Edition 30

The Road to Customer Loyalty

28th April 2011 By Peggy Carlaw no comments

Customer satisfaction has long been the predominant measure of a company’s success. Author Peggy Carlaw discusses how to start on the long, but rewarding path..While it’s important to satisfy the customers your business serves, perhaps the most important measure of success for businesses—large and small—is customer loyalty. It is customer loyalty, derived from consistent efforts to deliver customer satisfaction, which leads to an increase in sales, referrals, and profits.

So how do you secure customer loyalty? It isn’t something your company can do easily or overnight. Customers tend to remain loyal to those companies who continue to impress them with the value of their product or service, competitive pricing, and convenience. But the most important factor determining customer loyalty is quality customer service!

Fostering Customer Loyalty

Following are some tips for improving customer loyalty at your organization:

Hiring

In order to create hand maintain a successful business, you must hire the right people for the job. Selecting candidates who have the necessary skills (or the ability to learn them) and a great attitude will help you to create a positive working environment, and one where employees strive to continuously show their dedication to the customers they serve.

In general, you’ll want to screen for candidates who can plan and execute their work, make decisions and solve problems, exercise good judgment, and connect with other people. More specifically, you should take time during the hiring process to ask each candidate about his or her motivation for pursuing the position. It’s important that you choose people who truly have a desire to serve, and who will put a great deal of energy into making customers happy. These characteristics will show through in their customer service and translate into loyal customers.

Training

Another necessary step on the road to customer loyalty is an effective training program that gives employees the knowledge and skills they need to excel at their jobs. Additionally, by investing in training, management conveys a commitment to employees’ success and a confirmation of their value to the company. When employees feel confident in their abilities and satisfied with their role in the company, they are likely to be happier, more efficient workers who take pride in serving their customers.

Incentive Programs for Employees

Another way to encourage dedication to customer satisfaction is to implement an incentive program for your employees. One type of incentive program is an Employee of the Month (or Employee of the Quarter) program. Rather than rewarding the person with the most sales or the highest sales total in a given time period, you might try honoring the employee who receives the most positive feedback from customers. If you don’t currently have a customer survey mechanism in place, it may be a good idea to add a survey to your web site or phone system, or send out e-mail surveys to customers who have provided you with their information.

While it might not be necessary—or even feasible—to provide a monetary reward to the winner, you can be creative in how you honor your exceptional employees. For example, you might print their names in the company newsletter with a brief description of what they did for customers or you can have a high-level manager send out a company-wide e-mail praising the employee. It shouldn’t matter what the reward is—as long as you show your employees that you’re aware of the good work they’re doing to improve customer loyalty.

Rewards Programs for Customers

In addition to rewarding your employees for satisfying customers, you may also want to think about instituting a rewards program for customers who are loyal to your company.

Depending on your type of business, there are many ways you can achieve this. One is by offering discounts to repeat customers or customers who refer other people who become new customers. Another is to keep track of customer purchases, and reward them with a free product or service when their total reaches a certain number (i.e. a free sandwich after the sixth purchase). Using a point system (like airline miles) is another way to reward your customers for being loyal to your organization.

Free shipping is also a great loyalty strategy for online companies. Because a shipping charge is thought of as a deal breaker for many consumers, studies have shown that most people tend to choose a free shipping offer over a discount of 10 to 15 percent, even when the discount would actually save them more money. E-mailing repeat customers an offer code for free shipping is a great way to thank them for their business—and ensure that they’ll keep coming back!

 

About the author: Peggy Carlaw

Peggy Carlaw is the founder of Impact Learning Systems. Impact helps companies develop and implement customer service strategies to improve the customer experience. Their consulting services and training programs help organizations create a customer-focused culture while producing measurable business results.

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