Customer Loyalty and Retention: 5 Reasons Why You’re Losing Loyalty

by: Mark Herbert May 20, 2020

For most humans, relationships can be tough to navigate.  The same can be said for business relationships- that is, if you aren’t constantly seeking ways to keep the love alive. When it comes to customer loyalty and retention, statistics show high profitability for businesses who invest in strengthening customer relationships. But what exactly does “strengthening customer relationships” entail?

A good place to start is going through your customer loyalty and retention strategy and identifying behaviors that don’t work.  Check out our list below for the biggest “don’ts” when it comes to retaining customer loyalty.

1. Your brand experiences aren’t memorable

In an ideal world, a well-made, reliable product should be reason enough for it to fly off the shelves.  The reality?  The market is oversaturated, and your customers need to know your name in order to choose your products and services at the time of purchase.  When it comes to loyalty marketing, communicating a clear value proposition is key to customer loyalty retention. Highlight your strengths and brand them in a way that makes customers not only remember, but want to listen.  These actions combined with impeccable customer service and a quality product will not only help retain loyalty-it will make it impossible for you to forget!

2. You don't stand out from your competitors.

Did we mention how oversaturated the market is?

We don’t say that to be discouraging.  In fact, competition is both a healthy metric and motivator for businesses, especially when it comes to customer loyalty retention. The fact is that simply being a talented commodity supplier isn’t enough to keep your customers loyal.  According to Harvard Business Review, customers can love your brand, but if they love a competitor’s brand more, you’re ultimately losing sales.  When it comes to competition, the ability to increase customer loyalty lies in your business’s response: what is your competition offering your customers that you aren’t?

3. You don't show customers how valuable they are to your brand.

How is a customer supposed to know how much you value their business if you don’t show it?  When it comes to loyalty retention “etiquette,” mistakes are inevitable as no two customers are exactly alike. Instead of focusing what you can’t control, focus on what you can control, including actions to communicate gratitude for your customer when they facilitate your business. Examples include:

  • Offering support to customers at each step of the buyer’s journey.
  • Thanking customers for making a purchase.
  • Taking action to fix poor customer experiences.
  • Providing a customer loyalty program to reward customers for purchases made.

In terms of customer loyalty retention strategies, some of the above examples are simpler than others. If you are serious about improving customer loyalty, structuring an effective loyalty program might be the next step to take. A larger investment provides larger return, especially if you find yourself up against the situation next up on our list:

4. Your competitors have loyalty programs that are more compelling than yours.

The larger the goals, the tougher the competition.  If your competitors have implemented a customer loyalty program, chances are their customers are well taken care of.

The good news is that there are a variety of ways to reward your customers, and with the right loyalty program provider, you can customize the program to fit your needs. Incentive options for Loyalty programs include:

  • Reloadable debit card rewards
  • Pre-paid gift card incentives
  • Travel incentives for top earners
  • Online merchandise programs
  • Leaderboard and interactive gamification

Even better news? Your customers will not be the only ones benefiting from a customer loyalty program. Like all healthy relationships, loyalty love is a two-way street, helping you drive sales behavior and connect with your partners on an online platform.

Now that you’re considering a customer loyalty and retention program with the added benefits of online sales and marketing strategy, don’t miss our final loyalty “don’t” fact.

5. You're not measuring the effectiveness of your sales and marketing campaigns.

There are infinite ways to engage your customers, but a finite way to know which of your engagement investments really provide a positive return. Once you’ve got your customer loyalty and retention goals set and your reward program running, it is time to start reading the story of your data.  How many participants have enrolled? How many participated in your promotion? How many people opened the promotion email and logged into their reward account?

The above measurements are just a fraction of the performance tracking capabilities available to loyalty program sponsors here at Incentive Solutions.  We make this data a priority because we understand the importance of showing the ROI of marketing dollars. In fact, our teams are ROI certified, and we meet with our clients quarterly to help track and analyze results.

Studying the engagement levels of your customers and strategically adapting your promotions keeps customers from outgrowing your brand. When you plan marketing and sales strategy around your results, you improve customer loyalty and ensure ROI-trending in the right direction.

Ready to Do Customer Loyalty and Retention Right?

While the “dont’s” covered here today might seem daunting, the number of ways a customer loyalty program can help perform the “do’s” is pretty inspiring.  No matter where you are in your loyalty exploration journey, our sales team here at Incentive Solutions is happy to help.  Take advantage of one of our free consultations today and see just how much your business can benefit tomorrow.


About Mark Herbert

Mark Herbert is President and CEO of Incentive Solutions. He has more than 30 years of experience overseeing business operations within the incentives industry, helping companies increase channel sales, build customer loyalty, motivate employees, and grow their business.