Time to Take Stock of Customer Loyalty During Covid-19
What Is Customer Loyalty?
Given the impact of Covid-19 on small businesses, including pet care services, it’s an excellent time to take stock of how you’re addressing that all-important customer segment, namely, your loyal customers. This critical group of customers can be small in number yet represent upwards of 80% of your revenue. These are customers you want to retain particularly in light of the high cost of landing new customers.
Building a strong base of loyal customers is vital to business profit and the ability to expand.
Let’s first review some basic definitions and understandings!
The term “customer loyalty” is certainly not new but can take on different meanings depending on the business and customer.
In the pet care services business, many owners define “customer loyalty” as customers who continue to buy their pet care services – boarding, daycare, grooming, training, retail, or veterinary services. Their goal is to make their pet care facility and service offerings the pet owner’s preferred choice. They want to secure the all-important “repeat business.”
It follows that the business would create offers that:
- Make it stand out among the competition (e.g., advertise new – customer deals)
- Build demand (e.g., limited-time specials)
- Show a superior quality of service (e.g., invest in the facility; provide special amenities)
- Build customer loyalty (e.g., customer punch card; rewards)
Important Distinction: Loyalty is far more than “repeat business.”
The folks at the Loyalty Research Center pose this worthy consideration:
Is it possible for customers to continue using, as an example, your services for reasons other than “loyalty”:
- You provide the lowest prices
- Your customers buy out of habit
- It’s too much effort to change
- They buy due to an employee relationship not due to your company’s quality
- Location is convenient
- They don’t necessarily care but keep buying
Loyalty Research Center goes on to suggest:
What if a competitor shows up seeking your customers and makes the above reasons to stay with your company less appealing? If your competition makes it easy to switch, what can happen to your customer loyalty as defined by “repeat business?”
Bottom Line: Customer loyalty IS more than repeat business.
Here’s a more useful, informing definition from the Loyalty Research Center:
“Loyalty can be defined as a customer continuing to believe that your organization’s product/service offer is their best option. It best fulfills their value proposition, whatever that may be. They take that offer whenever faced with that purchasing decision.”
Source: Loyalty Research Center
http://www.loyaltyresearch.com/
The Loyalty Research Center goes on to say that customer loyalty means:
- Hanging in there even when there may be a problem. This behavior occurs because the “vendor/provider” organization has been good to them in the past and addresses issues when they arise.
- They do not seek out competitors and, when approached by competitors, are not interested.
- It also means the customer is willing to spend the time and effort to communicate with the vendor/provider as they build on past successes and overcome any vendor/provider weaknesses.
In a nutshell, I think the Loyalty Research Center sums up “loyalty” pretty well:
Definition: Loyalty means a customer wants to do business with you and does.
Now, to manage “loyalty,” it only follows that the pet care business owner would want to have an understanding of the following:
- Customers’ underlying preferences for various service offerings (e.g., Do they want grooming and training services? Do they want the extra amenities and are willing to pay for them?)
- What do customers value in the services being considered? Get as specific as possible!
- What are the customers’ experiences at your facility?
- What are the customers’ perceptions and beliefs about your company, including the particular services offered? How do they feel about your employees?
… to name just a few of the details that underlie why customers do business with you.
As a pet care business owner, you need to understand why people buy from you.**
Then you can begin to manage, secure, and grow your loyal customer base.
**HINT: There’s an app for that! An app that can quickly obtain valuable information from your customers so you can start collecting robust, reliable data on what your customers think of your company, your services, their experience, and what they would like more or less of regarding service offerings.
Most Important Question: Are you treating your loyal customers as loyal customers should be treated? A worthy question to answer as you re-open safely during the Covid-19 pandemic and plan your future business growth.
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