Is your company winning the retail game? If so then you should think about some of the main benefits of consumer loyalty since it’s one of the best ways to give your company a competitive edge. Here are some of the key benefits it can provide:
- Free brand advocates
A big benefit of consumer loyalty is repeat customers are more likely to tell their friends and family about your company and products. They’re often willing to be free advocates/ambassadors for your company, which is a plus. Marketing can be expensive. So it’s a plus when you can use cheaper options like word-of-mouth marketing. When customers are happy about your products/services they’re willing to spread the word without being paid to do that. It’s a win-win situation since they’re happy customers and your company is getting free advertising.
How often does this happen? Think about how often your friends and family make posts on social media when they’ve used a product/service they’re happy about. They’re willing to share the information because they think others will have the same good experience as them using your company’s offerings.
- Avoid price competition
How well would a startup company do in a price war versus a Fortune 500 company? One of the main benefits of boosting consumer loyalty is it can help to prevent price competition versus rival companies. How does it work? When customers are happy about your company they’re often willing to stick with your company if it doesn’t offer the lowest price.
Multi-billionaire Warren Buffet refers to it as an “economic moat.” In other words, your company will be safer from the competition based on non-price-related issues. Even when there’s issues like inflation and higher costs your customers will still likely stay in the fold.
- Easier to up-sell
One key benefit of consumer loyalty identified by Pathwwway Gambling is such customers are more willing to buy premium products and buy from different product lines. The main reason is they already know your company and its offering. Meanwhile, the chance that new leads will buy product sis as low as 5%. That figure is quite low compared to loyal customers who are up to 70% likely to place an order. So in a nutshell repeat customers are more likely to buy new products and better products from your company. That in turn leads to higher sales and profits.
- Cheaper than paid advertising
The good news about online marketing is it’s usually much cheaper than traditional options. That includes TV, radio, and print. This can free up money that your company can use for other priorities while still getting the word out about your company’s products and services. How about loyal customers? There are times they’ll accept payment to endorse your product and depending on the number of fans/followers they have it can result in huge sales versus the costs.
However, in other situations customers will be willing to share their experiences with your company’s products/services for free. This can help to save your company tons of money since there’s no lower price than free.
Has your retail company considered these consumer loyalty benefits?