Building customer loyalty is an important aspect of marketing for every business. It can not only help you boost your business sales but also proves to be valuable during challenging times. The Covid-119 pandemic taught us a very important lesson about loyalty and it applies to business as well. Having a consumer base that trusts you and prefers your products and services is extremely beneficial for your business. 

Marketing is not only about attracting new consumers to your business but it also has to do with retaining the ones that you currently have. You would be surprised to know that retaining customers costs five times less than making new ones. By focusing on customer retention you are not only maintaining your sales but also saving costs to the company.  

Why is Customer Loyalty So Important?

Customer loyalty simply means having the trust of your consumer and their willingness to continue doing business with you. When a business is offering satisfactory services to the consumers they are bound to come back. There are several aspects concerned with customer satisfaction including affordability, quality, durability, customer friendliness, and positive experience. If you are offering all these to your customers, your customer retention rate will be higher and automatically you have more customer loyalty.

Here are some of the reasons why  customer loyalty is important for your business:

Loyal customers yield higher conversation rates

Studies show that for a new customer, the conversion rate lies somewhere between 5% to 20% while on the other hand, the conversion rate for existing customers is 60% to 70%. If a customer is satisfied with your business why would they go through the trouble for searching for another source, this is why the conversion rate for existing customers is always higher than for new customers.

Customer retainment is cheaper than customer recruitment

Customer recruitment is five times more expensive than customer retainment. While that is an important aspect of marketing as well, by building loyalty you can get the same sales and earn more while spending less. 

Repeat customers typically spend more than new customers

If you are a new customer of a business, you would be hesitant to invest too much in it because you are not sure about the quality yet, However, if you have been buying from a particular business regularly, then it means you are already satisfied with their products and services and trusts them, so you would not be hesitant to try more of their products or to spend more money.

Customer Loyalty Boosts Profits

Naturally, the more customer loyalty your business has, the more profit it will make. In fact, you would be surprised to know that only a 5% increase in customer loyalty results in a 25 to 95% increase in the sales of a business. 

To conclude, customer loyalty is important to building a successful business. It not only reduces the cost to the company but also boosts your sales significantly.