4 mistakes that Market Leaders make that move their loyal customers to competitors?

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Your business is nothing without its customers. Learn why and how you should reward your business’s most loyal customers…

 Ever wondered about why people keep buying iPhones by Apple, despite the fact that they are highly priced?

Or for that matter, how come global biggies such as Amazon, Netflix, and Dominos etc. have consistent outstanding sales & customer base?

Well, it narrows down to one key reason which is being able to retain and grow their ‘Loyal Customers’.Market Leaders

According to a report by Brandongaille, “about 68% of loyal customers tend to buy more from a company or brand they like, while 54% abstain from buying products from any other brand”. Moreover, once customers become loyal to a company or brand, roughly 78% of them begin spreading the word about that brand, thereby getting it even more customers. These statistics are a clear indicator that how important this particular customer segment is for any business.

Unfortunately, many at times market leaders make some mistakes only to see their customers transfer loyalty to their competitors. Here are the four blunders to look out for, to avert your most devoted and dependable customers from making an exit.

Mistake #1 Not being proactive

The first and foremost mistake that most of the market leaders usually make is not responding proactively to their loyal customers, thereby damaging their relationship with them. They miss to understand that customers are more loyal and likely to stay when they feel that they are being valued and paid attention to. It is essential to identify and respond to customer issues before they arise or even going beyond expectations to provide a better experience to them.customer especially millennials

As per a report by InMoment, “about 50% of loyal customers have left a company for a competitor who was able to stay more relevant and better satisfy their needs.” Enterprises that are able to figure out the needs, desires and pain points of their loyal customers and providing suitable solution to them, definitely have an edge in having a strong loyal customer base.

Let’s consider the example of Amazon. The brand forestalls questions on delivery dates and times even before customers asks, and even take the initiative of notifying customers in advance of any delays. And in case, there is a delay then at times give them one free month of the service for this trouble, if the customer is an Amazon Prime subscriber.

What you can do – Collect necessary information through regular feedback, conduct marketing research or even make use of NPS surveys so that you are able to anticipate your customers’ needs and desires, and are able to respond to it effectively.

Mistake #2 Do not reward loyal customers

At times market leaders forget to make their loyal customers feel special. What they often forget is the fact that if your loyal customers feel that they are just a number” to your business, they would not hesitate to go to a competitor that offers a better experience. It is essential that you keep on showing your loyal customers that you appreciate their continuous support, and this can be done by offering customer loyalty programs to incentivize repeat purchases by providing its loyal customers with discounts, unique offers, and more.customer support

According to Jon MacDonald, Founder of The Good, for customer especially millennials, loyalty discounts (and saving money through it) rank first in importance when they choose companies to support – even over brand authenticity and trustworthiness. And, so as a customer becomes more and more loyal, the incentives that you offer should increase as well. Moreover, 87% of consumers who are satisfied with the special benefits offered by a retailer’s paid loyalty program will likely choose that retailer over a competitor that is offering a lower price (Source: Report by Clauru Commerce) . For example, Citibank, the famous credit card company, offers lower interest rates to customers with better credit profiles and good payment histories.

What you can do – Offer discounts, free giveaways, VIP events, free upgrades and special buying opportunities to regular customers to demonstrate that you value their relationship.

Mistake #3 Inaccurate customer segmenting

At times it happens that the market leaders do not properly segment their customers and resultantly they are not able to target their loyal customer profile, the ones that provide the most value to you in return, thereby losing them to their competitors. In the absence of proper profiling, market leaders are unable to solve customer problems or engage with them effectively. It costs five times as much, on average, to acquire a new customer than to retain an existing one. Existing customers are 50% more likely to try a new product and spend 31% more per purchase than new customers.

Marketers need to segment their customer base on loyalty as this will help in creating a personalized approach that makes customers feel like you understand them. You could run a customer loyalty or rewards program, and give incentives to your top purchasers to motivate them to buy more.

What you can do – Look at those customers that have purchased multiple times. Their strong purchasing habits coupled with their consumption habits in general, make them highly engaged customers. Target this segment with exclusive offers to make them feel valued.

Mistake #4 Not providing proper customer support

Lastly, customer support should always be kept in mind if you want to have a loyal customer base always. If the company’s customer service is excellent, 78% of consumers will do business with them again after a mistake. Customer experience needs to be as consistent as possible in order to build trust and grow loyalty.

However, at times market leaders are seen to overlook this particular area, resultantly losing their customers. Poor customer service is a sure-fire way to drive them to competition. As per a study by Oracle, “just one poor customer experience is likely to push 89% of customers, even the loyal ones to start doing business with a competitor”. But what is even worse is that dissatisfied customers will tell about their bad experience to others! Consider this even if a restaurant has the best food in the city, but if the staff working there are rude and unwelcoming, odds are that not as many customers will be going there to eat.

What you can do – Give your employees plenty of resources so they know how to swiftly handle if any complaint or dissatisfaction from customers end arises after any purchase, and also how to proceed if they cannot. Also, make sure you have enough employees to actually meet your customers’ support needs. Do not forget to take into consideration the feedback of your loyal customers.

Final Thoughts

To sum up, losing loyal customers is the worst nightmare of any entrepreneur. After all, these are the returning customers that provide you with repeat business over time. As Frederick F. Reichheld and W. Earl Sasser (“Quality Comes to Services) rightly said, “a company’s most loyal customers are also its most profitable”. And, which is why all effort should be taken to keep such customers happy and satisfied and increase their number.

What other tactics do you use to avoid these kinds of major missteps?

How do you keep customer loyalty high?

Share your advice in the comments below.

The post 4 mistakes that Market Leaders make that move their loyal customers to competitors? appeared first on Ken Research.

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