If you are doing business, you must have heard of the famous 80-20 rule or the Pareto principle which says that 80% of the sales of your business are generated by 20% of your customers. What this means in simple terms is that a small group of your customers contribute to a large proportion of your business. This is possible because of customer loyalty. It is a phenomenon that is defined as a behavior or attitude of customers to prefer a particular brand or product over other similar products available in the market. It is also known as brand loyalty and reflected in the behavior of the customer, where he or she repurchases the same product again and again for his or her use.
Suppose there is a consumer product, say television of a particular brand that you bought and were very happy with its performance and the service of the company. This makes it very likely that when you go to the market next to buy another electronic product, you are very likely to buy a product of the same brand. This is customer loyalty. It may be perplexing for some when they see an individual buying the same model of car again, after using the same car earlier for so many years. They think that it is foolish and one should try another car fora change. However, it is the liking of the customer that drives him to buy the same car even a second time.
Most business realize the importance of customer loyalty and this is the reason why big and small companies try to keep the flock of their loyal customers intact by giving rewards and incentives to their loyal customers. You must have seen loyalty programs run by even giant grocery stores like Spencer’s and Wal-Mart.
The best way to ensure that your customers keep coming back to you is to provide them with high quality at affordable or reasonable prices. There is no substitute to quality. However, customers also give importance to the manner in which they are treated, especially in the case of services, if you are a service provider and listen to your customer complaints in a genuine manner and get them rectified in the earliest possible time, you can rest assured that your customers will not go anywhere else.
There are many people who think that time and energy spent on existing customers is a waste and that customer loyalty is a myth. However, no matter how good a product or service that you may be providing, it is important for you to engage customers in a regular manner. You can engage customers by keeping a channel of communication open all the time. It has become very easy in present times to engage customers with the help of text messages. You can send them reminders about your impending sales, offers and discounts. A congratulatory message to them on festivals and New Year eve etc is an excellent idea. You should also engage customers by asking them questions from time to time.
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