Value of customer loyalty
Updated: Apr 29, 2020
“A well-implemented customer-loyalty strategy can play a critical role in the new normal”
As the world is rocked by Covid-19 and its after-effects, we are starting to look towards business recovery and the different ways we can contribute to kick-starting the economy.
Despite ongoing uncertainty around when and how the economy will begin to return to some level of normality, now more than ever, loyal customers will be critical to survival. Given that new customer acquisition is likely to be dampened for the foreseeable future, a well-implemented customer-loyalty strategy can play a critical role in the “new normal” of business operations during a recession.
In times of crisis – and certainly during lockdown – savvy customers have had time to look at every part of their business, and to assess what suppliers to prioritise and support.
Below are strategic mechanisms that loyalty solutions can provide to drive this customer retention, promote good business relationships and support cashflow during tough times.
Talking with your clients
Communicate to customers to show that you understand their needs and are willing to work closely with them to ensure mutual success. As Jacinda Ardern puts it, “we will get through this together, but only if we stick together”.
Empathic messages are a start. However, they must also be backed up with convincing action to demonstrate how you are on your customers’ side.
Alongside explaining how you have adapted your day-to-day operations to keep people safe, consider highlighting to these customers your history of rewarding their loyalty to your business and brand, and reassure them you will continue to show you value their support.
Cut through the clutter of the constant communications and ensure these messages are personalised, relevant and valuable to your customers.
Prioritise your cashflow
While cash is always king, in tough economic times many believe it’s even more important to ensure that you have the best chance at getting your bill to the top of the “pay on time” pile.
Consider offering a valuable incentive for customers to pay your bill on time. There are loyalty solutions in-market that can easily and effectively do this. Or you can take this one step further and focus on customer-specific payment incentives, showing your most valuable clients and best payers how much you value their support with bonus points or a “surprise and delight” gift.
Coax your slow payers with an extra incentive to clear an outstanding amount or consider a bespoke points offer that offers flexible payment options. Rewarding and supporting your customers – especially in times of uncertainty – can help to forge meaningful, long-lasting and profitable relationships.
Review marketing and advertising
Marketing budgets are often the first to get slashed when companies tighten their belts but, this time around, consider doing things differently. Companies that wait for the economy to get back into full swing to ramp up their marketing and customer retention and acquisition efforts will be at the mercy of better-prepared competitors.
Loyalty solutions not only offer rewards for best customer behaviour, but also capture and utilise valuable data allowing for considered, relevant and personalised marketing promotions.
Using your loyalty platform as your primary marketing tool is less expensive than traditional marketing channels, and comprehensive post-marketing campaign reviews show a clear return on investment to justify the cost to those scrutinising the bottom line.
Bringing it back to who matters
By putting your customers first and foremost in your recovery strategy and communicating this to them via a platform they know and trust, you will have the best chance at returning to growth as quickly as possible.
There’s no doubt that here in New Zealand we are going to collectively pay a heavy economic price for committing to the fight to manage Covid-19. However, we are all in this together. In coming out of it, let’s remember our most important asset is our customers.
Through working together, we can continue to find innovative ways look after each other and see the tough times through.
Stacey Kearins, group account manager, Smart Loyalty