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What is Customer Loyalty? Why is it Important for Your Business or Brand?

Customer loyalty = Brand Awareness + Higher profit

Customer loyalty is the term subjective in nature. It can be assumed that when a customer is specific about a brand or speaks a positive word of mouth about a particular brand, it is not affected by its packaging or price.

When a client is faithful to a particular brand, they are not affected by accessibility or pricing. They will pay more if they get a similar quality item or service they know about and love.

So organizations endeavor to zero in on further developing client loyalty to keep customers buying and elevating their brand to new clients.

So loyalty is the method of future customer behaviour shown by repetitive buys and positive references to the environmental elements.

The expense to gain new clients is a few times higher than the cost of keeping loyal customers. Thus, strengthening and further developing customer loyalty is a wise investment!

How to measure customer loyalty?

Measuring is the initial step in customer loyalty management. By estimating it, we can look at, aim, and improve. Here are the four best techniques for measuring customer loyalty which are – 

1. Net Promoter Score


Net Promoter Score®, or NPS®, shows the likeliness of your client referring you to her companions. It is a scoring system that measures client experience with the product.

You get a result with each score analyzed and make better decisions. It is divided into three parts:

  • Promoters: They are faithful clients who presumably love you and will remain clients for quite a while, and will most likely keep purchasing and purchasing more. (Score 9-10)
  • Passives: The Passives are cheerful yet are just clients; they are not exceptionally dedicated. (Score 7-8)
  •  Detractors: Detractors are not very satisfied and can be a decent source of data on how to improve. (Score 0-6)

2. Repurchase ratio


As the name suggests, it denotes the repurchaser over the single buyer. It is measured as per different models. Suppose you are following a subscription pattern in your product range.

In that case, it will be calculated by the number of customers who subscribed again divided by the total number of customers. 

3. Customer Loyalty Index

The Customer Loyalty Index (CLI) is an instrument that empowers tracking client loyalty over the long run, i.e. how much the client is faithful to the brand and how often they tend to abandon it.

They are in the form of questions, and the assessment is in the form of scalability as in like 0-40(below average), 40-75(average), and above 75 (above average).  

4. Upselling ratio

Upselling is the act of empowering customers to buy a similar better quality product than the one in question, which involves comparison charts to market higher-end products to customers.

Showing guests that different models might better satisfy their necessities can expand Average Order Value and assist clients with leaving happier with their buy.

It is calculated by dividing the number of customers who have bought multiple items by the number of customers who have bought only one product type. Higher the upselling ratio, the more the customer loyalty.

Importance of customer loyalty to a business

1. Promotes word of mouth marketing


Word of mouth marketing is exceptionally persuasive. We trust our loved ones when they suggest any brand, product, or company to us. Loyal clients have confidence in your business, and they’re modest about offering their positive feedback to new people.

Hence, customer loyalty matters as it builds new customers without any initiative taken by the company.

2. Gives an emotional touch to the brand

Once loyalty is created among customers towards a specific brand, they are emotionally connected to that product. They are habituated by consuming repeatedly. So this emotional touch brings regular sales to the company, and it does not get affected by the product’s price.

3. Reducing turnover and driving profit

It takes a great deal to acquire a client’s loyalty. What’s more, when you bring somebody into your trust, the thing you must be afraid of losing them.

So you should ensure that your priorities are in the right place because high Customer loyalty denotes high customer retention rates, which signifies higher sales and increment in revenue. 

4. Customer loyalty improves forecast accuracy

Forecasting aids planning. Accurate forecasting facilitates companies to identify production, and sales, determine expenditure, and discounts, and plan for unexpected events.

Loyal customers mean they are repeat customers, so testimonials or feedback from them will provide you with valuable information about your product or service and the areas that need improvement, which will facilitate forecasting accurate things about the future happenings of the business.

5. Loyal customers act as a focused group

Customer loyalty means loyal customers who are willing to participate and are ready to give their feedback. They give time and ensure to share their experience about the product with the company.

Making it easier for the company to take production, overhead, and research and development decisions based on their budget. 

Earning Customer loyalty over mere customer acquisition 

Customer acquisition is cheaper and easier. Just one advertisement or chance, and you got one lead. But building trust takes time and constant effort from the organization to meet needs.

Even with such a focus, customer loyalty can be lost similarly as quickly as it is won. One bad experience or mistake and the client is gone. A few clients can leave just for the sake of trying something new.  

They may not remain everlastingly, yet the more you can keep a client, the more beneficial they become. The more faithful you can keep them, the more of the customer lifetime value you get to realize.

So the best approach to achieve this is to add value to it.

Some of the best ways to gain customer loyalty are:

1. Getting Personal

Customized messages are known to convey 6x higher commitment rates than general messages. In the email, address the client by their name, and incorporate a customized message that appeals to their interests.

For instance, you can send special greetings on their birthday and an extra discount on anniversaries to get them something fun. This sort of gift builds emotional touch and good inclinations toward your brand.

Whether in messages or email, personalization helps build trust towards the company, enhancing customer engagement and loyalty. 

2. Carrying out referral programs


The referral program is a method by which you reward your consumers for spreading positive word of mouth to the potential buyers and bringing new leads to the company.

References assist with driving benefits up while minimizing expenses. It’s really obvious to understand the reason why references rock. The least demanding way to encourage references is by implementing a referral program software

3. Rewarding our loyal customers


When clients regularly shop for your product, perhaps the ideal way of thanking them is by perceiving and rewarding it. A loyalty program is an extraordinary way of showing your regular clients that you appreciate their effort and need them to keep coming back. 

With loyalty programs, the choices are endless. A few businesses use the points method, and as clients pile up their points, they get discounts or free items. On the other hand, there is a tiered approach where clients reach a new level when spending more.

4. Prioritizing customer service


Excellent assistance to customers can facilitate making loyal clients. It is noticed around 60% of clients will consider changing brands after a few instances of poor service.

Please pay attention to your clients’ necessities and provide a solution to their requests or concerns raised as early as possible. Likewise, make it simpler for your clients to reach out to your business by utilizing advanced technologies.

For instance, many businesses use AI chatbots to give all-day, everyday help to website visitors. These chatbots can give product recommendations that assist in boosting conversions and even upselling customers.


There are several ways to gain customer trust. But there is no standard methodology or rule. In the end, everything relies upon your brand’s image, business objectives, type of product it deals with, kind of client base, and so on. 

E-Commerce brands hope to scale their activities and cater to their current growing crowd by investing in the right AI-controlled device to optimize their operation just as deals and lift client bliss each time they hit the ‘Purchase Now’ button. 

If you are uncertain about how or where to start, connect with us. We should discuss how NotifyVisitors AI-driven software can cater to your eCommerce needs, improving client retention and gaining customer loyalty. 

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Sara is a Content Writer at NotifyVisitors. She is not only a creative writer but also paints a beautiful canvas. She makes sure that you are left with no doubt on keeping up with marketing and sales.