Why you should shift your focus on customer loyalty right now.

Yannis Abelas
Aug 22, 2017 · 9 min read

We live in an era where we all hear about growth hacking and all these terms involved in the digital marketing. The truth is, yes, you need growth hacking and marketing to get new customers to try your new product/service. The thing is, what about retention? How can you make them come back after they had the first bite?

There are thousands of businesses out there who do everything to get new customers, make them buy, try or sign up. Hiring growth hackers, online marketers, SEO analysts, you name it. However, there are only a few businesses out there, that focus on the most important thing that comes after ensuring the quality of the product and customer service.

That is loyalty.

Why spend all that money to pull people in if you have no intention of making them stick around? And yes, retention does not equal loyalty. You can be buying something again and again but that doesn’t mean that you will buy it for the rest of your life, maybe you have no other option for some reason. But retention if done right could lead to loyalty, so I would say there is a connection here.
The question is why to shift your focus from acquisition to retention?

Let’s do the math.

According to Bain & Company, a 5% increase in customer retention can mean a 30% increase in profit. (wow!)
The probability of selling to an existing customer is 60% - 70%, while to a new prospect it’s just 5% — 20%. (WTF - OMG - etc.)

And what about loyal customers?
The most loyal 50% of customers would pay a 25% premium before switching brands.
In many categories, the most loyal 10% of customers generate 50% of revenues.

I think you get the point.

Retention trumps acquisition. — Bronson Taylor

So why the f**k is everyone running around like mad seeking for new customers? Focus on the ones you already have. Make them stick, and then try to find more.

Quality over quantity people.

Which brings me to my next point. How in the world are you going to go to the “Referral” step, of your AARRR plan, or any next step, without building retention? (Referral meaning: I found a great product I am gonna tell my friends to use it, Yay!)

Oh, I know! I am gonna send them personalized emails and gifts so they can shop again and again, and tell their friends about it.
Uhm… NO!🤦‍♂️

Man, you only need one damn thing. Branding!

Yes, that’s right, branding. No, not the visual crap, logos, graphics, cards, and flyers. That’s a visual identity. I mean real, meaningful branding. The one that makes people cry at the thought of you going out of business.
And yes, that can happen. Imagine if all of a sudden Apple would go out of business (highly unlikable for obvious reasons) and you no longer got to use your iPhone and your MacBook.
Can you imagine yourself using an Android phone or using Windows? Damn, I got chills even thinking about it. (If you are an Android or Windows user, dude sorry, but WTF?😒)

Do you think this happens only because the products and the OS are so damn good? Of course not. Apple has dedicated its “life” into doing the best branding in the world. That translates into being the most valuable brand on earth, $170 billion, for seven straight years.

This is called brand equity, and it has to do with the value of the brand. Of course, the value can be viewed from two different perspectives, economics, and psychology. I’m not going to bore you with details, let’s just say it is really important and you can Google it.

So I hope you get my point, what makes you return to the same company to buy your next product or service, or whatever has to do with branding. More specifically the way people think and feel about your brand and products. Because real branding is based on human emotions.

You may ask me, how can I control how people feel and think?
Think about yourself for one moment. Everything you do, the way you look, talk, move, and express yourself has to do with who you are as a person. It has to do with what you feel and think.

We all have a friend who is the showman or show-woman in the group. She always comes up with cool jokes; she speaks a bit louder, she doesn’t care much of what other people might think of her. You know, the person who calls you at 1 AM, while you Netflix and chill in your pajamas, and somehow talks you into going to a what will later be remembered as a legendary night.
The point here is that even though you were about to go to sleep, this person with her personality made you do something you thought you wouldn’t. Why? Because she inspired you.
And it’s not that she inspired you only at that specific night, but this is who she is. This is her brand; you believe in her when she says that you should get off your couch and get ready for an epic night because you trust her.

So, two things. Trust, and inspiration.

Both incredibly important for building a great brand. Both extremely personal. And both are necessary in order to drive people to do things and create loyalty.

You can’t be loyal to a relationship in which you can’t trust one another, and there is no inspiration or motivation to stick around. You have to form solid relationships with your customers, and the only way to do that is by making them feel safe and inspired all the time. Seriously, all the time.
It can take you decades to build a great brand and minutes to destroy it with one mistake or mishandling of a situation.
(Hey there United Airlines and Volkswagen!😅)

It’s not enough to find out who your customers are. You need to help them become the people they want to be.

— Marty Neumeier

So ok, we all love our customers, they are the reason we exist, we want to keep them around. But how?

