How to increase customer loyalty in retail

When embarking on any type of business the main goals are, customer satisfaction and repeat business. Customers want to feel important, to create repeat consumers you need to give them a reason to come back. Some of the best and oldest companies employ the loyalty card method to attract and most importantly hold the attention of new and existing customers! In this article, we are going to explain how to increase customer loyalty in retail and give you the full break down. By the time you have read it, you will see why it is one of the most important tactics to employ, no matter the size or nature of your company.

What are loyalty programs and how does it benefit the business and consumer?

For many years now companies have been collecting and storing the data of their most loyal customers, using these techniques and others. Engaging their clients with weekly or even daily emails. That speaks to the sales that the business will be having. Most of these communications ask their clients to invite or nominate their friends and family, below is a list of benefits that you could expect should you decide to join a companies loyalty program.

Many everyday establishments have decided to offer a loyalties program to the services that they provide. By having this rewards system in place it benefits both the consumer and the business owner alike. The various benefits for the consumer are:

  • Discounts: this is the main benefit of these programs.
  • Brand exposure: become familiar with new and exciting products.
  • Rewards/cashback: this is a points-based system the more points you have the greater the amount returned.
  • Better customer communication: with these programs in place you as a company are more likely to engage with your customers.

These are just a few of the benefits for the customer who decides to join the loyalty programs. What is the point of these programs for the average business holder? Well, like it or not the world is changed how we live our everyday lives is dependant on one thing, how do I benefit, this is the main strategy to retain repeat customers.

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Customers want to feel important and that their contribution matters. There is a reason why there are sayings like “the customer is king”, or “the customer is always right” because without their support you could never hope to achieve success. Companies need people, people need people.

  • These programs increase the overall revenue by up to 5-10%.
  • The members of the program spend on average 5-20% more than the non-members do.
  • The members of these programs buy 5-20% more frequently than those of non-members.

The main motive of these programs is to increase customer retention. It is a well-established fact that on average 60% of overall retention relies on these programs. Those are huge numbers, it no longer is a secret why these programs are so important to the average business and consumer.


What are the many benefits of these programs in the business world?

  • The main benefit is customer retention. This is the end goal of these programs to get repeat and loyal customers.
  • Customer data and trends: this is a priceless tool that businesses can use for more targeted marketing. This tracks your customer’s habits and preferences.
  • Higher cart value: with this tactic a company can suggest new brands and accessories offer its loyal customers. The program is designed to bring relief in the slower seasons.
  • Reduces unprofitable customers: As you can imagine having all these customer programs can become a costly affair as you just blindly moving forward not knowing if your effort will generate returns. With the loyalty programs, you can easily keep track of this making advertising easier too as there is a higher rate of conversions.
  • Better communication with customers: These programs offer a direct line to your customers so you can get feedback and support to make your program better.

These are just a few of the many benefits that any business holder should consider when employing a loyalties program. The loyalty program guarantees customer satisfaction and engagement, they will want to know what your latest and greatest deals are. Make your customers the primary objective Giving that personalized touch, I know a company that writes out a thank you note to every one of their customers. Make it specifically all about them. Allow yourself to be secondary and I promise you, no matter the price you ask they will continue to support you. You will be adding value to their everyday experience and that is priceless to a customer. Just look like the great brands of today, their loyal customers continue to support them, change the look and feel of a company but never skimp on the service.

How do you create customer loyalty?

The most important thing here is you provide top quality product or service to your customers.

  • Building brand awareness, knowing that your customers will be loyal to their preferred brand.
  • Exposing them to brands that add value to their lives.
  • Pursue lost customers try to entice them back in with a previous deal that was offered to them.

The next list is showing us 7 most trendy ways to get clients interested in these programs:

  1. Mobile optimization: If it can be done on a smartphone the convenience will sell itself.
  2. QR codes or snap scan: Again make it easy.
  3. Innovative rewards: Mainly discounts or free merchandise really hooks new and existing customers in, approach your rewards program like you would Facebook, Ask your customers to invite their friends to join and they could win an amazing prize.
  4. Personalized customer experience: Give them something that took time and effort on your part to do, be it how you packaged it may be a company pen or sticker, something that says you are appreciated!
  5. Omni-channel customer engagement: Facebook, Instagram, Twitter and whatever other media channels you have to keep multiple posts going about your product and ROI is sure to follow.
  6. Brand partnerships/ affiliates: With this technique, they will know you are serious! That other company believe in you, it’s all about likeability and sell-ability.
  7. Corporate social responsibility: Being aware that what you say/ do does have an impact on those around you and the environment! Keep in mind how your product can help heal and aid to fight and not the cause of the issues.

Is retention the cheapest option?

  • Yes, it is acquiring new customers, some studies suggest that it can be up to five times more expensive to acquire new customers than to take care of the existing ones.
  • Retention: this concept makes sense as your loyal customers already know and like your products, but if you only work with existing clientèle you stagnate your growth.
  • Balance is key, these skills that you need are easy to acquire it just takes continuous effort.

Do you profit more with loyal customers?

The answer is yes! Now we going to get into why that is. Convincing your loyal customers to purchase is 60-70% more likely that they will as they are comfortable and confident in your product. Whereas, new customers are wary and conversion rates are between 5-20% the longer your company has been around also affecting these numbers. Loyalty programs also make it easier for newer companies to establish their brand and build that trust with their potential consumers.

It is the smartest strategy to get repeat business and also increase your conversions, as to this day word of mouth is still the number one advertising tool; and if you have an incentive-based strategy you will draw in and be able to keep existing and new customers happy and interested.

Are engaged customers more profitable?

Yes, they are! Customers are more likely to continue to use your product if they feel their needs are being met and their opinions valued. Your existing customers are easier to target if they feel important 23% more likely to buy again if you focus on their feedback and suggestions. Understanding your best customers will help you achieve your desired outcomes.

The goal of any business is to acquire and retain clients that’s how you grow your brand and keep the momentum going. 80% of your profits will come from 20% of your happy clients. Retention is key to any business or companies success so understanding your clients is the key to your overall success.

Customer feedback is so important as it helps you convert interested parties into long term clients. Empathy is a business owners most useful tool for understanding what your client wants and delivering on your promises will keep them on your books for years to come.

Customer loyalty programs help you as a service provider, e-commerce store or any other niche, these programs help you gauge and introduce new and existing customers to your brand and they also serve to help establish a trust in your product/service.

Customers that are satisfied with your service are more likely to stay on and to introduce friends and family to your brand as they want their friends/family to experience the same level of satisfaction.

Word of mouth is still the best advertising/growth tool for any business/company.

Brands are built by your clients, their happiness is vital to your success! Repeat business in how you can continue giving them that great experience. Know and understand your clients! Offer them great rewards and kickbacks for their continued service! Help them by enabling trust in you and your product. Working in tandem to ensure that both parties get the most of working/purchasing from you.


In the above article, I have taken the time to explain how to increase customer loyalty in retail. Having a loyalties program is vital to your brand’s success. Having repeat business is the easiest way to stay in the game. We need to understand the business relationship and see it for what it is, a partnership neither one can exist without the other. Taking care of your customers and offering them incentives for continued support is vital to the success and longevity of your brand.  Exposing your customers to new products and or services helps you establish who this customer is what they like and will they purchase what you are offering if they get more value out of the product. Customers look at the value before they look at the price tag. Within a few seconds, they already know if they will purchase or not. Know your customers, satisfy them and that’s how you will win them over every time.  These programs are an asset to any and all businesses, they have layered functions.


Author avatar
Rick Thompson

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