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Building Customer Loyalty: Top Strategies that Work
As the fifth and final step in the customer lifecycle, customer loyalty is immensely important to the health of any business. But before your marketing department can build customer loyalty, you must first develop a strategy to reach prospective customers, acquire and develop new customers, and improve performance with existing customers.
Building Customer Loyalty Through Contextual Marketing
Let’s start with why context matters. Context helps businesses understand, engage, and deliver value to customers in specific situations. Providing context informs the most relevant action that a business should take to reach the right audience.
Unfortunately, though the term customer context is thrown around often as a buzzword, there’s surprisingly little agreement on what is meant by context. More likely than not, marketers use this term as an online advertising model in which customers and potential customers are presented with targeted ads. But this vague definition doesn't appropriately capture the need for contextual marketing.
As such, we define customer context uniquely: as the special pairings of a customer's disposition and situation combined with the business's disposition and situation. The relevance of a company's engagement with this customer is tightly connected to its understanding of customer context.
A customer's disposition defines precisely who the customer is and could include any of the following:
- Demographic data, such as name, age, gender, marital status, and political affiliation
- Behavioral data, such as how he or she has interacted with the brand in the past
- Psychographic information, such as interests, opinions, and values
- Affinities, such as the customer's price sensitivity and brand loyalty
A customer's situation is constantly changing and could include any of the following:
- States, which could be the customer's specific physical location, social setting, and activities
- Physical or emotional needs, which could change at any time
- Sentiments, influenced by feelings or attitudes
- Events or real-time influences, i.e., major life changes, such as marital status, a change in job, an accident or illness of a family member, a change in stock price, and more
A business's disposition defines precisely what the business is and could include any of the following:
- Firmographics, such as office locations, number of employees, and language of service
- Product catalog, i.e., what the company actually sells
- Corporate strategies, as well as relationship strategies in general
- Market segmentation, e.g., cohort/persona, loyalty, portfolio strategy, and more
A business's situation is much more dynamic than its disposition and could include any of the following:
- Inventory details, such as the price flexibility of current stock
- Personal details, such as the number of employees currently working or subject matter expertise
- Corporate factors, such as brand or division interactions
- Environmental activity, such as macroeconomic trends and the effects of competitors
Opportunities to Improve Customer Loyalty
Bringing all of these together to understand customer context makes it easier for brands to better identify with and reach customers, providing more relevant, personal, and meaningful connections.
Ways to Enhance Customer Loyalty
It's immensely important for B2C companies to engage resources and initiatives to help build customer loyalty. On average, loyal customers are worth up to 10 times as much as their initial purchase.
So, how do you turn customers into brand advocates?
Understand the framework for building satisfied customers. In most cases, loyal customers are happy customers. But how can businesses ensure they are keeping customers happy? Businesses must align with these aspects of a satisfactory customer experience:
- Implementing a customer service training program for employees
- Following up with the customer after a problem is solved
- Making your customer service team readily available to offer support to customers
- Welcoming customer feedback—and applying it
Utilize data to analyze customer loyalty. Data-driven analysis and technology platforms can help businesses track customer information, including when, how, and what the customer purchases. Understanding this data informs marketers what future products or services to recommend to customers, as well as how to get the word out (e.g., via email, physical mail, social media, etc.).
Selligent's relationship marketing solutions help CMOs and marketing professionals create a heightened sense of customer loyalty for their customers. Not only does our platform offer breakthrough real-time linking of customer data, it also promotes customer engagement across multiple channels to help strengthen customer relationships.