Does Customer Loyalty Exist?

Does the loyal customer exist?

People are overwhelmed with choices.When I’m enthusiastic about a product or service I insist, that other people explore the option. Loyal customers spread the word, aren’t lured away via discount, marketing costs go down & sales go up. Not all customers are the same, some are more valuable than others. This is why you have to identify your best customers & build customer loyalty.

Most small businesses (62%) plan to spend the majority of their 2014 annual marketing budget on retaining existing customers rather than trying to acquire new ones,according to a recent BIA/Kelsey / Manta survey.

Why you need to identify your best customers.

More loyal customers is better for your business, increasing the Lifetime Value (LTV) per customer. 51% of their annual sales come from repeat customers. Some are much more valuable to you than others. You need to identify your best customers, and what they value most. This can be done with a CRM such as

kano model

Dr. Kano demonstrates that not all service and product performance is equal in the eyes of best customers. Some performance creates higher levels of loyalty than others. His research suggested there are three performance levels that form a pyramid. At the lowest level in the value pyramid  is basic value. This is least must-have performance. For instance a hotel:

Exciters Welcome by name Pillow choice Personal concierge
Performance Free Breakfast Quick Check-in Location
Basic Needs Non-smoking king bed clean


How to Identify Your Best Customers.

When 80% of your annual revenue come from a small percentage of your customers, you need to look at those customers: what, when and why did they buy? A few customers which make most of your revenue makes you vulnerable so you have to expand your customer base.

Take a look at the last five years to rule out revenue spikes. It can be a risk to just look at the past, so calculate the Customer Lifetime Value(this can be end of contract or natural progression in the sales funnel which adds revenue). You can use ReachLocal’s marketing maths tool to keep it simple. You will also receive a small report.

Customer Loyalty Does Exist.

Delivering unspoken needs is the secret to retaining best customers. Think about your best customers and ask yourself these questions: What are their unsolved issues? What’s keeping them up at night? How can your product/service address these issues? Asking yourself these questions will transform your business into a loyalty machine.


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Cindy Crijns

My passion is combining technology and marketing to reach potential clients & retain current customers. Specialities: B2B, B2C, SMB, Social media, demand generation, brand management, analytics & customer insight.

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