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How to build customer loyalty

Written by: Sheryl Strasser

Article Overview: Maintaining customer loyalty through customer incentives is a very common practice of many businesses today. When customers make purchases they can pick whether they get air miles, cash or other customer incentives. Some companies give customer incentives based on the number of purchases they make, for example get one free smoothie after you have purchased six.

How to build customer loyalty

What is the best customer incentive any company can give?

This is really the vital question. The customer incentives need to be structured right in order to maximize the revenue they bring to the companies.

Customer incentive programs are not new; they have been around for 100's of years. In the 1930's stamps were given to customers with purchases from certain merchants and were redeemed after they had collected up to a specified value. In the 1960's supermarkets started giving straight discounts to their consumers. It is currently estimated that over 50% of the population use at least one customer incentive program, and many do not spend unless there is some kind of incentives program involved in their spending. According to some analysts U.S. companies spend more than $1.2 billion on customer incentives programs.

Consumer’s perspectives on customer incentive programs play a very important role in whether they are profitable and successful. Customer incentive programs are on the rise, the market used to be cornered by airlines credit card companies and hotel rooms, but recently many other companies have found ways to use customer incentive programs.

Customer incentives when used right can generate loyal consumers and attract new ones. One thing that is clear is that these customer incentive programs need to offer incentives based on consumers spending habits and profitability.

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Article Tags: airlines, credit card companies, customer incentive program, customer incentive programs, customer incentives, hotel rooms, incentives program, loyal consumers, merchants, perspectives, population, profitability, spending habits, stamps, supermarkets, vital question



Related Forum Posts
a legacy - sounds like your grandfather left a real legacy. It reminds me of Dale Carnegies famous quote, 'people dont care how much you know, until they know how much you care' An interesting side bar is the idea of customer loyalty. I recently worked with a large bank on their new 'loyalty' program. I called it like I saw it, they didnt have loyal customers....they had hostages. If anyone reading wants to learn more about delivering great customer service, they should read "Raving Fans' by Ken Blanchard and "how to win friends and influence people' by Dale Carnegie Two of my favourite resources... The third resource I can always count on was my dad. Although he died almost 18 years ago, he raised me and my 5 brothers and sisters with a strong work ethic, a respect for people of all backgrounds and a healthy respect for time. In fact, I am often teased for always being early or at least very punctual and I find it sad that in today's world, we seem to have lost a lot of the basic tenets of common sense and courtesy.
Re: a legacy - [quote="TheRainmaker":36ce5c3z]sounds like your grandfather left a real legacy. It reminds me of Dale Carnegies famous quote, 'people dont care how much you know, until they know how much you care' An interesting side bar is the idea of customer loyalty. I recently worked with a large bank on their new 'loyalty' program. I called it like I saw it, they didnt have loyal customers....they had hostages. If anyone reading wants to learn more about delivering great customer service, they should read "Raving Fans' by Ken Blanchard and "how to win friends and influence people' by Dale Carnegie Two of my favourite resources... The third resource I can always count on was my dad. Although he died almost 18 years ago, he raised me and my 5 brothers and sisters with a strong work ethic, a respect for people of all backgrounds and a healthy respect for time. In fact, I am often teased for always being early or at least very punctual and I find it sad that in today's world, we seem to have lost a lot of the basic tenets of common sense and courtesy.[/quote:36ce5c3z] Very true - its important to create loyal customers and I've always felt that great customer service is a great way to start that process. If I deal with a company and its clear they don't care about my business and they don't support me, I look around for someone who does. Why support a business that won't support me? Chris
Re: Matching competitors prices - beware - While I agree that getting into a price war should be avoided if possible... on rare occasions, it's not a bad idea to match someone's price (or even beat it) if you're doing it "one time" to land a new customer. For instance, I was recently looking for the best price on a [u:2rhwa2wg]specific[/u:2rhwa2wg] flight to NY and a customer service rep from Flight Centre ended up taking zero commission to help me book my flight. In fact, she even beat the price by $5 in the hopes of creating brand loyalty for the future.
Starting A Business - go get a customer! you can have a great idea but if you don't have a customer you'll never be successful. Build a product / service around someone who will pay you for what you can offer! It's the best way to build a business.
Important tips for online business - 1.Traffic. Without traffic, you have nothing. It is like having a store where nobody walks through the door. Without traffic, there is none to buy your product. 2. Your Sales Letter. This is where you sell your product. It is of vital importance that you have a sales letter that converts, and you should work on it continuously to increase conversion. Otherwise those prospects that you have got to your website will just leave and go somewhere else. 3. Your list! You should continuously be trying to build your list and your network. It is easier to convert a qualified prospect into a customer, and an existing customer in to a repeat customer. Hope this helps guys!


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