Customer Loyalty and Satisfaction

CUSTOMERS LOYALTY AND SATISFACTION
DEFINITION
 Customer loyalty describes an ongoing emotional relationship between you and your
customer, manifesting itself by how willing a customer is to engage with and
repeatedly purchase from you versus your competitors.
 Customer satisfaction is defined as a measurement that determines how happy
customers are with a company's products, services, and capabilities.
I. Satisfied but disloyal customers:
A customer can be fully satisfied but may not be loyal due to following reasons:
a. Entrepreneur Customer: These types of customers like to experiment a lot

and hence try to create various options for them to get more benefits. So even
if they are satisfied they diverge to other options available in the market.
b. Pressure from Competitors: Due to the pressure in market the customer

tends to follow the competitors path and divert from the existing supplier to
remain sustain in the global marketplace.
c. Outdated Suppliers: The customer may be satisfied with the existing

customers but sometimes feel that the product and services he is using are
outdated in market. Due to the changing technology there is always a need to
update the technical aspects and product features even if the old products and
services are satisfactory. Focusing on these facets the customers normally go
to other suppliers for his new requirements.
II. Unsatisfied but loyal customers:
The other abnormal situation is when the customer is loyal but is unsatisfied. The reasons for
this are following:
a. Lack of available options: There can lack of options available for customers. This
situation arises when the existing supplier is having a monopoly in a particular
segment of products or when all other competitors are worse then the existing
supplier. The customer feel trapped in this type of situation and is forced to be loyal
to the supplier but at the end of the day he will be an unsatisfied customer.
b. Improved Supplier: In another situation the suppliers may take the customers in
confidence by convincing them to provide improved products and services in the
coming future. This is an important tactic that supplier implement in their marketing
strategy to become customer centric and to have customers stick to them and be loyal.
c. Customer Inertia: There are some customers who afraid to change the supplier.
Even if they have bad experience with the supplier, they continue to have business
with them. This may be due to the emotional and business attachments or bonding of
customers with those particular suppliers. Under this situation the customer tries to
ignore the feelings of being unsatisfied and remain loyal to them.
creating long term loyalty relationships
Building a working relationship with customers is key to the long-term success of a

business. Having a strong connection based on trust and communication helps
customers feel more secure and connected with a brand, and it can also lead to
growing customer retention and your repeat purchase rate.
Strategies to keep customers loyal
1. Provide outstanding customer service

According to American Express, about 60% of customers will consider switching brands
after two to three instances of poor service. Listen to your customers' needs and provide a
solution to their requests and concerns in a timely manner. Also, make it easier for your
customers to get in touch with your business by leveraging available technologies. Many
companies are starting to employ AI chatbots to provide 24/7 assistance to website visitors.
2. Reward customers with special offers and discounts

Keep your customers coming back by giving them special offers, sales, and discounts as a
“thank you” for their business. Ensure that the special offer or discount is relevant to the
needs of each particular customer to increase success rates. Regardless of your preferred
strategy, always make an effort to help them feel appreciated.
3. Leverage user-generated content (UGC)

Businesses can build and maintain customer loyalty by promoting user-generated content
(UGC). The UGC strategy helps your audience feel seen — like they’re part of your brand.
To create an effective UGC campaign, you can develop a hashtag that people use to
participate in your program. Many customers will take part just to see their images or stories
shared on your company page. Or, they may join in on the fun if you provide an incentive,
like a giveaway.
4. Create a unique customer loyalty program

Many businesses, including airlines and coffee shops, implement customer rewards or loyalty
programs that serve as powerful tools for enticing previous customers to return. Customers
can accumulate points through the loyalty program, which can be converted to shopping
vouchers, exclusive holiday rewards, and more.
Importance of loyal customers

 Savings on marketing costs: Attracting new customers requires market research, advertising
budget, time, resources, and strategy. On the other hand, existing customers are already in
your email list, and many are engaging with your brand on social media.
 Sell new products: Assuming that they enjoy their previous purchases, it should be relatively
easy to convince them to try other products as well.
 Build referrals: According to HubSpot Research, 81% of customers trust recommendations
from friends and family. When you build customer loyalty, you’re also building essential
referral networks. They’ll help spread the message about your brand, get more eyes on your
offerings, and boost conversions.
 Increase sales and profits: 65% of a company's revenue comes from existing customers. A
5% boost in your customer retention will help increase profits by 25% to 95%.
Customer loyalty is incredibly essential for both online and offline businesses. Now, let's take
a look at how to build customer loyalty.

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CUSTOMERS LOYALTY AND SATISFACTION

I. Satisfied but disloyal customers:

a. Entrepreneur Customer: These types of customers like to experiment a lot

b. Pressure from Competitors: Due to the pressure in market the customer

c. Outdated Suppliers: The customer may be satisfied with the existing

II. Unsatisfied but loyal customers:

creating long term loyalty relationships

Building a working relationship with customers is key to the long-term success of a

Strategies to keep customers loyal

1. Provide outstanding customer service

2. Reward customers with special offers and discounts

3. Leverage user-generated content (UGC)

4. Create a unique customer loyalty program

Importance of loyal customers

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