Here are a few tips:

Write a manifesto. 🖋

Consumers are not loyal to companies, but to beliefs. They are loyal to what the business stands for. Like Simon Sinek said, “People don’t buy what you do, they buy why you do it.”
For example, Toms shoes give away a free pair of shoes to children and people who need it most with every single pair of shoes you buy, and this is only how they started. Now they help people in third-world countries providing them water, health aid, safe birth kits, training and more. You know that each time you buy one of their products you contribute to a greater good.
So you need to let people know what you truly stand for, in order for them to have something to believe in and inspire them to become your brand followers.

Have an extraordinary Customer Support. 🙋

There is nothing more important than support to make people trust you. Think about it, whatever you do in your business, someone will get confused, make a mistake or something. You have to be there for them with real solutions and empathy, 24/7 365 days a year.

Like Zappos, they are one of the best in customer support. The customer service reps don’t read scripts, Zappos lets them make their own decisions for each case, they have total freedom over their actions. Each and every employee in the company has worked as a customer support agent at least for a day. This teaches everyone the importance of having empathy and that the client satisfaction is the priority.

The results? Zappos’s customer base is loyal, 75% of Zappos’s purchases come from returning customers. And that leads to something great because people become fans of the brand. Therefore they tell their friends about it. So 44% of new customers heard about Zappos via word of mouth. Impressive!

Build a community, build a tribe. 🗿

People always want to belong somewhere, to feel part of something that represents their values. A group of people in which they can be themselves, feel understood and safe. And the process is simple, motivate them, connect with them in meaningful ways and give them something to do so they can support you.

I highly recommend the book Tribes by Seth Godin for further study on this.

Provide value to your audience. 💎

Gary Vaynerchuk is a well-known entrepreneur who grew his family business from $3 million to $60 million, started a digital agency called Vaynermedia, and has invested in a bunch of really hot tech companies. But most of all people know him because of the content he puts out on social media. He has faithful followers and of course haters. What he does is kind of against the rules. He is 100% transparent of what he does and how he does his work, giving advice for free to every new or old aspiring entrepreneur out there. Which means he provides real value to his followers and doing so, his loyal followers have grown to more than 2 million people.
These people truly admire him; they will go to conferences to hear him speak, they will buy his T-shirts, they will wait outside a restaurant he is dining for hours just to get a chance to ask him a question. These people will follow him at whatever he does as long as he provides value for them and inspires them.

Once you start providing meaningful value for your audience, you increase your power, because you will later be able to move this audience to any direction you like. This might sound a bit evil, but it’s not. Imagine if you want to create a second brand for example. If you have the audience, you have a voice; chances are that the new brand will become successful notably faster than your previous one, just because you have people who believe in you and are grateful for what you provide to them throughout the years.

Build personal relationships. 🤝

Connecting with your customers on a personal level is crucial for growing a business that will retain their loyalty. Let them know how you are trying to be better. When Steve Jobs returned to Apple after he was fired, he was joined by a talented army of volunteers who were eager to be led. This happened because Apple invested heavily in its customers, making technology available to everyone. In the end, customers are the ones who will fight for your success.

Conclusion.

The bottom line is that branding is not going to help you create a customer experience that people will love, that’s your product design team’s job. But it can help you build a group of people who will love you for what you stand for and the value you create for them. Having a strong voice and a group of loyal followers rather than some customers who just happen to buy your products.

Focusing on the relationship between you and your customers is a priority. At the end of the day, your company exists because of all of them.


About Me

I am Co-founder & Creative Director at Befoolish; focusing on helping companies grow and create an inspiring culture to attract more loyal customers through branding.
Befoolish is an Amsterdam based Branding Agency, simply creating brands that people want to fuck with. 👉👌
Instagram / Dribbble

Yes, I obviously have a thing for emojis…

Befoolish

Stories from a pretty damn cool branding agency based in Amsterdam, creating brands that people love. ❤️

)

Yannis Abelas

Written by

Amsterdam based product designer. On a quest of exploring the fields of HCI, branding, and cognitive science. Currently at Tiqets.

Befoolish

Befoolish

Stories from a pretty damn cool branding agency based in Amsterdam, creating brands that people love. ❤️

Welcome to a place where words matter. On Medium, smart voices and original ideas take center stage - with no ads in sight. Watch
Follow all the topics you care about, and we’ll deliver the best stories for you to your homepage and inbox. Explore
Get unlimited access to the best stories on Medium — and support writers while you’re at it. Just $5/month. Upgrade