Nurturing Business Success: Diving into Customer Loyalty and Retention Strategies

In the current economic context, every sale matters, so customer retention is fast becoming an essential strategy for businesses of any size. Especially when a recent report published in Marketing Week shows that over half of UK consumers will feel encouraged to buy if they can receive a discount under a loyalty scheme. In this blog, we explore the benefits of customer loyalty and its role in creating brand engagement.

Understanding and Measuring Customer Loyalty

Now more than ever, customer loyalty is essential to building a successful business. However, it is no longer just about repeat purchases but about building a close relationship with the customer. That is why at Loyalty Works when we create a customer retention strategy for our clients, we conduct an in-depth analysis of the business we are working with to understand who their customers are and their buying patterns. It allows us to advise on the best customer retention strategies for the business. Once the loyalty programme is running, we can measure customer loyalty, retention, and engagement using metrics such as repeat purchases and social media engagement.

Using Customer Loyalty as Engagement Strategies

Customer loyalty can lead to increased brand engagement. It is because, in the modern business landscape, customer loyalty also means turning customers into brand advocates. Therefore, building a relationship with the customer base is as important as repeat purchases. Personalised marketing campaigns, interactive mobile apps or exclusive access to new products are only some ways you can create a meaningful connection with your customers who are more likely to choose your brand over others.

Choosing the Best Customer Loyalty and Retention Schemes

When it comes to customer loyalty and retention schemes, there's no one-size-fits-all solution. Tailoring loyalty campaigns to resonate with a brand's unique customer base is crucial. This is what Loyalty Works did when we were approached by Independent Builders Merchant Group (IBMG) who were seeking assistance in enhancing customer retention and acquisition through loyalty and rewards across three of their brands.

Our approach involved creating custom targets and rewards for invited customers, building a user-friendly loyalty website with clear messaging and an integrated online reward hub, and implementing automated communications for a seamless user experience. Additionally, tactical marketing campaigns were executed to drive further engagement across all brands. Collaborating closely with the sales and marketing team of the builder's merchant, we successfully launched the new initiative.

The results were impressive, with 41% of a pool of 17,000 customers (both dormant and spending) signing up within the first 3 months. Email communications achieved an average open rate of 44% and a click rate of 39%. Across all brands, sales growth increased by 27%, and branches welcomed the scheme as an effective sales tool that facilitated positive conversations with customers. One of our highlights was the excitement of working on and launching a new brand, translating into customer engagement and positive cash sales, as highlighted by Jonny Bone, Account Manager.

Becoming an Essential Part of Business

Customer retention strategies, customer loyalty, and engagement solutions are no longer buzzwords. They have become essential tools for growing businesses. However, a successful customer loyalty and retention strategy requires careful preparation. It is important to understand your customers and their buying habits before creating a customer engagement campaign. Nowadays, repeat purchases are no longer enough to build customer loyalty. It is the emotional connection that will turn an ordinary customer into a brand advocate, and utilising modern technology to your advantage is often a key to your success.