If you own a small business, you know it’s hard to improve customer loyalty when competing with larger, more established companies that have extensive marketing budgets and established brand identities.
That doesn’t mean you should give up on enjoying a large loyal client base. But how do you take your business to that level?
This is what we will talk about today. Learn how to build customer loyalty for small businesses no matter the obstacles and build genuine relationships to take your business to the next level.
Key challenges in customer loyalty for small businesses
Today, gaining customer loyalty is one of the most important goals for any business to survive and grow in the long run. However, building a loyal customer base is no easy task because there are some misconceptions and as a start-up you may not always have enough resources to gain their trust.
Some of them are –
1 Doing the basics right helps earn and keep the customers
You may think that your prospects will eventually become loyal fans over time if you keep doing the basics very well. While running a business involves mastering the basics and paying attention to key fundamentals, it will not help build customer loyalty.
Customer loyalty is created when your audience starts to make meaningful connections with your brand and offerings. Everyday business activities may keep your customer satisfied, but that’s about it. They will buy and use your product, and then go on about their day.
As Jeff Bezos said, “Don’t just satisfy the customer; delight them!” In a competitive market with a lot of options to choose from, you need to do the same to stand out from the crowd.
2 A great product is enough to hit the pinnacle
Only a stunning user experience won’t guarantee that buyers will flock to you unless you reach out to a wider audience base. While keen-eyed customers may find you, the majority will be enticed by more convincing ads.
When you target an audience, you will need to communicate your product value clearly to stand out from your competition.
3 Lower pricing paves way for a higher sales volume
A common misconception among many is that low prices will guarantee repeat purchases. That is simply not true. Depending on your audience, they are more likely to pay more for complementary benefits that may not come with a lower price tag.
These days, prospects usually put a lot of thought into perceived value and if your low prices can offer that, you need to demonstrate that.
Lower pricing is a great tool to boost sales on its own. But you should not solely depend on it to earn a loyal client base.
How to build customer loyalty for small businesses?
Building a loyal customer base requires you to understand some key factors. While this can seem like a huge task, there are some small things that you need to be mindful of to be successful.
Have relevant communication channels
You should open up proper communication channels that your clients are likely to use to reach out to you, such as emails, instant messaging, text messaging, and social media.
Ideally, you should reach out to as many people on as many platforms as possible. But that can be difficult to maintain for a small business. Focus on allocating representatives on relevant channels and you will satisfy a lot of frustrated customers.
Being available to your audience is a simple yet effective way to create loyal customers in the long run.
Maintain strong communication
Whenever a prospect reaches you, make sure to stay with them all the way through. Whether they have a small problem or a huge one, try to have it solved if it is within your ability or have them directed to a more appropriate channel.
People often feel confused when they make these calls, so it is your job to guide them to assurance. A phone call that ends abruptly without any resolution will leave a very bad impression, which is enough for them to never buy from you.
Improve customer service
According to Forbes Advisor, customer service experience is the most important reason to switch brands.
Consumers value their interactions with the support team of every business and will think highly of the brand happiness if helped well. They are likely to remember positive interactions even if their problems are not solved right away. That means support agents should be friendly, understanding, and properly trained to communicate the needs and solutions.
Show that you understand your audience
You should research your audience demographic and their purchase behavior to understand their needs and predict their actions. Try to look for patterns and buying habits when promoting a product or offering a discount.
For example, some may have timed buying habits. You can try to figure out the reason why they purchase products in that time period and offer complementary products at a discount if that seems appropriate.
When people feel that you have made their purchase decisions easier, they will be inspired to gravitate towards you.
Arrange promotional events
When learning how to build customer loyalty, remember that promotional events are a great way to draw in new customers that also serves as a thank-you gesture to old ones.
A few ideas are:
- Charity events
Charity events are a great way to show the goodwill of your business, which can help you gain customer trust.
- Launch parties
Launch parties are usually thrown for a new product or a location. This signifies progress for a business and inviting your clients is a nice way to acknowledge they are a part of it.
- Social media events
Social media promotional events are usually easier to arrange than charity or launch events and can engage your audience in a more personal way. Staging a game or a small contest can make them feel hyped up to participate to win prizes or discounts.
Facilitate loyalty programs
These kinds of programs for repeat purchases help prove that you recognize the patronage of your customers and allow you to make them feel important.
The rewards need to be significant and adequate for your loyalty program to incentivize your audience to be a part of it. You can offer discounts and gift packages based on the level of loyalty they have.
Just like customer service, this is also a great way to collect data on buyer behavior that you can use to expand your business.
Celebrate special occasions
You can offer discounts on the birthdays of your clientele or other special types of clients. One example is the jewelry sold at a discount to newlywed couples.
Personal milestones are very important to everyone’s life and an offering on such a day is hard to forget. Make sure to take this opportunity to congratulate them on their most-favorite days.
Try personalized marketing
Personalized marketing is using a target customer’s name and information to create a more attention-grabbing and individualized message for them. This tailored approach is suited to the unique needs of an individual and is more likely to generate a positive response.
