand, but they also see that the brand values their patronage. And while this has a lot to do with smart marketing, proving to them that they are valuable through quality customer service, can also show how much you value them.
Digging deeper into the meaning of “customer loyalty” and how companies have made improvements in that department, a recent post on HubSpot points to success stories, including Starbucks’s approach to kicking off a global loyalty program. It’s a simple concept: buy products, get loyalty points and use them for free goods. The result is an astounding 29 million active users.
Amazon has also jumped into the loyalty game with its practically ubiquitous customer loyalty strategy called Amazon Prime, pulling in more than 200 million users as of 2024. The program has grown, doubling from what it was in 2018. What do clients get? Free shipping, but there are also savings programs and the company’s entertainment offerings that serve as an added perk.
These examples are part of building brand loyalty through customer service that offers customers key perks. But it is just one part of making customers happy so they keep coming back.
Happy Consumers = Long-Term Customers
This article from the Harvard Business Review shows that positive interactions between the customer and the company lead to a long-term relationship. The authors tested the theory on a large group of consumers who had negative experiences with either an airline or a wireless carrier, which happen to be two industries where complaints run rampant on Twitter and consumers are quick to voice their frustration. The top five airlines and top four wireless carriers had motivated 400,000 customer service-related tweets over a one-year period.
When surveyed about the response or lack of response from the company, the disgruntled customers said that the amount of money they spent with said company in the future hinged largely on the time it took the company to respond to their complaint. For example, when the customer’s tweet was responded to in five minutes or less, they were willing to spend an extra $19.83. But the wait time of six to 20 minutes cut that spending down to $8.53. This assumes that the company was able to make good on something that had gone wrong and in short order.
Service-focused companies know that a disgruntled customer presents an opportunity for them, which is why they focus so intently on providing excellent customer service. Â Studies show that when a customer is angry and they receive help from a qualified professional, their loyalty to that brand improves beyond what it was prior to the incident.
The Connection Between Customer Service and Loyalty
Did you know that up to 89% of customers who switch from one brand to another do so because of the bad customer service they received from their former brand? A good portion of these customers made that decision after one bad interaction, essentially ghosting a brand they were once loyal to without giving them a chance to correct the problem. That shows how valuable it is to have quality customer service in place from the beginning.
So, how do these highly trusted companies keep their customers from jumping ship? First, they take the time to get to know their customers and prove to them that they are valuable to the brand. Wants and needs constantly evolve, which is why these brands are always asking for customer feedback, and collecting that feedback is a crucial component of customer service.
Consider that the vast majority of consumers are eager to form a relationship with a company. They want to latch onto a brand they’re proud to buy from and they will even go out of their way to make purchases from that brand. There is a psychological reason behind this behavior and it has to do with having a sense of community, establishing a crucial emotional connection and feeling a sense of reliability within the relationship.
While many variables impact the success of gaining loyalty, customer service departments that focus on making a great first impression, collecting feedback and excelling in problem resolution can meet these goals with no problem.
Loyalty Stats to Consider
Exploding Topics, a company that analyzes data for many of the best-known brands around the world, published an article late last year about loyalty, presenting a long list of statistics based on a variety of studies that prove the importance of gaining customer loyalty. The following are some of the most telling:
- 80% of Americans value brand loyalty
- 75% say their loyalties lie with companies that understand them on a personal level
- Poor customer service is to blame for three in five global customers quitting a brand
- More than half of global customers say customer service is “very important” in their decision to form loyalty with a brand
According to SurveySparrow, bad news gets around. When a customer feels they have been slighted or wronged by a brand, they’re going to tell others about it, which can be highly damaging to the brand’s reputation. The report shows that 95% of customers will tell others about their negative customer service experience.
But how can a company take a displeased consumer and turn them into a fan? The report shows that 64% say they want companies to “respond and interact in real time.” The reward for getting it right is that 81% of customers who receive good customer service are willing to pay more simply due to the brand’s approach to customer service.
Gaining new customers is more expensive than retaining current customers. That cost is up to five times higher to attract new clientele. A related statistic says the probability of selling to an existing customer is between 60% and 70%, whereas the probability of selling to a brand-new patron is between 5% and 20%.
With a tighter focus on quality customer service, companies can reduce expenditures and energy toward attracting new customers because they’re retaining their current ones.
How to Build Brand Loyalty
The evidence about improving brand loyalty and achieving revenue growth is expansive. Research from McKinsey shows that some companies double their revenue growth compared to companies that fall behind in the brand loyalty category. The base upon which these improvements are made is a sound customer service strategy.
But what does the strategy consider as actionable areas where improvement can be made? One of them is taking a moment to consider what your brand voice is and the story that best defines what you are as a brand – something that hits home with your target audience. This also helps to define your company culture. This culture must be adopted by your customer service professionals, as they are often the voice of the company.
When you partner with a highly regarded contact center, they will make it their mission to understand your company culture and become a seamless representative of your company. This, in turn, helps to build a brand community that gives a massive boost to your ability to increase brand loyalty.
Partner with a Trusted Contact Center
At Protel BPO, we’ve built a foundation upon which we can provide exceptional support for our clients’ customers. That foundation is made of top-notch educational programming, quality managers who lead to teams to successful outcomes, and a company culture that values employees and promotes from within. When you’re ready to build your brand loyalty, contact us and let’s talk about how we’ll provide a custom approach to your needs.