This type of marketing is more suited to high-profile customers and can leave a lasting impression on them.
Leverage referral programs
Referral programs incentivize your audience to spread positive word of mouth. Offer discounts or certain benefits to both the referrer and the referee to simultaneously create a loyal base and find new prospects.
Have an easy-to-use website with understandable instructions
Make sure your website is simple to navigate and has precise content. If your website is not clear, people will simply stop using it and switch to your competition.
When we use a website, sometimes we stumble upon different types of errors. And when they happen, make sure the wording on error messages communicates clearly on the issue. Make it clear if the problem is a user error or a technical issue and what steps should be taken next by the user.
If it happens to be a technical error, instead of using unfamiliar terms, there should be a more friendly, easy-to-understand language. Work on your UI to make it more humane and keep your visitors using your website.
Have a look at how a friendly UI of a website can improve a customer’s day even when they do not work as intended.
Offer benefits based on loyalty level
Not all customers will feel the same about your brand. You need to identify the level of loyalty before deciding what kinds of promotional activities you can try.
This pyramid visualizes the levels of loyalty a customer has. Naturally, your committed and repeat buyer numbers will be small. Use this information to turn satisfied and habitual buyers to be loyal.
Partner up with businesses favored by your customers
Try seeking out complementary businesses liked by the majority of your target audience and team up with them. This way, your referral customer volume will increase.
An example would be a dairy company that teams up with a coffee shop and promotes each other. As the business is complementary, this cross-promotion will positively affect both.
Utilize social media
If you own a business, you have to be on social media. You can also improve customer loyalty leveraging its benefits and opportunities.
Always post regularly with interesting and engaging content that generates curiosity in the minds of users. The more you post, the more audience you will reach who might be interested in your business. Having a social media presence often humanizes a company which is very popular nowadays.
Do a giveaway
This is a surefire way to attract a lot of engagement from customers. Who doesn’t love free stuff? Giveaways have several benefits, such as they help:
- Increase social media user engagement with your company
- Boost your brand awareness
- Discover new audience segments
Social media content creators and influencers are a rising force today. You can sponsor them to advertise your products and expand your audience.
Offer flexible payment methods
Some may have their preferred payment methods or they may require more time to complete the payment process, especially if it is a big purchase. Having multiple payment methods available will help remove a lot of hassle and increase their trust in you. Some payment methods can be uncommon so such customers usually return to places where they have those options.
Allow customers to express themselves
Allow outlets for customers to express their thoughts and ideas if they feel like it. This could be through the comments sections on social media outlets or a review section on your website. If they do, acknowledge their thoughts with a short reply back. Have representatives at onsite locations too if they feel like sharing their thoughts face-to-face with a person.
This will not only help you gather data on the needs of your consumers but also make them feel like you listen to them. And sometimes, customers are just happy being heard.
Why you should build customer loyalty
Loyal customers not only contribute to steady revenue but also act as brand advocates that recommend your business to others. Also, retaining existing customers is often more cost-effective than acquiring new ones.
Repeat sales
The most lucrative benefit of a loyal base is repeat sales. Since the clients develop a long-term business relationship with the business entity, they are more likely to spend more money on you than one-time customers.
Also, it is easier to market to repeat customers than new ones, which increases your marketing ROI.
Have a greater chance against competition
A loyal base is a great defense against competition. Customers who are used to your product are likely to stick to you even when competitors are present and will even go through minor inconveniences to get your product or service.
Word-of-mouth marketing
Your loyal customer base is your main force of word-of-mouth marketing. They know more about your company than other customers and are more likely to refer you to their friends and families. They advocate for your products, your company values, and customer services. A loyal customer base can slowly grow on its own without much effort on your part.
Steady growth of business
Loyal customers are repeat buyers who will keep buying your products. As a result, you will always have an assurance of a certain amount of sales no matter what. So every time you get new customers, your sales number will always have steady growth which is essential for the survival of your business.
Insight into customer needs and behavior
Customer research is an important step in business development. Survey data on topics such as demographics, purchase behavior, and response to ads are very important to understand the direction a business should go. If you have a loyal customer base, the data will be easier to collect and reliable to base major decisions on.
Anticipate new product performance better
A great way to test the viability of new products or services is to sample them to your repeat buyers. Their reactions and feedback will give you an idea of what kind of returns you will get out of an official launch and can make necessary adjustments early in development cycles.
Some precautions
While it is important to maintain clear communication and offer promotions at the right times, make sure not to overstep your boundaries. People are constantly exposed to information and promotional deals even when they are not looking for it so they can get annoyed when you start pitching your offers.
Try to identify optimal opportunities when you know your pitch will work and be careful not to get in the way of their daily lives. Otherwise, they might be turned away completely by your business and will avoid you entirely.
Conclusion
Customer loyalty is one of the most important aspects of business these days that does not happen naturally, despite what some may believe.
Now that you know how to build customer loyalty, put all of your effort into building it. This will help make your business sustainable in the long run.
